COMMISSIONER OF CUSTOMS Vs. RACHNA INDUSTRIES

JUDGEMENT

(1.) THESE appeals have been filed by the Commissioner of Customs, Mumbai on a direction issued by the Central Board of Excise and Customs, in exercise of its powers under Section 129D(1) of the Customs Act, 1962 to file an application before the Tribunal in order to determine the legality and propriety of the two adjudication orders captioned above passed by the Additional Commissioner of Customs, Mumbai.

(2.) THE brief facts are that the respondents filed 4 Bills of Entry for clearance of 4 consignments of low carbon mild steel defective sheets totally weighing 1000 MT on 18 -10 -1984. The goods imported are canalised items as per Sr. No. 56 Part A Appendix 5 of ITC Policy and could be imported through only canalising agency and could not be imported under OGL. The respondents wrote to the Collector of Customs to say that they are actual users of the materials and had imported it as such and that they had admitted that it was a mistake to have imported because the goods are canalised for import. They requested in their letter dated 18 -10 -1984 that the matter may be adjudicated at an early date without any show cause notice or personal hearing to avoid the demurrage. The concerned Appraising Group processed the 4 Bills of Entry and while submitting the case papers to the Additional Collector of Customs for adjudication, the 4 Bills of Entry were divided into 2 parts by clubbing two Bills of Entry and they were processed in separate files. Both the files were put up to the Additional Collector of Customs, Mumbai for adjudication on 18 -10 -1984 and that authority passed orders in both the cases confiscating the goods under Section 111(d) of the Customs Act with an option to redeem the goods on payment of fine of Rs. 5 lakhs each. In both the orders the Additional Collector observed that a lenient view has been taken as the importers are actual users and not traders and for the same reason no penalty was imposed on them. On 22 -10 -1984, when the these two adjudication orders were passed, the vessel carrying the goods in question had not entered the Indian Waters and no Import General Manifest had been filed. The entry inwards was given on 20 -11 -1984 and the IGM of the vessel was filed on 26 -10 -1984. After granting the entry inwards, the Bills of Entry were further processed and the duty and fine were paid. Before the goods were cleared out the Customs charge, an information was received in the Customs House that the respondents had deliberately imported the goods in question without being in possession of valid licence and that they were fully aware that the goods are canalised items and they have managed to get the goods adjudicated on a fine taking the margin of profit as 25% of the cif value whereas the actual margin of profit was much higher. The office premises of the Customs House Agent were searched and some incriminating documents were taken over. Statement of Respondents Shri Raj Kumar, Proprietor of M/s. Rachna Industries was recorded under Section 108 of the Customs Act wherein he admitted that he was fully aware of the provisions of the Import Control Trade Policy. Enquiries were also made at Faridabad where the respondents claimed to have a factory and it was found that the unit was closed since 1979 and the power connection of the unit has also been disconnected long time back as per the inspection report, dated 26 -7 -1980 of the Ministry of Steel and Mines, Government of India and the unit has not been working since long. In these circumstances, the Board on examining the papers relating to the adjudication has come to the conclusion that the order of adjudication is not legal and proper and that the circumstances of the case requires imposition of penalty as well as much higher redemption fine.

(3.) WHEN the matters were called none is present for the respondents and it is seen that their counsel on record has witten to them on 4 -8 -1998 enclosing therewith the original hearing notice and seeking instructions. But none is present today and as the matters relate to the year 1985, the case is proceeded with for disposal. The ld. Counsel also filed a letter of no instruction in the Registry.