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2016 (9) TMI 1011 - CESTAT MUMBAI

2016 (9) TMI 1011 - CESTAT MUMBAI - 2016 (340) E.L.T. 727 (Tri. - Mumbai) - Evasion of customs duty - mis-declaration - natural marble blocks and slabs - artificial marble tiles and vitrified tiles - approach to settlement commission by few co-noticees and importer as per provisions of section 127B of Customs Act, 1962 - penalty proceedings dropped by settlement commission for these co-noticees - whether the immunity from penalty be available to the other co-noticees who did not approach the tri .....

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set aside. - Appeal dismissed - decided against Revenue. - C/85867/2014 - A/89235/16/SMB - Dated:- 19-2-2016 - Shri C J Mathew, Member (Technical) Shri MK Sarangi, Dy. Commissioner (AR) for the appellant Shri B Shesha Gopalan, Advocate & A. Sheerazi, Advocate for the respondent ORDER Consequent upon the review of order-in-order CAO no. 134/2013-14/CAC/CC(E)/YG/GR.VII dated 29th November 2013 of Commissioner of Customs (Export), Mumbai, in exercise of powers under section 129D(1) of the C .....

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other noticees, approached the Settlement Commission of Customs and Central Excise in accordance with the provisions of section 127B of Customs Act, 1962. Consequently, proceedings under sections 111 and 112 of Customs Act, 1962 were continued and concluded only in relation to Shri Mahendra Kumar Darewala, Shri Pawanchandra Mulchand Mehta, Shri Shantilal Seth, Shri Prafulchandra Kataria, Shri Nitin Majethia and Shri Vinod Tomer. In impugned order, the adjudicating authority imposed a penalty on .....

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relied upon the decision of this Tribunal in SK Colombowala v. Commissioner of Customs (Import), Mumbai [2007 (220) ELT 492 Tri.-Mumbai)]. The relevant portion of the relied upon order, following reference to third Member owing to difference of opinion, was that : 26. … … (c) The case against all co-noticees comes to an end once the order of settlement is passed in respect of the person entitled to file an application before the Settlement Commission and therefore, penalty imposed .....

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cular, it is contended on behalf of Revenue that the adjudicating authority should have appreciated that the Tribunal while deciding M/s Rajesh Associates v. Commissioner of Customs [Appeal no. C/195-197/2012] had sought reference of these two rulings to a Larger Bench which, however, declined to decide on the reference as the expected determination by the Honble High Court of Madras would provide a wider jurisdictional guidance. It is also the contention of the Revenue that the conclusion of t .....

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3] which held: 22. Once it is held that the penalty levied upon M/s. Choice Laboratories and the Petitioner are based on independent and distinct causes of action and there is no settlement in respect of imported Clove Bud oil with which the Petitioner is concerned, then the alternative submission of Mr. Bulchandani that the levy of Penalty of ₹ 15,00,000/- is excessive and harsh, loses credibility. In the facts of this case, the Petitioner, a Chartered Accountant, has indulged in fabricat .....

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d in that act. In the instant case, although the customs duty ordered to be recovered on goods were cleared under a common advance licence granted to M/s. Choice Laboratories the penalty levied upon M/s. Choice Laboratories and the Petitioner arise from different causes of action. The liability to pay penalty is not joint but several. The offence committed by the Petitioner is totally independent and far more serious than the acts of the principle noticee and other persons involved and hence the .....

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hority dropped the proceedings against the respondent, viz., the decision in re SK Colombowala and reservation about its finality owing to pendency of appeal against the decision of the Tribunal in re KI International with the impact of its outcome clearly articulated by the Larger Bench in re Rajesh Associates [Misc. Order no. 42714/2015], exploration of the evidence linking the notices with the illicit import is secondary to the issue of continuance of proceedings.. 8. The decision of the Trib .....

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arger Bench. Therefore, it would appear that the Tribunal has no option but to follow the decision in re SK Colombowala. A further impediment to according precedential value to the decision in re KI International is the pendency of the appeal against it in the Hon ble High Court of Madras. 9. It is also pertinent to note that in Radiant Silk Mills Pvt Ltd v. Commissioner of Customs & Central Excise, Mumbai - II [2013 (288) ELT 311 (Tri.-Delhi)] a single member bench of the Tribunal, placed i .....

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008 that the importers covered by the said adjudications having settled their dispute before Settlement Commission and immunity from penalty and prosecution having been granted to them, the trader, broker and sub-broker appellants covered by those adjudications cannot be called upon to pay penalty out of same adjudication. Hon ble Supreme Court in the case of S.P. Chengalvaraya Naidu v. Jagannath reported in (1994) 1 SCC 1 laid down the law that the principle of finality of litigation cannot be .....

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gains indefinitely. We have no hesitation to say that a person, who s case is based on falsehood, has no right to approach the court. He can be summarily thrown out at any stage of the litigation. Thus plea of these appellants are baseless and being misconceived are devoid of merit and they are liable to penalty under law for the unlawful act. The order of the Tribunal in the case of S.K. Colombowala v. CC (Import), Mumbai - 2007 (220) E.L.T. 492 (Tri.-Mum.) does not come to rescue of these app .....

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t before the Commission. Further, the doctrine of finality does not immune these appellants who defrauded Revenue. 11. As is seen from the above, the Division Bench has not followed the majority decision of the Tribunal in the case of S.K. Colombowala by observing that the said decision did not take into consideration the law laid down by Apex Court in the case of S.P. Chengalvaraya Naidu referred supra. 12. I have looked into the said decision of the Hon ble Supreme Court in the case of S.P. Ch .....

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wala. The proceedings are under the Central Excise Act as regards imposition of penalty in terms of Rule 26 of Central Excise Rules. The question of obtaining any decree or order by mis-representing the facts of the case or by fraudulently representing the case, as was the case before the Hon ble Supreme Court, are not involved in the present appeal. While delivering the majority judgment, the majority Members have relied upon the decision of the Hon ble Supreme Court as also of the Tribunal, wh .....

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