TMI Blog2024 (4) TMI 831X X X X Extracts X X X X X X X X Extracts X X X X ..... knowledge of the undue benefit that the exporter was availing by mis-declaring the goods and the value. They also stated that remittances were received without any proof of the same. The exporter had not disputed the alleged offence nor had contested the alleged offence of misdeclaration of goods and value. Shri Surendran (Appellant 1) having arranged containers and advising them to ensure factory sealing so that it is not opened at ICD Bangalore; arranging a CHA and getting the blank shipping bills signed by the CHA admittedly for monetary consideration; getting a letter from the exporter not to export substandard goods and charging unusually high price for containers, all goes to prove the mala fide intention behind these exports. Moreover, the same team has worked for similar exports at Hyderabad ICD, thus, without doubt all the circumstantial evidences clearly prove their involvement in mis-declaring goods and value for undue DEPB benefit. Shri Ashok Shukla (Appellant 2) also admits having sublet his license for monetary consideration, signing of blank shipping bills and allowing his license to be used without knowing the exporter and what for it is being used goes to prove th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... derabad. Based on suspicion, the officers attached to Hyderabad Commissionerate intercepted a consignment of export goods declared as Ladies nightwear covered under 4 shipping bills filed at ICD Hyderabad. On examination of the consignment, it was noticed that the consignments were actually cloth pieces irregularly shaped, made out of leftover rags of various textile materials and not fit to suit the declaration as well as its value. Investigation proceedings were initiated against the exporter for fraudulent export. Simultaneously, investigations were caused at Bangalore to examine the previous exports of M/s. Globe Fashions (Exim) India. Investigations at Bangalore revealed that the said exporter had undertaken export of similar goods under 31 shipping bills from ICD Bangalore and adopted similar circuitous route as in the case of exports from Hyderabad of sending empty containers from Bangalore to Goa and after stuffing at Goa instead of exporting from Goa or any nearby port had undertaken the exports through ICD Bangalore. 2. Shri. D. Surendran, Proprietor (Appellant 1) of M/s. Trans Asia Shipping Service, Bangalore in his statement dated 12.4.2004 stated that he was using the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith the said exporter nor had any dealings with them, that he dealt with Shri D. Surendran to whom he had given blank signed shipping bills on the assurance that the dealings by the exporter would be bona fide, he was not aware that empty containers were sent from Bangalore to Goa for stuffing and brought back to Bangalore for customs clearance, he had not taken any permission from customs for taking containers outside Bangalore and that he had signed 35 blank shipping bills for the said exporter, of which 4 bills were cancelled, that he admits the seizure of blank shipping bills which are purchased by Shri D. Surendran and later signed by him was all done in order to help Shri Sanjeev and Shri Muralidharan when they had applied for identity cards to carry out customs clearances by showing them as their employees. Shri Ashok Shukla (Appellant 2) in his further statement dated 26.4.2004 stated that he had shown Shri Praveen Kumar of M/s. Silver Sands and Shri Sudheer of M/s. Peak International, as their employees to get ID cards from the department to undertake customs clearances and that it was a mistake to give blank signed shipping bills to them. 4. Based on the investigations an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ficers have detected a consignment at ICD Hyderabad and found that it contains substandard material and based on that investigation, investigations were conducted at ICD Bangalore and reviewed the exports affected by the same exporter through Bangalore and held that the appellant had abetted in exporting the substandard goods and consciously facilitated the alleged crime. It is stated that the Commissioner has held them guilty purely on suspicion and there is no evidence whatsoever that the goods exported through ICD Bangalore were overvalued or mis-declared, the appellant had taken abundant precautions to get a letter from the exporter confirming that there would not be any discrepancy in the declaration. This declaration has been misinterpreted by the authorities that it was a deliberate effort to insulate the appellant and it is also alleged that the appellant had charged Rs.75,000/- Per container from the exporter which is exorbitant. The Counsel further states that this amount included freight to be paid to the foreign carrier and therefore, it cannot be questioned. It is also claimed that they had no knowledge regarding the alleged inferior quality of the export goods and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as seen from the records placed before us. 8. The appellant 1 (Shri Surendran) Proprietor of M/s. Trans Asia Shipping Services Pvt. Ltd. had arranged for the containers from Bangalore to Goa and after stuffing at Goa, the containers were exported from ICD Bangalore. It is admitted by the Appellant 1 (Shri Surendran) that he utilised the services of M/s. Cargo Travel Services Pvt. Ltd. who was registered as a CHA and he got the blank shipping bills signed by Appellant 2 (Shri Ashok Shukla, Director of M/s. Cargo Travel Services Pvt. Ltd.). He filed the shipping bills and arranged for the clearance of goods through his employees Shri Sanjeev and Shri E. Muralidharan. He also managed to get identity cards from the Customs Department by falsely claiming that they were employees of M/s. Cargo Travel Services Pvt. Ltd. Appellant 1 in his statement admitted that he had met Proprietor of M/s. Global Fashions (Exim) India and had suggested to him that the container can come under factory stuffing procedure from Goa, so that it can easily be exported from ICD Bangalore. He also admitted that he had taken collected Rs.75,000/- which is unusually high for arranging the transportation of the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the goods to confiscation under Section 113 of the Customs Act, 1962. By virtue of Section 23A of the Foreign Exchange Regulation Act, 1947, the provisions of Sections 113 and 114 of the Customs Act, 1962 are attracted when there is a contravention of Section 12(1) of the Foreign Exchange Regulation Act, 1947 in relation to goods which had in fact been exported. In the present case, the goods were fraudulently exported and the appellants had abetted and misused the provisions to enable the exporter for ineligible benefit under the DEPB scheme which warrants penalty under Section 114 of the Customs Act ,1962. 13. Sections 113 and 114 of the Customs Act, 1962 are reproduced for ready reference: SECTION 113. Confiscation of goods attempted to be improperly exported, etc. The following export goods shall be liable to confiscation:- (a) any goods attempted to be exported by sea or air from any place other than a customs port or a customs airport appointed for the loading of such goods; (b) any goods attempted to be exported by land or inland water through any route other than a route specified in a notification issued under clause (c) of section 7 for the export of such goods; (c) any 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e made under this Act for carrying out the purposes of that Chapter have been contravened.] Section 114. Penalty for attempt to export goods improperly, etc. - Any person who, in relation to any goods, does 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, - (i) in the case of goods in respect of which any prohibition is in force under this Act or any other law for the time being in force, to a penalty 1[2[not exceeding three times the value of the goods as declared by the exporter or the value as determined under this Act]], whichever is the greater; 3 [(ii) in the case of dutiable goods, other than prohibited goods, subject to the provisions of section 114A, to a penalty not exceeding ten per cent. of the duty sought to be evaded or five thousand rupees, whichever is higher: Provided that where such duty as determined under sub-section (8) of section 28 and the interest payable thereon under section 28AA is paid within thirty days from the date of communication of the order of the proper officer determining such duty, the amount of penalty liable to be paid ..... 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