TMI Blog2011 (6) TMI 207X X X X Extracts X X X X X X X X Extracts X X X X ..... the higher side and, therefore, we reduce the penalty from Rs. 10 lakhs to Rs. 5 lakhs - The appeals are disposed of - C/300 & 367/2003 - A/191-192/2011-WZB/C-I(CSTB) - Dated:- 17-6-2011 - Shri S.S. Kang, Shri P.R. Chandrasekharan, JJ. Ms. Lakshmi Menon, Advocate for the appellant Shri Manish Mohan, Authorised Representative (SDR) for the respondent Per: P.R. Chandrasekharan: These appeals are directed against the Order-in-Original No: COMMR/MCT/2/2003 dated 25/02/2003 passed by the Commissioner of Customs Chattrapati Shivaji International Airport, Mumbai. Vide the said order the Commissioner ordered absolute confiscation of 265 carats diamonds valued at Rs. 17,32,406/- seized from Shri Dharmesh K Pandya under Sections 111(d), 111(o), 111(j) and 113(d) of the Customs Act, 1962. The Commissioner also ordered confiscation of 265 carats of diamonds valued at Rs. 11,38,910/- seized from M/s. Tara Jewels Exports Ltd. under Section 113(d) of the Customs Act with an option to redeem the same on payment of fine of Rs. 5 lakhs subject to the condition that the said diamonds shall be exported from SEEPZ or shall be used for manufacturing jewellery for export from S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cut and polished diamonds weighing 265 carats equal to the quantity which was also imported and was being removed surreptitiously and seized by the customs at the SEEPZ gate. The said four packets containing 265 carats of cut and polished diamonds were appraised by the Customs Appraiser attached to the Gem and Jewellary complex along with Shri Ashish Kothari of M/s. Jewel India (P) Ltd. and Shri Rajesh Kothari of M/s. Fine Jewellery, SEEPZ and on detailed examination they were valued at Rs. 11,38,910/-. The Appraiser and the other jewellery experts also opined that the said four packets containing 265 carats of cut and polished diamonds do not tally with the import invoice No. K1/97-98 dated 01/04/1997 of Kohinoor Gems Traders, Hong Kong. Shri Dharmesh K Pandya was also arrested on 05/04/1997 and produced before the Chief Metropolitan Magistrate, who remanded him to judicial custody till 11/04/1997 and he was released on bail on the ground that his actions were at the instance of his employer. (iv) Statements of Shri Atul Gandhi, Sr. Officer (Assorting) of M/s. Tara Jewels Exports Ltd. was recorded on 04/04/1997 under Section 108 of the Customs Act ibid. Shri Atul Gandhi also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of fine/penalty imposed is disproportionate with the allegations and, therefore, liable to be set aside (vii) The absolute confiscation of the diamonds seized from Shri Dharmesh K. Pandya was not warranted in view of the facts that the same were entitled to be redeemed on payment of fine in accordance with the provisions of Section 125 of the Customs Act. (viii) The appellant relies on the following judgments in support of the above contentions, namely: a) Associated Cement Companies Ltd. vs. Commissioner of Customs 2001 (128) ELT 21 (SC); b) M. Shashikant Co. and Others vs. Union of India and others 1987 (30) ELT 868 (Bom.) 5. The learned DR representing the department, on the other hand, justifies the absolute confiscation of the diamonds seized from Dharmesh Pandya on the ground that they are prohibited goods as defined under Section 2(33) of the Customs Act, 1962 and, therefore, they are liable to absolute confiscation under the provisions of Section 125 of the said Customs Act and he relies upon the judgment of this Tribunal in the case of Universal Traders vs. Commissioner of Customs (Exports), ACC, Mumbai 2007 (220) ELT 116. As regards the retraction of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from Hong Kong by M/s. Tara Jewels Exports Ltd. as has been confirmed by Shri Atul Gandhi who was the Senior Assorting Officer and who, by virtue of his experience and knowledge, had confirmed this fact. From the statement of Shri Kiran Doshi, who supplied the indigenous diamonds to Shri Dharmesh Pandya, it is evident that the diamonds seized from M/s. Tara Jewels Exports Ltd. were the same as those supplied by him. From the expert opinion given by the Jewellery Appraiser attached to the SEEPZ unit and also Shri Ashish Kothari and Shri Rajesh Kothari who are dealers in diamonds and who were also working in the same SEEPZ area, it is clear that Shri Dharmesh Pandya has substituted the imported diamonds with indigenous diamonds and has tried to remove the imported diamonds from the SEEPZ area in contravention of the provisions of EXIM policy and the provisions of the Customs Act. These diamonds were permitted to be imported by the appellant, M/s. Tara Jewels Exports Ltd., duty free subject to the condition that they are used in the manufacture of studded jewellery and for export thereafter. Inasmuch as the said diamonds have been removed without being put to use for the purpose for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he fine imposed is rather high compared to the value of the goods and accordingly we reduce the fine from Rs. 5 lakhs to Rs. 2.5 lakhs. Since it has been established that these are indigenous diamonds of inferior quality there cannot be any condition of export attached to them and accordingly we set aside the condition imposed by the Commissioner that the said diamonds shall be exported from SEEPZ or used for manufacture of jewellery for export from SEEPZ. 10. As regards imposition of penalty of Rs. 10 lakhs on M/s. Tara Jewels Exports Ltd., the same has been imposed under Section 112(a) and 114 of the Customs Act. A plea has been taken that the employer has no vicarious liability on the actions of the employee. We do not find any merit in this argument. It is the employer M/s. Tara Jewels Exports Ltd. who is the importer and who has to fulfill the export obligations and is responsible for the proper storage and accounting of the imported goods. If the terms and conditions of import are violated, either by themselves or by any of their employees, they are squarely responsible for the same and hence they are liable to penalty. Since the value of the goods involved in this case i ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
