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TMI Blog2008 (10) TMI 535X X X X Extracts X X X X X X X X Extracts X X X X ..... eja in Cus. Appeal Case No. CDM-126/2005 claimed seized goods valued at Rs. 27,07,516/-, for which an option to redeem the same was given on payment of Redemption Fine amounting to Rs. 7.5 lakhs only (Rupees seven lakhs fifty thousand only) along with appropriate duty. (3) M/s. J.C.I. Chemicals India (P) Ltd. in Customs Appeal Case No. CDM-125/2005 Ltd. and its Director Shri T.P. Ghosh in Customs Appeal Case No. CDM-127/2005 claimed seized goods valued at Rs. 8,14,800/- for which an option to redeem the same was given on payment of Redemption Fine amounting to Rs. 2.5 lakhs (Rupees two lakhs fifty thousand only) along with appropriate duty. (4) Shri Naresh Juneja in Cus. Appeal Case No. CDM-126/2005 Director of M/s. Juneja Chemical Industries (P) Ltd. and Shri T.P. Ghosh, Director of M/s. Juneja Chemicals India (P) Ltd. in Cus. Appeal Case No. CDM-127/2005 were held to be guilty of illicit import and made liable to Personal Penalty under Section 112(a) and (b) of the Customs Act, 1962. (5) Shri Naresh Juneja in Cus. Appeal Case No. CDM-125/2005 was found to be kingpin and the main perpetrator of the syndicat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /s. Juneja Chemical Industries P. Ltd. at 5, Matheshwaouala Road, Kolkata - 46. Search to different premises located at different places was done on 23-3-04, 24-3-04 & 25-3-04 by the Investigating Officers on the basis of Search Authorisation and various persons were examined under summon on different dates to ascertain character of the transaction and also to examine duty liability under Customs Act, 1962 (hereinafter referred to as "the Act") as well as to find whether there was any violation of law. 3.2 The search team found 2296 drums and 308 bags of leather chemicals in the searched premises and believing that to be of foreign origin and having been illegally removed from Falta Special Economic Zone, they viewed that such goods were liable to be confiscated. Accordingly, seizure of such goods was made. However, finding difficult to remove such goods for custody, an order was passed on 25-3-04 under Section 110 of the Act, giving custody of such goods to the 3rd Appellant (Para 3 at page 2 of O-I-O). 3.3 Out of 2296 drums aforesaid, 1149 drums and 698 drums were released by orders dated 2-6-04 and 18-11-2004 respectively. Thus 449 drums remained to be questionable a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... type of organic product in aqueous medium and (2) White thick liquid containing polyoxythelene type of compound in aqueous medium" collectively valued at Rs. 2,52,000/- ; (ii) 3 drums of 150 kg. each of SOFT 2395/60/FE (Sulphonated Fish Oil) with markings Batch-186 dt. 2-9-03 Excel Technoligie, to Nirvik Exports, Falta SEZ, Made In Italy, collectively valued at Rs. 27,000/- were not covered by any legal duty payment documents, (iii) 2 drums of 45 kg each of COVER N-10 (Casein Binder) with the foreign markings value at Rs. 11,700/- were not covered by licit duty payment documents as claimed by Mr. Juneja. (iv) 3 drums of 30 kg each of Binder IK 611, valued at Rs.9,450/- were not covered by licit duty payment documents as claimed by Mr. Juneja. (v) 1 drum of Primax IP 52 N (Resin binder) weighing 50 kg valued at Rs. 5,750/- was not covered by licit duty payment documents as claimed by Mr. Juneja. (vi) 24 drums of SF-288 of foreign origin containing Sulphonated Fish Oil, valued at Rs. 1,72,800/- were not covered by the duty payment documents as submitted by Mr. Juneja because of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith clear foreign origin valued Rs. 7,200/-. (iii) 1 drum of Syntal CT-9 weighing 50 kg with foreign markings "Excel Technologie, Made In Italy" and marks "To Devi Chemicals Rifle Range Road (mentioned at Sl. No. 72 of list of goods lying under detention at 5 matheshwartala road, after release of Indian goods on 2-6-04) is claimed by Mr. Juneja to have been imported by M/s. Devi Chemicals and purchased by Juneja Chemical Indus. Pvt. Ltd. vide Devi Chemical's Bill No. D/42/03-04 dt. 27-8-03. But Mr. S.K. Sachdeva of M/s. Devi Chemical Enterprise Pvt. Ltd. failed to provide legible copy of Bill of entry under which consignment covering above drum was cleared on payment of duty by M/s. Devi Chemicals. Thus subject one drum valued Rs. 6500/- is not covered by any licit duty payment documents. (B) Basis for 88 (35 + 25 + 28) drums appearing in page 23 of O-I-O questioned to 1st Appellant were : (i) 35 drums containing sulphonated fish oil SF - 288 of foreign origin as admitted by Mr. Naresh Juneja himself, valued Rs. 2,52,000/- were not covered by duty payment documents submitted by Mr. Naresh Juneja. (ii) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s Fenasia Overseas Pvt. Ltd. were not covered by licit duty payment documents; (iii) 6 drums valued at Rs. 1,54,000/- were not covered by the documents submitted by the party and as such remain without any licit duty payment documents. (iv) 9 drums valued at Rs. 81,000/- were not covered by licit duty payment documents. (v) 11 drums valued at Rs. 99,000/- were not covered by licit duty payment documents. (vi) 5 drums valued at Rs. 75,000/- were not covered by licit duty payment documents. (vii) 6 drums valued at Rs. 76,500/- were not covered by licit duty payment documents. (viii) 4 drums valued at Rs. 17,000/- were not covered by licit duty payment documents. (ix) 3 drums valued at Rs. 18,750/- were not covered by licit duty payment documents. (x) 3 drums valued at Rs. 15,000/- were not covered by licit duty payment documents. (xi) 1 drum valued at Rs. 3900/- was not covered by licit duty payment documents. Basis of 21 drums questioned was as under : (i) &nb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Order of Adjudication appearing at pages from 36 to 42 of the said order, made her finding on paras from 28 to 44 of the show-cause notice. While passing the impugned order, that Authority relied on the judgment of the Hon'ble Supreme Court in the case of Collector of Customs v. D. Bhoormull ref. 1983 (13) E.L.T. 1546 (S.C.) and the order of adjudication resulted with the consequences aforesaid. 6.2 Ld. Assessing Authority while deciding the matter observed as under and concluded against the Appellants which resulted with the consequences as aforesaid : (A) M/s. J.C.I. Chemical India Pvt. Ltd., the 1st Appellant was created with the help of Shri Naresh Juneja. Mr. T.P. Ghosh, the 4th Appellant confirmed that M/s. J.C.I. Chemical India Pvt. Ltd. which is the 2nd Appellant does not import or export the leather chemicals, but deals with trading activities only. Shri Ghosh was only signing documents like debit vouchers relating to M/s. Juneja Chemical Industries Pvt. Ltd., in which he had no concern either as a owner or as a partner. In his statement dated 17-6-04 recorded under Section 108 of the Act, he stated that since he was sitting in the same offic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Authority was of the view that all the units were related to each other having a common fulcrum i.e. Sri Naresh Juneja of M/s. Juneja Chemical Industries Pvt. Ltd. and that too by companies clearly related and linked with each other and finally goods coming back through different factions to M/s. Juneja Chemical Industries Pvt. Ltd. at an enhanced cost since M/s. Juneja Chemical Industries Pvt. Ltd. and its related companies were the original importer of the goods. M/s. Alam Tannery Ltd. which was in the chain of deal in turn had sold the questioned goods to M/s. Fenasia Overseas Pvt. Ltd. Such goods did not move between the companies. But only documents were generated to cover the illicit movement of goods. (H) Doubts existed about the mode of payment by M/s. S. S. Enterprise Ltd. to whom D. T. A. sales were made vide invoices No. 1007 and 1008 by M/s. Nirvik Exports Pvt. Ltd. Shri Falguni Mukherjee failed to throw any light on whether any payment has actually been made to M/s. Nirvik Exports Pvt. Ltd. Shri Falguni Mukherjee, also a Director of M/s. T. J. Commercial failed to state whether any payment was received from M/s. T. J. Commercial to whom the goods were sold ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a Director of JCICI were also required to show-cause as to why penalty should not be imposed upon them under the provisions of Section 112 of the Act. November 18, 2004 : Order passed by the Commissioner releasing the balance 698 drums and 58 bags of leather chemicals, upon observation that "no case has been made out of in respect of the 698 drums and 58 bags, as the same are covered by the licit documents". Hence, 1847 drums and 58 bags out of the detained 2296 drums and 336 bags stood released. December 13, 2004 : Reply to show-cause filed by the appellants. The reply of JCIL and Naresh Juneja are at pages 112 to 209 of the Appeal Petition CDM-124/2005. Reply of JCICI and T.P. Ghosh are at pages 63 to 68 of the Appeal No. CDM-126/2005. December 29, 2004 and December 30, 2004 : As per order of the Commissioner, joint inspection of the remaining seized/detained drums and bags (in respect of which the show-cause notice dated September 20, 2004 was issued) was conducted at 24, K. P. D., Kolkata and 5, Matheswartala Road, Kolkata 700046 (where the seized goods were detained) by the representatives of the respondents and the appellants. Joint inspection reports submitted to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t any authority of law, illegal, invalid and bad. (C) The true terms, scope and effect of Section 123 of the Act has been succinctly explained by the Hon'ble Bombay High Court in its decisions in Commissioner of Customs (Prev.), Mumbai v. Shri Ganesh Enterprises - 2006 (199) E.L.T. 208 (Bom.) and Commissioner of Customs (Prev.) v. Aakash Enterprises - 2006 (205) E.L.T. 23 (Bom.), wherein the High Court discussed and explained the decision of the Hon'ble Supreme Court in Commissioner of Customs, Madras v. D. Bhoormull - 1983 (13) E.L.T. 1546 (S.C.). Both these decisions have affirmed by the Hon'ble Supreme Court in Commissioner v. Shri Ganesh Enterprises - 2007 (208) E.L.T. A159 (S.C.) and Commissioner v. Aakash Enterprises - 2007 (215) E.L.T. A103 (S.C.). In this respect, reliance was also placed by the Appellants upon the following decisions of the Calcutta High Court and this Tribunal :- (i) Commr. of Customs v. Raj Kumar Jaiswal - 2006 (204) E.L.T. 561 (Cal.); (ii) Commr. of Customs (Prev.) v. Ritu Kumar - 2006 (202) E.L.T. 754 (Cal.); (iii) Rang Birangi Sarees (P) Ltd. v. Commr. of Cus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed and were not tainted goods. (E) Despite the fact that number of drums, weigh of drums country of origin etc. were co-related with the documents and joint inspection report factually matched with the appellant's contentions, the Commissioner ignored the same and purported to arrive, on mere hypothesis, assumptions and presumptions, at factually incorrect findings and confiscated the said goods on the extraneous grounds to the show-cause notice, travelling beyond the scope of the show-cause notice. (F) As regards the goods in Appeal No. CDM-124/2005, the Chart presented to authority and submissions made clearly and unambiguously establish that the order passed by the Commissioner is wholly erroneous, without any substance or merit whatsoever and is invalid and bad ab initio. (G) Commissioner has confiscated the goods on the ground that since no markings regarding the importation in the name of M/s. Nirvik Exports (P) Ltd. is available; the claim for licit import is disputed. The Commissioner has failed to appreciate since the goods are not notified under Chapter IV nor under Section 123 of Customs Act, 1962, the burden ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f diverse types of leather chemicals, procures such foreign origin chemicals from several importers or their resellers or their onward sellers who sale the same in open market. Such chemicals purchased by the Appellants are supplied to the Appellant either in original drums or repacked drums or in original bags or in repacked bags. The Appellant further purchases chemicals from the units located in Special Economic Zone, which are sold to the Appellant after observations of all formalities of the provisions of Domestic Tariff Area Sale. The appellant purchased said goods, non-notified leather chemicals, from various importers or from their resellers or their onward sellers. Such purchases are in original packed durms, or in repacked drums or bags or packed in used drums or reused bags. When such non-notified goods are importable under OGL provisions of Import Policy, permissible for import by anyone without any restriction or prohibition whatsoever there can be no dispute whatsoever that purchase of such goods and/or acquisition thereof through normal trade channel against payment of cheques and/or Bank Draft, as was done in the instant case, was sufficient evidence for the legal a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5 lakhs respectively have been arrived at. No materials have been disclosed, as required under the well settled principles in this regard, in support thereof. The Imposition of the aforesaid redemption fine are also, therefore, arbitrary unreasonable and thus untenable and unsustainable. (R) In so far as the imposition of the penalty of Rs. 2.00 lakhs and Rs. 1.00 lakh respectively under Sections 112(a) and (b) of the Act upon the two Directors of the two Companies, Mr. Naresh Juneja and T.P. Ghosh respectively, it was submitted that no material has been disclosed in either the show-cause notice or the said order in support of the misconceived and baseless purported conclusions contained therein that the said persons or any one of them were involved in any manner whatsoever in the importation of any goods which were liable to confiscation or had abated the commission any such offence by the two Companies. Vague allegations and/or findings are contained in the show cause notice and the said order respectively, based on assumptions and presumptions unsupported by the materials on record. Not a single piece of document has been disclosed as none could be which evide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pect of impugned drums/bags should have been resolved by a speaking order and well reasoned. The Appellant when pleads to have explained entire facts and circumstances of the case with evidence available on record, that should have been tested on the touch stone of law. 9.2 We appreciate that once material fact relating to each drumg/bag questioned in Paras 5.1 and 5.2 of this order aforesaid is examined with evidence, the Appellant may not have grievance. Absence of patient hearing is apparent from the impugned order since reasons which are heart beat of quasi judicial decision, are absent in respect of the matter in controversy. Ld. Counsel's argument that certain decisions have been mis-placed by the ld. Authority below is also patent since no discussion on applicability of such judgment appears in order to say that facts of this case is within the four of the judgment relied by Revenue. Unless facts are found to be akin, the ratio of a decision may not be applicable. Such aspect needs careful consideraion. In absence of properly tested and settled facts available on record against each alleged drum/bag, we are unable to opine whether order of adjudication was passed ratio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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