S. Kishore Vs Commissioner of Customs (CESTAT Chennai)
CESTAT Reduces Customs Penalty Because Co-Noticees Received Lower Penalties Before Settlement Commission; CESTAT Upholds Fraud Findings but Cuts Penalty in EPCG Export Obligation Case; Reduced Penalty Granted Because Main Noticee’s Managing Director Faced Lower Penalty Before Settlement Commission; CESTAT Confirms Liability Under Sections 112(a) and 114AA for False EPCG Shipping Bills.
In S. Kishore Vs Commissioner of Customs, the Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) partly allowed the appeal by reducing penalties imposed on the appellant under Sections 112(a) and 114AA of the Customs Act, 1962, in connection with fraudulent fulfilment of export obligations under the EPCG Scheme.
The case arose after M/s Chromaprint India Pvt. Ltd. imported machinery under EPCG licences and allegedly fulfilled export obligations through unrelated third-party exporters’ shipping bills to fraudulently obtain Export Obligation Discharge Certificates (EODCs) from DGFT. The authorities alleged that the appellant acted as a mediator in arranging shipping bills from unrelated exporters for false fulfilment of export obligations. A show cause notice dated 17.02.2015 proposed recovery of customs duty of over Rs.3.17 crore along with confiscation and penalties.
The appellant argued that he merely handled documentation relating to EPCG licences and EODC applications and had no role in exports or procurement of shipping bills. It was also contended that most co-noticees, including the main noticee, had settled the matter before the Settlement Commission and that comparable relief should be considered for the appellant.
