A. VAIYAPURI Vs. COMMISSIONER OF CUS. (SEAPORT), CHENNAI

JUDGEMENT

(1.) The appeals are directed against two Orders -in -Originals passed by Commissioner of Customs, Chennai. As the issue is common in both the appeals, they are taken up together for disposal. The appellant filed appeals against imposition of penalty. Appellant was working as a Branch Manager, Bank of Madura, Bangalore. The facts of the case relate to import of "Mulberry Raw Silk" in the guise of "Duppion Silk" and also misuse of DEEC scheme by the importers. The adjudicating authority in his orders dated 27 -1 -2002 and 8 -2 -2002 confirmed the demand and ordered for confiscation of the goods and also imposed penalty on importer and also on various co -noticees and imposed penalty of Rs. 1 lakh imposed on the appellant in each appeal under Sec. 112(a) as well as under 112(b) of the Customs Act. I find that there are no appeals filed by other importers and co -noticees. Therefore, this order is confined only to the present appeals filed by appellant against imposition of penalty.

(2.) Heard both sides. Ld. Advocate for the appellant submits that appellant was working as a Branch Manager and issued only Bank Guarantee to the importers. He relied paras 6, 10, 12 and 39 of OIO dated 8 -2 -2002. The appellant has not contravened any of the provisions of the Customs Act and no allegations have been brought out either in the SCN or in the adjudication order. In the second appeal, the SCN has invoked the provisions of Sec. 112(a) for penalty whereas the penalty was imposed under Sec. 112(b). The department failed to bring out omission and commission of the appellant in relation to the imported goods in contravention of any of the provisions of Central Excise Act. Even if there is any violation under banking regulations, Customs Act cannot be invoked for imposition of penalty. Further, he submits that there was no forgery of bank guarantee or any fraudulent issue of bank guarantee as the department have already enforced the said bank guarantee and realised the money from the bank towards the realisation of dues. He also submits that this is not a case where any licence was issued and misused by appellant. He further submits that the only violation brought out in the orders is violation of banking regulations. Therefore, appellant being bank employee who acted bonafidely cannot be imposed penalty under Customs Act and there is no forgery of BG or fraudulent issue of BG. He submits that appellant was already suspended from the bank and removed from the services in 2002. He relied on the following citations: -

(3.) On the other hand, ld. AR for the Revenue reiterated the findings and submits that bank guarantee is nothing but cash payment for clearances for duty free goods under DEEC. Importers have imported the goods by execution of bank guarantee to clear the goods under DEEC licence and the goods were diverted. She submits that out of 8 BGs, 3 BGs were fraud and forged. She relied paras 14.2.2 and 15.1 and 15.2 of both SCNs. She submits that appellant has introduced the licence brokers to the importers, therefore he abetted in cases of imported goods. Appellant has acted as a link between the importer and the licence brokers.