TMI Blog2019 (8) TMI 1791X X X X Extracts X X X X X X X X Extracts X X X X ..... nd presumptions. Hence the quantum of undervaluation determined by the revenue can always be debated. Further it is fact that appellants have before the Commissioner asked for cross examination of various persons associated with market enquiry. In the present case, where the value has been determined on the basis of the market inquiry Commissioner should have normally allowed cross examination and supplied all the documents, which formed the basis of valuation to the appellants. In normal course for determination of the value, after allowing cross examination and supplying all, the documents to the appellant importers. However in view of specific concession made by the appellants counsel during the course of hearing that with the passage of time (nearly two years from date of importation), the goods have become junk and they do not intend to clear the same for DTA market, the issue in respect of the re-determination of the assessable value under Section 14 has become a mere technical and administrative formality and dispute. Suffice to say that appellant importer had misdeclared the goods in terms of value, quantity and description. For the misdeclaration of the goods in terms o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . - Hon ble Mr. S.K. Mohanty, Member (Judicial) And Hon ble Mr. Sanjiv Srivastava, Member (Technical) Shri Anil Balani, Advocate, for the Appellant Shri R.K. Dwivedy, Additional Commissioner, Authorised Representative for the Respondent ORDER PER: SANJIV SRIVASTAVA The appeals as detailed in the table below are directed against the order in original CAO No CCVA/ 23/2018-19 Adj (I) CC dated 29.01.2019 of Commissioner Customs (Import) Air Cargo Complex Sahar Mumbai. Appeal No Appellant Remark C/85762/2019 Amit Rajkumar Singhania Appellant 1 C/85763/2019 Jitu Sharad Shirsat Appellant 2 C/85812/2019 Anjana Nilesh Jadhav Appellant 3 C/86211/2019 Manish Dhirajlal Barot Appellant 4 C/86436/2019 Chitalia Logistics P Ltd Appellant 5 C/86437/2019 Harshwardhan T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... imported vide bill of entry no 9278948/ 12.04.2017 9Totally amounting to ₹ 31,25,739/-) be confiscated absolutely as the same were found in contravention of provision of IPR (Imported Goods), Enforcement Rules, 2007. iv) The Re=determined Customs Duty including differential customs duty in respect of Bill of entry No 9278934, 9278938, 9278942, 9278944, 9278946 and 9278948 all dated 12.04.2017 amounting to ₹ 3,61,985/-, ₹ 8,46,791/-, ₹ 3,01,742/-, ₹ 6.62,015/-, ₹ 4,74,049/- and ₹ 10,50,666/- respectively (Total amounting to ₹ 36,97,248/-) (excluding counterfeit items) be demanded and recovered under section 28(4) of the Customs Act, 1962 along with appropriate interest under Section 28AA of the Customs Act, 1962. v) I impose penalty amounting to ₹ 46,03,850/- (Rupees Forty Six Lakhs Three Thousand Eight Hundred and Fifty only) on the importer M/s Amit Enterprise under Section 114A of the Customs Act,1962 for his omission and commission and short levy of Customs duty on account of suppression of facts in terms of quantity, description, classification, brand and value. vi) The amount paid vide manual Challans No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of goods for re-export may be exercised by the importer within 30 days of the issue of this order, after payment of fine penalty. iii) The 6130 pieces of Handsfree, Sun Glasses and Spectacle Frames of total value re-determined at ₹ 5,21,707 imported vide bill of entry no 9278929/12.04.2017; 155 pieces of Adaptor and Earphone of total value re-determined at ₹ 5,040 imported vide bill of entry no 9278931/12.04.2017; 8112 pieces of Backcover, Bluetooth, Earphone and Touchpad of total value re-determined at ₹ 3,51,636 imported vide bill of entry no 92789378/12.04.2017 and 12994 pieces of Bluetooth head set , Samsung Cable, Samsung Cable (USB Data Line), Samsung Mini Micro USB Cable, Samsung Integrated Microphone, Travel Adapter and Bluetooth handsfree with USB slot of total value re-determined at ₹ 8,34,653/- imported vide bill of entry no 9278939/12.04.2017 (total amounting to ₹ 17,13,036) be confiscated absolutely as the same were found in contravention of provision of IPR (Imported Goods), Enforcement Rules, 2007. iv) The Re-determined Customs Duty including differential customs duty in respect of Bill of entry No 9278929, 9278931, 9278937 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ), in addition to payment of applicable duty on the goods covered under the aforesaid Bills of entry at the redetermined values as stated above. In the alternate I also give the option for reexport of the imported goods totally amounting to R 12,54,586/- on payment of Redemption Fine of ₹ 2,50,000/- (Rupees Two Lakhs Fifty Thousand only). The redemption of goods for re-export may be exercised by the importer within 30 days of the issue of this order, after payment of fine penalty. iii) The 5000 pieces of Head Phones (handsfree) of total value re-determined at ₹ 3,29,500/- imported vide bill of entry no 9278932/ 12.04.2017, be confiscated absolutely as the same were found in contravention of provision of IPR (Imported Goods), Enforcement Rules, 2007. iv) The Re-determined Customs Duty including differential customs duty in respect of Bill of entry No 9278932 dated 12.04.2017 amounting to ₹ 2,72,354/-, as calculated (excluding counterfeit items) be demanded and recovered under section 28(4) of the Customs Act, 1962 along with appropriate interest under Section 28AA of the Customs Act, 1962. v) I impose penalty amounting to ₹ 3,69,363/- (Rup ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under Section 114A of the Customs Act,1962 for his omission and commission and short levy of Customs duty on account of suppression of facts in terms of quantity, description, classification, brand and value. v) The amount paid vide manual Challans No 259 dated 27.04.2017, in respect of said Bs/E of M/s Prism Enterprise be appropriated against the liability of Customs Duty, Interest or any other liability so may arise. 89. Shri Shivaji Sajerao Salunkhe (the proprietor M/s Prism Enterprise) in respect of the bills of entry No 9278936 dated 12.04.2017: I impose penalty of ₹ 18,000/- (Rupees Eighteen Thousand only) on Shri Shivaji Sajerao Salunkhe under Section 112 of the Customs Act, 1962 for his wilful involvement in illegitimate import of subject goods under seizure. 90. Shri Amit Rajkumar Singhania who appears to be the actual owner in respect of the bills of entry No 9278934, 9278938, 9278942, 9278946 and 9278948 all dated 12.04.2017 filed in name of M/s Amit Enterprise and Bs/E 9278929, 9278931,9278937, 9278939 all dated 12.04.2017 filed in the name of M/s J S Enterprise : i) I impose penalty of ₹ 6,00,000/- (Rupees Six Lakhs only) on Shri Am ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) I impose penalty of ₹ 12,00,000 (Rupees Twelve Lakhs only) on Shri Ashraf Mohammed Husain Kolswalia under Section 114AA of the Customs Act, 1962 for his involvement knowingly and intentionally in making, using and submitting false/ incorrect documents to customs authorities for clearance purposes. 93. Shri Nasir Phundan Khan who is the claimant in respect of the Bs/E 9278936 all dated 12.04.2017 filed in the name of M/s Prism Enterprise : i) His claim of ownership in respect of the Bs/E 9278932 all dated 12.04.2017 filed in the name of M/s Prakash Enterprise be rejected as he has failed to produce/ submit any agreement/ No Objection from M/s Prism Enterprise or its proprietor Shri Shivaji Sajerao Salunkhe. ii) I impose penalty of ₹ 18,000 /- (Rupees Eighteen Thousand only) on Shri Nasir Phundan Khan under Section 112 for his role in respect of misdeclaration of quantity, value, brand and description of the subject import goods, he has thus rendered himself liable to penalty under Section 112 of Customs Act, 1962. iii) I impose penalty of ₹ 3,00,000 (Rupees Three Lakhs only) on Shri Nasir Phundan Khan under Section 114AA of the Customs Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1.3 Early hearing applications filed by the Appellant 1, Appellant 2 and Appellant 3 have been allowed vide Misc Order No M/ 85321-85323/2019 dated 23.04.2019. Hence the matter has been listed and taken up for hearing on 11.06.2019, 0.06.2019, 27.06.2019. While adjourning the matter on request of revenue, bench had specifically recorded: Revenue sought adjournment on the ground that the documents relevant for the appeals are in the process of compilation at the Commissionerate. Accordingly, the matter is adjourned to 01.08.2019 with the direction for not seeking any adjournment on the said date of hearing. It is made clear that if Revenue is not able to produce the relevant documents the appeal will be decided on the available records. 1.4 Finally appeals were heard on 01.08.2019. At the time of hearing the three appeals in which early hearing was allowed, it was brought to the notice of bench that three more appeals against the same order have been filed which are before the single member. Accordingly these appeals were also called for and all six appeals were heard simultaneously and taken up for disposal. 1.5 In table below the details of appellants whose appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7.04.2017 9278936 Prism Enterprise 504246.89 126620.00 19.04.2017 9278934 Amit Enterprise 1443053.00 281474.00 29.04.2017 9278938 Amit Enterprise 1113109.00 222357.10 14.04.2017 9278942 Amit Enterprise 8654486.97 205627.60 15.04.2017 9278944 Amit Enterprise 834085.44 218131.20 13.04.2017 9278946 Amit Enterprise 939096.58 203778.10 15.04.2017 9278948 Amit Enterprise 1295767.98 276129.30 15.04.2017 2.2 After completion of investigations show cause notice was issued to the importers and all other concerned with import of the said goods asking them to show cause as to why the imported goods which ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be sustained. As per the Explanation 1 to Section 28, relevant date for issuing the show cause notice is the date of order for clearance or the date of payment of duty . In the present case since none of the exigency leading to invocation of Section 28 have occurred the demand made under Section 28 is bad in law. Since demand under Section 28 cannot be sustained, the penalty imposed under Section 114A and demand of interest under Section 28AA too cannot be sustained. As per table 27.1 on page 56 of SCN the differential duty demanded is around ₹ 40 Lakhs whereas during the course of investigation for provisional release of the goods they were made to deposit ₹ 90 lakhs. The entire case of revenue against the appellants is based on flimsy and dubious material. No market enquiry report, or panchnama etc has been placed on records. Even the documents sought to be relied upon are illegible and unintelligible. Natural Justice has been violated as they have been denied opportunity of cross examination without any valid and justifiable reason. Penalty under Section 114AA cannot be sustained in view of the decision in case of Bosch Chassis Systems India Ltd [ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods have been confiscated absolutely in terms of Section 111(d), (l) (m) of Customs Act, 1962. Appellants do not seriously dispute the order of confiscation of these goods. b. Imported goods misdeclared in terms of value. These goods have been confiscated but have been allowed to be redeemed on the payment of redemption fine imposed. 4.2 In respect of two importer namely M/s Amit Enterprises and M/s J S Enterprises who are appellants before us in the table below we list the quantum of undervaluation and also the differential duty that is sought to be levied on the importers. B/E No Importer Value Duty Declared Assessed Difference Declared Assessed Difference 9278929 J S Enterprise 11,64,292.62 15,81,720 4,17,427 2,51,397 3,03,471 52,074 9278931 13,09,187.58 18,78,267 5,69,079 2,75,939 4,31, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... based on such manipulated documents is liable to be rejected. Further, a clear relationship has emerged between the main player in this scheme of duty evasion, Shri Amit Singhania that he held interests in the overseas suppliers as well as in the imported goods in 9 of the 12 Bills of Entry in question which renders the declared value of goods liable to rejection. The declared values in the remaining three Bills of Entry were similar and identical to Bills of Entry in which Shri Amit Singhania was involved as the real owner of imported goods and the same had been manipulated and prepared with the active connivance of the CB Shri Manish Barot of Chitalia Logistics Pvt Ltd and hence the declared value in these three Bills of Entry are also liable to be rejected. 4.4 Detailing the process for determination of value, Commissioner has in para 21 observed as follows: 21. Accordingly, valuation of the subject goods in the instant case (except mentioned at Point III of Para 20 above) was done as per the said Rule 7 of the CVR, 2007 and in order to re-determine the value of the goods under seizure, the procedure followed for valuation purpose is: i) A list of unique items o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nds that the case is basically about gross mis-declaration of quantity, description and value; the inventory of seized goods prima facie indicate mis declaration in terms of quantity, description and value and the nature of some of the seized goods figuring in the inventory also prima facie indicated violation of IPR as well as other norms. To sum up it was clear that the case is built on the grounds of seizure of offending goods and so far the factotum of seizure neither appears to suffer from deficiency nor does the offending nature of goods appear mitigated in any manner. Further it is seen that the learning advocate at sort cross examination of departmental officers and shop keepers but the records of case make it clear that none of these persons statement (recorded under the statutory provision of Section 108 of Customs Act) are part of the case file or have been relied upon in the case. Merely by saying that market inquiry is vague, the learned advocate does not prepare the ground for assailing the market enquiry report. In absence of any prima facie case being made out by the learning advocate showing ex facie defect in the market enquiry, I was not inclined to allow cross e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 316977390 Shivaji Sarjerao Salunkhe 6 Mohite Lane, New Jimmy Baug near Nalanda Schooll Lokgram Police Chowky Kalyan East 421306 Prism Enterprise Report dt 22.03.2018 No sign Board. Address and IEC Holder found 25.2 The statements of Shri Jitu Sharad Shirsat, Proprietor of J S Enterprise and Shri Nilesh Ramesh Jadhav, Proprietor of Amit Enterprise were recorded on 27.07.2017 and 15.09.2017 respectively. Inter alai both these IEC holders have admitted that they had no knowledge of the import consignments covered by the above said Bs/E filed in name of J S Enterprise and Amit Enterprise which were seized by the Customs. At the time of address verification, Shri Rahul Prakash Sable Proprietor of Prakash Enterprise Shri Shivaji Sarjerao Salunkhe, Proprietor of Prism Enterprise, refused to have any knowledge of any import consignments filed in their company/ fir s name which were seized by Customs .... 25.4 Prima facie, the manner of the present imports appear to be part of a larger modus operandi of a syndicate of related overseas suppliers and local importers to misdeclared and underval ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... educe the same to ₹ 7,00,000/- (Rupees Three Lakhs Fifty Thousand only). 4.9 In terms of Section 125 (2), it is only after the person given the option to redeem the goods, redeems the said goods then only the question of payment of duty under section 125(2) of the Customs Act, 1962 will come. In case- he does not redeem the goods for clearance in DTA there cannot be question of payment of duty. he redeems the goods but seeks the permission for export of redeemed goods and the permission to export is allowed by the competent person, then also there cannot be any question of payment of duty. Hence the demand of duty made by invoking the provisions of Section 28, prior to redemption of the goods is totally premature. Hon ble Supreme Court has in case of Jagdish Cancer Research Centre [2001 (132) ELT 257 (SC)] laid the law stating as follows: 11. Whenever an order confiscating the imported goods is passed, an option, as provided under sub-section (1) of Section 125 of the Customs Act, is to be given to the person to pay fine in lieu of the confiscation and on such an order being passed according to sub-section (2) of Section 125, the person shall in addit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Owner of Goods 6,00,000 2,00,00,000 2 Proprietor of Firm in whose name B/E filed 2,30,000 - 85,00,000 Firm in whose name B/E filed 23,05,362 - 3 Proprietor of Firm in whose name B/E filed 4,50,000 - 1,80,00,000 Firm in whose name B/E filed 46,03,850 - 4 Custom Broker (CB) 5,00,000 10,00,000 5 Power of Attorney holder Custom Broker 7,50,000 25,00,000 4.11 The sections under which the penalties have been imposed are reproduced below: SECTION 112. Penalty for improper importation of goods, etc.- Any person, - (a) who, in relation to any goods, does or omits to do any act which act or omission would rend ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on, statement or document which is false or incorrect in any material particular, in the transaction of any business for the purposes of this Act, shall be liable to a penalty not exceeding five times the value of goods. 4.12 Commissioner has in para 67 onwards recorded the role of Appellants as follows for imposing penalties- 67. Noticee No 1 M/s Amit Enterprises: The role of Notice No 1 is detailed in para 27.1 of the subject show cause notice. There are six Bills of Entry which were imported under the IEC of Notice No 1. As is already been stated supra, the goods were misdeclared/ non-declared rendering the goods liable to confiscation. I am in full agreement of liability of confiscation of the goods imported under the IEC of Noticee No 1. From the records of case it is clear that Noticee No 1 was simply functioning as a dummy to allow import under its IEC; the premises of Noticee No 1 as mentioned in the IEC was found to nonexistent, no sign board or office or any company in the name of M/s Amit Enterprises was found to be functioning at the said address. Summons and other correspondence were issued to M/s Amit Enterprises but most of them were returned undeli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... notice. There are four Bills of Entry which were imported under the IEC of Noticee No 3. As is already been stated supra, the goods were misdeclared/ non-declared rendering the goods liable to confiscation. I am in full agreement of liability of confiscation of the goods imported under the IEC of Noticee No 3. From the records of case it is clear that Noticee No 3 was simply functioning as a dummy to allow import under its IEC; the premises of Noticee No 3 as mentioned in the IEC was found to nonexistent, no sign board or office or any company in the name of M/s J S Enterprises was found to be functioning at the said address. Summons and other correspondence were issued to M/s J S Enterprises but most of them were returned undelivered with remarks from the postal authority Addressee doesn t residing in this address . Hence I hold that the goods covered under the four bills of Entry of M/s J S Enterprises whose collective value has been re-determined as ₹ 85,17,761/- liable to confiscation under Section 111 of Customs Act. I also hold that the goods contravening the provisions of IPR norm liable for absolute confiscation. It follows that the duty liability on the confiscated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t Noticee No 9 is claimant of goods imported under 9 Bs/E filed by utilizing the IECs of M/s Amit Enterprises/ J S Enterprises; this is further supported by the fact that vide letter dated 3.11.2017 both the entities i.e. M/s Amit Enterprises and J S Enterprises have given sole ownership of the goods covered under the said 9 Bs/E to Noticee No 9. Further the case records including the statements of Noticee No 9 make it amply clear that he was one of the main persons in this sordid saga of smuggling of mobile accessories and other connected goods by utilizing proxy IECs. Although the learned advocate during the course of personal hearing vaguely stated that confessional statements have been retracted, he did not specify as to which statement he was referring. I have perused the case records and I find that not only the retraction was after a considerable time lag, the Revenue 9Supdt of Customs CIU, ACC, Mumbai) had filed an effective rebuttal against the retraction. In view of the aforesaid I do not find any reason to give credence to the retraction as it is basically an afterthought to escape the punitive actions. I hold Noticee No 9 as the person whose acts of commission/ omission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Show Cause Notice. On perusal of the records of the case, I am in full agreement of the role of Noticee as stated in para 27.13 of the Show Cause Notice. Notice No 14 happens to be the lynchpin of this smuggling racket. He is common factor in all the import transactions covered under these adjudication proceedings. His culpability is further aggravated by the fact that he was essaying the role of Custom Broker and therefore he had added responsibility to shoulder which he has not only failed to do but went many steps down the unlawful path by actually facilitating the smuggling. Although the learned advocate during the course of personal hearing vaguely stated that confessional statements have been retracted, he did not specify as to which statement he was referring. I have perused the case records and I find that not only the retraction was after a considerable time lag, the Revenue 9Supdt of Customs CIU, ACC, Mumbai) had filed an effective rebuttal against the retraction. In view of the aforesaid I do not find any reason to give credence to the retraction as it is basically an afterthought to escape the punitive actions. I hold Noticee No 14 as the person whose acts of co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re thus utilized have rendered themselves liable to penalty under Section 112 of Customs Act. I am also of putting it on record that I am considering the sole proprietor of proprietorship firm and the concerned proprietorship firma as a single entity for the purpose of applicability of section 112 of Customs Act, in terms of various precedents set by higher judicial/ quasi judicial authorities. In this regard, I place reliance on the Hon ble judgement in Hasmukh Dalpatrai Ganantara Vs Collector of Customs {1987 (30) ELT 782 Tri Mumbai}. In this context I must put it on record that the material of the case at hand does not indicate that the persons whose credentials were used for obtaining IECs have actively colluded or suppressed facts o made wilful mis-statements, hence I do not find these persons viz the proprietors of the firms in whose name IECs were obtained, to be liable to penalty under Section 114A/ 114AA of Customs Act. But at the same time I am fully conscious of the fact that there was collusion, wilful misstatement as well as wilful suppression of facts in carrying out the smuggling activity by utilizing the proxy IEC; the blame in my opinion rests with the firms whos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nterprises 2,30,000 23,000 3 Nilesh Ramesh Jadhav Proprietor Amit Enterprises 4,50,000 45,000 4 M/s Chitalia Logistics Pvt Ltd 5,00,000 50,000 5 Shri Manish Barot 7,50,000 75,000 4.16 In his written submissions filed after hearing of the matter learned Counsel for appellant have submitted that since the initiation of proceedings Shri Nilesh Ramesh Jadhav Proprietor of Amit Enterprises have expired and hence the proceedings against him and his proprietorship concern should abate. In case of Shabina Abraham [2015 (322) ELT 372 (SC)] following has been held- 24. It is clear that on a conjoint reading of these paragraphs this Court found that the machinery provisions contained in the Bombay Sales Tax Act, 1953, were sufficient to reassess a dissolved firm in respect of income that had escaped assessment before its dissolution. A distinction was drawn between an individual who dies and a firm that is dissolved as a device to evade tax. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of the earlier law. But we thought it advisable to keep section 19(3) of the 1959 Act apart while construing the 1953 Act because it is the Courts, not the legislature, who have to construe the laws of the land authoritatively. As said in Craies on Statute Law : Except as a parliamentary exposition, subsequent Acts are not to be relied on as an aid to the construction of prior unambiguous Acts. (6th Ed., p. 146). The limited use which may be made of the language of Section 19(3) of the 1959 Act, though such a course is unnecessary, is for saying that it serves to throw some light on the Act of 1953, in case the argument is that the Act of 1953 is ambiguous. 36. Section 19(3) being quite clear and explicit, it is unnecessary to dwell on the other provisions of the Act of 1959 in order to show that a dissolved firm can be assessed under it. We may only point out that the Act of 1959 contains provisions similar to those in Sections 15, 15A and 35 of the Act of 1953 on which we have dwelt at some length. Those provisions can be found in Sections 35, 35A and 62 of the Act. 25. A reading of the ratio of the majority decision contained in Murarilal s case (su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e revenue also relied upon the definition of a person under the General Clauses Act, 1897. Section 3(42) of the said Act defines person as under :- (42) Person shall include any company or association or body of individuals whether incorporated or not. It will be noticed that this definition does not take us any further as it does not include legal representatives of persons who are since deceased. Equally, Section 6 of the Central Excises Act, which prescribes a procedure for registration of certain persons who are engaged in the process of production or manufacture of any specified goods mentioned in the schedule to the said Act does not throw any light on the question at hand as it says nothing about how a dead person s assessment is to continue after his death in respect of excise duty that may have escaped assessment. Also, the judgments cited on behalf of revenue, namely, Yeshwantrao v. The Commissioner of Wealth Tax, Bangalore, AIR 1967 SC 135 at pages 140, 141 para 18 : (1966) Suppl. SCR 419 at 429 A-B, C.A. Abraham v. The Income-Tax Officer, Kottayam Another, AIR 1961 SC 609 at 612 para 6 : (1961) 2 SCR 765 at page 771, The State of Tamil Nadu v. M.K. Kanda ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 31. The impugned judgment in the present case has referred to Ellis C. Reid s case but has not extracted the real ratio contained therein. It then goes on to say that this is a case of short-levy which has been noticed during the lifetime of the deceased and then goes on to state that equally therefore, legal representatives of a manufacturer who had paid excess duty would not by the self-same reasoning be able to claim such excess amount paid by the deceased. Neither of these reasons are reasons which refer to any provision of law. Apart from this, the High Court went into morality and said that the moral principle of unlawful enrichment would also apply and since the law will not permit this, the Act needs to be interpreted accordingly. We wholly disapprove of the approach of the High Court. It flies in the face of first principle when it comes to taxing statutes. It is therefore, necessary to reiterate the law as it stands. In Partington v. A.G., (1869) LR 4 HL 100 at 122, Lord Cairns stated : If the person sought to be taxed comes within the letter of the law he must be taxed, however great the hardship may appear to the judicial mind to be. On the other hand, if the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No 15) held the position of director, he (noticee no 15) utterly failed in his responsibility in ensuring that noticee no 14 acted in compliance of norms mandated under Customs Act and rules/ regulations made thereunder. This failure on the part of noticee no 15 ultimately resulted in unlawful import transactions which are the subject matter of this adjudication proceedings. Hence I hold the noticee no 15 liable to penalty under Section 117 of the Customs Act. Section 117 of the Custom Act, 1962 reads as follows: Penalties for contravention, etc., not expressly mentioned. Any person who contravenes any provision of this Act or abets any such contravention or who fails to comply with any provision of this Act with which it was his duty to comply, where no express penalty is elsewhere provided for such contravention or failure, shall be liable to a penalty not exceeding one lakh rupees. From the reading of the said section it is quite evident that penalty under this section could be imposed only for contravention of the provisions of the Custom Act, either directly or indirectly by abetting in such contravention or for failure to comply with the provi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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