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TMI Blog2006 (6) TMI 132X X X X Extracts X X X X X X X X Extracts X X X X ..... s the penalty imposed under section 112(b) of the Customs Act (hereinafter referred to as the "Act") is concerned. 2.1 The brief facts of the case are stated as under. The appellant is an indenting agent of importer with respect to various textile materials from abroad. As per the Customs Notification No. 21/2002 dated 1-3-2002, vide 31.168, exporting firm which are registered with Apparel Export Promotion Council (in short "AEPC") can import the lining materials free of duty upto 2% of the Freight On Board (for brevity "FOB") value of the export of textile garments made in the previous year. The AEPC will issue certificate to the exporting firm certifying the value of the exports made during the previous financial year. The duty fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anufacture of textile garments, vide the conditions referred to above. 2.4 The appellant, who is an indenting agent of various exporting firms which are registered with the AEPC, after collecting all the necessary documents from the importers for the import of polyester lining fabrics, cleared the imported goods by availing exemption under notification No. 21/2002 dated 2-3-2002 and after taking delivery of the imported goods, diverted the same to the local market. 2.5 As the goods imported availing concession under notification No. 21/2002 dated 1-3-2002 were not used in the manufacture of textile garments and diverted to domestic market in contravention of the notification, the same are liable to be confiscated under Section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the same to the local market, as admitted by the importer as well as indenting agent before the customs, upheld the penalty imposed by exercising the power under Section 112 of the Customs Act. 2.10 Aggrieved by the said order, the appellant/indenting agent has preferred these appeals raising the following substantial questions of law. (i) Whether before penalty can be imposed the entirety of the circumstances must reasonable point to the conclusion that the appellant involved in dealing with the goods consciously or knowingly? (ii) Whether penalty can be imposed under Section 112(b) of Customs Act in the absence of mensrea? and (iii) & ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ect of which the value stated in the entry made under this Act or in the case of baggage, in the declaration made under section 77 (in either case hereafter in this section referred to as the declared value) is higher than the value thereof, to a penalty not exceeding the difference between the declared value and the value thereof or five thousand rupees, whichever is the greater; (iv) in the case of goods falling both under clauses (i) and (iii), to a penalty not exceeding the value of the goods or the difference between the declared value and the value thereof or five thousand rupees, whichever is the highest; (v) in the case of goods falling both under clause ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d collected the AEPC certificate and other documents from the importer of polyester lining fabrics from the various importers, cleared the imported goods by availing the duty concession under notification No. 21/2002 and after delivery of the imported goods, diverted the same to the local market as per the materials available before the authorities, the contention that he had not dealt with the goods consciously or knowingly or he had any mensrea in that regard nor he had any requisite knowledge of confiscability of the goods, is not tenable, when the appellant himself had fairly conceded the above violation before the authorities concerned. 4.3 The appellant, thus, having contravened the conditions stipulated in the notification No. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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