Dismissed

Jawahar P. Kanungo v. Union of India and Customs Excise and Service Tax Appellate Tribunal and Anr.

Bombay HC8 Mar 2006CUAPP/2/2006

Case brief

AI extract

What is this about?

Customs Appeal against penalty imposition. The High Court found that the Tribunal validly imposed a penalty of Rs. 25 lacs based on the appellant’s admission of involvement in duty-free imports. No substantial question of law arose, and the appeal was dismissed.

What did the court decide?

The appeal was dismissed in limine. The penalty of Rs. 25 lacs was upheld.

Jawahar P. Kanungo Vs Union of India and Customs Excise… — Customs and Excise | Bombay HC (2006)

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORIGINAL SIDE

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CUSTOMS APPEAL NO.2 OF 2006

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Jawahar P. Kanungo Appellant vs. Union of India & ors. Respondents

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Mr.Anil Balani with Mr.Jerry Lewis for the appellant.

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Mr.M.I. Sethna, Senior Advocate with Mr.R.Ashokan for the respondents.

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CORAM : R. M. LODHA &

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J.P. DEVADHAR,JJ .

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DATED : 8th March, 2006

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P.C.

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Heard Mr.Anil Balani, the learned counsel for the

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appellant.

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2.	The	learned co	unsel for	the	a	ppellant	submitte	d that
the	Custo	ms, Excise	and Se	rvice	Tax	Appell	ate	Tribunal
was	not	right in	imposing	penalty	for	the	first	time
without		considering	written	submiss	ions/def	ence	of	the
appellant.		He would	also	contend		that	by	invoking
Section 11	1(o) of the	Customs Act, the pe	nalty could not

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have been imposed upon the appellant.

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3.	The arguments	have	no	merit.	T	he Trib	unal	has	given
solid	reasons for	impos	ing	penalty	of	Rs.25	lacs	on	the

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appellant besides confirming the duty demand against the

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importer firm-USL and confiscation of the goods.

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In paragraph 16, the Tribunal considered the
statement of the appellant and also the statement of
Shri N.J.D’costa who happened to be the appellant’s
employee. The statement of the proprietor of other firm

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M/s.Jabee & Co. was also considered. Paragraph 16 the

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Tribunal’s order reads thus:

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"16.	Shri Jawahar Kanungo is also liable to
penalty,	as his involvement in the offence is
clearly	established. He has admitted that as
a	Proprietor of M/s.Manek Metal Corporation
and	Director in M/s.Kanungo Trading & Metals
Pvt.Ltd.	and Manek Metal Trading Pvt.Ltd. he
handled	imports of USL, maintained liaison
with	M/s.H.G.Mehta & Company and M/s.Jabee &
Co.	for clearance of raw material imported
duty	free by USL and that he had directed
M/s.Ashok	Goods Transport to transport the raw
material	imported duty free by USL. He has
also	admitted that he had paid the Customs
Duty	and CHA charges from his company’s
account	for the import by USL. He has
operated	the bank account of USL at Gulalwadi
Branch	of Bank of Baroda and paid
Rs.13,85,00	0/- from M/s.Kanungo Trading &
Metals	Pvt.Ltd., Rs.46,51,000/- from M/s.Manek
Metal	Corporation and Rs.2,82,650/- from
M/s.Manek	Metal & Trading (P) Ltd. into the
USL	account, but he could not provide any
details	for the reasons for doing so. He has
admitted	that during the period from April
1993	to December 1994 a total amount of
Rs.6.77	crores has been deposited in USL
account,	Rs.3.43 crores was deposited from out
of	the accounts of his companies and these
amounts	have not been reflected in the account
of	USL. Shri A.S.Bhattar stated that nobody
of	USL was preparing the pay-in-slip and
depositing	the cheques/Demand Drafts/Banker’s
cheques	in the account of USL, that he used to
give	blank cheques duly signed by him as
authorized	person to operate USL account in
Bank	of Baroda with Shri Jawar Kanungo for
withdrawals	or issue as required from time to
time	and that Shri Jawar Kanungo was

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depositing the money in	this	account. The
involvement of Shri Jawah	ar Kanu	ngo is further
brought out from the	statemen	t of Shri
N.J.D’Costa, who is an	employee	of Jawahar
Kanungo that he used	to sign	the letters of
USL addressed to Customs	House	Agent and that
he had signed the	documents	as Managing
Director of USL. He	was	also giving
instructions to CHA	M/s.H.G./Me	hta &Company
for clearance of the	goods	on Kanungo’s
instructions. The propr	ietor of	other CHA
firm M/s.Jabee & Com	pany admi	tted that Shri
Jawar Kanungo had approa	ched him	for clearance
of consignments in the	name	of USL and
documents for clearance	were	received from
Shri Jawahar Kanungo or	from his	staff and
Shri Jawahar Kanungo	was	giving them
instructions for clearance	and	delivery of
goods. The Power of	Attorney h	older for CHA
firm, M/s.H.G.Mehta &	Company	has also
admitted that all the	import	related documents
and correspondence in	respect of	USL were
given to him by Shri	Jawahar	Kanungo and that
the payments for cleara	nce of	goods were
received by his firm fro	m Shri	Jawahar Kanungo
either by cheque/demand	drafts or	in cash.
Further, Shri Ashok Kuma	r Doshi,	Proprietor of
M/s. Ashok.Ashok Goods	Transpor	t has admitted
that he was making avail	able the	trucks in the
docks area for transportin	g the	goods imported
by USL, on the request	of Shri	Kanungo. We,
therefore, impose a penalty of Rs.25,00,000/- upon Shri Kanungo."

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It is pertinent to note that in his statement, the appellant admitted that money was paid to USL account by his firm and that he had associated himself with booking the material for import by USL. The statement of N.J.D’costa, the employee of the appellant was also recorded and the involvement of the appellant is clearly reflected from his statement as well.

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In the facts and circumstances, therefore, the

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imposition of penalty by the Tribunal after setting aside the order of the Commissioner of Customs cannot be said to suffer from any error of law. 7. No substantial question of law arises in the appeal. 8. Appeal is dismissed in limine. (R.M. LODHA,J.) (J.P. DEVADHAR,J.)

Jawahar P. Kanungo v. Union of India and Customs Excise and Service Tax Appellate Tribunal and Anr.

Case brief

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What did the court decide?

Jawahar P. Kanungo v. Union of India and Customs Excise and Service Tax Appellate Tribunal and Anr.

Case brief

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What did the court decide?

What the court decided

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