TMI Blog2005 (9) TMI 462X X X X Extracts X X X X X X X X Extracts X X X X ..... Deep Corp. and Niki Traders were set up by Vora to import bearings and bearing housings grossly undervaluing them; that the differential duty is demandable from Vora and the grossly undervalued bearings and bearing housings were liable to confiscation. He imposed penalties on Shri Vora of Nippon Bearings, Ashwin Mehta, his manager, and Shalin Vora, his son who assisted him in the affairs of M/s. Nippon Bearings. These then are the appellants before us. 2. Misdeclaration of value of imported goods, demand for differential duty thereon, liability of the goods in question to confiscation and the liability to penalty under the Customs Act are the issues. The issue as to the person from whom differential duty can be demanded, i.e. whether from the person/persons who held themselves to be importers by filing the bills of entry or from the person/persons who is/are alleged to have caused the imports from behind the scenes has to be addressed first. In the present case the Commissioner held that Deep Corp. and Niki Traders are the fronts - are nothing but dummies - therefore differential duty has to be demanded from Nippon Bearings, the de facto importer. The Commissioner held that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the name of these persons were actually made by M. Vora. He admits that he being an employee of Nippon Bearings corresponded with the foreign supplier in respect of imports made by Niki and Deep and also by Jayashree Enterprises, another firm floated by Sirish of Deep Corp. 10. Shri M. Vora in another statement dated 8-1-1996 admits that he knew Deep Corp. and Niki Traders; that he was the one who arranged the imports made by them; that he got in touch with D.V. International, Hong Kong for the imports made in the name of the two firms stated above; that the differential amount between the manufacturer's invoice and the price shown in invoices tendered to Customs at the time of clearance was remitted by him to M/s. D.V. International, Hong Kong, through illegal channels; he was shown various documents on which the Department relied to establish his role in the imports made by various concerns; that he is prepared to pay the differential duty. He tendered two cheques for a total amount of Rs. 1,15,00,000/- (they were not honoured by the Bank when they were presented by the Department). Some 12 days later he retracted this statement. The Department denied the allegations made b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ri Balani appearing for S/Shri Manharlal Vora, Shalin Vora and Ashwin Mehta pleaded that - (a) The Commissioner erred in holding Manharlal Vora as the importer even when the bills of entry for clearance of imported goods were filed by Nikki Traders and Deep Corp. holding that they are benami firms of M.L. Vora. There is no evidence to this effect. In the cases of J.B. Trading Corpn. [1990 (45) E.L.T. 9 (Mad.)], K. Sons Overseas (I) P. Ltd. [2001 (132) E.L.T. 93 (T)], Wai Wai Stationery P. Ltd. [2001 (137) E.L.T. 1388 (T) and Biren Shah [1994 (72) E.L.T. 660 (T), the Court and the Tribunal did not allow the defacto importers to step into the shoes of benami importers. In the present case Niki Traders and Deep Corp. were not the benami firms of M.L. Vora but are importers in their own right. Their denial to this effect is with an intention to escape the allegation of under-invoicing. (b) Cross-examination of proprietors of Niki Traders and Deep Corp. on whose evidence the Commissioner heavily relied in his order was not allowed on frivolous grounds. The Commissioner seemed to have denied cross-examination on the ground that they are co-accused. Denial of cross-examination ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... halin Vora and Ashwin Mehta are liable to penalties under Section 112(a) of the Customs Act. 19. We have considered the rival contentions. 20. Section 2(26) defines an importer quote Importer in relation to any goods at any time between their importation and the time when they were cleared for home consumption includes any owner or any person holding himself to be the importer. 21. In respect of the 12 bills of entry in question Jariwala and Sirish Mehta held themselves to be importers, filed bills of entry, produced the bills of lading in their names and the bills of exchange were transacted through their Banks. For all purposes they held themselves to be the importers. Under Section 28 of the Customs Act they are the persons chargeable to duty being importers (CC v. Trivandrum Rubber Works [1999 (106) E.L.T. 9 (S.C.)]. 22. However much after the goods were cleared investigation conducted by the officers seemed to have revealed that they were not, after all, the importers. The Commissioner's finding that M.L. Vora was the real importer is based on the statements of Jariwala (Niki Traders) and Sirish (Deep Corp.), the proprietors of the firms who imported the goods in que ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uments were recovered. Some of the documents pertained to correspondence posterior to the date of filing of the bills of entry. Apart from these discrepancies, the panchnama speaks of box files etc. without disclosing the documents seized during the search of M. Vora's office. The fact that the documents were shown to Ashwin Mehta when his statement was recorded does not mean that he admits that they were recovered from the office of Shri Vora. 27. Apart from all this, the case law cited by the learned advocate in support of his contention that the concept of de facto importer has been rejected by the Tribunal in several cases is seen by us. Even when the evidence was much stronger than in the present case the Tribunal did not entertain the theory of de facto importer. In the present case except the statements of co-accused there is no evidence to suggest that the importer was M. Vora. In fact the documentary evidence (bill of entry, invoice, bill of lading, Bank transaction etc.) clearly establish that Niki Traders and Deep Corp. were the importers. Demand for differential duty should have been confirmed on them. The said firms paid Rs. 40 lakhs towards differential duty. The ba ..... X X X X Extracts X X X X X X X X Extracts X X X X
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