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2018 (12) TMI 883 - HC - CustomsPenalty u/s 112(a) of the Customs Act, 1962 - allegation that Chartered Accountant (CA) has abetted the fraud - CA issued the Export Performance Certificate and Solvency Certificate - Duty Exemption Entitlement Certificate - Duty Drawback - the only allegation against the appellant was that as a chartered accountant, he has abated in the fraud committed by the principal importer since he had issued Export Performance Certificate and Solvency Certificate in the name of said M/s. Spectrum Fabrics without verifying the facts. Held that:- The SCN itself, is sufficiently clear. Against the appellant, only allegation 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 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. Even accepting the allegations contained in the show cause notice against the assessee and the final findings of the Commissioner in the penalty order, it cannot be stated that the assessee either had done or committed to do any act which would render the goods liable to confiscation under Section 111 of the Act - The Tribunal in the impugned judgment erroneously expanded the findings of the Commissioner by observing that the role prescribed by the adjudicating authority to the assessee was of knowingly being involved in facilitating the importer to commit the fraud. This was neither the allegations contained in the show cause notice nor was the findings of the Commissioner. In fact the allegations and the findings clearly were that the assessee had acted without due care and issued the certificates without full verification. Decided in favor of appellant.
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