TMI Blog2002 (5) TMI 812X X X X Extracts X X X X X X X X Extracts X X X X ..... oses other than for fulfilment of export obligation without discharging their export obligation in full, in contravention of Notification No. 149/95, dated 19-9-95 in which the duty free importation was allowed. The finding arrived at by the Commissioner (Adjudication) in paras 19 to 25 are reproduced :- I have considered all the submissions made by the company and gone through the records of the case carefully. I find that M/s. Merven Drug Products, Hyderabad, had taken two numbers of advance licenses i.e. (1) 1531853, dated 15-3-96 and (2) 1531849, dated 15-3-96 and imported 5480 Kgs. of O-Chloro Benzaldehyde (OCB) and 7800 Kgs. of Hydroxylamine Sulphate (HAS) free of duty under Notification No. 149/95, dated 19-9-95 against Advance Li ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Foreign Trade (Development and Regulation) Act, 1992. Therefore, I find that the said goods are liable for confiscation under Section 111(d) of the Customs Act, 1962, also. I find no reason with the party contention that proviso under Section 28 of the Customs Act cannot be invoked in this case. The party wilfully misstated and suppressed the facts with an intention to evade payment of duty and I find that proviso to Section 28 of the Customs Act, 1962 is invokable for recovering the duty and also Section 114(A) of the Customs Act, 1962 is also invokable for penal action on the party. I find that Shri T. Mallikarjun Reddy, Chairman Executive of M/s. Merven Drugs Pvt. Ltd. knowing fully well, allowed misutilisation of the exempted r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he party under Section 114(A) of the Customs Act, 1962 and I impose penalty amount of Rs. 50,000/- on Shri T. Mallikarjun Reddy, Executive Chairman of M/s. Merven Drug Products Pvt. Ltd. Hyderabad. As per the above findings the duty and penalty under Section 114(A) has been imposed. 2. The appellant are now contesting the charge on the imported goods being diverted in the market and the liability to pay the customs duty which has since been discharged. It is with regard to the non-leviability of penalty under Section 114(A) of the Customs Act on the appellant and the Executive Chairman which is under contest. The main argument advanced by the Chartered Accountant in this case is that Section 114(A) had come into force on 20-9-96 while ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en approved by the Apex Court in the case of CC v. Elgi Equipments as reported in 2001 (128) E.L.T. 52. He further submits that there were no grounds for imposing penalty on Executive Chairman as he is not a part to play any role in the removal of goods and had no personal interest in the same. Commissioner has not given any reason why Executive Chairman should be imposed with penalty. He relied on the judgment of Anil Bhalla v. CC as reported in 2001 (138) E.L.T. 883 wherein the penalty on the Managing Director has been set aside. He submits that the condition of the goods is very bad and of extenuating circumstances ought to have been considered for the purpose imposing penalty which has not been done and hence the order being non-speakin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed after the promulgation of Section 114(A) which provides for imposition of mandatory penalty. In the absence of this information it is not possible to confirm the penalty imposed. Furthermore, the Apex Court in the case of CC v. Elgi Equipments (supra) have now laid down that it is not mandatory to impose an equal amount of duty as penalty. The extenuating factors are taken into consideration. Furthermore the plea that assessments were still provisional and proceedings initiated is not being answered by the Commissioner. Further, the contention that Executive Chairman was not involved in the matter and this fact has not been discussed and no finding has been arrived at on the Executive Chairman should be penalised. In that view of this re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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