TMI Blog2016 (5) TMI 892X X X X Extracts X X X X X X X X Extracts X X X X ..... n Choksi and Shri Pragnesh Jain under Section 114A of the Customs Act, 1962 and Section 112 of the same Act respectively. 3. The relevant facts that arise for consideration are that DRI received intelligence regarding diversion of imported polyester fabrics/cotton fabrics/HDPE, falsely declaring the manufacturer-exporter as Sahil Industries. Statements of various persons were recorded and Shri Kiran Choksi and Shri Pragnesh Jain had been implicated by various persons and the goods were being delivered to someone else other than the importer; that the declared address of Sahil Industries at Santacruz was found to be non-existent; no manufacturing activity took place in two declared factory premises at Wada and Bhiwandi and false declaration of the exports for the last three years has not obtained the licences and 26 bills of entry were cleared earlier. It is also noted that DGFT suspended 13 licences issued to Sahil Industries on 28.5.2003. It is the case of the Revenue that Shri Kiran Choksi, one of the respondents, was also involved in diversion of materials obtained under advance licence in the case of Shree Rajshree Plastics. Based upon such findings, show cause notices were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have been on Shri Kiran Choksi who is the de facto owner of Sahil Industries as the Sahil Industries has no independent existence. It is his further submission that Shri Pragnesh Jain associated himself with the clearance made by Shri Kiran Choksi and hence need to be penalized under Section 112 of the Customs Act, 1962. He would submit that the evidence on record clearly establishes the role of Shri Kiran Choksi for importing goods under the name and style of Sahil Industries, and hatched a conspiracy to fraudulently obtain licences for duty free imports and dispose of such goods in local market for a profit. He would submit that the CHA, Shri Pragnesh Jain, has helped Shri Kiran Choksi to do so due to his continuous long standing association in business. Hence he also needs to be penalized. He would rely upon a judgment of the apex court in the case of Air Customs Officer, IGI, New Delhi vs. Pramod Kumar Dhamija reported in 2016-TIOL-15-SC-CUS and the judgment of the Honble Kerala High Court in the case of K.P. Abdul Majeed vs. CC, Cochin reported in 2014 (309) ELT 671 (Ker.), for the proposition that person charged with financing, smuggling needs to be prosecuted and prosecuti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on Shri Kiran Choksi. The sum and substance of the departments seeking to impose penalty under Section 114A was that Shri Kiran Choksi was de facto owner of Sahil Industries and had imported the goods under various advance licences and subsequently diverted them to the local market. Hence Sahil Industries being a proprietary concern having Shri Sawant as proprietor, lifting of corporate veil has to be undertaken and it was found that Shri Kiran Choksi was the mastermind. We find that the Commissioner (Adj.) in his findings from para 96 to 108 has recorded clearly that no incriminating documents were recovered from the premises of Shri Choksi by the investigating agency, this fact by itself makes one view with serious doubt as to the averments of Shri Sawant who has implicated Shri Kiran Choksi, it is also that statement of Shri A.J. Kerawalla does not indicate that Shri Choksi was representing Sahil Industries for procuring from C.A. certificate; from various statements of high seas sellers, it was gathered that there was no conclusive proof to establish Shri Kiran Choksi as the importer of the alleged goods as many of these high sea sellers suspected or believed that Shri Kiran ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the notice vide his letter dated 20.1.2004. The main argument of Shri Pragnesh Jain is that the evidence on record does not in any way implicate him in the present case. It was pointed out that as a Custom House Agent, he had not contravened any of the Rules and Regulations and that the key persons involved namely Shri Sawant, Shri Choksi or Shri Vinod Chaudhary have nowhere alleged that he had any knowledge about diversion of the goods imported under the relevant advance licences. It was also pointed out that as a Clearing Agent his job ended with the clearance of the goods and that the subsequent events consequent to the clearance of the alleged goods from the Customs Area is of no relevance, especially, when there is no evidence to implicate the notice in any active involvement in the subsequent diversion of the goods. In this context, Shri Jain has also drawn attention to the definition of abetment in Section 107 of the Indian Penal Code and has argued that the records of the case does not throw any positive evidence to indicate that he had quoted certain case laws. I have closely examined the above said contentions and arguments of Shri Jain and I have also perused the case ..... X X X X Extracts X X X X X X X X Extracts X X X X
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