The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Ahmedabad bench in the issue of misdeclaration of the country of origin to evade Anti-Dumping Duty (ADD) had quashed customs penalty without evidence.
The Directorate of Revenue Intelligence (DRI), booked a case against Mr. Nalin Mehta, Director of M/s Mehta Impex Pvt. Ltd., Mumbai alleging that he evaded anti-dumping duty on vitrified tiles imported by mis-declaring the country of origin as Malaysia, instead of China. Consequently, three Show Cause Notices were issued inter-alia raising demand for anti-dumping duty jointly and severally on Nalin Mehta and Shobha Plastics Private Limited.
The demand was set aside by Tribunal with a direction to the Commissioner to fix the responsibilities of every individual separately. Thereafter Commissioner held Nalin Mehta to be the real importer of the goods and fixed duty liability upon him along with interest and penalties and further imposed a penalty under section 112(a) of the Act on Mr. Jayesh Mehta and Mr. Harshad Vadodaria and further appropriated amounts deposited during the investigation on behalf of Shobha Plastics Pvt Limited against the duty and interest liabilities which was fixed upon the importer Nalin Mehta. Aggrieved, appellants Shobha Plastics Pvt Limited, Mr. Harshad Vadodaria, and Mr. Jayesh Mehtaapproached CESTAT.
The counsel for the appellants submitted that the Commissioner in the second round of litigation has held Nalin Mehta as the importer of the goods and accordingly he was held liable to pay the duty, the department has not preferred an appeal against the said order and hence the said position has attained finality. The appellants admittedly had no role as regards the transaction that was entered by the importer with the supplier of the goods nor is there any evidence to show that present appellants were in any way aware of the fact that anti-dumping duty was sought to be evaded by the importer of the goods.
The Tribunal observed that there is no reliable and corroborative evidence to establish that appellants herein knew that goods imported were of Chinese Origin, in that view it cannot be said that appellants herein have committed any act or omission, which rendered the goods liable to confiscation, accordingly penalty under section 112 (a) cannot be sustained.
Mr. Ramesh Nair, Member (Judicial), and Mr. Raju, Member (Technical)by relying on the decision in Amrit Foods V. Commissionerhave held that “the impugned order to the extent it is against the present appellants is not sustainable, hence the same is set aside”.
Advocate Mr. Rahul Gajera appeared on behalf of the appellant and Mr. Dinesh M. Prithiani appeared on behalf of the Respondent.
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