TMI Blog2018 (4) TMI 210X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellant, being the chief executive officer of the company, who had arranged the export and enroute, the prohibited goods are found to be loaded in the place of the declared cargo and attempted to be exported abroad by way of mis-declaration and when it is further noted that the appellant is unable to give the correct particulars of the middle men, who had approached and interacted within as regards the export in question, it is seen that as rightly determined by the authorities concerned, the appellant cannot be declared to be an innocent person, particularly when it is noted that he had acted with the middle men without verifying their credentials etc. The appellant is liable to penal action under section 114 of the Customs Act 1962 - appeal dismissed - decided against appellant. - C.M.A. No.1315 of 2012 - - - Dated:- 22-3-2018 - S. Manikumar And T. Ravindran, JJ. For the Appellant : Mr. S.Murugappan For the Respondents : Mr. A.P.Srinivas JUDGMENT ( Judgement of this Court was made by T. Ravindran, J. ) Challenge in this civil miscellaneous appeal is made to the Final Order No. 141/2012, dated 16.02.2012, passed by the Customs, Excise Service Ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d broke up the seal and found the container to contain wood logs instead of the declared Granite Cobble Stones and thereafter, after complying with the necessary formalities in the presence of the witnesses, the container in question was opened and on opening, wood logs of assorted sizes were found stacked inside the whole container and they were certified as Red Sander Wood logs by the authorities concerned and they were noted to be totally in 377 in numbers and accordingly, noting that the wood logs totally weighing 13320kgs were attempted to be exported out of India in contravention of the provisions of Customs Act, 1962, the above said contraband namely, the red sander wood logs were seized under a mahazar and thereafter, the appellant as well as the others involved in the matter were examined and their statements were recorded under Section 108 of the Customs Act. 3. The appellant, on being examined on 08.08.2005, had inter alia informed during the course of his voluntary statement that pursuant to the order placed by a Malaysian party i.e., M/s. Naldex Sdn. Bhd, Malaysia, for the export of granite cobble stones through one Mr.Krishnan of Chennai, who had met him at Kuppam, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rding to the appellant, when he was examined on 14.09.2005 that he is in-charge of the company M/s. Archana Exports and that he was approached by one Krishnan representing one Mr.Selvam of Malaysian buyer and Selvam had also contacted him over phone and informed that his brother would contact him in Chennai as regards the proposed export and later, Saravanan contacted him and furnished his address and that he never met him in person and contacted only through phone and he is not aware of the transport agency and the details of the driver of the said truck fixed for the transport of the consignment from Kuppam to Chennai harbour. 4. The authorities concerned, after examining the other persons involved in the matter and recording their voluntary statements as provided under law and further noting that the fax number and the address of Saravanan as furnished by the appellant did reveal that they did not pertain to Saravanan and relate to others and accordingly, concluded that red sander wood logs numbering 377 pieces totally weighing 13320 kgs and valued at ₹ 23,31,000/- (LMV) and ₹ 53,28,000/- (IMV) were attempted to be exported out of India by mis-declaring as 20 Mts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ilers informed Shri.Bhaskar Naidu that he was the brother of the overseas buyer. However whereas he failed to give the correct address of Shri.P.Saravanan too and instead provided some fictitious non-existing address and phone numbers to the department, as and when Shri.Bhaskar Naidu needed to contact Shri.Saravanan he was able to reach Shri.Saravanan. For instance, on 03.08.2005, Shri.Bhaskar Naidu contacted Shir.P.Saravanan to enquire whether the container, which left his premises, had reached Chennai Harbour. Again on 05.08.2005 Shri.Saravanan contacted Shri. Bhaskar Naidu asking to expedite the clearance. The Fax message dated 08.07.2005 of Shri.Selvam received at 7.20 P.M seized at Archana Exports, Kuppam reads I am out of the country for a few more days. This gives a clear message that Shri.Selvam and Shri.Bhaskar Naidu had on going regular business deals. The exchage of e-mail messages betwee Shri.Selvam and Shri.Bhaskar Naidu clearly indicates their earlier transaction, and business dealings even before the present consignment. This clearly establishes that Shri.Bhaskar Naidu. CEO of M/s.Archana Exports and the overseas buyer knew each other very well. Both carefully hatche ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aventions committed as above detailed, however, reduced the penalty from Rupees ten lakhs to six lakhs and in other aspects, rejected the appeal preferred by the appellant. Impugning the same, the present civil miscellaneous appeal has been preferred. 7. The civil miscellaneous appeal preferred by the appellant has been admitted on the following substantial questions of law: 1. Whether the appellant can be visited with penalty under section 114 of the Customs Act, 1962, on the stated cause (in the show cause notice) that the illegal export was attempted in the name of M/s. Archana Exports of which the appellant was the CEO? 2. When investigation did not result in finding any involvement of the appellant and consequently the show cause notice itself was limited to an averment that the illegal export was attempted in the name of M/s. Archana Exports of which the appellant was the CEO, was it open to the respondents to invent new grounds when passing order in adjudication and appeal? 8. It is mainly contended by the counsel appearing for the appellant that in the show cause notice, no overt act as such has been attributed against the appellant for the de-stuffing of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which would be normally expected of from a prudent person, it is contended that the appellant accordingly failed to take appropriate and adequate steps to safeguard the said transit of the declared cargo from the factory to Chennai harbour, it is contended that thereby the appellant has made himself responsible for the penal action as per the relevant provisions of the Customs Act, 1962 and in such view of the matter, it is argued that the order passed by the respondents do not warrant any interference and therefore, according to him, the civil miscellaneous appeal preferred by the appellant is liable to be rejected. 10. After considering the rival contentions putforth by the respective counsel, it is noted that as per Section 114 of the Customs Act, 1962, that any person who, in relation to any goods, does not or omits to do any act which act or omission would render such goods liable to confiscation under section 113, or abets the doing or omission of such an act, shall be liable to a penalty as detailed therein. It is found that the intelligence had been gathered by the authorities concerned that by mis-declaration, the prohibited goods are being attempted to be exported thro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rovided under section113 and even abets the doing or omission of such acts, would be liable to penalty as per Section 114 of the Customs Act, 1962. Under the above provisions of law, it is seen that as rightly determined by the authorities concerned, the question of mens rea is not at all relevant for being liable to confiscation and penalty and in such view of the matter, considering the voluntary statements given by the appellant to the authorities concerned, which are admissible in evidence as per law, when it is found that the appellant had suspicious and clandestine dealings with the middle men vis-a-vis, the subject export and even during the interrogation unable to furnish any correct particulars as regards the middle men, who had interacted with him with reference to the subject export and on the other hand, the so called information furnished by him, being found to be not genuine, it is seen that the appellant, right from the inception, is instrumental in arranging for the restuffing of the prohibited goods in the place of the declared goods and in such view of the matter, the appellant cannot plead ignorance that inasmuch as the persons noted in the show cause notice, enr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 12. On the other hand, the counsel for the appellant placed reliance upon the decision of this Court rendered in C.M.A. No.1783 of 2017 dated 26.07.2017 (Commissioner of Customs Vs. M/s. Mansa Impex Services). The principles of law outlined in the above said decision are taken into consideration and followed as applicable to the case at hand. He also placed reliance upon the decision of the CESTAT, South Zonal Bench, Chennai reported in 2010 (262) E.L.T.385 (Tri. - Chennai) (Sekar Sekar Processs Vs. Commissioner of Customs, Chennai). However, as seen, the said decision had been rendered on the facts and circumstances of the case and therefore, would not be applicable to the case at hand. 13. Adding further, when this Court questioned the standing counsel for the Customs department as to whether any criminal prosecution has been launched against the appellant, for the above said acts, it was informed to us that the appellant and others were prosecuted and the appellant being the main accused, for the offences committed by them as regards the subject matter, in E.O.C.C.No.23/2008, on the file of the Additional Chief Metropolitan Magistrate (E.O.I.), Egmore and it is informed by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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