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2016 (10) TMI 200 - CESTAT AHMEDABAD

2016 (10) TMI 200 - CESTAT AHMEDABAD - TMI - Imposition of penalty under Section 112(a) of Customs Act, 1962 - import of rough diamonds - restriction on import - Kimberley Process Certificate - seizure - confiscation of rough diamonds under section 111 of the Customs Act, 1962 - Shri Narendra Raval the owner of rough diamonds - is Shri Narendra Raval involved in the illegal import or smuggling of seized Rough Diamonds brought by Shri Jorabhai and Shri Premabhai? - Held that: - the only evidence .....

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s per the provisions of Customs Act which has jurisdiction within the territory of India only - jurisdiction of Customs Act to foreign citizen and to territory beyond India - Held that: - the issue is academic. The decision in the case of C.K. Kunhammed vs. CC [1992 (3) TMI 199 - CEGAT, MADRAS] would apply. - Imposition of penalty set aside - appeal allowed - decided in favor of appellant. - C/13694/2014 - A/10455/2016 - Dated:- 17-5-2016 - Dr. D.M. Misra, Member (Judicial) and Mr. P.M. Sale .....

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ercepted two persons namely Shri Jorabhai Valabhai Rabari alias Desai (Jorabhai for short) and Shri Premabhai Jethabhai Patel alias Attaya (Premabhai for short) on 22.04.2011 at Surat and recovered 48637.525 carats of Rough Diamonds of Zimbabwe origin, valued at ₹ 10,16,68,077/. Import duty is NIL on Rough Diamonds. However import of Rough Diamonds are restricted and should be accompanied by Kimberley Process Certificate. Since the subject Rough Diamonds were not accompanied by the mandato .....

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an citizen residing in Nairobi (Kenya). The said show cause notice was adjudicated by the Commissioner of Customs, Ahmedabad vide OIO No. 18/Commr/DRI/2012 dated 31.10.2012 whereby the adjudicating authority ordered absolute confiscation of the seized rough diamonds and imposed penalty of Rs. One Crore each on all the three persons. Aggrieved by the said order of the Commissioner, all the three persons preferred separate appeals before this Tribunal. Shri Narendra Raval pleaded that neither the .....

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Section 112 (a) of the Customs Act, 1962. Hence this appeal before us. 3. Heard both sides and perused the records. 4. Learned Advocate for the appellant at the outset itself submits that Shri Narendra Raval has no connection with the smuggling of rough diamonds or its seizure. He categorically denied the ownership of the said goods and submitted that he is not aware of the illegal activities of Shri Jorabhai and Shri Premabhai. He submits that Shri Narendra Raval is a Kenyan citizen of Indian .....

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n that, he has no connection with them or any business with them. The learned Counsel submits that the name of Shri Narendra Raval was taken by Shri Jorabhai and Shri Premabhai simply because his name is well known, and as a red herring. He contends that the department in the show cause notice has based the allegations against Shri Narendra Raval on flimsy evidences such as the initial statements of Shri Jorabhai and Shri Premabhai recorded on 22.4.2011 (which was retracted by them on first oppo .....

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sel therefore contends that the said initial statements of Shri Jorabhai and Premabhai should not be given any weightage as far as Shri Narendra Raval is concerned. Shri Premabhai had also explained in the cross-examination that the telephonic conversations with Shri Narendra Raval was with respect to purchase of land in Gujarat for starting an orphanage, and that except for the same, they had no other talks or any dealings or business. Learned Counsel submits that the only other evidence relied .....

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t Shri Narendra Raval was present in the said meeting they had with Shri Jorabhai and Shri Premabhai on 25.03.2011 at Nairobi. However, learned Counsel submits that it has been proved from the passport entries of Shri Narendra Raval that he had travelled to Tanzania on 23.3.2011 and came back to Kenya only on 27.03.2011. Further, Assistant Commissioner (Head of Investigation), the United Republic of Tanzania, in his certificate dated 25.4.2014 has also confirmed that Shri Narendra Raval visited .....

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oreigner s) was familiar and was found convenient and expedient to mention at the time of interception/ seizure of the Rough Diamonds. Learned Counsel also contended that the statements of co-accused has no evidentiary value, as held in a catena of cases, Vinod Solanki vs. UOI - 2009 (233) ELT 157 (SC) et all. He also argued that Shri Narendra Raval is a Kenyan citizen and is resident at Nairobi, and hence no penalty is imposable on him as per the provisions of Customs Act which has jurisdiction .....

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re of rough diamonds named Shri Narendra Raval as the owner of seized goods as recorded in their statements dated 22.4.2011. He submits that the statements were recorded under Section 108 of the Customs Act, 1962 and have evidentiary value and the subsequent retraction does not nullify the same. As regards the jurisdiction of Customs Act to foreign citizens, he relied upon the observations of Member (Technical) in the case of Hi Lingos Company Limited vs. Collector of Customs, Bombay - 1994 (72) .....

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that the case against Shri Narendra Raval is built upon three type of evidences; (i) Initial statements of Shri Jorabhai and Shri Premabhai dated 22.4.2011, (ii) the Call Detail Records (CDR), and (iii) the statements of Shri Chetanbhai V. Shah and Shri Ajaybhai M. Khambhadiya and their depositions during the cross-examination. (a) With respect to the call records, it is observed that there were 16 calls, duration ranging from a few seconds per call to 10 minutes per call, during 12.4.2011 and .....

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cross-examination that Shri Narendra Raval wanted to start an orphanage in India and also told him to look for some place in Gujarat; and except for that they had no other talk or dialogue or business. Under the facts and circumstances of the case, it cannot be concluded that there was something extraordinary and incriminating just by the fact of having a number of telephonic conversations. (b) The statements of Shri Chetanbhai V. Shah and Shri Ajaybhai M. Khambhadiya are to the effect that they .....

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certificate given by the Assistant Commissioner (Head of Investigation) Union Republic of Tanzania establishes that Shri Narendra Raval was out of Kenya from 23.03.2011 to 27.03.2011. Hence this evidence cannot be relied upon. (c) Shri Jorabhai and Shri Premabhai, on being asked by the officers in the presence of Panchas at the time of interception and seizure of the subject Rough Diamonds, stated that they have no invoice and other documents and K.P. Certificate for the said rough diamonds and .....

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Raval. However, the statement of Shri Premabhai dated 22.04.2011 mentions that the rough diamonds seized from their possession were brought from Shri Narendra Raval for sale in India and sale proceeds were to be remitted back to Shri Narendra Raval. Learned Counsel for the appellant has vehemently disputed the admissibility of the statements of Shri Jorabhai/ Shri Premabhai. We find that Shri Jorabhai and Shri Premabhai had given initial statements on the day of seizure i.e. on 22.4.2011. Howev .....

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d rough diamonds. It is observed that the Panchnama which is in the local language (Gujarati) and which narrates the gist of confessions of Shri Jorabhai/ Shri Premabhai does not mention anywhere about Shri Narendra Raval. It is only the statement of Shri Premabhai dated 22.4.2011 which mentions Shri Narendra Raval. This statement was retracted on 26.4.2011 before the Chief Judicial Magistrate in writing, and also during cross-examination held on 21.4.2014. There is no supporting or corroboratin .....

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