The Customs, Excise & Service Tax Appellate Tribunal, Ahmedabad, ruled that CHA employees lacks locus standi to claim duty drawback.
The tribunal found that all the three appellants are neither the exporter of the goods nor the CHA. The entire case of over valuation stands attributed to exporter and CHA.
It was observed by the bench that as far as the allegation of fraudulent claim of duty drawback by over valuing the goods, the beneficiaries are the exporter i.e. M/s. Haresh Fashion. All the appellants have no locus- standi to either claim the drawback or receive the drawback. As regard the allegation that Shri Pratik Bhansali and Zayd Chakiwala admitted that they were supposed to get 40% and 60% of drawback does not appeared to be correct for the reason that the drawback if at all is received, it is by the exporter of the goods i.e. M/s. Haresh Fashion in the case. Moreover, except statements which too not relatable, there is no documentary evidence to show said kickback of 40% to 60% drawback.
The tribunal further found that Shri Pratik Bhansali had clearly denied the allegation in his first statement, thereafter, there was no need to again call him but he was repeatedly summoned and in the subsequent statement he stated that he was supposed to get 40% of the duty draw back. When there are two contradictory statements by one person, those statements cannot be relied upon. Moreover, when the appellant right from their reply to show cause notice denied the allegation, the adjudicating authority was supposed to cross-examine the witnesses, however, no cross-examination has been conducted.
It was also observed that as regard the allegation of sharing 40% or 60% drawback by Shri Pratik Bhansali and Shri Zayd Chakkiwala, no documentary evidence was brought on record for any past incident that they have received any such sharing of the drawback, therefore, the penalties under Section 114(iii) and 114 AA, was wrongly imposed.
Facts
Shri Pratik Bhansali worked as President of M/s. A. V. Joshi & Company, a Container Freight Station at Kandla. In April, 2017, he was approached by Shri Alok and Shri Arvind on behalf of exporter firm M/s. Haresh Fashion for export of woven girl fancy frock of MMF and thereafter, he received 02 samples through courier. He sent the same to Shri Balaji Naidu, Custom Broker. Thereafter, the exporter through Custom Broker filed 02 Shipping Bills bearing Nos. 6293441 and 6293292 under duty drawback scheme with Custom House, Kandla for export of goods declared as Woven Girls Fancy Frock- MMF by declaring FOB value as Rs. 1,48,51,872.00 and Rs. 1,03,96,310.40 respectively.
The officers carried out market survey and obtained a report based on which market price was ascertained as Rs. 40 to 55 per piece. The report contains no details of source from which this opinion was obtained.
Despite this, the declared value was rejected and re-determined as Rs. 8,09,400/- and Rs. 5,58,600/-. It was also ordered to change classification from CTH 6204 1919 to CTH 6204 4390. The goods entered for export were confiscated and option to redeem the same was given to the exporter.
With regard to Shri Pratik Bhansali, penalty of Rs. 10.0 lakh under Section 114 (i) and separate penalty of Rs. 15.0 lakh under Section 114AA of Customs Act,1962 was imposed on the ground that he was assured 40% share of duty drawback and hence, he overvalued the goods.
Conclusion
As regard the appeal of Kaustubh Parikh, the tribunal found that he is merely an employee of CHA, therefore, he has performed his duty on the instructions of his senior and it is also a proven fact that he has not been benefited by attempt to claim excess drawback by the exporter. The CHA has already been penalized. In such case, the penalty on the employee cannot be imposed on the charge of wrong availment of drawback by the exporter.
Therefore, the bench viewed that all the appellants in the case are not liable for any penalty.
Case Details
Case Name: PRATIK BHANSALI V/S Commissioner of Customs-Kandla
Citation: Customs Appeal No. 10637 of 2020
Court: CESTAT Ahmedabad
Judge: Ramesh Nair, Member (Judicial) And Raju, Member (Technical)
Decision Date: 14/08/2024
