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TMI Blog2009 (6) TMI 303X X X X Extracts X X X X X X X X Extracts X X X X ..... BS Home Appliances Pvt. Ltd. under Section 125 of the Customs Act, 1962. 38.3 I impose a penalty of Rs. 1,00,000/- (Rupees One lakh only) on M/s. RBS Home Appliances Pvt. Ltd. under Section 112(a) of the Customs Act, 1962. 38.4 I am imposing penalty under Section 112(a) of the Customs Act, 1962 on the following persons. (i) Rs. 20,000/- (Rupees Twenty thousand only) on Smt. Jagruti Jayraj Pandit, the then Manager (Finance) of M/s. RBS Home Appliances Pvt. Ltd. (ii) Rs. 10,000/- (Rupees Ten thousand only) on M/s. Blue Star Enterprises. (iii) Rs. 10,000/- (Rupees Ten thousand only) on M/s. Milan Enterprises. 38.5 ..." 2. 312 units of fully automatic washing machines had been imported by M/s. RBS Home Appliances Pvt. Ltd. (appellant in Appeal C/190/08) on the strength of Special Import Licence No. 0011315, dated 27-12-1996. A Bill of Entry was filed for the clearance of these goods. It was assessed by the proper officer of customs and, on the basis of his order, the goods were cleared on payment of duty. In the year 1998, officers of the Directorate of Revenue Intelligence (DRI) unearthed cases of Forgery of Special Import Licences (SILs) by certain importers including one M/s. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t obtained SIL No. 0011315, dated 27-12-1996 from DGFT and therefore there was no question of its transfer to anybody else by them. In that statement, he also stated that the I.E. Code mentioned in the above licence did not belong to M/s. Reliable Overseas. When a 'transfer note' of M/s. Reliable Overseas certifying transfer of the licence for Rs. 1,29,83,870/- to M/s. Blue Star Enterprises, New Delhi was shown to him, Shri Gopinath stated that the letter head used for the transfer note was not theirs, nor was the signature in the transfer note that of any of their partners or officials. Finally Shri Gopinath expressed the doubt that the transfer note itself was a forged or fabricated document. After completing the enquiries, the department issued a show-cause notice to M/s. RBS Home Appliances, Smt. Jagruti Jayraj Pandit and others proposing to confiscate the goods covered by the Bill of Entry under Section 111(d) and (o) of the Customs Act, 1962 as also to impose penalties on the noticees under Section 112 of the Act. These proposals were contested. It was in adjudication of this dispute that the Commissioner passed the aforesaid order. 3. The learned Counsel for the appellants ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ud found in the present case. On the facts of this case, therefore, the ratio of the High Court's decision cannot be applied. The D.R. has then proceeded to address the principal issue as to whether the purchaser of a forged licence is liable to be proceeded against. In this connection, he relies on the Supreme Court's decision in Commissioner of Customs (Preventive) v. Aafloat Textiles (I) P Ltd. - 2009 (235) E.L.T. 587 (S.C.). In the same case, earlier, the Tribunal had set aside a penalty which had been imposed on the above company under Section 112 of the Customs Act, 1962. That was based on the finding that there was no proof of misstatement or suppression of facts in that case. The Hon'ble Supreme Court set side the Tribunal's decision and restored the penalty to M/s. Aafloat Textiles (I) Pvt. Ltd., after holding that the purchaser of the gold and silver imported under SIL was running a risk and that he had the burden of taking precautions to ensure the genuineness of the licence under which the goods were to be imported. The Supreme Court, thus, enforced the "caveat emptor" principle against the transferee of the goods imported under the forged licence. The S.D.R. heavily re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t case, the Commissioner has not found the Special Import Licence having been forged by the appellants, nor is it his finding that any of the appellants in any way abetted forgery of the licence. The finding against the appellants is that they had deliberately procured the licence from an illegal source with full knowledge of forgery. It has also been found that the appellants, by not providing the exact details of the source of the licence, indulged in evasive action indicative of mens rea and therefore the goods in question were rendered liable for confiscation. Having perused the statements of witnesses recorded by the investigators under Section 108 of the Customs Act, I have not come across any instance of Smt. Jagruti or any other functionary of M/s. RBS Home Appliances having conceded knowledge of any fraud committed by the original licensee. Therefore, the above finding of the Commissioner appears to be baseless. Of course, in the case of Aafloat Textiles (supra), the Hon'ble Supreme Court placed burden of proof on the transferee of a forged licence. It was held that it was for the buyer to establish that he had no knowledge about the genuineness or otherwise of the Special ..... X X X X Extracts X X X X X X X X Extracts X X X X
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