Nachiket Satishbhai Mavalankar Vs C.C (CESTAT Ahmedabad)
The appellant faced penalties of Rs. 7 lakh under Section 114(3) and Rs. 3 lakh under Section 114AA of the Customs Act, 1962, based on allegations of issuing an erroneous valuation certificate for export cargo. The Department initially alleged involvement in mis-declaration of export cargo, resulting in the imposition of penalties. The appellant’s advocate highlighted that the original adjudicating authority had examined statements from other individuals, particularly Gaurav Dilip Panwar, Director of RRPL, which indicated that the appellant had no knowledge of the alleged mis-declaration. Statements from other noticees referenced the appellant’s involvement only in routine valuation, without any indication of awareness or participation in the alleged mis-declaration or conspiracy.
Despite these findings, the penalties were imposed by the original authority and later upheld by the Commissioner of Appeals. The appellate authority’s order stated that the appellant “knowingly and intentionally signed Valuation Certificate which was false and incorrect in material particulars,” thereby rendering the appellant liable under Section 114AA. The appellant contended that this finding was factually incorrect and directly contradicted the original authority’s conclusions regarding the lack of knowledge or involvement in the mis-declaration.
In support of the appeal, the appellant cited judicial precedents emphasizing that knowledge of mis-declaration is a necessary condition for imposing penalties under Sections 114 and 114AA. Key cases referenced included Anchor Logistics v. C.C., 2013 (290) ELT 334 (Guj.), Bhatia Shipping Pvt. Limited, 2024 (19) Centax 347 (Tri. Amd.), and HRMM Agro Overseas Pvt. Ltd., 2013 (292) ELT 68 (Tri. Amd.), all of which underscore that penalties cannot be sustained in the absence of knowledge or participation in wrongdoing.
