ASHOK DESAI Vs. COMMISSIONER OF CUSTOMS, KANDLA

JUDGEMENT

(1.) THE prayer in the application is to dispense with the condition of pre -deposit of penalty of Rs. 50 lakhs imposed upon Shri N.K. Didwania, Director of M/s Hazel Mercantile and of Rs. 25 lakhs imposed on Shri Ashok Desai, employee of M/s Hazel Mercantile. As per the facts on record, one M/s Silicon Industries (I) Ltd., bought the imported goods from M/s Hazel Mercantile on high seas sale basis, which stand diverted by them in the open market. Accordingly, original adjudicating authority vide his impugned order, demand of Rs. 3 crores stand confirmed against M/s. Silicon Industries along with imposition of penalty of identical amount. The said M/s Silicon Industries has already deposited amount of Rs. 1 Crore. However, they have not reportedly challenged the said order and as such, their appeal and stay petition are not before us. Penalty stand imposed upon present applicant on the ground that the goods were sold to M/s Silicon Industries without receiving the full sale proceedings and as such it is seen that the high sea sale was a pretext to pass on the goods to M/s Silicon Industries, who has subsequently sold the same in open market. We find that originally show cause notice was issued to M/s Silicon Industries on 7 -5 -04, without making any proposal to impose penalty upon the present appellant. They were not served with a copy of the show cause notice. It is only subsequently on 29 -12 -06 and an addendum show cause notice was issued. Based upon the facts that Shri Sandeep Mansingka of M/s Silicon Industries has approached the office of the Customs and offered to give a further statement in the matter wherein he has implicated the present appellant. Apart from the above fact that the said statement of Shri Sandeep Mansingka was given after the issuance of show cause notice, we find that in all his earlier statements recorded during the course of investigation, he has neither named the present appellant nor attributed the goods to them. In fact, some of the statements were recorded in presence of the appellant wherein he admitted having bought the goods from the present appellant on high seas sale basis and never attributed any role to the present appellant. In any case, we find that the impugned order is passed on the basis of statements of the co -accused and there is no other independent evidence on record to reflect upon the appellants involvement in the disposal of the goods in the open market.

(2.) AS such, we are of the view that the appellants have prima facie, a good case in its favour so as to allow the stay petition unconditionally and fix the appeal for final disposal on 17 -11 -2008.