MUKESH K. AGGARWAL Vs. COMMISSIONER OF CUSTOMS

JUDGEMENT

(1.) THESE four appeals arise out of cases relating to import of Audi 80 Cars from M/s. Volkswagen, Germany. The cars were assessed and cleared. Investigation into these imports was taken up by the Directorate of Revenue Intelligence in November 1989 when it was noticed that the cars were actually of higher engine capacity, and that the price declared in the invoice was lower than the actual purchase price/commercial price and that the imports had been basically organised and managed by Shri Sadiq A. Futehally, proprietor of M/s. Ashiya Motors. The main evidence gathered during the investigation was that the actual cubic capacity of the engines was found to be in excess of that declared (declared CC was 1595 while it was found that the actual cubic capacity was around 1800 CC), on the basis of test conducted by IIT, Mumbai and other institutions and on the basis of technical literature. With regard to import policy, the main evidence was that, although import of cars was permissible only by NRIs who had paid for the cars in question from their earnings abroad, many stated that Shri Futehally of M/s. Ashiya Motors had paid some commission for permitting use of their names, but the entire import and sales were carried out by Shri Futehally. Based on the above evidence, show cause notices were issued proposing re -assessment/of the cars based on their correct value as well as correct rate of duty applicable to cars of engine capacity in excess of 1600CC. The notices also proposed confiscation of the cars, and imposition of penalties on Shri Sadiq Futehally and the persons in whose names the imports were made. The notice issued to Shri Mukesh K. Agarwal (along with Dr. Merwyn C. Fernandez, Shri Ashwin Shah and others including Shri Futehally) was adjudicated by the Collector of Customs, Nhava Sheva, who confiscated the cars with option to redeem on payment of a fine and also imposed penalties on the importers as well as penalty on Shri Sadiq Futehally. Confiscation was ordered on the ground of misdeclaration of assessable value. This has given rise to appeal C/2632/90 by Shri Mukesh K. Agarwal. Notices issued to the NRIs, Shri Sushil K. Jolly, Dr. Yashwant R. Kher, Shri Kadri Aminuddin and Shri Govindbhai D. Patel were adjudicated by common order of the Collector, confiscating the cars with option to redeem on payment of fine by the purchasers of the cars in India and imposing penalties of Rs. 5,00,000/ - each on Shri Sushil K. Jolly, Shri Kadri Aminuddin and Shri Govindbhai Patel and penalties of Rs. 2,00,000/ - in respect of each of the show cause notices, on Shri Sadiq Futehally. Appeal C/502, 504 and 507/93 have been filed by Shri Sadiq Futehally against imposition of penalties in relation to cars imported by Shri Sushil Jolly, Dr. Yashwant Kher and Shri Kadri Aminuddin.

(2.) WE have heard both sides and perused the records.

(3.) THE preliminary objection raised by Shri Baxi to the hearing of the appeals by learned Member (Technical), Shri Moheb Ali M., on the ground that he was associated, as Deputy Director General of DRI, with the investigation of this case, is overruled, in view of the fact that the issues in dispute in these appeals stand settled by virtue of the Tribunal's order No. 678 -735/2004 -NB(A) dated 2 -7 -2004 [2004 (178) E.L.T. 861 (Tribunal)] in the case of Sadiq A. Futehally and others.