The Delhi Bench of the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) upheld the penalty levied on the misdeclaration of goods in order to avail ineligible drawback. The Appellant Jayant Vikram had filed benami shipping bills with mis-declared quantities and values at the behest of Shri Ashok Sharma.These information getting from Directorate of Revenue Intelligence who said that certain exporters were mis-declaring the description quantity and value of export consignments in order to avail ineligible drawback.
Acting on this intelligence, the goods sought to be exported under shipping bills filed in the name of one M/s Delight Fashions were examined. It was found during examination that not only was the nature of goods different from the declaration, but the values were highly inflated.
Accordingly the Additional Commissioner passed the order-in-original rejecting the declared value, re-determining it, reducing the drawback, confiscating the export goods, but allowing their redemption payment of fine. He also imposed penalties on various persons including Rs. 5,00,000/- on the appellant under section 114 (iii) and 114AA of the Customs Act.
Aggrieved by the order the appellant filed appeal before the tribunal.
Abraham Markos, Counsel for appellant submitted that the appellant was the Manager of the CHA who filed the shipping bills. If the Shipping Bills had been filed in good faith after taking the normal precautions expected of a CHA and without any knowledge about the fraud or mis-declaration, the CHA or its employees would not have been liable to penalty.
Further the counsel argued that the appellant was the Manager of the CHA who filed the shipping bills. If the Shipping Bills had been filed in good faith after taking the normal precautions expected of a CHA and without any knowledge about the fraud or mis-declaration, the CHA or its employees would not have been liable to penalty.
Nagendra Yadav, Counsel for the department, supported the order of lower authorities.
It was observed by the tribunal that The appellant’s submission that he did not abet the commission of any offense under section 114 (iii) of the Customs Act also cannot be accepted for the reason that the appellant had filed benami shipping bills with mis-declared quantities and values at the behest of Shri Ashok Sharma.
It is the discovery of this mis-declaration which rendered the goods liable for confiscation. Therefore, the appellant was liable to penalty under section 114 (iii) of the Customs Act.
Further the bench observed that this section provides for a penalty for willfully mis-declaring facts in any declaration before the customs authorities which the appellant did.
A Two-Member Bench comprising Justice Dilip Gupta, (President) and P.V. Subba Rao, (Technical Member) upheld the penalty levied on the misdeclaration of goods in order to avail ineligible drawback.
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