TMI Blog1989 (6) TMI 203X X X X Extracts X X X X X X X X Extracts X X X X ..... was to take export consignment of 1250 TV sets to Dubai, after discharge of the import cargo. On 20-8-1987, 10 shipping bills, for the said consignment, were presented by one Shri Prakash K. Kamat, the Customs House Agent, for 1,000 black and white TV sets and 250 colour TV sets under a drawback claim for Rs. 4,02,500/- (cif value US $ 1,62,000). All the shipping bills were filed for and on behalf of M/s. Royal Electronics Pvt. Ltd. and were signed by Mr. Shashikant M. Walhekar (the appellant in Appeal No. C/876/88-Bom.) as the chairman of the said company. The invoices were signed by Shri Pratap L. Muchandi (the appellant in Appeal No. C/877/88-Bom.) and the consignee was M/s. Steel Palace at Dubai. The consignment was brought to the Port on 26-8-1987. Though the shipping bills were filed for 1250 TV sets, only 1185 cartons were brought to the Port, which were 65 less than those shown in the shipping bills. The cartons received were stored in MPT Warehouse in E shed. The vessel Al Yakoobi, however, sailed out on 27-8-1987 under the instruction from the consignors, without loading the export cargo, namely the said consignment of TV sets and the consignors tried to retrieve the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t appear for personal hearing, when they were called upon to do so. The Additional Collector, proceeded to adjudicate the matter upon the evidences available before him and ordered confiscation of the entire export consignment apart from imposing a penally of Rs. 5,00,000/- on each of the appellants. 5. Both the appellants have challenged the order of both the confiscation as well as imposition of personal penalties. 6. Shri Alimchandani, the learned consultant, appearing on behalf of Mr. Walhekar, the appellant in Appeal No. 876/88, challenged the validity of show cause notice on the grounds that :- (a) Chairman has been described as a partner. (b) Though the notice is not issued for confiscation under Section 113(d) of the Customs Act, the show cause notice alleges attempt on the part of the appellant and seeks his explanation for the same. He also contended that only the appellants are held liable to penal action, whereas the others, who actually filed the shipping bills are exonerated. Shri Alimchandani also pleaded that the adjudication order is passed in violation of the principles of natural justice as the appellant has not been supplied with the copies of the docu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me queries were raised by the department on filing of the shipping bills, which indicated that the shipping bills were not accepted by the department. Such a shipping bill cannot be said to have been verified. He further argued that the order-in-original only makes mention of Section 113 and does not specify exactly under what clause of the section the order is passed. He submitted that the order-in-original suffers from vagueness and cannot be sustained. 7. He also submitted that there is nothing on record to implicate the appellant Walhekar. It is only in the statement of Mr. Muchandi that Walhekar stands implicated. He submitted that Mr. Muchandi s statement being in the nature of that of the co-accused, cannot be accepted unless it has been corroborated on the material particulars and stated that even otherwise Mr. Muchandi has retracted from his statements, which makes his statements not admissible in evidence and that no reliance can be placed. Shri Alimchandani, therefore, submitted that the order of the adjudicating authority being bad in law is void, inoperative and that the order of confiscation of the goods as also the imposition of personal penalty, is bad in law. 8 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... part of the appellant to export the goods and submitted that the attempt is an act where the last proximate act is loading of the goods and till the shipping is not done, it is only the preparation and not an attempt so as to attract any of the provisions of the Customs Act. He also drew our attention to Section 2(19) and read the same along with the provisions of Section 113 and submitted that only export goods are liable to confiscation, and submitted that here, before the investigation were initiated, the vessel has already sailed without taking the consignment and as such the consignment was not an export goods and the shipping bills filed which were for the purpose of export by the vessel Al Yakoobi, cannot he said to be surviving. Search commenced and the suspicion arose only on 31-8-1987, by which date, the shipping bill had become infructuous and the goods had lost the status of being export goods. According to him, therefore, no offence can be said to have been committed by the appellant. He also submitted that though the shipping bills were filed on 20-8-1987 they were not passed through the process laid down in Sections 16,17, 39, 40 and 51 of the Customs Act and th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was stated by those persons. Shri Mondal also submitted that though the order, confiscation is under Section 113 only and there is no mention about the sub-clause made applicable but that does not make the order bad in law, inasmuch as the show cause notice very specifically mentioned as to which is the sub-clause invoked in the adjudication proceedings. According to Shri Mondal, there was a deliberate attempt on the part of the appellants to export the goods under the drawback claim and that the case squarely falls within the ambit of Section 113(i) when the same is read alongwith the provision of Section 50 of the said Act. Shri Mondal submitted that this can also be a case falling under Section 113(d) of the Customs Act but when the show cause notice is not issued for a breach under Section 113(d) he would not touch on the same. He also submitted that mention of shed D in the panchnama and shed E in the show cause notice and in the order-in-original makes no material difference as the complete description of the goods sought to be attached has been given in the show cause notice. Moreover, the appellants have at no stage prior to this, pleaded that the show cause notice was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 11. We have considered the arguments advanced by the learned consultants and the learned SDR and have also perused the records available with us. Considering the same, following points arise for our determination : (i) whether there is a denial of the principles of natural justice (ii) whether the identity of the goods is established. (iii) whether the case falls within the purview of Section 113(i) of the Customs Act. (iv) whether the whole consignment is liable to confiscation. (v) whether either of the appellants is responsible for the same consignment and is liable to be penalised. 11A. Before going to the points arising for our determination, we take up the admitted facts. 10 shipping bills under the drawback claim were filed on 20-8-1987, through the Customs House Agent Shri Prakash K. Kamat, by M/s. Royal Electronics Pvt. Ltd. for export of 1000 black and white TV sets and 250 colour TV sets. The drawback claim was for Rs. 4,02,500/-. Mr. Walhekar is the Chairman and Mr. Muchandi is the Managing Director of M/s. Royal Electronics Pvt. Ltd. The shipping bills were signed by Mr. Walhekar as the Chairman of the company and other documents namely invoices were si ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here is one letter dated 3-8-1988 written by the Supdt. of Customs and addressed to both the appellants on their various addresses given as also to the other persons to whom the show cause notices were given (referring to the demand made by them) and it mentions as under: If you have any further grievance on this point you may personally call at this office and take copies of the relevant documents. This letter which is admitted to have been received by the appellants and produced by them in the paper book supplied to us clearly indicates that there was no denial made by the department for supply of the copies. On the contrary the department had shown willingness to throw open all the documents which they had with them for inspection and for taking copies, if the appellants so desired. If, inspite of this, the appellants did not avail of this opportunity and went on writing letters reiterating their earlier demand, it cannot be said that they were denied the right to inspect the documents. On the contrary, it shows that the appellants themselves never wanted to avail of the offer made and for one reason or the other, they wanted to create this an issue and for delaying the ad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... than those shown in the shipping bills) were brought to dock on 26-8-1987, for the purpose of export, under the said shipping bills. It is also an undisputed fact that when the consignment of 1185 cartons was examined only 250 cartons were found to have contained TV sets and the rest 935 cartons contained bay and bricks. 16. Section 113 of the Customs Act provides for confiscation of the goods attempted to be improperly exported etc. and specifies which of the goods are liable to confiscation under the said Section. Clause (i) of the same Section provides as under :- any dutiable or prohibited goods or goods entered for exportation under claim for drawback which do not correspond in any material particular with the entry made under this Act or in the case of baggage with the declaration made under Section 77 in respect thereof. To fall within the said clause, the goods must have been entered for export . Section 50 of the Customs Act explains as to what is meant by entry of goods for export . Sub-section (i) of the said section reads thus: The exporter of any goods shall make entry thereof by presenting to the proper officer in the case of goods to be exported in a ve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ributed to the act of preparation but not an attempt so as to attract the provisions of the Act. We, however find, on careful reading of the Act, that a person intending to export goods is, as per the law, required to enter the goods by filing the shipping bill and bring the goods to the customs area. If these two acts are completed, as per the law, he has made the attempt to export these goods. In this case, charge is under Section 113(i), where it is more precise and specific. Under Section 113(i) entering the goods for export under the claim of drawback, is the only requirement of falling within the mischief of the same and vide Section 50, entry of goods for the exportation is complete as soon as the Shipping Bill in the prescribed form is presented to the proper officer. As soon as that is done, and if the goods are found to be not corresponding in material particulars with the entry made in the Bill, the same squarely falls within the ambit of Section 113(i). No further overt act is required. It is not required whether the entered Shipping Bills have been passed or whether quality control certificate has been produced. The requirement is that the goods should have been en ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onsignment. The consignors were trying to retrieve the goods containing partly TV sets and mostly hay and bricks. Merely because at some subsequent point, the appellants, for some ulterior motive, refrained from exporting the goods, cannot protect them from the applicability of Section 113(i), when they had already done whatever was required to be done for this export. There is a clear evidence available on record to show that they did enter the goods for export through that vessel and arranged that vessel to go away only because they apprehended detection of the fraud which was being practised by them. Having already taken all steps for the purpose of exporting the goods by duly complying with the formalities laid down under Section 50 of the Act, their plea that the goods were not the export goods cannot be accepted. The seizure made subsequent to the sailing of the vessel without cargo also does not alter the position. Under the guise of these, they cannot get out of the mischief of Section 113(i) of the Customs Act. It was a fait accompile as soon as the shipping bills were filed and tools were brought in the customs area. 24. The argument was also advanced that the appella ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Customs Act, that the consignor being the private limited concerned, notice ought to have been served on the company and that the Directors cannot be punished for the act of the company. It is admitted that show cause notice is not issued on the said company. When however the individuals have been identified and the role played by them have been ascertained, it may not be considered essential that the show cause notices ought to have been served on the company. Non-issuance of show cause notices on the company therefore does not vitiate the proceedings and in any case cannot absolve these appellants from the personal liability when their active role here is clearly established. 27. It was also pleaded that in any case 250 TV sets were available as per the S/Bs entered and hence they are not liable for confiscation. We find from the detailed list of seizure panchanama (Annexure A) that these 250 TV sets are not against one consignment covered by a particular shipping bill. It is, found that in each consignment covered by a shipping bill, cartons packed with the hay and bricks were intermingled and hence they did not correspond to the entry made. Hence, relief requested for is not ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
