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TMI Blog2024 (3) TMI 700X X X X Extracts X X X X X X X X Extracts X X X X ..... e show cause notice. With the officer-noticee having been discharged from the allegation of not having conformed to the statutory mandate in section 51 of the Customs Act, 1962, the conformity of the contents of the container, at that point in time, with the declaration is beyond controversy. No evidence has been brought on record that the goods were not substituted after examination which would have been manifested by appeal of Revenue against the dropping of charges against officer-noticee. It would appear that such possibility had not been conjectured and not investigated by the agencies of Revenue and, in the circumstances, is not amenable for refutation of the claim of appellant seeking the benefit from that finding. The show cause notice contains narration of role of appellant in procuring the goods, as found, and of his role in procuring documentation for non-existent goods as well as the greasing of the system to leach the exchequer. These are derived from statements which were not subjected to the rigour of section 138B of Customs Act, 1962. Those may not, therefore, be appropriate grounds for connecting the appellant with misdeclaration or entering goods for export withou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he two containers. 2. The adjudicating authority has held that 3.5 From the facts as unfolded during the investigations conducted by the DRI, it is seen that M/s. MJM Corporation which was into the business of export and import of steel items ventured into the impugned fraudulent export of ready-made garments with a view to claim and earn undue export incentives under the export promotion schemes, as per the suggestions of Shri. Pravin Joshi, representative of the CHA M/s. Virat Industries. Shri. Pravin Joshi had advised Shri Rajiv Mehta, Proprietor of M/s MJM Corporation that the business of such fraudulent export of ready-made garments would fetch him a profit of Rs. 5 lakhs per container exported. Shri. Rajiv Mehta was also convinced of the fact that Shri. Pravin Joshi could get the export documents and cargo of such fraudulent exports cleared through customs even if they are overvalued, mis-declared, et al. Shri. Rajiv Mehta, accordingly, made preparations which included, amongst other things, finding an overseas buyer, procuring cheap quality goods and obtaining ARE-Is from some manufacturers. Thus he contacted Shri. Hasan A!i alias Alibhai in Dubai and got assurance that once ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is not the correct value. Hence, the same is required to be rejected based on the report of AEPC, market enquiry and purchase price as accepted by the exporter (para 1.38.3 of this order). As such I hold that the value of the impugned goods as re-determined at Rs. 9,28,900/- after taking into account the actual purchase price of the impugned goods as disclosed by the exporter himself and the selling price of such or like goods in the market and also by adjusting it upwards by 25% considering the normal profit margins and other incidental expenditure to be the assessable value of the impugned goods under the provisions of section 14(1) of the Customs Act, 1962 and reject the FOB value declared in the impugned shipping bills. to conclude that 3.9 Coming to the role played by each of the noticees I find that Shri. Rajiv Mehta, Proprietor of M/s MJM Corporation with the active guidance, help and support of S/Shri. Pravin Joshi and Vikas Doshi, indulged in the impugned fraudulent export with a claim of undue benefit to the tune of Rs. 41.21 lakhs from the Government under the export promotion schemes. S/Shri. Pravin Joshi and Vikas Doshi, as per their own admissions, were to earn Re. 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion. Therefore, I order toimpose penalty on M/s Shyam Overseas, Surat under Section 114 of the Customs Act, 1962. 3. Thus, the confiscation of the goods under section 113(d) and 113 (i) of Customs Act, 1962 for incorrect declaration of quantity, for not conforming to the value declared and covered by documents only purporting licit clearance from factory of manufacture was found to suffice for section 114 of Customs Act, 1962 to be invoked against the appellant. 4. Learned Counsel for appellant drew our attention to 1.37.1 that Shri. Rajiv Mehta, the sole proprietor of M/s. MJM Corporation was the key person behind the impugned attempt of fraudulent export by mis-declaration and gross overvaluation of cheap quality T-shirts and rags/chindis with an intention to avail undue export benefits and to defraud the Government exchequer to the tune of Rs. 41.21lakhs; that he, on the advice of Shri. Pravin Joshi, arranged ARE-Is from M/s. Sri Shyam Overseas, Surat to misguide the customs officer into believing that the goods were supported by genuine ARE-Is; that however, in reality he had procured the cheap quality goods locally; that he, with the help of a broker named Shri. Jagdev, had p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l basis and such valuations of the impugned goods were arbitrary and much more on the lower side; that copies of the findings of such market enquiries had not been furnished to the noticee which was further in violation to the principles of natural justice; 2.2.2 that from the perusal of the show cause notice, it was clear that the noticee was enticed by Shri. Pravin Joshi, Noticee No. 3, into the export of readymade garments; that the noticee was engaged in the export of stainless steel utensils etc. and he was a novice as far as export of RMG is concerned; that in para 36 (ii)(b) of the notice, it had been clearly stated that Shri Pravin Joshi was the brain behind the alleged fraudulent export; that the noticee in the interest of natural justice, may be allowed to cross-examine Shri. Pravin Joshi to prove that the noticee was an innocent victim lured by Shri. Pravin Joshi who was a kingpin in the alleged fraudulent, export; 2.2.3 that they referred to the judgment in the case of Akshay Exports Inds. vs. C.C., Mumbai- 2003 (156) E.L.T. 268 (Tri.- Kolkata) wherein it had been held that the onus to prove a charge of over-valuation was on the Department by bringing on record the mate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the retractions cited above, and in view of the legal position enumerated in the foregoing paras, the statements of the notice recorded under section 108 of the Customs Act, 1962, ceased to be voluntary and hence could not be relied upon as evidence; had not been addressed in the impugned order. 5. He further contended that, in the light of 3.11 Allegation against Shri. Suhas Prabhu, Examining Officer, is that he had cleared the impugned goods without carrying out proper examination as per the examination orders given in the EDI system and thus aided and abetted the fraudulent intentions of other noticees. I find that, though strictly speaking, the officers were supposed to login and see for themselves the examination orders in the EDI system in the case of each and every shipping bill and act accordingly, due to the excessive amount of work thrust upon them a practice of examination of goods on the basis of the examination orders manually recorded by the Goods Registration Officer , who was also an equivalent rank officer, on the annexure C was in vogue. In the present case, these annexure C could not be produced by investigating officer, hence contention of the officer that he ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dgements in which specific factors weighed for disallowance of similar pleas for non-admissibility thereof implying that the manner in which section 138B of Customs Act, 1962 is complied with must rest on facts and circumstances of each case; further, none of the cited decisions pertain to cross-examination for ascertainment of credibility of persons purporting to have carried out survey of market value. Normally, that would have sufficed for remand of the matter back to adjudicating authority for fresh determination after such compliance. It is now over two decades since the impugned occurrence and over a decade since the adjudication process was completed. The plausibility of establishing relevancy of facts appears to be only a wing and a prayer. Hence, we proceed to the other submission made on behalf of the appellant. 8. The adjudicating authority found it fit to conclude that the customs official, assigned with the task of completing the regulatory mandate of section 51 of Customs Act, 1962, was not derelict in his duties even though the goods had not been proceeded against by him at that stage and it is the claim of Learned Counsel that sauce for the goose is sauce for the ga ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h the declaration is beyond controversy. No evidence has been brought on record that the goods were not substituted after examination which would have been manifested by appeal of Revenue against the dropping of charges against officer-noticee. It would appear that such possibility had not been conjectured and not investigated by the agencies of Revenue and, in the circumstances, is not amenable for refutation of the claim of appellant seeking the benefit from that finding. 10. The show cause notice contains narration of role of appellant in procuring the goods, as found, and of his role in procuring documentation for non-existent goods as well as the greasing of the system to leach the exchequer. These are derived from statements which were not subjected to the rigour of section 138B of Customs Act, 1962. Those may not, therefore, be appropriate grounds for connecting the appellant with misdeclaration or entering goods for export without declaration. The plausibility of goods having conformed to declaration, though found otherwise subsequently, at the time of completion of statutory obligation devolving on the appellant is no longer fiction and, in the absence of refuting thereto ..... X X X X Extracts X X X X X X X X Extracts X X X X
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