K.K. ARORA Vs. COMMISSIONER OF CUSTOMS

JUDGEMENT

(1.) HEARD both sides.

(2.) IN all these appeals, the appellants have raised a common question about imposition of penalty for not fulfilling the export obligation.

(3.) M /s. Pharmed Chemicals Limited, having their factory at Sipcot Industrial Area, Hosur, Tamilnadu and their office at Pharmed Gardens, White -field Road, Bangalore have imported several consignments of chemicals have imported 1050 kgs of Pivaloyl Chloride vide Bill of Entry No. 006662 -IMP -B, dated 18 -9 -1995 a Mumbai against Advance License No. 1533488, dated 2 -8 -1995. They have failed to fulfil export obligation in respect of Advance License and instead diverted the duty free imported material into local market and also to their own sister concerns M/s. Medicare Pvt. Ltd. and M/s. Pharmed Limited. A case was made out by DRI, Zonal Office Bangalore against the importers. A show cause notice was issued under Section 124 and Section 24 of Customs Act, 1962 by the Joint Director of DRI on 30 -9 -1999 to all concerned including two Directors of M/s. Pharmed Chemicals Limited proposing to deny the benefit of Notification No. 80/95, dated 31 -3 -1995 against the imports which have taken place duty free under Advance License, demand of customs duty foregone for imports made under DEEC amounting to Rs. 48,716/ - and imposition of penalty on all of them.