Judgment:
Jyoti Balasundaram
In this case, the impugned order dt. 30.10.06 was sent by registered post to the Raj Bhavan Road, Somajiguda, Hyderabad address of the company and it was also sent by registered post to the above mentioned address for service upon Shri R.Bhadrinarayanan, Managing Director. Since the order could not be served upon the appellants at the above address, it was displayed on the notice board of Custom House in the year 2007. The appeals have been filed before the Tribunal on 15.4.2009.
2. The ld.counsel for the appellants submits that appellant-company was registered at Ameerpet Hyderabad in the year 1994-95; shifted to Raj Bhavan Road, Somajiguda address in the year 1997; subsequently shifted to Diamond House Panjagutta in 2002 and thereafter the company was shifted to Srinagar colony, Hyderabad. He submits that Srinagar colony address of the company was very much available with the department as seen from the departments letter dt. 8.8.05 addressed to the company by the office of the Commissioner of Customs in connection with resubmission of advance licences after getting endorsement from JDGFT, Hyderabad. There is also communication dt. 8.9.06 from the company’s Srinagar colony address to the Commissioner of Customs in which they have stated that they had received notice for personal hearing on 11.9.06 and they have been able to get back all the licences except 3 which were still with the Preventive Section of the office of the Commissioner of Customs and that they had handed over 3 licences to the office of the JDGFT Hyderabad for endorsement on the licences which are yet to be returned etc. He submits that Srinagar colony address was clearly known to the department and yet the impugned order was issued to the previous address namely Somajiguda address. It is his submission that resort to Section 153 (b) of the Customs Act for service of notice by display on the notice board can be done only after the service provided as per Section 153 (a) is exhausted and in the present case the provisions of clause (a) of Section 153 have not been completely exhausted as the impugned order was not served upon the company or Badrinarayanan at the last known address of the company. He submits that that the impugned order was actually received by the appellants on 9.2.2009 and since the appeals have been filed in April 2009, there is no delay and the applications for condonation have been filed only by way of abundant caution.
3. We have carefully considered the rival submissions and find that Srinagar colony address of the appellant company was available with the department. Shri Badrinarayanan was the Managing Director available at the Srinagar colony address as on the date when the impugned order was passed and issued. Therefore, it cannot be said that the order was tendered to the appropriate address namely the last known address of the company at Srinagar colony, Hyderabad. In these circumstances, display of the order on the notice board in terms of Section 153 (b) is not sufficient as the department has not attempted to serve or served the order upon the last known address of the company. In these circumstances, we accept the contention of the appellants that there is no delay in preferring these appeals and we dismiss the applications for condonation as not required as the appeals are within the statutory period of limitation.
4). Now, we take up the applications for waiver of predeposit of duty of Rs.1,79,81,173/- (out of the total duty demand of Rs.1,99,52,448/-, the importer had already paid Rs.19,71,275/- which has been ordered to be appropriated) and penalty of Rs.25 lakhs imposed upon Shri Badrinarayanan, Managing Director of the first appellant company, under the provisions of Section 112 (a) of the Customs Act. We find that at this stage, we are able to decide the appeals themselves and hence proceed to do so with the consent of both sides after waiving predeposit. The demand has been confirmed on the ground that the appellant company, which had imported Cocoa Beans and FPK Oil duty-free against advance licences, only fulfilled export obligation partially and since there was no stock of the remaining quantity of imported items, the case of the department is that part of the Cocoa Beans and FPK Oil imported duty-free had been diverted by the applicants. However, as pointed out by the appellant company, the JDGFT has confirmed that the export obligation against various advance licences issued to the appellant company under which they had imported Cocoa Beans and FPK Oil had been discharged. The communication from the office of JDGFT covers all the 9 advances licences under which the imports in the present case were made. Although the appellant company had throughout been stating before the adjudicating authority that the export obligation had been fulfilled, they had not produced such endorsement on the advance licences prior to the passing of the impugned order and they have obtained these endorsements only in Dec 08/ Jan 09. Interest of justice requires that the case be decided afresh by the Commissioner in the light of the communications received in Dec08 and Jan09 from the office of the JDGFT. We, therefore, set aside the impugned order and remit the case insofar it relates to the appellant company to the Commissioner for de novo adjudication in the light of the EODCs granted by the JDGFT. He shall pass fresh orders after extending reasonable opportunity to the appellant company of being heard in its defence. The appeal of M/s.Lotus Chocolate Co. Ltd. namely C/86/09 is, therefore, allowed by way of remand.
5). As regards the appeal of Shri Badrinarayanan, we agree with him that penalty imposed on him cannot be sustained for the reasons that penalty has been proposed against him and imposed upon him under provisions of Section 112 (a) and the ingredients of this provision are not made out against him as Section 112 applies only to a person who, in relation to any goods, does or omits to do any act which act or omission would render such goods liable to confiscation under section 111, or abets the doing or omission of such an act, and in the present case no goods either have been confiscated nor have been held to be liable to confiscation and question of abetment does not arise for the reason that the main offender, if any, namely M/s.Lotus Chocolate Co.Ltd. has not been penalized and when the main person has not been penalized, a person cannot be held to have abetted commission or omission of an offence so as to hold him to be liable. When the main person himself has not been penalized, we, therefore, set aside penalty imposed on Shri Badrinarayanan and allow Appeal No.C/87/09.