The Delhi High Court rejected the letter for withdrawal of shipments on the lack of corroboration with evidence.
M/s Bhavana Jindal Exim Pvt Limited (appellant) is, engaged in the business of exports. S.K. Jindal (appellant) is one of the directors of the company. The appellants have filed the present appeals impugning an order passed by the Customs, Excise and Service Tax Appellate Tribunal( CESTAT) , New Delhi, in the respective appeals preferred by the appellants.
The controversy arises in the context of two shipping which were filed by the company’s CHA related to shipment of ‘Leather Apparels and Leather Gents Long Jacket’, which were being exported to M/s Unimax Handbags, Los Angeles.
It is the respondent’s case that DRI Officers, on the basis of some intelligence, examined the goods and on visual examination, found that those goods were old and used. Thereafter, the statement of S. K. Jindal was recorded and it is apparent from the said statement that he admitted that the goods, which were being exported were old.
The Show Cause Notice was issued calling upon the appellants to show cause why penalty under Section 114 of the Customs Act, 1962 not be imposed. It was alleged that the goods were over-valued to avail a higher duty drawback.
The counsel appearing for the appellants submitted that although it is admitted that the goods in question are not new but the appellants had not admitted that the goods were used. The appellants’ defence rests on their claim that the company had sent a letter requesting permission for withdrawal of both the shipments and it was contended that since the appellants had sought withdrawal of the export shipments, no mens rea could be attributed to them
The Coram consisting of Justices Vibhu Bakhru and Amit Mahajan noted that “In our view, that makes little difference as there is no real dispute that the goods were over-valued.”
“The reasons provided by the appellant for withdrawal of the export shipments was that the buyer had cancelled both the shipments / cargo due to late delivery. This did not conform with the explanation that the appellants had sought permission to withdraw the shipments on becoming aware that the goods being dispatched were old and over-valued” the Bench observed.
The Court concluded by saying that “There is no dispute that the said letter was not produced before the adjudicating authority. The Commissioner (Appeals) had found that the delivery of the letter to the department is itself doubtful apart from the fact that the letter did not corroborate the explanation as provided by the appellant.”
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