J.M. Shah Vs. Commissioner of Cus.

.....the final products as held by them from the raw materials imported by them. m/s. m. j exports did not meet the export requirements. they in turn diverted/supplied/sold the goods to m/s. tudor india ltd, one of the appellants herein. m/s. tudor india ltd manufactured the final product from the said imported goods and exported the entire quantity to their buyers. such export was not under deec. the other appellant before us, to day, is one mr. j. m. shah, who at the relevant time was the managing director of m/s. m. j exports, who is also a director in m/s. tudor india ltd. m/s. tudor india ltd and mr. shah has been imposed penalties under section 112 (a)/112(b) of the customs act, 1962 of rs 30.00 lakhs and rs 20.00 lakhs respectively. hence these appeals.3. on a careful perusal of the impugned order, we do not find any evidence arrived at of a liability to confiscation under section 111(o) of the customs act, 1962 for the diversion of the deec duty free imported raw material. no other liability to confiscation of any goods has been arrived at under any of the provisions of the act.4. both sides agree that the duties involved on the raw materials imported by m/s. m. j. exports which were not utilized by them for the deec export obligations has since been discharged along with interest thereon prior to issue of the show cause notice. no penalties of any amount or any other liability has been arrived at on m/s. m. j. exports by the id. adjudicator, though they were issued a show cause notice pursuant to which the present proceedings were conducted by the id.commissioner.5. when no liability to confiscation of the goods imported duty free and utilized in contravention of the deec import and benefit of notification no. 80/95 has been arrived at, consequent penalties under section 112 on any person cannot be upheld.6. in this view of the matter, the appeals succeed and the impugned order is set aside and the appeals disposed of accordingly.