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TMI Blog2016 (5) TMI 553X X X X Extracts X X X X X X X X Extracts X X X X ..... rned in the smuggling. Evidence gathered by Revenue unambiguously proved that both the appellant were contributory to the fraud committed against Customs and they made an organised bid to be enriched at the cost of the nation. It is established principle of law that fraud and justice are sworn enemies. When the collusion and fraudulent design of the exporter, importer-appellant, K. Ramlal Jain and M/s. DHL Logistics Pvt. Ltd., surfaced, the impugned goods that came to India, became no mans property and confiscation being an action in rem, the dubious claim of ownership of the goods at different point of time calls for absolute confiscation thereof without any leniency for redemption and re-export of the same. Accordingly, the order of the adjudicating authority requires to be set aside on such count and absolute confiscation of the impugned goods is hereby ordered. In the course of hearing, Revenue informed that the impugned goods have already left India on payment of redemption fine. Therefore it is left to the Chairman of the CBE&C to deal this matter as the Board may consider appropriate in the fitness of the circumstances of the case to protect interest of Revenue since the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nalty of ₹ 1,00,000/- was imposed on him unreasonably. So also in absence of absolute confiscation of the goods and re-export permitted by law, there is no contribution of this appellant at all to the allegation made by Customs. 1.4 On the above premises, it was prayer of both the appellants that if at all redemption fine is imposable that may not be done arbitrarily since margin of profit (MoP) was not considered by learned Authority below while imposing such fine. So also, penalty to the extent of ₹ 5,00,000/- is not imposable when the appellant was neither an importer nor in any way connected with the import. Further, the penalty of ₹ 1,00,000/- imposed on the appellant Shri K. Ramlal Jain may be waived. 2.1 On the other hand, Revenues submission is that the appellant M/s Antoine Becouerel Organic Chemical Co., was the real importer which can be appreciated from page 6 of appeal folder because he was known to the bank. He used documents which were negotiated for import. The real importer cannot escape to avoid compliance to law, even though; he was on record all along from the date of negotiation with the bank. The appellant knowingly imported the proh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... recorded from these persons which are incriminating in nature and inculpatory. Therefore, they do not deserve any leniency for reduction of penalty and redemption fine. 4. Heard both sides and perused the records. 5. Present appeals arose against adjudication made in respect of import of tranexamic Acid, packed in 60 drums imported by the appellant company under Master Airways Bill (MAWB) No.043-57255590 and House Airway Bill (HAWB) 7DPW639 dated 31.03.2013 (Ref: Page 77 of appeal folder) accompanying IGM No.414601 and Invoice No.PRI20130321 dated 21.03.2013(Ref: Page 72 of appeal folder) declaring the consignee as M/s. Antoine Becourerel Organic Chemical Co. The consignor of the goods was M/s. Prisun Pharmachem Co., of China. The export documents were negotiated through ICICI Bank Sowcarpet, Chennai. 6. These two appellants in this batch of appeal were brought to the fold of law by adjudication order dated 28.03.2014 along with 3 others finding them to be connected with the import of Tranexamic Acid from the period 2012. While the appellant M/s. Antoine Becouerel Organic Chemical Co., was found to be the importer, as per invoices aforesaid issued by Chinese exporter, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ring the goods as drug. When samples of impugned live consignment were sent to testing laboratory for examination that proved to be drug (as recorded in para 37.2 of the impugned order at page 42 thereof) and requires drug licence for import. Investigation found that there were two consignors of the goods from China, one was M/s. Prisun Pharmachem Co. Ltd., and M/s. ITW Test and Measurement, of Shanghai. 11. Learned Adjudicating authority examined the matter framing the following issues in para 35 of his order as follows:- (i) Whether live consignment of Tranexamic Acid packed in 60 drums valued at ₹ 48,17,745/- (Rupees Forty Eight Lakhs Seventeen Thousand Four Hundred and Seventy Five only) USD 87750/- (US Dollar Eighty Seven Thousand Seven Hundred and Fifty only) covered under MDWSB NO.043-57255590/HAWB 7DPW639 and IGM NO.414601 and Invoice No.PRI20130321, dated 21.03.2013 with consignor name as M/s. PrisunPharmachem Co. Ltd. and consignee name as M/s. Antoine Becouerel Organic Chemical Co., No.19, 1st Floor, V.O.C. Nagar, Anna Nagar (East), Chennai 600 102, seized from a truck bearing Regn. No.TN 22 BE 7952 which was found parked in Import Examination shed parking ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... HOMSOEVER IT MAY CONCERN stating that the goods covered by MAWB No. 043/572/55590 were sent to it by mistake by M/s. Prisun Pharma chem Co. Ltd., of China (consignor-exporter). Fraud against Customs was engineered through such declaration to defraud Customs although from the beginning the invoice was in the name of the appellant-importer and appellant was actively and consciously involved in the import of the impugned goods without drug licence in Form 10. Payment was made by ICICI bank against the impugned import from the accounts of appellant-importer. Such colorful device was adopted by the appellant-importer to escape from penal consequence of law. 15. Appellant-importer arranged a communication from the Chinese exporter to deliberately file false amendment application before Customs by M/s. DHL Logistics Pvt. Ltd., holding out that concern as the importer of the impugned goods. It also had no drug licence in Form 10. The Chinese exporter M/s. Prisun Pharmachem by its declaration dated 16.4.2013 captioning TO WHOMSOEVER IT MAY CONCERN stated that the consignment covered by MAWB was sent to M/s. Antoine Becouerel Organic Chemical Co., erroneously but that belongs to M/s. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, 1940 brings the impugned goods to its purview since the imported goods were proved to be drug upon testing by the Drugs Controller. Appellant further submitted that there is no drug licence required for an exporter who manufactures outside India. But, Rule 24A of the Drugs and Cosmetics Rules, 1945 rules out such proposition. Added to this, Rule 23 of the said rules requires an import licence in Form No. 10 as was suggested by the Drugs Controller as well as Revenue. Appellant places reliance on Rule 45 of the said Rules, 1945. But, no such rule comes to the rescue of the appellant since that rule deals with duties of the Government analyst. Therefore, appellant circumvented the law defrauding Customs. 19. Cogent and credible evidence came to record and Customs proved its case against both the appellants. These appellants made every attempt to be enriched at the cost of this country. They all had hand in glove. Secrecy and stealth being covering guards of ill designed act, they acted under secrecy to cause detriment to the interest of law smuggling the prohibited goods as defined by section 2(39) read with section 2(33) of the Customs Act, 1962. Many facts relating to the il ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es 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]. 23. Fraud is proved when it is shown that a false representation has been made (i) knowingly, or (ii) without belief in its truth, or (iii) recklessly, careless whether it be true or false. This aspect of the matter has been considered by Apex Court in Roshan Deen Vs PreetiLal [2002 (1) SCC 100], Ram Preeti Yadav Vs U.P. Board of High School and Intermediate Education [2003 (8) SCC 311], Ram Chandra Singh s case (supra) and Ashok Leyland Ltd. Vs State of T.N. and Another [2004 (3) SCC 1]. Suppression of a material document would also amount to a fraud on the court (see Gowrishankar Vs 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... articular person is concerned with their illicit importation or exportation. It is enough, if the Department furnishes prima facie proof of the offending goods being smuggled one. The second kind of penalty is one in personam which is enforced against the person concerned in the smuggling of the goods. In such case, the Department has to prove further that the person proceeded against was concerned in the smuggling. 27. The smuggling racket perpetuated smuggling in the past as is revealed from their conduct. Evidence gathered by Revenue unambiguously proved that both the appellant were contributory to the fraud committed against Customs and they made an organised bid to be enriched at the cost of the nation. It is established principle of law that fraud and justice are sworn enemies. When the collusion and fraudulent design of the exporter, importer-appellant, K. Ramlal Jain and M/s. DHL Logistics Pvt. Ltd., surfaced, the impugned goods that came to India, became no mans property and confiscation being an action in rem, the dubious claim of ownership of the goods at different point of time calls for absolute confiscation thereof without any leniency for redemption and re-export ..... X X X X Extracts X X X X X X X X Extracts X X X X
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