Shri Gajraj Singh Baid vs Commissioner Of Customs

Sl.

No.",Container No.,"B.E./ IGM No.&

date",B/L No. & date,"Description of

goods as per

B.E/B.L/ IGM","Goods actually

found on

examination

1,TRLU 5705768,"B.E.No.00004

dt.29.01.2010 &

IGM No. 23919 dt.

13.01.2010","APLU

051117121 dt.

30.12.2009","Mens casual

shoes

(unbranded/

branded)","Shoes incl.

branded &

Mobile batteries

2,"APHU

6485271","IGM No.23961

dt.20.01.2010","APLU

051132541

dt.06.01.2010",Footwear,"Shoes, Mobile

batteries &

cigarettes

3,"CLHU

8447321","IGM No. 24017 dt.

28.01.2010","APLU

051132706 dt.

14.01.2010",Footwear,"Shoes, Mobile

batteries &

cigarettes

4,FCIU 8116039,"IGM No. 24056 dt.

03.02.2010","APLU

051132839 dt.

20.01.2010",Footwear,"Shoes, Mobile

batteries &

stickers of

Mobile batteries

In compliance to summons the appellant - Shri Gajraj Singh Baid appeared before the DRI Headquarters New Delhi on 29.03.2010 wherein his,,,,,

statement was recorded as under:-,,,,,

• “He was looking after the clearance/ liaison work of M/s Maa Shakti Industries for the past one and half years and Shri Makhan,,,,,

Kant Sharma is a dummy proprietor in the company and the imports are being made by Shri Rajesh Kumar Gupta @ Rajesh Bihari.,,,,,

• He offered Shri Makhan Kant Sharma to lend his company’s name and IEC for imports of goods by Shri Rajesh Kumar Gupta @,,,,,

Rajesh Bihari and Shri Makhan Kant Sharma agreed to the proposal for monetary consideration of Rs. 10,000/-per month. He also stated",,,,,

that Shri Makhan Kant Sharma and Shri Rajesh Bihari were never in direct touch with each other and he (Gajraj Singh Baid) used to be,,,,,

the middle man for clearance and payments of Rajesh Bihari.,,,,,

• He knew Shri Rajesh Kumar Gupta @ Rajesh Bihari since the last one and half years.,,,,,

• Initially the clearances of M/s Maa Shakti Industries were done from ICD Kanpur and since December 2009 Shri Rajesh Bihari had,,,,,

started importing at ICD Agra.,,,,,

• He used to go with Shri Makhan Kant Sharma for the clearances at ICD Agra and all the expenses including the conveyance were,,,,,

borne by Shri Rajesh Bihari.,,,,,

• Shri Rajesh Bihari had provided him hard copy of Bill of Lading and country of origin certificate in respect of one of the container at,,,,,

ICD Agra, and had also provided soft copy of unsigned commercial invoice and packing list in pen drive for filing bill of entry in respect of",,,,,

that container, and he took hard copy of Invoice and Packing list and after signing these documents on behalf of supplier, filed Bill of",,,,,

Entry number 004 dated 29.01.2010 at ICD Agra.,,,,,

• He took Shri M. K. Sharma, the Proprietor of M/s Maa Shakti Industries to Agra for signing the import documents for the container No.",,,,,

TRLU 5705768 for which the Bill of Entry had been filed with the local Customs.,,,,,

• He informed Shri Rajesh Bihari that the container at ICD Agra had been detained by DRI Lucknow and then Shri Rajesh Bihari,,,,,

informed him that three more containers in the name of M/s Maa Shakti Industries are on the way to Agra. He (Gajraj Singh Baid) informed,,,,,

him (Rajesh Bihari) that in the present circumstances it is not possible to get those containers cleared at Agra and requested him to divert,,,,,

the containers to another port. Rajesh Bihari tried to divert those containers to another port however, M/s APL China refused to do so as",,,,,

the containers had already arrived in India and IGM had been filed in respect of these containers.,,,,,

• Shri Rajesh Bihari had informed him that the containers at ICD Agra contained goods such as mobile batteries, cigarettes etc. in",,,,,

addition to shoes.,,,,,

• He had signed the letter addressed to the Assistant Commissioner of Customs, ICD, Agra on behalf of M/s Maa Shakti Industries as",,,,,

Manager, in which he had requested that the containers may be examined in the presence of the Proprietor. His sole intention was to gain",,,,,

some time to settle the issue of clearances of containers, off the record.",,,,,

• The e-mail ID on the letter head of M/s Maa Shakti Industries is his own.,,,,,

• He threw his pen drive in the toilet. The pen drive was retrieved and opened in his presence and found to contain soft copies of,,,,,

documents like blank letter-heads in the name of M/s Maa Shakti Industries, packing list and invoice. He also admitted that he had got",,,,,

drafted the letter of re-export of these containers for Shri Rajesh Bihari through an advocate. He admitted the ownership of the pen drive,,,,,

as well as the soft copy of documents in it. 26 pages of printouts were taken and were duly signed by Shri Gajraj Singh Baid.â€​,,,,,

The appellant after recording of the statement for over 48 hours was arrested on 30.03.2010 and was produced before the Court of Metropolitan,,,,,

Magistrate, New Delhi on 31.03.2010 by the Officers of DRI, Lucknow, and after obtaining transit remand was again produced before the Court of",,,,,

Special Chief Judicial Magistrate (Economic Offences at Agra) on 01.04.2010 and thereafter was remanded to judicial custody. Thereafter, on",,,,,

03.04.2010, the appellant was granted bail by the Special CGM, Agra. Thereafter, the appellant again appeared before the DRI, Lucknow on",,,,,

16.04.2010 in compliance to summons and his statement was recorded wherein he inter-alia stated that he was the Prop. of M/s Paramount,,,,,

Sanitation. Further, he gives consultancy with regard to import/ export. Further, he also manages customs clearances for his client.",,,,,

Follow up search was conducted at the residence of the appellant at A-10, Aravali Kunj, Sector-13, Rohini, Delhi, was conducted on 03.05.2010",,,,,

and some documents were resumed. The documents resumed contained one diary in which appellant has made some entry against the name of one,,,,,

Rajesh Bhai/ Rajesh A/c Agra. On scrutiny of the diary it appeared that amounts like 4 lakh, 1 lakh, 25,000/- etc. was received from Rajesh Gupta @",,,,,

Rajesh Bihari for the purpose of custom duty and other expenses. It appeared to revenue that appellant used to manage the funds received from,,,,,

Rajesh Gupta @ Rajesh Bihari.,,,,,

Follow up search was also conducted at the office premises of M/s New Globe International, Sector -9, Rohini, New Delhi through which the",,,,,

appellant used to give consultancy regarding import and export. One file was resumed from the said premises. On scrutiny of which, two airway bills",,,,,

were found on which mobile number of the appellant was mentioned below the name of Maa Shakti. It appeared to Revenue that appellant is working,,,,,

as the representative of Maa Shakti.,,,,,

The appellant again appeared before the Senior Intelligence Officer of DRI, Lucknow on 10.05.2010 for recording of his statement wherein he",,,,,

inter alia stated as follows:-,,,,,

• Shri Rajesh Bihari informed him over phone on 22/23 January 2010 that he is sending him the documents regarding import of one,,,,,

container at ICD Agra and told him to prepare the documents. After receiving the documents such as Invoice, Packing list etc. he (Gajraj",,,,,

Singh Baid) prepared the B/E and took signature of Shri Makhan Kant Sharma on it. He along with Shri Makhan Sharma visited the,,,,,

customs office at ICD Agra and the documents were submitted for clearance of the goods.,,,,,

• He was informed by Shri Makhan Kant Sharma that DRI Lucknow had detained the goods arrived at ICD Agra. He was then informed,,,,,

by Shri Rajesh Gupta alias Rajesh Bihari that the container contained Branded Shoes and Mobile batteries â€"Rajesh Bihari also informed,,,,,

that three more containers are yet to arrive.,,,,,

• Shri Makhan Kant Sharma has lended his companies name and IEC at Rs.10,000/- per month on his recommendation to Shri Rajesh",,,,,

Bihari for import of goods.,,,,,

• Shri Rajesh Bihari is the actual owner of the goods imported by M/s Maa Shakti Industries and used to provide all the documents,,,,,

related to import.,,,,,

• He knew Shri Rajesh Bihari for the past one year and also provided the address of Rajesh Bihari.,,,,,

• He used to get Rs. 10,000/- per container from Shri Rajesh Bihari and was authorised by Rajesh Bihari for this work.",,,,,

• He was authorised by Shri Makhan Kant Sharma to look after the work of M/s Maa Shakti Industries.,,,,,

• He also admitted that he received huge amounts (Rs.4,00,000/-, Rs.1,00,000/-, Rs. 25,000/-, Rs.50,000/-, Rs. 2,00,000/-) from Shri",,,,,

Rajesh Gupta @ Rajesh Bihari to deposit customs duty and for other expenses and the same was written in his diary, which was resumed",,,,,

during his house search.,,,,,

• Shri Rajesh Bihari gave him money in cash for depositing Customs duty and the remaining amount was deposited in the current account,,,,,

of M/s Maa Shakti Industries at State Bank of India Rohini Branch, Delhi or at Punjab National Bank, Janpath Branch, Delhi.",,,,,

• Shri Rajesh Kumar Gupta @ Rajesh Bihari used to provide him the documents such as Invoice, Packing List etc., on which he used to",,,,,

sign and present them before the Customs.â€​,,,,,

In the course of further investigation it appeared that CHA firm M/s Balaji Mariline Pvt. Ltd., have filed Bills of Entry for M/s Maa Shakti",,,,,

Industries which have been cleared in past. On summons, the Associate Director of CHA firm Shri Vinod Mehrotra appeared and recorded his",,,,,

statement on 08.10.2010, wherein he inter â€"alia stated as follows:-",,,,,

• His firm M/s Balaji Mariline Pvt. Ltd., had filed five Bills of Entry at ICD Kanpur for M/’s Maa Shakti Industries for which Gajraj",,,,,

Singh Baid had contacted him.,,,,,

• Gajraj Singh Baid had met him as the authorised representative of M/s Maa Shakti Industries.,,,,,

• He had never met the proprietor of the firm - M/s Maa Shakti Industries, and had contacts only with Gajraj Singh Baid.",,,,,

• On being asked whether their firm has received payments from M/s Maa Shakti Industries, he submitted the account statement of M/s",,,,,

Balaji Mariline Pvt. ltd., wherein they had received amounts through fund transfer from account number 08661930001220 and had marked",,,,,

the amount received for the services rendered to M/s Maa Shakti Industries. On enquiry of account number (08661930001220) from,,,,,

HDCFC Bank, it was found that the said account number belonged to Gajraj Singh Baid and Manjula Baid.â€​",,,,,

In the course of further enquiry from Shri Kuldeep Singh Sikarwar, Terminal Manager, Concor at ICD, Agra stated that he does not know the",,,,,

person who comes for taking delivery on behalf of M/s Maa Shakti. Further, he produced a copy of letter issued by M/s Maa Shakti, which authorised",,,,,

the appellant as its authorised representative.,,,,,

On subsequent search on 15.06.2010 at the premises of M/s New Globe International, Sector-9, Rohini, Delhi, one CPU of Compaq Presario",,,,,

having Sl. No. INI33401B6 was resumed. The said CPU was opened in the presence of two independent witnesses. However, nothing incriminating",,,,,

was found. In response to bail cancellation application filed by Revenue before the Court of Session Judge, Agra the bail was cancelled and appellant",,,,,

was taken into judicial custody on 07.06.2010. Further, the appeal of the appellant before the Hon’ble High Court was also rejected on 26.07.2010.",,,,,

In response to summons, Shri Makhan Kant Sharma, Prop. of M/s Maa Shakti Industries appeared before the DRI, Lucknow on 12.04.2010 and",,,,,

his statement was recorded on 12.04 and 13.04.2010, wherein he inter-alia stated as follows:-",,,,,

• He is the owner of the firm M/s Maa Shakti Industries, B-4/166, Yamuna Vihar, Delhi-5, having IEC number 0507030397.",,,,,

• He had changed his address to R-35, Phase-I, Buddha Vihar, Rohini, Delhi-86 and had not informed DGFT about the changed",,,,,

address.,,,,,

• He wilfully accepted the offer of Shri Gajraj Singh Baid for lending his company’s name and IEC No. for import of goods by,,,,,

Gajraj Singh Baid for monetary consideration of Rupees 10,000/- per month and Rs. 3,000/- per container.",,,,,

• He used to sign on all import documents as and when Shri Gajraj Singh Baid asked him to do so. Shri Gajraj Singh Baid used to look,,,,,

after all related work of ICD and he (Shri Makhan Kant Sharma) only accompanied him (Gajraj Singh Baid).,,,,,

• After arrival of the goods at ICD Agra all the formalities and liaison were done by Gajraj Singh Baid and he (Makhan Kant Sharma),,,,,

used to sign on the documents as asked by Gajraj Singh Baid.,,,,,

• He was told by Gajraj Singh Baid in January 2010, that at ICD Agra some undeclared valuable goods have been brought with shoes",,,,,

and for this Gajraj Singh Baid had promised to give Rs. 10,000/- extra and he wilfully accepted his offer.",,,,,

• He was very well aware that wrong declaration of goods for evasion of Customs duty is illegal and punishable under Customs Act and,,,,,

such goods can be seized.,,,,,

• He was very well aware that Gajraj Singh Baid used to import illegal goods through his firm and was aware that this time mobile,,,,,

batteries and cigarettes were also brought without declaring in the IGM, along with the declared goods.",,,,,

• He was very well aware that wrong declaration of goods for evasion of Customs duty is illegal and punishable under Customs Act and,,,,,

such goods are liable for confiscation.,,,,,

• He admitted that B/E for remaining three containers were not filed as DRI had already detained the first container, and all the",,,,,

remaining three containers also contained undeclared goods.,,,,,

• He admitted that Gajraj Singh Baid had told him to stay underground till the enquiry is on.,,,,,

Pursuant to recording of the statement, Shri Makhan Kant Sharma was also arrested on 13.04.2010 and was remanded to judicial custody by the",,,,,

Special CJM (Economic Offences), Lucknow, where he was released on bail vide order dated 07.06.2010 on the condition that he will deposit Rs.",,,,,

Four crores as differential customs duty, shall furnish a personal bond of Rs. 5 crores and two sureties each of like amount and surrender his passport",,,,,

and also cooperate with the investigating agency.,,,,,

Shri Makhan Kant Sharma challenged the order before the Hon’ble High Court at Lucknow wherein the High Court granted bail by deleting,,,,,

the condition to deposit of Rs. 4 crores.,,,,,

Further follow up search was conducted at the residential premises of Shri Rajesh Kumar Gupta @ Rajesh Bihari at Flat No. C-801, NPSC",,,,,

CGHS Ltd., Sector-2, Dwarka, Delhi. The said premises was found locked over the last four months approximately from the date when the",,,,,

investigation started by the DRI officials. The summons issued during May, 2010 to October, 2010, the same could not be served on Shri Rajesh",,,,,

Kumar Gupta @ Rajesh Bihari. Further, Shri Bhopal Singh, Head Hawaldar of DRI, DZU was deputed to servce summons by hand, who filed his",,,,,

separate report that summons could not be served as the premises were always found closed. A complaint was filed by Revenue against the said Shri,,,,,

Rajesh Kumar Gupta under Section 174, 175/ 228 of IPC before the Court of Special CJM, Lucknow on 19.11.2010. The investigation was lying",,,,,

incomplete as Shri Rajesh Kumar Gupta @ Rajesh Bihari had not joined the investigation. Further, Revenue has referred the matter of IPR violation to",,,,,

the brand owners of ITC Ltd, Adidas, etc. wherein the report was awaited. ITC Limited filed their report stating that the cigarettes of Benson and",,,,,

Hedges have been imported in violation of IPR (Imported Goods) Enforcement Rules, 2007 read with Notification No. 47/2007-Cus. Similar report",,,,,

was also filed by Adidas India Pvt. Limited and Puma Sports India Pvt. Ltd. As regards the import of Nokia brand goods, the Consulate General of",,,,,

India in Hong Kong informed that the matter has been referred to China Customs for obtaining the copies of export declarations filed before them.,,,,,

Further, on enquiry from the Hong Kong based supplier at the location of Galaxy Industries (Hong Kong) Limited as well as Distar Overseas (HK)",,,,,

Ltd., were not found on their declared address.",,,,,

Further from the point of vigilance Shri Santosh Kumar, Inspector at ICD, Agra was interrogated on 24.08.2010 wherein he inter-alia stated as",,,,,

follows:-,,,,,

• He was marked for the examination of the container by Superintendent Examination on 01.02.2010 filed through B/E No. 04 dated,,,,,

29.01.2010. The container was presented by one Shri Ajay Sharma (H card holder at ICD Agra) for examination.,,,,,

• He had asked Shri Ajay Sharma to create a passage in the container, so that the container can be examined till the end of the",,,,,

container. But the laborers told that it was not possible to create a passage. Hence, Shri R. C. Shukla, Superintendent suggested to remove",,,,,

the cartons from top and the cartons such removed were randomly examined in the presence of the Superintendent.,,,,,

• On examination it was found that the cartons contained Branded Shoes besides Unbranded Shoes.,,,,,

• ""Branded"" word was found added in the B/E no. 04 dated 29.01.2010 when he arrived in the office on 02.02.2010, which was not",,,,,

there when the B/E was marked to him for examination.,,,,,

• Examination report was dictated to him (Shri Santosh Kumar) by Shri R. C. Shukla, Superintendent and Shri O.P. Shukla,",,,,,

Superintendent.,,,,,

• He further stated that for the last 18 years he has done his entire work in Hindi only, whatever work he has done in English, that is",,,,,

either dictated by somebody or copied, this evidence is with the department.",,,,,

• ""on the first check basis†was also added by the Superintendent Shri R. C, Shukla on 05.02.2010 in the chamber of Deputy",,,,,

Commissioner.,,,,,

• He had not done 100% examination of the container and only 50-60 cartons were examined by him because there was no order for,,,,,

100% examination. In his report initially he had written 5900 Branded shoes and 6400 unbranded shoes. But after the fax letter from DRI,,,,,

the figures were changed to 8900 Branded Shoes and 3400 Unbranded Shoes, on request of Superintendent Shri R. C. Shukla and Shri O.",,,,,

P. Shukla.,,,,,

• He accepted that the words ""after thorough examination of container in shed after de-stuffing"" was added by him in the examination",,,,,

report on 05.02.2010 in the chamber of Shri R. L. Meena, Deputy Commissioner.",,,,,

• That Gajraj Singh Baid was not present during the examination of the container and in his absence one Shri Ajay Sharma was present,,,,,

on his behalf.,,,,,

• That on 04.02.2010 Shri Gajraj Singh Baid had contacted him for taking sample from the examined container.,,,,,

• He does not know Shri Makhan Kant Sharma or Shri Rajesh Bihari.,,,,,

• He had requested to examine all the packets in the container but due to refusal of Shri O.P. Shukla, Superintendent detailed",,,,,

examination was not done.,,,,,

• That only 10% examination of the container was done as there was no order for 100% examination of the container.,,,,,

Further statement of Shri R. C. Shukla, Superintendent at ICD Agra was recorded on 26.08.2010 and 06.09.2010, wherein he inter-alia stated as",,,,,

follows:-,,,,,

• He as a Superintendent Examination used to mark the file for examination to Inspector, depending upon the recommendation of the",,,,,

processing unit. The percentage to be examined was not written.,,,,,

• On being asked the difference between examination on ‘first check basis’ and ‘simply examine’ and ‘put up report’,",,,,,

he said that on both the conditions it means 5% to 10% examination, which was decided by the Inspector himself. As separate order is",,,,,

issued for 100% examination.,,,,,

• He had marked the B/E No. 04 dated 29.01.2010 to Shri Santosh Kumar, Inspector for examination ‘on first check basis’ on",,,,,

01.02.2010.,,,,,

• That after the examination when Shri Santosh Kumar, Inspector requested for ""thorough examination of the container in shed after de-",,,,,

stuffing"". He had marked ""Please do the needfulâ€, to Shri Santosh Kumar and returned him the B/E.; He had written ""on first check basis""",,,,,

by another pen.,,,,,

• He does not know why Shri Ajay Sharma presented the container for examination, though the B/E was filed on self basis.",,,,,

• • He does not remember whether the B/E was filed for Unbranded shoes or for both i.e. Unbranded/ Branded shoes.,,,,,

• He does not know that the said party was called by Shri O.P. Shukla Superintendent at ICD Agra and had never told Shri Santosh,,,,,

Kumar, Inspector that the party was brought byShri O.P. Shukla, at ICD Agra.",,,,,

• He has not dictated the examination report to Shri Santosh Kumar, Inspector, as alleged by him (Santosh Kumar)",,,,,

• On being shown the note sheet of the file B/E no. 04 dated 29.01.2010 and asked to identify the signatures on it, he said that the note",,,,,

sheet was put up by Siri Ashok Gupta, Inspector (Processing) and forwarded by Shri S. D. Srivastava, Superintendent (Processing) and",,,,,

approved by the Deputy Commissioner.,,,,,

• He also told that there was practice at ICD Agra to give the examination order and examination report on the triplicate copy of the B/E.,,,,,

• He was not present during the examination of the containers because of the workload; He has not put his name below his initials which,,,,,

is wrong.,,,,,

• On being asked where was the duty of Shri O. P. Shukla on 01.02.2010, he said that Shri O. P. Shukla was given the charge of Duty",,,,,

drawback and was on leave on that day.,,,,,

Further statement of Shri O. P. Shukla, Superintendent at ICD Agra was recorded under Section 108 of the Customs Act, 1962 on 28.09.2010",,,,,

wherein he inter alia stated as under:-,,,,,

• He said that Shri Gajraj Singh Baid and Shri Makhan Kant Sharma had come to ICD Agra in December, 2009 and after giving their",,,,,

introduction requested to open the docket file of M/s Maa Shakti Industries.,,,,,

• On being asked whether opening of docket file was under his charge, he said that docket opening was not assigned to any particular",,,,,

Superintendent and the work was done by any Superintendent present.,,,,,

• He was on leave on 01.02.2010 the day on which the container No. TRLU 5705768 was examined by Shri Santosh Kumar, Inspector.",,,,,

• He had never dictated any examination report to Shri Santosh Kumar, Inspector and denied the allegations made by him (Santosh",,,,,

Kumar).,,,,,

• He denied of having stopped Shri Santosh Kumar from detailed examination, as he had no role in the examination.",,,,,

• On being asked that how he had authorised two persons to take sample from the container No. TRLU 5705768, initially he said that he",,,,,

denied authorised two persons to enter the custom bonded area only but on being shown the said letter he accepted that he authorised two,,,,,

persons to draw samples from the Container No. TRLU 5705768.,,,,,

Further statement of Shri Ashok Kumar Gupta, Inspector at ICD Agra was recorded wherein he inter alia stated as under:-",,,,,

• That on 29.01.2010 he was looking after the processing of Bill of Entry, Shipping Bill and Drawback claim.",,,,,

• That on scrutiny of the B/E filed for Shoes by M/s Maa Shakti Industries and the documents it seemed that the consignment imported,,,,,

was from China. He discussed this with Shri Saheb Das Srivastava, Superintendent and recommended for ‘first check’ on the note",,,,,

sheet and forwarded it to Superintendent, Shri Saheb Das Srivastava.",,,,,

• That the B/E was filed as Mens Casual Shoes (unbranded) and that the word ‘Branded’ was added on later.,,,,,

• On being asked who had filed the B/E, he said that he does not know who had filed the B/E and the file related to the said B/E was sent",,,,,

by the noting section to him.,,,,,

• He does not know Shri Makhan Kant Sharma or Shri Gajraj Singh Baid.; He had not opened the docket file of M/s Maa Shakti,,,,,

Industries.; He had not received any orders from the Deputy Commissioner relating to processing of the B/E.,,,,,

Further statement of Shri Ajay Sharma (H card holder) of M/s Lara Exim Pvt. Ltd., was recorded on 27.10.2010, who inter alia stated that he had",,,,,

not received any directions from the CHA firm regarding presenting the container of Maa Shakti for examination. He knows Shri Gajraj Singh Baid.,,,,,

He further stated that Shri Gajraj Singh Baid had requested in the morning of 01.02.2010, to present the container for examination, as he will be",,,,,

delayed to reach ICD, Agra. Accordingly, he presented the container before Shri Santosh Kumar, Inspector and accordingly put his signature on the",,,,,

Bill of Entry by endorsing â€" presented one container for examination. He further stated that Shri Gajraj Singh Baid had promised Rs. 1,000/- for the",,,,,

work. He further stated that presenting the container for examination without any authorisation was wrong. On opening of the container, Shri Santosh",,,,,

Kumar, Inspector directed him to remove 60-70 packets from the container. All such removed packets were opened for examination contained either",,,,,

branded or unbranded shoes. During such examination, Shri R.C. Shukla, Superintendent was also there for a short while. That no report was written",,,,,

by Shri Santosh Kumar, Inspector in his presence. On being requested by Shri Gajraj Singh Baid, he has requested Shri Santosh Kumar, Inspector to",,,,,

speak to Shri Baid on phone, which was refused by Shri Santosh Kumar, Inspector. Thereafter, he requested Shri Shukla, Superintendent, and left the",,,,,

place. He is not aware of any conversation between them. He also stated that earlier on few occasions also he has presented the container for,,,,,

examination on behalf of Maa Shakti.,,,,,

In the investigation of the Bank account of M/s Maa Shakti Industries maintained with Punjab National Bank and State Bank of India, Revenue",,,,,

Item,Qty.,Estimated seizure value,Customs duty,,

Shoe,10371,"1,03,71,000/-","13,80,800/-",,

Mobile phone batteries,"11,04,585","16,55,37,750/-","3,93,77,230/-",,

Unbranded Men’s

casual shoes","10,977","65,86,200/-","3,88,575/-",,

Branded Cigarettes,"81,50,000","2,96,45,000/-","1,23,23,476/-",,

Corrugated packet

containing stickers for

mobile phone battery",3,"3,000",706/-,,

Name,Penalty,,,,

M/s Maa Shakti Industries, Prop. Makhan Kant Sharma","Rs.3,00,00,000/-",,,,

Shri Gajraj Singh Baid, Consultant","Rs.3,00,00,000/- u/s 112(a) 114A & AA",,,,

Shri Rajesh Kumar Gupta @ Rajesh Bihari, Owner of the

goods","Rs.3,00,00,000/-",,,,

documents retrieved from pen drive alleged to be found with the appellant. However, none of the aforesaid are reliable.",,,,,

(v) Shri Makhan Kant Sharma is a co-noticee in the instant case and he admitted the duty liability in his defense reply as apparent from,,,,,

para 80 of the adjudication order, as well as Bail Order passed by the Hon’ble High Court of Allahabad in case of Makhan Kant",,,,,

Sharma (Criminal Revision No. 245 of 2010). Copy of Bail Order of Makhan Kant Sharma is enclosed herewith as Annexure â€" A. Being a,,,,,

co-noticee and main beneficiary, statement of Shri Makhan Kant Sharma, cannot be relied upon against the appellant to implicate him. In",,,,,

this regard, reliance is placed upon the judgment of the Hon’ble Punjab & Haryana High Court in case of ASSISTANT COLLECTOR,",,,,,

CUSTOMS Vs. AMRIK SINGH reported in 2014 (301) ELT 170 (P&H). Moreover, it is pertinent to mention that just after recording of",,,,,

statement, Shri Makhan Kant Sharma was arrested by the DRI officers. In such circumstances, possibility of statement of Shri Makhan Kant",,,,,

Sharma being recorded as per wishes of the DRI officers, cannot be ruled out.",,,,,

(vi) It is a fact on record that IEC was in the name of Shri Makhan Kant Sharma. It is also a fact on record that all the documents filed in,,,,,

relation to the import consignment were filed by Shri Makhan Kant Sharma. He himself admitted that papers were signed by him. It is also,,,,,

an admitted fact that import remittances were made from the Bank Account of M/s. Maa Shakti Industries which was operated by Shri,,,,,

Makhan Kant Sharma. The appellant, being engaged in consultancy work in relation to import and export, in normal course of business,",,,,,

introduced Shri Makhan Kant Sharma to Shri Rajesh Bihari who was financially sound and was interested in import of goods. This should,,,,,

not be made basis to implicate the Appellant for imposing penalty.,,,,,

(vii) As far as the statements of appellant is concerned, same were not voluntary statements but were recorded under immense coercion and",,,,,

pressure, which can be understood from the facts and circumstances of the case. It is evident from the impugned order itself that statement",,,,,

of the appellant was continuously recorded for 2 days i.e.29.3.2010 and 30.3.2010 and just after recording of statement of appellant, he",,,,,

was arrested by the DRI Officers on 30.3.2010. The appellant was summoned for recording of statement but kept under custody of DRI,,,,,

Officers for two days and was not allowed to go outside, during which period the alleged statement was recorded by the DRI officers as per",,,,,

their dictates and wishes, and immediately thereafter, the appellant was arrested.",,,,,

(viii) It is also pertinent to mention that soon after bail granted to the Appellant on 3.4.2010, DRI officials filed an application i.e, on",,,,,

26.4.2010 for cancellation of bail of the appellant. Said proceeding went up to Hon’ble Supreme Court and finally bail was granted by,,,,,

the Hon’ble Supreme Court. It is pertinent to mention that before the Hon’ble Supreme Court, the department filed counter-affidavit,",,,,,

where they made averments only on the basis of statements of the appellant. The appellant filed rejoinder to counter-affidavit and brought,,,,,

the fact of coercion and pressure exerted by the departmental officers to the notice of the Hon’ble Supreme Court. The appellant also,,,,,

produced the record of proceedings before the lower court with regard to bail application and pointed out that considering the force and,,,,,

pressure exerted by the departmental officers, the learned Magistrate granted bail to the appellant. In fact, the harassment caused to the",,,,,

appellant was continued throughout the proceedings of recording of statements. Detailed submissions in this regard, have been made in",,,,,

para D-2 of the grounds set out in appeal memo. In any case, only on the basis of statement of appellant, that too, recorded under coercion",,,,,

and pressure, allegations cannot be confirmed against the Appellant. Reliance is placed upon the judgment in case of Vinod Solanki",,,,,

reported as 2009 (233) ELT 157 (SC), Sailash Amulakh Jogani reported as 2009 (241) ELT 348 (Bom.), Asst. Collr. of C.Ex., Rajamundry",,,,,

Vs. Duncan Agro Industries Ltd, reported as 2000(120) ELT 280 (SC).",,,,,

(ix) As far as documents said to be retrieved from pen drive alleged to be found with Appellant are concerned, same are also not reliable.",,,,,

Heavy reliance has been placed in adjudication order on the said documents. It is pertinent to mention that recovery of pen drive is,,,,,

mentioned in statement of the appellant recorded on 29/30.3.2010. But, no panchnama has been drawn in respect of retrieving copies of",,,,,

documents from the pen drive alleged to be recovered from the possession of the appellant. It is submitted that procedure for admissibility of,,,,,

such documents/computer print outs is prescribed under Section 138C of the Customs Act. Section 138C provides computer print outs to be,,,,,

a document and admissible in any proceeding under the Customs Act as evidence of any content stated therein, subject to fulfillment of the",,,,,

condition of sub-section (2), which has not been complied at all in the present case. In such a situation, no reliance can be placed on such",,,,,

documents. In this regard, reliance is placed on the judgment of the Hon’ble Supreme Court in case of Anvar P.V. Vs. P.K Basheer",,,,,

reported in 2017 (352) E.L.T 416 (S.C) which relates to Section 65B of the Evidence Act, 1872 (parimateria to Section 138C of the Customs",,,,,

Act, 1962). Following the ratio laid down by the Hon’ble Supreme Court, the Tribunal also, in case of S.N Agrotech Vs. Commissioner",,,,,

of Customs, New Delhi reported in 2018 (361) E.L.T. 761 (Tri-Del.), has held that documents retrieved from electronic devices without",,,,,

complying with provisions of Section 138C of the Customs Act, 1962 are not admissible.",,,,,

(x) It is submitted that a different yardstick has been applied towards the appellant vis-Ã -vis the departmental officers in the present case. It,,,,,

is pertinent to mention that apart from Appellant, customs officers were also made noticee in the present case, who gave incriminating",,,,,

statements. But, at one place, on the basis of statements, the learned adjudicating authority implicated the appellant and imposed huge",,,,,

penal liability while on the other hand, exonerated the customs officers implicated in the show cause notice, by discarding the statement of",,,,,

Shri Santosh Kumar, Customs Officer. It is not understandable as to why the statement of the appellant has been treated as gospel truth,",,,,,

though the same was recorded under threat, pressure and coercion. However, the statement of Shri Santosh Kumar, Inspector Customs has",,,,,

been treated as unreliable, though the same was a voluntary statement as there is no such contention by Shri Santosh Kumar that the",,,,,

statement was given under any pressure. It is apparent from the finding of the learned adjudicating authority given in respect of the,,,,,

Customs officers exonerating them, that he willfully/deliberately ignored the gravity and attempted to protect the officers at the cost of",,,,,

implicating the appellant. The learned adjudicating authority exonerated all the Customs officers who were implicated in the show cause,,,,,

notice for alleged connivance, on the ground that the allegations were made only on the basis of statements without any corroborative",,,,,

documentary evidences. However, while confirming the allegations against the appellant, the learned adjudicating authority applied",,,,,

different yardstick and imposed on the appellant huge penal liability, only on the basis of statements without any corroborative evidence.",,,,,

(xi) The learned adjudicating authority has imposed a consolidated penalty on the appellant under Sections 112(a), 114A and 114AA of the",,,,,

Customs Act amounting to Rs. 3,00,00,000/-. There is no quantification as to how much penalty has been imposed under which Section. It is",,,,,

a settled law that without mentioning exact penal provision and penalty imposed under the provision is unsustainable in law. Reliance is,,,,,

placed upon the judgment of the Hon’ble Supreme Court, in case of Amrit Foods Vs. CCE reported as 2005 (190) ELT 433 (SC).",,,,,

(xii) The learned Adjudicating Authority completely erred in invoking provisions of Section 114A against the Appellant for imposing,,,,,

penalty. Penalty under Section 114A is imposable on the person who is liable to pay the duty or interest, as the case may be, as determined",,,,,

under Section 28(8) of the Customs Act. It is an admitted fact by the department that appellant is not the importer and hence is not liable to,,,,,

pay duty. Therefore, there is no question of imposing penalty on the appellant under Section 114A.",,,,,

(xiii) While imposing penalty, together with other provisions, Section 112(a) has also been invoked. It is submitted that penalty under the",,,,,

aforesaid section can be imposed on the person who in relation to any goods (i) does any act which would render such goods liable to,,,,,

confiscation under section 111, (ii) omits to do any act which renders such goods liable to confiscation under Section 111 or (iii) abets the",,,,,

doing or omission of such an act. Thus, section 112(a) provides three situation under which penalty is imposable. There is no such act or",,,,,

omission or abetment on the part of appellant rendering the goods liable for confiscation. In fact, the appellant did not even know that the",,,,,

container is containing undeclared and counterfeit goods which is apparent from the extract of statement of appellant, mentioned in the",,,,,

paragraph F of grounds in Appeal-Memo. Therefore, no penalty under section 112(a) is sustainable against the Appellant. Penalty has",,,,,

been imposed on the appellant alleging knowledge on the part of appellant with respect to impugned goods. But, no evidence has been",,,,,

adduced by the department as to how the appellant was knowing about the same. It is submitted that Section 112 (a) provides for penalty in,,,,,

case of any act or omission rendering the goods liable to confiscation or abetment in doing so. The allegations are based on the statements,,,,,

which cannot be relied upon as explained above. There is no act of omission on the part of Appellant rendering the goods liable for,,,,,

confiscation. Further, as far as abetment is concerned, it is submitted that there are twin requirement to prove abetment. One, pre-",,,,,

knowledge of the alleged activity and pre-supposition of undue benefit likely to arise from the alleged activity. There is nothing in the show,,,,,

cause notice showing any knowledge/awareness on the part of Appellant. There is nothing adduced in the show cause notice or,,,,,

adjudication order, showing that the appellant derived any undue benefit out of the alleged activity. To impose penalty for charge of",,,,,

abetment or connivance, it is required to prove prior knowledge and the law in this regard is settled by the Hon’ble Supreme Court in",,,,,

the case of Sri Ram Vs. State of U.P.-AIR 1975 SC 175. Section 107 of IPC Explanation 2 clarifies that “whoever, either prior to or at the",,,,,

time of the commission of an act, does anything in order to facilitate the commission of that act, and thereby facilitates the commission",,,,,

thereof, is said to aid the doing of that actâ€. In the said order, the Hon’ble Supreme Court held that “in order to constitute",,,,,

abetment, the abettor must be shown to have ‘intentionally’ aided the commission of crime. Mere allegation that the crime charged",,,,,

could not have been committed without the interposition of the alleged abettor, is not enough compliance with the requirement of Sec.107",,,,,

IPC. A person may, for example invite another casually or for a friendly purpose and that may, facilitate the murder of the invitee but unless",,,,,

the invitation was extended with the intention to facilitate the commission of the murder, the person inviting cannot be said to have abetted",,,,,

the murder. It is not enough that an act on the part of the alleged abettor happens to facilitate the commission of the crime. Intentional,,,,,

aiding and therefore complicity is the gist of the offence of abetment under the third paragraph of section 107 of IPC.†The Hon’ble,,,,,

Bombay High Court in a larger Bench decision in the case of AMRITLAKSHMI MACHINE WORKS Vs COMMR. OF CUS. (IMPORT),",,,,,

MUMBAI reported as 2016 (335) E.L.T. 225 (Bom.), has also decided the issue of imposing penalty under Section 112(a) on the allegation",,,,,

of abetment. The relevant paragraph of the aforesaid judgment reads as under :,,,,,

“25…………… Parliament has specifically included abetment in Section 112(a) of the Act, to include acts done with knowledge,",,,,,

otherwise the first portion thereof “Any person - (a) who in relation to any goods does or omits to do any act ….†would cover acts,,,,,

done or omitted to be done on account of instigation and/or encouragement without knowledge. However, the first portion of Section 112(a)",,,,,

of the Act is only to make person of first degree in relation to the act or omission strictly liable. Persons who are not directly involved in the,,,,,

act or omission to act, which has led the goods becoming liable for confiscation cannot be made liable unless some knowledge is attributed",,,,,

to them. Therefore, it is to cover such cases that Section 112(a) of the Act also includes a person who abets the act or omission to act which",,,,,

has rendered the goods liable to confiscation. Imposing penalty upon an abettor without any mens rea on his part would bring all business,,,,,

to a halt as even innocent facilitation provided by a person which has made possible the act or omission to act possible could result in,,,,,

imposing of penalty. To illustrate innocent transferee of a license which enabled the purchaser of the license to misuse the license could be,,,,,

imposed with penalty. This could never be the intent or objective of Section 112(a) of the Actâ€​. (emphasis supplied).,,,,,

(xiv) Further, the learned Adjudicating Authority completely erred in not appreciating the statutory provisions properly in as much as, fifth",,,,,

proviso of Section 114A itself clearly provides that where any penalty has been levied under this section, no penalty shall be levied under",,,,,

Section 112 and Section 114. But, the learned Adjudicating Authority has invoked all the penal provisions together. Hence, the composite",,,,,

penalty imposed on the appellant is not sustainable.,,,,,

(xv) Further, Section 114AA of the Customs Act is also not invocable against the Appellant. From perusal of provisions of Section 114AA, it",,,,,

clear that penalty under the aforesaid section is imposable if some false declaration or statement has been made or any false signature has,,,,,

been made in respect of any transaction for the purpose of this Act i.e, Customs Act. It is submitted that Appellant is neither importer, nor",,,,,

filed Bill of Entry. Appellant has not made any declaration whatsoever leading to invocation of Section 114AA. All the allegations against,,,,,

Appellant are merely based on statements of Shri Makhan Kant Sharma, who is a co-noticee and of the appellant, but none of said",,,,,

statements are reliable. The allegation has been made that the appellant prepared, signed and filed the documents such as invoice and",,,,,

packing list of the foreign seller, in anonymous names, before the Customs, which is baseless. No such document containing the signature of",,,,,

the appellant was found. It is also pertinent to mention that no forensic lab test has been made by the department in this regard. Merely,",,,,,

because the appellant said so in the statement, that too, under coercion and pressure of the departmental officers, the same cannot be made",,,,,

basis to implicate the appellant. It is a settled law that statements alone cannot be made basis to confirm the allegation unless supported by,,,,,

independent corroborative evidences. On the basis of statements recorded under coercion and pressure, the department alleged that the",,,,,

appellant was preparing, signing and filing the documents in anonymous name, but there has been made no effort by the investigation in",,,,,

procuring any such document and also there is no investigation to the effect confirming that the so-called signatures were made by the,,,,,

appellant. None of the evidence had been adduced by the department confirming so, except relying on involuntary statements of the",,,,,

appellant. Hence, penalty imposed under Section 114AA is not sustainable. Otherwise also, purpose of introducing the provisions of Section",,,,,

114AA in the Customs Act was to punish those people who avail export benefits without exporting anything. Said provisions were introduced,,,,,

to counter serious frauds, not every kind of violations under Customs Act. The case of appellant cannot be equated with the same. Detailed",,,,,

submissions relying upon the report of the Parliamentary Standing Committee, have been made in para H-4 of the Appeal Memo. It is",,,,,

submitted that the Hon’ble Supreme Court in case of Loka Shikshana Trust v. CIT reported in AIR 1976 SC 10, Indian Chamber of",,,,,

Commerce v. Commissioner of Income Tax reported in AIR 1976 SC 348, Additional Commissioner of Income Tax v. Surat Art Silk Cloth",,,,,

Manufacturers' Association reported in AIR 1980 SC 387 Novartis AG v. Union of India (2013) 6 SCC 1, relied upon the speeches made by",,,,,

the Finance Minister for the purpose of ascertaining what was the reason for introducing a particular clause. In view of Constitution Bench,,,,,

Judgment of the Hon’ble Supreme Court, in case of Kalpana Mehta Vs. Union of India & Ors. (W.P. (C) 558 of 2012), Parliamentary",,,,,

Committee Report is to be considered to see the purpose for which a statutory provision has been brought in. Thus, in view of parliamentary",,,,,

standing committee report on introduction of Section 114AA, penalty cannot imposed on the Appellant under Section 114AA.",,,,,

(xvi) That in view of above, it is submitted that the impugned Order-in-Original passed by the learned Adjudicating Authority, is arbitrary,",,,,,

vague, perverse and against the settled position of law, hence, deserves to be set aside.",,,,,

Learned Authorised Representative Shri Gyanendra Kumar Tripathi appearing for the Revenue relies on the impugned order.,,,,,

Having considered the rival contentions and the facts on record, it is evident that this appellant knew both Shri Makhan Kant Sharma and Shri",,,,,

Rajesh Kumar Gupta @ Rajesh Bihari. As per the facts on record, Shri Rajesh Kumar Gupta is the actual importer who has been importing goods in",,,,,

the name of proprietorship firm â€" M/s Maa Shati of Shri Makhan Kant Sharma, which was having IEC number. Admittedly, appellant has",,,,,

introduced both the persons. The appellant was being paid nominal/nominal remuneration for facilitating the clearance of the goods, being imported by",,,,,

the said Shri Rajesh Kumar Gupta. There is no allegation in the show cause notice that this appellant was a partner or sharing in the profits being,,,,,

made in the business by Shri Rajesh Kumar Gupta, save and except, the normal remuneration/ commission, as a person handling clearances; It has not",,,,,

been established that the appellant has any role in arranging either the import of the goods or disposal of the same. He stated that he also came to,,,,,

know about the alleged mis-declaration only after inspection of the container in January/ February, 2010 by the Customs. He stated that whatever",,,,,

amount he has received from the said Shri Rajesh Kumar Gupta, was towards disbursement of custom duty, CHA charges and other clearing",,,,,

expenses. This point was not effectively controverted by investigation with evidence. It is worth noting that even in the course of search and,,,,,

investigation, no unexplained huge cash or assets has been found in the possession of this appellant.",,,,,

34.1. Further, we find that during the course of adjudication, admittedly, non-RUDs were not provided; appellant’s prayer for one adjournment or",,,,,

re-fixation of the date for receiving of the documents, was not accepted by the Adjudicating authority. To that extent we find that the order is bad as",,,,,

the appellant has not been provided proper opportunity to defend himself. We further find that there is nothing against the appellant wherein it can be,,,,,

deduced that he was doing any of the act of omission /commission with regard to the goods under import, so as to render the same liable for",,,,,

confiscation. Shri Makhan Kant Sharma has stated similar facts that he was in personal financial difficulty as his earlier business was stopped due to,,,,,

misfortune, and he was trying for some other business and accordingly own his volition with the help of this appellant got introduced to Shri Rajesh",,,,,

Kumar Gupta to facilitate the imports made by him. Further, we find that Shri Makhan Kant Sharma has admitted that he was consciously importing",,,,,

the goods for Shri Rajesh Kumar Gupta for remuneration. Neither Shri Makhan Kant Sharma nor this appellant was aware that Shri Rajesh Kumar,,,,,

Gupta was importing goods by resorting to mis-declaration and suppression, which amounted to smuggling. Revenue places reliance on some",,,,,

documents which have been allegedly taken from the pen drive, alleged to have been given to appellant by Shri Rajesh Kumar Gupta. However, we",,,,,

find that no proper procedures for recovering the pen drive or taking extracts from pen drive have beed followed. In fact, even a Panchnama was not",,,,,

drawn. Under the circumstances, reliance placed on such documents, loses evidentiary value.",,,,,

34.2. We further find that the impugned order heavily depends on statements rather than the statements supported by concrete evidence. It is alleged,,,,,

that the appellant has given inculpatory statement. However, the appellant submits that the statement has been recorded under undue coercion and",,,,,

duress. It is apparent on the face of record that the recording of the statement started on 29.03.2010 and continued again on 30.03.2010 after which,,,,,

he was arrested. Though, the submissions on threat and coercion are not substantiated, understandably, looking at the continuity of proceedings, it",,,,,

cannot be presumed that he was stress-free. Shri Rajesh Kumar Gupta is stated to have given the said pen drive to the appellant for taking print out of,,,,,

the invoice, packing list etc. As discussed above, the pen drive was not recovered under Panchnama. Therefore, in the absence of corroborative",,,,,

evidence, mere statement, that too by the of co-noticee cannot be relied upon as laid down by the Hon’ble Punjab & Haryana High Court in",,,,,

Assistant Commissioner of Customs vs. Amrik Singh (supra). Similar view has been taken by the Hon’ble Supreme Court in the case of Vinod,,,,,

Solanki -2009 (233) ELT 157. Moreover, we find that learned Adjudicating authority has not followed the provisions of Section 138B of the Customs",,,,,

Act, 1962, while placing reliance on the statements.",,,,,

34.3. The impugned order imposes a consolidated penalty on the appellants. We find that there is no provision in the law for such an imposition. We,,,,,

find that the impugned order, is bad in law and is liable to be set aside on this ground alone. We further find that the appellant has been imposed",,,,,

penalty under Section 114A Customs Act, 1962. We find that it is not established that the appellant has forged or falsified any of the documents which",,,,,

were filed before the Customs. The allegation against the appellant that he prepared and signed documents in the name of anonymous foreign seller is,,,,,

not substantiated as no such documents containing signature of the appellant has been brought on record. We find for these reasons, penalty under",,,,,

Section 114AA is not attracted. We find that the provisions of this Section are attracted only when a person is charged with liability to pay duty or,,,,,

interest. Admittedly, no duty or interest has been demanded from this appellant.",,,,,

34.4. We find further that no acts of omission or commission, which would render the goods liable for confiscation have been alleged or proved on the",,,,,

part of the appellant. No charge of abetment is also evidenced against the appellant. It is not the case of the department that he was sharing the profit,,,,,

in the acts of duty evasion etc resorted to by the importers. It is not established that the appellant had knowledge of the illegal trade indulged in by Shri,,,,,

Rajesh Kumar Gupta. Therefore, we find that the penalty under Section 112(a) is also not attracted.",,,,,

In view of our aforementioned findings and observations, we allow this appeal and set aside the impugned order. However, we leave the question",,,,,

open as regards the jurisdiction of DRI to issue the impugned show cause notice.,,,,,

In the result, the appeal is allowed with consequential benefits, if any, in accordance with law.",,,,,

(Pronounced on 30.11.2021).,,,,,