AIRTRAVEL ENTERPRISES INDIA LTD. Vs. CC

JUDGEMENT

(1.) IN these applications accompanying captioned appeals, M/s. Airtravel Enterprises India Ltd., seek waiver of predeposit and stay of recovery of penalties imposed on them in the two orders impugned in the appeals. The CHA was found in the impugned orders to have abetted overvaluing of the export goods namely T -shirts and facilitated attempts by fraudulent exporters to obtain huge amounts of undue drawback. In both the cases, the same persons were involved in the transactions. In appeal No. C/437/06, shipping bills had been filed in the name of one firm by name M/s. Extreme. In the second case, the exporting firm was shown to be M/s. Lucky Exports.

(2.) THE facts in both the cases are that one Shri T.E. Dhanasingh had been introduced to Shri C.V. Suresh, Dy. Manager of the appellant firm by one of the friends of Shri. Suresh. Shri T.E. Dhanasingh introduced one Shri C. Balasundaram alias Balu to Suresh. Shri C. Balasundaram procured T -shirts from one Shri D. Jothimani. Shri C.V. Suresh helped Shri Dhanasingh to prepare the documentation for export of the T -shirts purchased. The value of the T -shirts declared in the shipping bills in both the cases were found to be several times higher than their actual price ascertained on market enquiry. The number of T -shirts declared in the shipping bills was also higher than the actual number of T -shirts found on examination. In the case covered by the appeal No. E/437/06, the value declared was Rs. 8,97,156/ - as against the ascertained value of Rs. 1,20,000/ -; the number of T -shirts declared in the shipping bills was 4320 pieces, whereas the actual number of T -shirts found on examination was only 3000 pieces. In the case covered by the appeal No. E/438/06, the value declared was Rs. 58,61,864/ - as against the ascertained value of Rs. 5,33,146/ -; the number of T -shirts declared in the shipping bills were 33504 pieces, whereas the actual number of T -shirts found on examination was only 28,224 pieces. The consignments had been examined on intelligence received and the attempted fraud unearthed. The exporting firms entered in the shipping bills were non -existent. Further, investigation conducted revealed that Shri T.E. Dhanasingh had sourced the T -shirts for export through Shri. C. Balasundaram from one Shri. D. Jothimani. In the statements recorded from S/Shri C. Balasundaram and T.E. Dhanasingh they confessed the modus operandi they had planned to follow for undue gain. After due process of law, a Show Cause Notice issued in this connection was adjudicated by the Commissioner confiscating the export goods and penalizing the exporter on record, Shri. T.E. Dhanasingh, Shri. C. Balasundaram, CHA M/s. Airtravel Enterprises India Ltd. and Shri. C.V. Suresh, (Sic).

(3.) IN the appeal filed on behalf of the CHA, it is claimed that the CHA had not taken any active part in the attempted illegal export. The Commissioner found that the CHA had facilitated the concerned persons in filing shipping bills for the consignments in question. The CHA had undertaken the export documentation without obtaining authorization from the exporters. Even after noticing the discrepancies as regards the exporter's name, IEC and Pan No. etc. entered in the shipping bills, Shri C.V. Suresh, authorized representative of the CHA assisted the attempted illicit export. He found that the CHA had colluded with the other persons involved. The CHA had failed to comply with the provisions of Regulation 13 of CHALR as they had filed export documents without verifying the existence of the exporter and allowed Shri T.E. Dhanasingh to sign the shipping bills as proprietor without obtaining any authorization. He had done this knowing the fact that Shri T.E. Dhanasingh was not the real proprietor of the firm. Accordingly, the Commissioner found the CHA to be liable for penal action under Section 114 and Section 117 of the Customs Act. As regards Shri C.V. Suresh, the adjudicating authority found that he had taken personal initiative in the commission of the offending transactions. Penalties of Rs. 25,000/ - under Section 114 and Rs. 5,000/ - under Section 117 were imposed on the CHA in the order impugned in appeal No. E/437/06 and penalties of Rs. 1,00,000/ - under Section 114 and Rs. 10,000/ - under Section 117 of the Customs Act were imposed on the CHA in the order impugned in appeal No. E/438/06.