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TMI Blog2002 (5) TMI 812X X X X Extracts X X X X X X X X Extracts X X X X ..... for fulfilment of export obligation without discharging their export obligation in full, in contravention of Notification No. 149/95, dated 19-9-95 in which the duty free importation was allowed. The finding arrived at by the Commissioner (Adjudication) in paras 19 to 25 are reproduced :- "I have considered all the submissions made by the company and gone through the records of the case carefully. I find that M/s. Merven Drug Products, Hyderabad, had taken two numbers of advance licenses i.e. (1) 1531853, dated 15-3-96 and (2) 1531849, dated 15-3-96 and imported 5480 Kgs. of O-Chloro Benzaldehyde (OCB) and 7800 Kgs. of Hydroxylamine Sulphate (HAS) free of duty under Notification No. 149/95, dated 19-9-95 against Advance License No. 153185 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (Development and Regulation) Act, 1992. Therefore, I find that the said goods are liable for confiscation under Section 111(d) of the Customs Act, 1962, also. I find no reason with the party contention that proviso under Section 28 of the Customs Act cannot be invoked in this case. The party wilfully misstated and suppressed the facts with an intention to evade payment of duty and I find that proviso to Section 28 of the Customs Act, 1962 is invokable for recovering the duty and also Section 114(A) of the Customs Act, 1962 is also invokable for penal action on the party. I find that Shri T. Mallikarjun Reddy, Chairman Executive of M/s. Merven Drugs Pvt. Ltd. knowing fully well, allowed misutilisation of the exempted raw materials with an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. I impose a penalty of Rs. 11,75,901/- on the party under Section 114(A) of the Customs Act, 1962 and I impose penalty amount of Rs. 50,000/- on Shri T. Mallikarjun Reddy, Executive Chairman of M/s. Merven Drug Products Pvt. Ltd. Hyderabad." As per the above findings the duty and penalty under Section 114(A) has been imposed. 2. The appellant are now contesting the charge on the imported goods being diverted in the market and the liability to pay the customs duty which has since been discharged. It is with regard to the non-leviability of penalty under Section 114(A) of the Customs Act on the appellant and the Executive Chairman which is under contest. The main argument advanced by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 3. It is his contention that the order is against principles of natural justice as the appellant had sought for examining the records to know the date of clearance of the raw material in the market but that opportunity has not been given. He further submits that it is not proper to impose mandatory penalty of 100% which has not been approved by the Apex Court in the case of CC v. Elgi Equipments as reported in 2001 (128) E.L.T. 52. He further submits that there were no grounds for imposing penalty on Executive Chairman as he is not a part to play any role in the removal of goods and had no personal interest in the same. Commissioner has not given any reason why Executive Chairman should be imposed with penalty. He relied on the judg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... market and the dates on which it was sold has not been brought out in the order. Therefore the appellant request for examining the records to find out the date of clearance has not been furnished and thereby it is a clear violation of principles of natural justice. It has to be seen as to when the sale has taken place and as the said sale occurred after the promulgation of Section 114(A) which provides for imposition of mandatory penalty. In the absence of this information it is not possible to confirm the penalty imposed. Furthermore, the Apex Court in the case of CC v. Elgi Equipments (supra) have now laid down that it is not mandatory to impose an equal amount of duty as penalty. The extenuating factors are taken into consideration. Fur ..... X X X X Extracts X X X X X X X X Extracts X X X X
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