Altaf Ahmed Vs Commissioner of Customs (CESTAT Ahmedabad)
Customs Penalty Under Sections 112 and 114AA Set Aside for Lack of Show Cause Notice and Evidence: CESTAT Ahmedabad
The CESTAT Ahmedabad allowed an appeal against an Order-in-Original dated 15.04.2025 whereby the Commissioner had imposed penalties of Rs. 25,00,000 under Section 112(a), Rs. 25,00,000 under Section 112(b), and Rs. 50,00,000 under Section 114AA of the Customs Act, aggregating to Rs. 1 crore.
The case arose from an investigation by the Directorate of Revenue Intelligence (DRI) into the alleged diversion of imported areca nuts warehoused in KASEZ by M/s. Global Enterprises. According to the department, duty-free areca nuts imported into the SEZ were intended to be diverted into the Domestic Tariff Area (DTA) under the guise of an SEZ-to-warehouse transfer. The department also alleged that the goods had been rejected by FSSAI and that the Central Warehousing Corporation (CWC) warehouse space availability certificate had expired before clearance from the SEZ.
The adjudicating authority held that the appellant was to receive a commission of Rs. 10 per kg for delivery of the consignment to M/s. J B Traders, Nagpur, and was an active partner in the alleged diversion. It further alleged that the appellant caused incorrect declarations for transfer to CWC, Okhla, submission of an expired space certificate, and generation of incorrect e-way bills, leading to penalties under Sections 112(a), 112(b), and 114AA of the Customs Act.
