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TMI Blog2010 (10) TMI 736X X X X Extracts X X X X X X X X Extracts X X X X ..... 58/2010(PB) - Dated:- 8-10-2010 - Dr. Chittaranjan Satapathy, Shri D.N. Panda, JJ. Shri M. Javed, Advocate, for the Appellant. S/Shri Sumit Kumar, Vijay Kumar and Mahesh Rastogi, DRs, for the Respondent. [Order per : D.N. Panda, Member (J)]. The appellant M/s. Friends Trading Co. came in Appeal No. C/576/06 before Tribunal against Order in Appeal No. 24/CUS/APPL/LDH/2006 dated 24-8-2006 passed by the learned Commissioner (Appeals), Jalandhar holding that DEPB scrips used by the appellant for discharge of customs duty as a transferee thereof were obtained by the transferor of the same on the basis of forged/substituted shipping Bills and such scrips being cancelled by the issuing authority were ab initio void and were non-est. 2. The appellant imported certain goods vide Bill of Entry No. 88 dated 24-11-2000 and availed exemption from payment of Customs duty amounting Rs. 6,39,299/- under Notification No. 34/97-Cus., dated 7-4-1997 issued under Section 25 of the Customs Act, 1962 against DEPB Scrip Nos. 3010006832 dated 14-11-2000. It was alleged by the Revenue that the DEPB scrips procured/purchased by the Appellant had been obtained fraudulently by M/s. JAS K ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellant cannot be denied benefit of the DEPB scrips for no reason attributable to the appellant as to the manner of acquisition of the same by the transferor. (4) When the DEPB scrips were voided on 2-1-2003, the appellant had not committed any fraud or any wilful misstatement or suppression of facts to invite a proceeding under Section 28 of the Customs Act, 1962. (5) The Show cause notice issued by the Customs Authority in September 2003 is barred by limitation when the JDGFT by order dated 4-10-2005 held that the appellant who acquired the DEPB scrips was bona fide and utilised the same for discharge of duty. (6) There was no collusion of the appellant with the transferor of the scrips for which no penalty was imposed by the JDGFT on the appellant. Therefore extended period is not invokable in the present case following the ratio laid down by Hon ble High Court of Punjab Haryana in the case of CC v. Leader Valves Ltd. - 2007 (218) E.L.T. 349 (P H) which has been approved by Hon ble Supreme Court as reported in CC v. Leader Valves Ltd. - 2008 (227) E.L.T. A29 (S.C.). (7) When the DEPB scrips were not forged but were good scrips issued on the basis of fabricated document ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Naidu v. Jagannath - AIR 1994 SC 853. (7). The DEPB credits issued being ab initio void was not transferable. It has been held by the Apex Court in the case of Ram Preeti Yadav v. UP Board of High School and Intermediate Education - AIR 2003 SC 4268 that no court in this land will allow a person to keep an advantage which he obtained by fraud . (8). Tribunal in the case of CC v. D.M. Enterprises, 2007 (213) E.L.T. 414 held that fraudulently obtained DEPB Credits has no title on the face of law and it was held in DIC India Ltd. v. CC - 2008 (226) E.L.T. 545 that DEPB credit obtained on the basis of forged and fake document does not confer any title on the claimant and others who use such ab initio void credits. (9). Tribunal in the case of ICI India Ltd. v. CC - 2009 (240) E.L.T. 290 held that transaction based on fraud continues to be tainted by the vice and the person committing the fraud is precluded from deriving any benefit. (10). Similar view was also expressed by Tribunal in the case of Kamala Metachem v. CC - 2007-TIOL-2247-CESTAT-KOL and in the case of M/s. Synotex Industries v. CC - 2008-TIOL-777-CESTAT-KOL. (11). When the material evidence established fraud against Reven ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tter or words, which includes the other person or authority to take a definite determinative stand as a response to the conduct of the former either by words or letter. It has been held by Apex Court in the case of Commissioner of Customs, Kandla v. Essar Oil Ltd. - 2004 (172) E.L.T. 433 (S.C.) that by fraud is meant an intention to deceive; whether it is from any expectation of advantage to the party himself or from the ill will towards the other is immaterial. The expression fraud involves two elements, deceit and injury to the deceived. Undue advantage obtained by the deceiver, will almost always call loss or detriment to the deceived. Similarly a fraud is an act of deliberate deception with the design of securing something by taking unfair advantage of another. It is a deception in order to gain by another s loss. It is a cheating intended to get an advantage. (See S.P. Changalvaraya Naidu v. Jagannath [1994 (1) SCC 1]. 11. In a leading English case i.e. Derry and Ors. v. Peek (1886-90) All ER 1 what constitutes fraud was described thus : (All ER p. 22 B-C) fraud is proved when it is shown that a false representation has been made (i) knowingly, or (ii) without beli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... E.L.T. 527 and Hon ble Allahabad High Court in Coolade Beverages Limited v. Commissioner of Central Excise, Meerut, 2004 (172) E.L.T. 451 and H. Guru Investment (North India) Pvt. Limited v. CEGAT, New Delhi, 1998 (104) E.L.T. 8 Hon ble High Court of Punjab Haryana in the case of Golden Tools International v. Joint DGFT, Ludhiana, 2006 (199) E.L.T. 213, upheld cancellation of DEPB and levy of penalty under Section 11(2) of the Foreign Trade (Development and Regulation) Act, 1992. Hon ble court observed that the entire claim of the petitioners was based on falsehood. It was not in dispute in that case that furnishing of bank certificate of exports and realisation of export proceeds was a pre-requisite for issue of DEPB. Admittedly, the bank certificates furnished were fabricated documents. The observations of the former Lord Chief Justice of England, Sir Edward Coke, more than three centuries ago, that fraud avoids all judicial acts, ecclesiastical or temporal , noticed by the Supreme Court in S.P. Chengalvaraya Naidu v. Jagannath, AIR 1994 SC 853, are apt for the instant case. The Apex Court has also observed that an act of deliberate deception with the design of securing somet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Customs Act, 1962 (in short, the Act ) against the order dated 4-4-2006 Passed by the Customs Excise and Service Tax Appellate Tribunal, New Delhi [2006 (202) E.L.T. 611 (Tribunal)]. 2. The assessee imported goods against DEPB Scrips without payment of duty. It was later found that DEPB Scrips were obtained by producing forged bank certificate of export and realization. The DEPB Scrips were cancelled by the competent authority. Accordingly, demand of duty was confirmed after notice. The assessee purchased DEPB Scrips from M/s. Vivek Impex Private Limited who purchased the same from M/s. Shyam International who had purchased the same from M/s. Parker Industries. The Commissioner of Customs held that any concession availed of on the basis of DEPB Scrips obtained by producing forged documents could not be retained. This view has been affirmed by the Tribunal. 3. We examined an identical issue in our recent order dated 1-9-2007 in CUSAP No. 27 of 2008 M/s. Munjal Showa Limited v. Commissioner of Customs and Central Excise (Delhi (IV), Faridabad) [2009 (246) E.L.T. 18 (P H)]. After considering the observations of the Hon ble Supreme Court in East India Commercial Company ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... come to the conclusion that the documents were forged. In these circumstances, if further opportunity has been given to the appellant on its own asking and for its own benefit, we do not find any error in the course adopted by the Tribunal so as to give rise to substantial question of law sought to be raised. 4. We also made a reference to judgments of the Hon ble Supreme Court in S.P. Chengalvaraya Naidu v. Jagannath, AIR 1994 SC 853 and Commissioner of Customs v. Essar Oil Ltd. - 2004 (172) E.L.T. 433 (S.C.) = (2004) 11 SCC 364 and judgments of this Court in Golden Tools International v. Joint DGFT, Ludhiana - 2006 (199) E.L.T. 213 and The Commissioner of Customs, Commissionerate, The Mall, Amritsar v. M/s. Parker Industries, Jalandhar - 2007 (207) E.L.T. 658. 5. In view of above, we do not find any ground to interfere with the order upholding demand of duty on goods in respect of which exemption had been availed of on the basis of DEPB Scrips obtained against forged documents. 6. No substantial question of law arises. 7. The appeal is dismissed. 16. The ratio of the aforecited decision in Friends Trading Co. (supra) squarely applies to the present case of demand of d ..... X X X X Extracts X X X X X X X X Extracts X X X X
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