ASHWANI KUMAR JAIN Vs. CCE

JUDGEMENT

(1.) THESE three miscellaneous applications have been filed by Shri Ashwani Kumar Jain, M/s Agemo Leather Components (P Ltd., and M/s Sukumar Chemicals (P) Ltd.,

(2.) UNDER the adjudication order No. 13/Commr/2000 dated 10.10.2000 Commissioner of Customs had imposed penalty of Rs. 5 crores on Shri Ashwani Kumar Jain and Penalty of Rs. 1.25 crores and penalty of Rs. 75 lakhs on M/s Sukumar Chemicals (P) Ltd., and penalties of Rs. 1.75 crores and Rs. 75 lakhs on M/s Agemo Leather Components (P) Ltd., on the ground that they have attempted to export readymade garments and watches under claim of drawback by giving false description of readymade garments and over invoicing export goods for claiming undue drawback and DEPB benefits. The watches and the readymade garments which were found in the form of rags or made out of cheap old fabrics were also confiscated under the said order. All the three persons involved in the adjudication order filed appeals before the Tribunal but their appeals were dismissed under final order No. A/758 -760/2000 -NB (D) dated 3.9.2001 on the ground that they have not complied with the stay order No. S/281 -283/0l -NB(DB) dated 20.6.2001.

(3.) UNDER the stay order No. S/281 -283/01 -NB (DB) dated 20.6.2001, Shri Ashwani Kumar Jain was directed to pre -deposit an amount of Rs. 1 crore, M/s Agemo Leather Components (P Ltd., were directed to pre -deposit an amount of Rs. 75 lakhs and Rs. 20 lakhs and M/s Sukumar Chemicals (P) Ltd., were directed to pre -deposit an amount of Rs. 50 lakhs and Rs. 20 lakhs out of the penalties imposed on them. All the three applicants had gone to Allahabad High Court against the stay order No. S/281 -283/01 -NB (DB) dated 20.6.2001. After considering all the submissions made by all the three applicants before the Hon'ble Allahabad High Court in Writ Petition No. 979 to 981 of 2001 the Hon'ble Allahabad High Court under order dated 14.10.2004 rejected their all the contentions and held that their argument that the petitioner should not be asked to deposit any amount in view of the pending claim with regard to duty drawback lacks merit. The Hon'ble High Court has observed: It was also submitted that the petitioners are entitled for the duty draw back and the department is illegally withholding the same on the earlier exports. An opportunity was given to the department to file a reply. The department has come out with the case that entitlement of the petitioner to receive the duty draw back, is very much in dispute. The department is disputing the claim of the petitioner. A writ petition for direction for payment of duty draw back was also filed. The said writ petition was dismissed by the Division Bench of this Court and the Supreme Court has also rejected Special Leave Petition. Therefore the said argument that the petitioner should not be asked to deposit any amount in view of pending claim with regard to duty draw back lacks merit. As regards their financial position the Hon'ble High Court observed as under: It was then submitted that the petitioners are not in a financial position to deposit the amount as directed by the impugned orders as a condition precedent for hearing of the appeals filed by them before the respondent No. 1. It was contended that the respondent No. 1 has not taken into account the hardship placed before it. This argument at the first instance appears to be attractive but on deeper probing it does not hold water. In Paragraph 4 of the writ petition No. 979 of 2001 the petitioners have given magnitude of their export business. On their own showing in a period of about two months M/s Agemo Leathers (P) Ltd., had affected export sale worth Rs. 13 crores and in a period of about nine months M/s Sukumar Chemicals (P) Ltd., has made export sale worth Rs. 27 crores. Thus the petitioner according to their own showing made export sale worth approximately Rs. 40 crores up to 31.08.1998. These are admitted figures of the petitioners. It has been further admitted that the petitioners have received the aforesaid amount through their bankers. Meaning thereby that the petitioners were possessed of about Rs. 40 crores. Search operation is dated 14 15th September 1998. These undisputed facts have to be kept in mind to decide the question of grant of partial waiver by the respondent No. 1 in appeals. The petitioner have not given details and particulars where Rs. 40 crore have gone. The Tribunal in para 10 of its order has observed that plea of appellants regarding financial hardship also cannot be on the face of it taken to be true so as to allow them total waiver of pre -deposit of the penalty amount. This observation of the Tribunal clearly shows that even though the Tribunal was not satisfied with the plea of financial hardship raised by the petitioner, yet as a matter of grace granted partial relief. The Tribunal in the appeal of Ashwani Kumar allowed the waiver to the extent of 80% and directed him to deposit only 20% of the disputed amount. On the facts of the case it cannot be held that the Tribunal mis -directed itself and committed illegality in not granting full waiver or there is no application of mind by the Tribunal. Similarly in the appeal filed by M/s Agemo Leather Components (P) Ltd., and M/s Sukumar Chemicals (P) Ltd., the Tribunal has waived more than 50% of the disputed amount of penalty by the impugned order. Thus, after considering all the arguments the Hon'ble High Court finally passed the following order: After the close of hearing of argument an affidavit dated 23.9.2004 was filed on behalf of the petitioner. Paragraph 4 of the said affidavit reads as under: