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TMI Blog2018 (12) TMI 883X X X X Extracts X X X X X X X X Extracts X X X X ..... n was that he had issued certificates without full verification. This in turn, enabled the importer to obtain advance licence. This advance licence was utilized for making duty free import of goods which were in breach of the condition of license diverted into local market. In so far as the appellant-assessee is concerned, his involvement even as per the show cause notice was confined to issuing certificates without full verification. There is no allegation that the assessee was either part of or aware of impeding fraud which the importer intended to perpetrate. Whatever be the fault of assessee in exercising the due diligence in issuing the relevant certificates, even according to the department as emerges from the show cause notice and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tantial question of law is framed:- (i) Whether in the facts and circumstances of the case, the Hon'ble CESTAT was justified in holding the penalty of ₹ 5 Lacs imposed by the respondent vide the order-in-original No. 09A/2010/CAC/CC/RBT dated 29.1.2010? The above question arises in following background: The appellant - assessee is a Chartered Accountant. The Custom Authorities found that one M/s. Spectrum Fabrics had made import of polyester fabrics without payment of duty under the Duty Exemption Entitlement Certificate ( DEEC for short) under advance licenses and the goods so imported were illegally diverted to the local market instead of utilizing the same for production and export of goods. A show cause notice wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Vs. Gold Control Adm (1986 (23) ELT 523 (1), Smt. Vidya Wati Vs. State (1988 (37) ELT 341(del)) and Laxmi Packaging (P) Ltd (1998(98) ELT 91(T)) , I dins that in the case of M.M. Raikhana, it was held by the Hon'ble Tribunal that penalty on a person is not sustainable in the wake of no evidence produced to show that the advance licence would not be used in the manufacture of export goods. The ratio of this case is not applicable in the present case because herein there is an 'admitted' evidence of Shri. Mahesh Patel that he had not verified the documents before giving the export performance certificates. Thus, the allegation of 'no evidence' by the noticee doesn't survive. I also find that the rest of the cases are e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4.1 From the above detailed finding of the learned Commissioner, it is seen that the appellant Shri. Mahesh P. Patel has issued the solvency certificate on the basis of balance sheet which was not signed by the Chartered Accountant. Therefore, he was not supposed to issue any certificate which is not based on the audit of books of accounts. Accordingly, on the basis of the certificate issued by the Chartered Accountant, Shri. Mahesh P. Patel, M/s. Spectrum Fabrics obtained the advance licence fraudulently which resulted in huge revenue loss of ₹ 1.46 Crores customs duty to the Government exchequer. As per the role described by the adjudicating authority, it is clear that the appellant Shri. Mahesh P. Patel was knowingly involved ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se diverted into local market. In so far as the appellant - assessee is concerned, his involvement even as per the show cause notice was confined to issuing certificates without full verification. 6. In the final order of the adjudication also, the Commissioner came to confirm the allegations made in the show cause notice without traveling beyond them, which any case, he could not have. He referred to the assessee's statement recorded under Section 108 of the Act and concluded that the arguments advanced on behalf of the assessee were in the nature of retraction of the statement which the assessee had never retracted earlier. The Commissioner held that the assessee had certified that he (the assessee) had verified the books of accoun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ice and the order of the Commissioner, no role was played by him in so far as the imports and illegal diversion of the imported goods to local market are concerned. The Commissioner has confirmed penalty under Section 112(a) of the Act which envisages imposition of penalty on any person who in relation to any goods does or omits to do any act which act or omission would render such goods liable to confiscation under Section 111 or abates the doing or omission of such act. While ordering confiscation of the goods by the said order imposing penalty on the appellant, the Commissioner has relied on clause (o) of Section 111 of the Act. This clause makes goods brought from a place outside India liable to confiscation if the goods are exempted, s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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