9911796707
TMI Blog2013 (10) TMI 1003X X X X Extracts X X X X X X X X Extracts X X X X ..... ices (SCN) issued by different Jurisdictional Commissionerate viz., Customs, Air Cargo Export, New Delhi; Preventive, West Bengal, Kolkata; Export, Chennai and Air Cargo Complex, Meenam bakkam, Chennai and all such SCNs were adjudicated by a designated adjudicating authority viz. Commissioner of Customs, ICD, TKD, New Delhi in terms of separate adjudication order numbers 50-54/2008 dated 29/08/2008 which are subject matter of this bunch of appeals. 2. Revenue having agreed to the above proposition, all these appeals was heard analogous and a common order has been passed against such appeals arising out of different adjudication orders as said above giving rise to different consequences depicted under each such appeal as under. Appeal No. C/740/2008 AND Appeal No. C/770/2008 3. Appeal No. C/740/2008 and appeal No. C/770/2008 were filed by Samsung Electronics Ltd. (hereinafter referred to as The Appellant Company) and Sri Sunil Goel, Vice President (Finance and Accounts) of the appellant company respectively arising out of Order-in-Original No.50/2008 Dated 29/08/2008 adjudicating SCN No. VII/10/TKD/SIIB/22/2004 dated 28/02/2004 and such adjudication gave rise to the following c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cription of the said goods as CGA in the shipping bills and a fine of Rs. 1.5 Crore (one crore fifty lakhs only) was imposed on the appellant company in lieu of confiscation since such goods had left India. (ii) Undue DEPB benefit of Rs.1,40,30,482/- gained by the appellant against export of mis-declared monitors violating Section 113 (d) and 113(i) of the Customs Act, 1962 was disallowed. (iii) Customs duty of Rs.1,17,44,230/- discharged utilizing unduly gained DEPB scrips was ordered to be recovered under section 28 of the Customs Act, 1962 and interest was directed to be payable on the said amount of customs duty demand under section 28AB of the Customs Act, 1962. (iv) Goods imported utilizing DEPB scrips unlawfully obtained were confiscated. But such goods not being physically available for confiscation, a fine of Rs.1 core (one crore only) in lieu of confiscation was imposed on the appellant company. (v) Penalty of Rs.1.5 crores was imposed on M/s Samsung India Electronics Ltd., under section 112 and 114 of the Customs Act, 1962. (vi) Penalty of Rs. 15 lakhs (Fifteen Lakhs Only) was imposed on Shri Sunil Goel, Vice President (Finalce & Accounts) of M/s Samsung India Elect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated 20/10/2005 and such adjudication gave rise to the following consequences: (i) VGA monitors declaring FOB value of Rs.25,09,66,901 exported by M/s Samsung India Electronics Ltd. Nodia were confiscated finding mis-declaration of description of the said goods as CGA in the shipping bills and a fine of Rs. 3 (three) crores only was imposed on the appellant company in lieu of confiscation since such goods had left India. (ii) Undue DEPB benefit of Rs.4,25,84,713/- gained by the appellant company against export of mis-declared monitors violating Section 113 (d) and 113(i) of the Customs Act, 1962 was disallowed. (iii) Customs duty of Rs.4,18,36,088/- discharged utilizing unduly gained DEPB scrips was ordered to be recovered under section 28 of the Customs Act, 1962 and interest was directed to be payable on the said amount of customs duty demand under section 28AB of the Customs Act, 1962. (iv) Goods imported utilizing DEPB scrips unlawfully obtained were confiscated. But such goods not being physically available for confiscation, a fine of Rs.2 Crores in lieu of confiscation was imposed on the appellant company. (v) Penalty of Rs.4.50 Crores was imposed on M/s Samsung India El ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... butor of Samsung, made on 22.5.2004 resulted in recovery of certain documents which were subjected to scrutiny by investigation. Statements from different persons were recorded in the course of investigation and extensive enquiry was made to ascertain real nature of the goods exported to claim DEPB benefit as is apparent from in Para 6 to 11 of the adjudication order. 8.2 Investigation noticed that Colour Monitors, VGA (Video Graphic Array) of 15 and above and Colour Monitors of higher quality/resolutions were exported by the appellant company during December 2001 to 31.3.2004 mis-declaring the same as CRT Data Display Monitor (Colour CGA) to make undue gain of DEPB benefit since DEPB benefit was available only against CRT Data Display Monitor (Colour CGA) of all sizes but not against Colour Monitors VGA of 15 and higher sizes at the relevant time. Investigation proceeded to ascertain whether the appellant company had manufactured CGA monitor to export the same. But it came to the light that no such monitors were manufactured by the appellant company. 8.3 Investigation examined Shri Sanjay Pees, National Sales Manager IT Products of the appellant company. He, in his statement re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ung in his statement dated 25.06.2004 admitted that their company was exporting Colour Monitors to various countries under DEPB Scheme. On being asked about the person instrumental in deciding the classification of Colour Monitors for DEPB benefit he stated that he did not know as to who was the person who decided the classification of Colour Monitor for export under DEPB Scheme. 8.9 M/s Samsung India Electronics Ltd. vide their letter dated 10.06.2004 informed that they made deposit of Rs.1,60,00,000/- (Rupees One Crore Sixty Lakhs only) vide TR-6 Challan No. 1184 dated 10.06.2004 towards ineligible DEPB credit already utilized by them. 8.10 Investigation visited the web site: 'http:/what is techtarget.com/definition/o.sid9 gci 211966.html', and noticed technical features of the goods manufactured and sold by the appellant company as recorded in Para 12 to 18 of the adjudication order No. 50 dated 29/08/2008. Goods of appellant company were compared with the nature of the goods manufacture in India by IBM and it was found that technically CGA and VGA monitors were different. Different features of both has been depicted in para 12 of the adjudication order No. 50/2008 dated 29/08 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tors as was admitted by appellant company which manufactured colour monitors of size 15, 17 and 19. 9.5 Ld. Adjudicating Authority opined that technical specification of the monitors exhibited by the website of the appellant established that the said monitors were not CRT Data Display Monitors (Colour CGA) but were colour monitors of higher resolution i.e. VGA, EXA, SXGA etc. Appellant did not export CRT Data Display Monitor (Colour CGA) at all. But colour monitor of higher resolutions i.e. VGA, EXA, SXGA etc were exported. This was established from admitted fact by Shri Sanjay Pees, National Sales Manager of Samsung who stated that appellant company never sold any CAG colour monitor during the last 2 years. 9.6 Ld. Adjudicating Authority also relied on statement of Shri Ajay Kumar, Prop. of distributor of appellant. He admittedly stated that the monitors purchased by them from the appellant company were not CGA CRT Data Display Colour Monitors; that monitors purchased by them since 1993 from Samsung were VGA and of higher versions/resolutions and that CGA colour monitors were not manufactured in India since then. 9.7 Shri Vivek Prakash, Vice President Marketing and incharge of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed Colour Monitors of VGA and of higher resolutions only. 9.12 Ld. Authority also looked into Sync Master CDT Monitor Sales Guide, of M/s Samsung which showed Systems Requirements. The Systems Requirements exhibited VGA-SOOx600-16 bit thousand of colours. So also the signal used in CGA Colour monitor is digital colour signal. Specifications of colour monitors of appellant company showed that the signal used in the monitors was RGB Analog Video Signal which is used in colour monitors of VGA and XGA etc. of higher resolutions and not in CRT Data Display Monitors (colour CGA). 9.13 Further, according to ld. Adjudicating Authority as per endorsed copy of the letter of DGFT, monitors exported by M/s Samsung were not CRT Data Display Monitor colour CGA. This established that the CGA monitors were not manufactured in India during the relevant period and the monitors manufactured in India during that period was VGA Colour Monitors only. 10. In Para 28 of adjudication order, breach of law made by the appellant company and other persons was recorded by ld. Adjudicating Authority to complete the adjudication examining entire defence of the appellant. He held that the goods exported by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clarificatory in nature and that shall retrospectively apply to the colour CGA Monitors exported by the appellant and DEPB benefit undeniable. 11.4 According to the appellant, an interpretation which is in accordance with advancement in technology should be adopted. Similarly, condition of notification No. 45/2002-Cus dated 14/05/2002 having been fulfilled it was rightly issued DEPB scrips and use of the scrips for discharge of customs duty against imports cannot be denied. The appellant bonafide believed that it was entitled to the DEPB benefit. Therefore denial of benefit of DEPB is unwarranted. So, also Section 28 cannot be invoked to apply longer period of limitation for which the adjudication is time barred. 11.5 It was further argued that the penalties imposed on the appellants be waived and no duty chargeable nor claim to and use of the DEPB scrips deniable. 11.6 Under Para 4.37 of Hand Book of Procedure prescribes the DEPB rate taking into the deemed duty paid on the imported inputs for export products, FOB value of export is determined. Therefore DEPB against such FOB value of export of cannot be denied. Neither there was short levy nor the shipping bills challlanged. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by it when its deliberate misdeclaration was detected. Without coming out with clean hands, the appellant has made futile exercise to make undue gain of the ratio of the judgments cited by it. 12.4 Ld. Adjudicating Authority had proper authority and jurisdiction to adjudicate the matter when Revenue was defrauded, invoking extended period of limitation prescribed by section 28 of the Customs Act, 1962 following the ratio laid down by Apex Court in the case of CC V. Candid Enterprises 2001(130) ELT 404 (SC). He has acted well within his jurisdiction and rightly examined the credible and cogent evidence gathered by investigation from different sources including website information by corroborative enquiry. Therefore adjudication findings are not liable to be disturbed. Appellant made deliberate misdeclaration of description of goods for which action was rightly initiated under Section 28 of the Customs Act, 1962. That disentitles the appellant to claim DEPB benefit under law when entire plea of appellant is baseless to get relief in these appeals for no reason. Therefore none of the adjudication findings are liable to be disturbed and all the appeals are liable to be dismissed. F ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he appellant at the cost of the Revenue. Further, the interpretation adopted by appellant that the approach for grant of DEPB should keep in pace with advancement of technology is also baseless for the reason that grant of any notification at the cost of public revenue is not retrospective following the ratio laid down by Apex Court in Sunwin Technology 2011 (21) STR 97 (SC). Accordingly grant of the notification above cannot be stretched to grant benefit to past exports made by the appellant misdeclarating description of the goods. 13.6 Appellant's plea that the word 'colour' used twice in sl. No. 17 of DEPB Schedule was redundant is of no sense when the goods exported by the appellant described its own identity. Misdeclaration of description of the goods by the appellant was proved to be deliberate to make undue gain of DEPB scrips. Therefore appellants were rightly brought to the fold off section 28 of the Customs Act 1962 debarring the plea of time bar following the ratio laid down by Apex Court in Candid Enterprises 2010 (130) ELT 404 (SC). When the appellant was questioned as to the aforesaid deliberate misdeclaration it surrendered before the law and made a deposit of the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... riation between misdeclaration of the goods as declared on the shipping bill and as declared in the public notice issued by Customs House for the same consignment, they would be entitled to bring such discrepancy to the notice of the DGFT and await for further orders on the quantum of credit to be given under DEPB for DGFT. Accordingly it was directed that Adjudicating Authority shall refer the matter to the DGFT to have final say on the described goods in the bill on entry whether falls within the scope of such entry. But in the present case there was misdeclaration by appellant for which it fails to succeed in its plea that Customs Authority should not question the DEPB credit granted by DGFT. 13.9 Appellant further relied on 2003 (157) E.L.T. 662 (Tri.-Mumbai), Kabian ECS India Pvt. Ltd. Vs. Commissioner of Customs,-2003(157) ELT 662 (Tri-Mum) to submit that customs has no power to question decision of DGFT. There is no doubt that customs shall not dispute the export if there no variation or misdeclaration of the description on the Bill of Entry. But in the present case there was material departure to the declaration as to description of the goods for which appellant fails to g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r false [Ref: Roshan Deen v. Preeti Lal [(2002) 1 SCC 100], Ram Preeti Yadav v. U.P. Board of High School and Intermediate Education [(2003) 8 SCC 311], Ram Chandra Singhs case (supra) and Ashok Leyland Ltd. v. State of T.N. and Another [(2004) 3 SCC 1]. 16. Suppression of a material fact would also amount to a fraud on the court [(see Gowrishankar v. Joshi Amha Shankar Family Trust, (1996) 3 SCC 310 and S.P. Chengalvaraya Naidu's case (AIR 1994 SC 853)]. No judgment of a Court can be allowed to stand if it has been obtained by fraud. Fraud unravels everything and fraud vitiates all transactions known to the law of however high a degree of solemnity. When fraud is established that unravels all. [Ref: UOI v. Jain Shudh Vanaspati Ltd. - 1996 (86) E.L.T. 460 (S.C.) and in Delhi Development Authority v. Skipper Construction Company (P) Ltd. - AIR 1996 SC 2005]. Any undue gain made at the cost of Revenue is to be restored back to the treasury since fraud committed against Revenue voids all judicial acts, ecclesiastical or temporal and DEPB scrip obtained playing fraud against the public authorities are non est. So also no Court in this country can allow any benefit of fraud to be enjo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of law which is enshrined in Section 17 of Limitation Act that fraud nullifies everything for which plea of time bar is untenable following the ratio laid down by Apex Court in the case of CC. v. Candid Enterprises - 2001 (130) E.L.T. 404 (S.C.). Non est instruments at all times are void and void instrument in the eyes of law are no instruments. Unlawful gain is thus debarred. 21. Fraud and justice do not dwell together for which penal provisions are enacted to eradicate evils of defrauding Revenue which is anti-social activity adversely affecting public revenue. Such provisions are construed in the manner which curbs the mischief, promote their object, prevent their subtle evasion and foil their artful circumvention. Thus construed, the term fraud within the meaning of these penal provisions is wide enough to take in its fold any one or series of unlawful acts committed or omissions made. An act of fraud on Revenue is always viewed seriously. 'Fraud' and collusion vitiate even the most solemn proceedings in any civilized system of jurisprudence. It is a concept descriptive of human conduct either by letter or words, which includes the other person or authority to take a definite ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
