The Principal Bench of New Delhi Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has held that documents stating the name of the importer become valid when the statement u/s 138 B of the Customs Act, 1962 turns irrelevant.
The Appellants were represented by Shri Sansar Chand and Shri Mohinder Singh and the Respondent was represented by Shri Rakesh Kumar.
Eighteen (18) bills of entry were filed by M/s K R Express Pvt Ltd. who is a licensed customs broker in the name of M/s Samay International. All the documents such as bills of lading, invoices, and Import General Manifest were in the name of M/s Samay International. The goods were cleared after assessment by the assessing officers.
As per the intelligence of DRI, no imports were being made at all after remittances and no bills of entry were also filed and the money so remitted abroad was being adjusted against the undervalued imports by other importers.
Investigations were initiated and the statement of Shri Mukesh Arora recorded under section 108 of the Customs Act, confirmed that they would use bogus firms to transfer money abroad one such firm is M/s Samay International which has a bank account in ICICI Bank. He further confirmed that the M/s Samay International was created by him along with his partner Shri Bobby in the name of one Shri Anil Kumar and the importer exporter code was obtained.
The Tribunal found that the differential duty has been demanded in this case from the customs broker, KR Express and Shri Pradeep Kumar along with interest which was impermissible to charge duty from 2 or 3 persons without identifying who the importer is.
As per the documents, M/s Samay International is the importer. The statements made before the officer by various persons have not been subjected to Section 138 B and hence are not relevant.
It was observed that in all the relevant documents, M/s Samay International was the importer and the statements contradicting this are not relevant given section 138B and the differential duty can only be demanded from the importer and not from others.
The Tribunal viewed that the term “beneficial owner” has been defined in the Customs Act and the term “importer” was enlarged to include “beneficial owner” only from 2017 and not during the relevant period and found that even the confiscation is not sustainable as the allegation of under-valuation itself is not sustainable.
The penalties imposed on all are set aside by Justice Dilip Gupta, president and P V Subba Rao, member (technical), the appeal filed by the revenue is dismissed and appeals filed by Shri Joginder Kumar, Shri Surinder Kumar, M/s K R Express and Shri Pradeep Kumar were allowed with consequential relief.
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