GIRISH K. SHAH Vs. COMMISSIONER OF CUSTOMS

JUDGEMENT

(1.) THE appellant is aggrieved by the penalty of Rs. 10 lakhs imposed on him in the impugned order by the Collector of Customs, Mumbai under Section 114 of the Customs Act, 1962.

(2.) THE facts; briefly are that on 1 -3 -1989 M/s. S.K. Gems and M/s. Hemant Exports, Bombay presented one consignment each declared to contain cut and polished diamonds to the Jewellery Appraiser of the Postal Appraising Section of the Custom House, Bombay for assessment for the purpose of export to Hong Kong by post parcel. The consignment sought to be exported in the name of S.K. Gems under invoice dated 28 -2 -1989 was declared to be two lots of cut and polished diamonds totally weighing 417 carats or a declared value of US . 1,82,960/ - or Rs. 27,64,000/ -. Similarly the other consignment by the exporter in the name of Hemant Exports had an invoice dated 28 -2 -1989 declared to contain one lot of 439 carats of cut and polished diamonds valued at Rs. 28,65,000/ -. The parcels said to contain cut and polished diamonds and the related export documents were presented to the Customs by one Jatin J. Shah, an employee of M/s. Girish K. Shah on the basis of authority letters issued by the export firm in his favour. One Shri Sugathan and Pandurang Jadhav, both employees of the same Girish K. Shah were there for assisting Jatin Shah, who first presented the two lots of cut and polished diamonds with related documents and the invoices of M/s. S.K. Gems to the Jewellery Ap -priaser for valuation. After showing real diamonds to the Appraiser for approval of value Jatin Shah before taking the same to the Examiner of Customs for weighment substituted real diamonds with two lots of synthetic stones and handed over the two packets of synthetic stones to Sugathan to get the same weighed and sealed with customs seal by the Examiner. On weighment of the said two lots the Appraiser observed the goods presented to the Examiner for weighment appeared to be other than the one shown to him for valuation and the same appeared to be substituted with synthetic stones.

(3.) ON detection of the substitution of real diamonds with synthetic stones, the Jewellery Appraiser directed Jatin Shah to call the exporters to the Foreign Post Office to explain. After sometime one Shri Shirish Prabhu another employee of M/s. Girish K. Shah, accompanied by another person who claimed to be the proprietor of M/s. S.K. Gems, whose name was later ascertained to be Ashok H. Parekh, came to the Postal Appraising Section. Thereafter the Appraiser took these people to the office of the Assistant Collector of Customs and Ashok Parekh introduced himself as proprietor of M/s. S.K. Gems before the Assistant Collector. He also made endorsement below the examination report on the reverse of the export invoice of M/s. S.K. Gems to the effect that the shortage of 1 carat was due to mistake at the time of weighment and signed as S.R. Joshi. It was decided to re -examine the goods. But, before the commencement of re -examination and panchanama Ashok Parekh and Shirish Prabhu disappeared from the examination centre.