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TMI Blog2014 (5) TMI 867X X X X Extracts X X X X X X X X Extracts X X X X ..... mately works out to 40% of the demand confirmed. Therefore, in the present case, a pre-deposit of ₹ 15 lakhs ordered by the Member (Technical) cannot be faulted - Decided against assessee. - APPEAL NO. C/1309/12-Mum - Stay Order No. S/187/2014-WZB/C-I(CSTB) and Misc. Order No. M/520/2014-WZB/C-I(CSTB) - Dated:- 22-11-2013 - Ashok Jindal, Shri P K Jain and Shri P.R.Chandrasekharan, JJ. For the Appellant : Shri Prasad Paranjpe, Adv. For the Respondent: Shri M S Reddy, Dy. Commissioner (A.R.) JUDGEMENT Per: Ashok Jindal The applicant Shri Rajesh Atmanand Agarwal is seeking waiver of pre-deposit of penalty of Rs. 75,00,000/- imposed on him under Section 112(b) (i) of the Customs Act, 1962 by way of this stay application. 2. The stay application of the applicant was listed on 14.03.2013 and on the said date none appeared on behalf of the applicant nor any application for adjournment was received. The learned A.R., who appeared for the Revenue, submitted that the applicant has imported the goods under Target Plus Scheme which were diverted into open market and as the goods have been sold in the open market the applicant had violated the Condition NO. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bom,). 5.2 The learned Advocate prays that this appeal be tagged with the appeals of the co-noticees for final hearing as per the practice being followed by this Tribunal while considering the stay applications of the co-noticees in the same proceedings. 6. On the other hand, the learned A.R. strongly opposes the contentions of the learned Advocate on the stay application. The A.R. submits that each stay application is independent and the same has to be considered separately. In this case the applicant is the main brain behind the diversion of the gods which were imported under Target Plus Scheme. Hence, the adjudicating authority has imposed heavy penalty on the applicant and at this stage the applicant be directed to make a pre-deposit of the penalty imposed on him to entertain the appeal. 7. Considered the submissions bade by both sides. 8. While considering the stay applications, the general practice of the Tribunal is that if the main party of the same proceedings has been granted unconditional waiver of pre-deposit, the other co-noticee will also be granted waiver of pre-deposit. This practice is being followed not only by the Mumbai Bench but all the Benches of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iew taken in the earlier judgment, thereby creating a judicial uncertainty with regard to the declaration of law involved on an identical issue in respect of the same Exemption Notification. It needs to be emphasized that if a Bench of a Tribunal, in identical fact-situation, is permitted to come to a conclusion directly opposed to the conclusion reached by another Bench of the Tribunal on earlier occasion, that will be destructive of the institutional integrity itself. What is important is the Tribunal as an institution and not the personality of the members constituting it. If a Bench of the Tribunal wishes to take a view different from the one taken by the earlier Bench, the propriety demands that it should place the matter before the President of the Tribunal so that the case is referred to a larger Bench, for which provision exists in the Act itself. In this behalf, the following observations by a three Judge Bench of this Court in Sub-Inspector Rooplal Anr. Vs. Lt. Governor Ors. (2000) 1 SCC 644 are quite apposite : At the outset, we must express our serious dissatisfaction in regard to the manner in which a Coordinate Bench of the Tribunal has overruled, in effec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tutions shall not give rise to even a remotest feeling or situation of being in-consistent in their orders lest they should be accused of being partial and unfair . (d) The hon'ble High Court of Himachal Pradesh further observed that- Interim order, no doubt is at the discretion of the judicial forum. But that discretion is not an arbitrary discretion. Discretion does not mean the arbitrary fiat of the person in the office passing the orders. The decision has to be informed by reasons, objectivity and transparency. Whim and caprice are alien to judicial process. Consistency in passing orders is a vitally relevant factor, while exercising discretion in passing judicial orders, lest it should be mis-understood as an exercise of arbitrary power and attribution of motives. Exercise of arbitrary powers is the pre-Constitution concept and approach by the despotic monarchs. Constitutional Institutions vested with judicial powers are to exercise their powers on proper application of mind, weeding out all extraneous considerations and they should act fairly and impartially. Consistency is one of the hallmarks of the judicial discipline, particularly in passing interlocutory o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... PSY was sold in the open market. The customs duty so saved was distributed between Ms. Ankh, Importer, broker, High Sea Seller etc. Thus, applicant was involved in the whole process. The present applicant was fully aware of all the facts. He was in tough with the CHA and even arranged the transportation of the imported goods etc. His statement was recorded on 28.08.08 and broadly all the fats have been admitted by him. In fact, another statement was recorded on 05.01.2010 wherein he reconfirmed the said facts. The case had been adjudicated in the impugned order after considering his submissions and ad penalty has been imposed. Even in appeal before us, applicant has not disputed the fact about diversion of the goods and selling of the goods in the open market in contravention of specific conditions to allow the goods free of customs duty as mentioned earlier. Even in appeal before us the only point that is being made by the applicant is that he was only a broker and has acted in a professional manner. He has also claimed that he did not have prior knowledge about DFCE certificate, even though he himself approached Shri Paramdeep Singh Kohli of M/s. Ankh, Delhi and this fact has be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppeal, deposit with the proper officer the duty and interest demanded or the penalty levied Provided that where in any particular case, the Commissioner (Appeals) or the Appellate Tribunal is of opinion that the deposit of duty and interest demanded or penalty levied would cause undue hardship to such person, the Commissioner (Appeals) or, as the case may be, the Appellate Tribunal may dispense with such deposit subject to such conditions as he or it may deem fit to impose so as to safeguard the interests of revenue : Provided further that where an application is filed before the Commissioner (Appeals) for dispensing with the deposit of duty and interest demanded or penalty levied under the first proviso, the Commissioner (Appeals) shall, where it is possible to do so, decide such application within thirty days from the date of its filing. 4.2 A reading of the said Section would indicate that normally it is expected that the appellant would deposit the duty, penalty etc. levied before filing the appeal. In case, the Appellate Tribunal is of the opinion that the deposit of the penalty levied would cause undue hardship to such person, the Appellate Tribunal can disp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 129E of the Customs Act is not clear from the earlier order of the Tribunal. Be that as it may be, I proceed to discuss various case laws relied upon by my Ld. Brother for the present order. 4.4 The learned brother has relied upon three judgements of the Hon'ble Supreme Court and the Hon'ble High Court in support of his decision to waive the penalty in the present case. 4.5 The first judgement is of the Hon'ble High Court of Bombay in the case of Mercedes Benz India Pt. Ltd. vs. Union of India- 2010 (252) ELT 168 (Bom). I have gone through the said judgement. In the said case the issue involved was relating to includability of Road Delivery Charges, recovered from the appellant from their dealers as indicated in their sales invoices, in the value of vehicles being cleared. On the same issue, in respect of the same asessee, a case was booked which was decided by the Tribunal in favour of the assessee and the finality. However, subsequently a fresh show-cause notice was issued for further period on the same issue. The matter came up before the Tribunal and the Tribunal again allowed the appeal of the assessee which was taken to the Hon'ble Supreme Court b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... job worker for Colgate Palmolive India Ltd., and was registered as service provider and paying service tax under Business Auxiliary Service. The Central Excise authorities took a view that the activities carried out by the assessee amounted to manufacture thus attract excise duty. The assessee filed an appeal before the tribunal. On the date of hearing of the stay petition, request for adjournment and heard the junior Advocate and ordered for pre-deposit of Rs. 8 crore. Identical issue came for consideration before the Tribunal in respect of another assessee within fifteen days and the Tribunal dispensed with the condition of pre-deposit and the stay petition was allowed unconditionally. The first assesee approached the tribunal under Rule 41 of CESTAT (Procedure) Rules 1982 to modify the stay order directing him to deposit Rs. 8 Crore. The same was refused by the Tribunal and in this context the Hon'ble High Court of Himachal Pradesh has made observations as reproduced in sub-para (c) of para 8.1 above. 4.8 In addition to these three judgements which are relied on by my learned brother as quoted above, the learned Advocate for the applicant has also quoted two judgements na ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Notification 32/2005-Cus clearly prohibit is transferring or selling of the goods imported and cleared free of customs duty. There is no dispute about the fact that the goods were cleared free of customs duty, diverted and were sold in the open market. The investigations have clearly revealed that the duty so saved was to be divided between DFCE holder i.e. M/s Ankh, importers from China, brokers (the present applicant is main person) and various other persons in this case. So far as the applicant is concerned he has undoubtedly dealt with the goods. He contacted the DFCE holder, got imported the polyester spun yarn through various companies and such goods were sold on paper on high sea sale basis to the DFCE holder. During the clearance and after clearance of the goods from the Customs, the activity was monitored by the applicant and duty evaded was distributed between various players including the present applicant. Under the circumstances, prima facie the penalty has been correctly imposed under Section 112(b)_(i). The said provision reads as under:- Section 112. (b) who acquires possession of or is in any way concerned in carrying, removing, depositing, h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reason that Rs. 68 lakhs has been deposited during investigation. So far as the other applicant is concerned the penalty imposed on him was less than the present applicant. 6.4 If we go through the detailed investigation report as also the impugned order, the present applicant has main role in organizing, diverting the goods and evading the duty by DFCE holder. In the circumstances, I am of the view that total waiver of penalty will not be appropriate. Keeping in view the amount of duty evaded, the benefit that would have accrued to the applicant and the requirement of Section 35F viz. undue hardships and safeguarding interest of revenue, it is ordered that the applicant to deposit Rs. 15,00,000/- (Rupees fifteen lakhs only) for hearing the appeal. (Pronounced in open court on 20.11.13) Difference of Opinion In view of difference of opinion, following point is placed before the Hon'ble President for reference to the Third Member:- Whether in the facts and circumstances of the case and case laws relied by Member (Judicial), the requirement of pre-deposit of penalty be waived in the case of applicant Shri Rajesh Atmanand Agarwal as held by Member (Judicial). O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the dues confirmed against them and this Tribunal vide Order No.S.643-645/13/CSTB/C-I dated 20.3.2013 waived the requirement of further pre-deposit taking note of the fact that the main applicant had paid a sum of Rs. 68 lakhs and the same was considered sufficient for hearing of the appeal. 8.1 The present appellant also filed an appeal against the imposition of penalty. While the learned Member (Judicial) held that in view of the said order dated 20.3.2013, pre-deposit should be waived. However, the learned Member (Technical) held that the appellant having admitted to his role in facilitating the duty evasion, he is liable to penalty and, therefore, total waiver of penalty will not be appropriate. Accordingly, he was of the view that the appellant should be directed to make a pre-deposit of Rs. 15 lakhs. Hence, the reference to me. 9. The learned Counsel for the appellant submits that inasmuch as in the case of the main appellant and two of the co-appellants pre-deposit have been waived, in the case of the present appellant also the same treatment should be accorded. He relies on the decision in the case of Maninder Singh Vs. Commissioner of Customs, Cochin - 2009 (247) E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 129E of the Customs Act, 1962, we waive the requirement of pre-deposit of balance amount of duty and penalty or the main applicant and penalties on the co-applicants and stay recovery thereof during the pendency of the appeals. The reading of the above order makes it clear that the said order does not lay down any ratio. It is a settled position in law that at the time of passing interim orders of stay, prima facie case, interest of revenue and financial hardships are the factors which merit consideration. The decision of the Hon'ble Apex Court in the case of Dunlop India Ltd. - 1085 (19) ELT 22 (SC) and the decision of the Hon'ble Andhra Pradesh High Court in the case of SQL International Ltd. - 2012 (276) ELT 465 (AP) also support this view. However, in the order dated 20.3.2013, there is no discussion of these various factors, therefore, it cannot be said that there is binding precedent of the ratio which flows from the said order. 11.2 In the present case, it is an admitted position that the appellant knowing fully well facilitated the diversion of the goods imported under Target Plus Scheme in complete disregard of the provisions of law, for which he receiv ..... X X X X Extracts X X X X X X X X Extracts X X X X
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