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TMI Blog2018 (3) TMI 1261X X X X Extracts X X X X X X X X Extracts X X X X ..... er the goods are exempted from duty in terms of N/N. 150/94 - Cus only when the goods are procured by the Government of India or shipped on the order of the department of Govt. of India - None of the conditions of the notification has been followed by the Appellant firms. Extended period of limitation - Held that: - This is a clear case of evasion of duty by frauds. However the demands beyond the period of five years are not sustainable. Confiscation - redemption fine - Held that: - since the goods are not available therefore there is no ground to confiscate the same and therefore no redemption fine can be imposed. Penalty u/s 112 (a) and u/s 114 (ii) of CA - Held that: - the Appellants have played active role in claiming illegal benefit of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m CWC warehouse for delivery of Lion Gate, he always used to accompany the cargo to Lion Gate or Tiger Gate and used to get the signature of stores keeper for having received the goods, that the store used to come at the gate to see the goods and he used to show him copy of purchase order whereupon storekeeper used to tell him to take back the goods and deliver to the ultimate consignee mentioned in order, that the goods never used to be taken inside the Tiger or Lion Gate and he used to take back the goods from the gate. That the storekeeper used to sign on the shipping bill as 'received' and thereafter he used to take back the goods without the Customs, Preventive Escort, that only he once delivered the duty free goods taken out from the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the period June' 93 to July' 93 for confiscation of goods, demand of duty and imposition of penalties. A show cause notice dt. 19.12.1997 for the period December' 92 to Jan' 93 was issued on the same allegation for confiscation of goods, demand of duty and imposition of penalty to M/s B.K. Industrial Corporation, Shri Kirit Kamdar and Shri Hemant Shah. A show cause notice dt. 10.03.1998 on same allegations for the period February' 93 to April' 93 was issued for confiscation of goods, demand of duty and imposition of penalties to M/s B.K. Industrial Corporation, Shri Kirit Kamdar, Shri Hemant Shah and Shri P.R. Seshadri. A show cause notice dt. 04.02.1999 on the same allegation for the period November' 92 to May' 1994 was issued to M/s Hite ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bmits that in case of SCN dt. 12.08.1998 the portion of demand is beyond period of five years and hence not sustainable. That some of the goods were received by the Indian Navy. That the findings of the diversion was based upon statement of Partners which is untenable. The demand has been confirmed that the storekeeper in Indian Navy Shri P.K. Seshadri was not authorized to certify that the stores were meant for Indian Navy supplies but no basis has been specified in the impugned order for arriving at this findings. That section 72 has been wrongly invoked for removing of goods from warehouse in contravention of section 71. That when the goods were diverted locally, it is not understood how section 71 or 72 of Customs Act would apply. He al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al user of the goods. It is clearly appearing from the statement of Captain Allen Oleary (Controller of procurements Indian Navy) who in his statement dt. 03.02.98 stated that he is working as Controller of Procurement, Material Organization, that the shipping bills are always signed by the Controller personally and the Storekeeper who is civilian staff employee below officer rank is not authorized to sign any of these documents except giving receipt of items; there is no person having designation of SSK Controller of Procurement, Naval Dockyard Lion Gate. The storekeeper is not authorized to sign the shipping bills indicating the receipt of the goods when he is not physically warehousing the goods inside the dockyard. In his further statem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd that the diversion of goods under the garb of Naval clearance stands accepted by Shri Hemant Shah and Shri Kirit Kamdar in their statements dt. 28.10.97 and 04.11.97 wherein they have categorically stated that the diverted goods were sold in the open market. Further the goods are exempted from duty in terms of Notification No. 150/94 - Cus only when the goods are procured by the Government of India or shipped on the order of the department of Govt. of India. None of the conditions of the notification has been followed by the Appellant firms. It is thus absolutely clear that the Appellant firms has diverted the goods illegally and the co-appellants Shri Hemnat shah and Shri Kirit Kamdar played active role in such evasion. We therefore fin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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