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2017 (9) TMI 1787 - Commission - CustomsViolation of import conditions - import of Zip Fasteners - N/N. 21/2002-Cus., dated 1-3-2002 - misuse of benefits of the Notification - garment accessories imported vide 8 Bills of entry were neither brought to the factory premises of the applicant nor used in export production as mandated in the said Notification. Instead the imported garment accessories were sold in the domestic market - Section 123 of the Customs Act, 1962. Held that:- The impugned goods were neither smuggled nor seized to make it illegal import under Section 123 of the Customs Act, 1962. It was imported against the import certificate issued by the AEPC. The only allegation in the impugned SCN is that the applicant has not fulfilled the conditions of Notification No. 21/2002-Cus., dated 1-3-2002, thereby making them ineligible for “Nil” rate of duty on the accessories imported. As the goods were neither seized by the DRI nor there is any allegation against the applicant that they smuggled clandestinely these goods, the Bench is of the considered view that under the facts and circumstances of the case, import under Bill of Entry 4572044 dated 7-9-2011 is not hit by the bar envisaged under Section 123 of the Customs Act, 1962. Pendency of another SCN demanding Anti-Dumping Duty - Held that:- The Bench has considered this issue and is of the firm view that the SCN demanding Anti-Dumping Duty is not a proceeding pending before an adjudicating authority against which the applicant has filed settlement application and the applicant has approached the Settlement Commission in settling the issue arising out of SCN regarding the wrong availment of benefits of Notification No. 21/2002-Cus., dated 1-3-2002. Hence the Bench holds that the pendency of another SCN demanding Anti-Dumping Duty is not an impediment in settling this case. The Bench is of the opinion that the applicant has made full and complete disclosure of the duty liability, co-operated with the investigation and discharged their duty liability along with interest immediately on commencement of investigation i.e., over one year before issuance of SCN dated 31-3-2015. Accordingly, the Bench considers it as a fit case to settle the differential duty liability at ₹ 23,19,372/- along with interest amounting to ₹ 6,35,309/-. Redemption fine - Held that:- The Bench holds that the Commission/Omission on part of the applicant have rendered the goods liable for confiscation. However, as the goods had not been seized at any point of time in this case, the question of imposition of any fine on the goods in lieu of confiscation does not arise. Penalty on applicant - Held that:- The applicant had deliberately misused the ICs of the exporters and availed unintended benefit of nil duty. However, once the investigation started, the applicant extended full co-operation, made no attempt to cover up the wrong doing and paid the entire amount of duty along with interest before the issue of Show Cause Notice. But for the painstaking investigations carried out by the Officers of DRI, Coimbatore Regional Unit, the fact of the matter would not have surfaced - The act of the applicant attracts penalty under Section 114A and also under Section 114AA of the Customs Act, 1962 separately for having rendered the goods liable for confiscation under Section 111(d) and 111(o) of the Customs Act, 1962 for not fulfilling the conditions prescribed under Notification No. 21/2002, dated 1-3-2002 and accordingly the applicant is liable for penalty under the provisions of the Customs Act invoked in the SCN. Penalty on co-appellants - Held that:- It is inconceivable to believe that the Directors failed to monitor their import transactions and activities of their staff till it was detected by the DRI. The Directors of the applicant firm cannot wash their hands off saying that they were not aware of the said illegal arrangements. Shifting the blame on Shri Kannan will not absolve them of the act of evasion or duty. The applicant firm is equally responsible for actions of its employee and the Directors of the applicant firm equally responsible for the imports made in their name resulting in the revenue loss for the Government. The omissions and commissions of the three directors of the applicant company, viz., Shri K. Tamizharasan, Director - “the Co-applicant I”, Shri N. Sridhar, Managing Director -”the Co-applicant II” and Shri S. Ramachandran, Director -”the Co-applicant III” have rendered the impugned goods liable for confiscation - the Bench imposes a penalty of ₹ 10,000/- (Rupees Ten thousand only) each on Shri K. Tamizharasan Director - “the Co-applicant I”, Shri N. Sridhar, Managing Director - “the Co-applicant II”, Shri S. Ramachandran, Director - “the Co-applicant III” under the provisions invoked in the show cause notice and grants immunity to the applicant in excess of the above amount. The penalty should be paid within 30 days from the date of receipt of this Order and compliance reported to the jurisdictional Commissioner. The Bench is inclined to consider grant of immunity from prosecution to the applicant and co-applicants.
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