[Order]. - The appellant is in appeal against the impugned order imposing penalty of Rs. 10 lakhs under Section 112 of the Customs Act, 1962.
2. Brief facts of the case are that appellant is having valid import and export code and imported compact disc rewritable (CDR) in his own name and also against IEC in the name of others. The case of the Revenue is that as imports have been made by the appellant in the name of other firms namely M/s. Megha Trading Co. and Balaji Sales Corp. who were having the IEC code but they were not the actual importer of CDRs but the appellant is the actual importer and imports were made in their name on behalf of the appellant and some commission was paid by them for lending their IEC. Therefore, appellant is liable to be penalized as the appellant is not entitled to import the goods in the name of others, only the IEC holder is entitled to import the goods. Therefore the case has been booked against the appellant and a penalty of Rs. 10 lakhs imposed on the appellant.
3. The learned Counsel submits that in this case, the appellant has not violated any provisions of the Customs Act and DGFT has not issued any show cause notice for violation of the provisions of Foreign Trade Policy. He further submits that all the documents were filed in the name of IEC holders and they are importing the goods which are actually used by the appellant and there is no provisions in the Customs Act prohibiting such an act. Therefore, as held by this Tribunal in the case of Atul D. Sonpal [ (Tri.-Mum.)], penalty is not imposable on the appellant.
4. On the other hand, learned AR opposed the contention of the appellant and submits that the IEC holders are found to be non-existent and bail was granted to the appellant on the condition that appellants are required to produce the actual IEC holder. Later on appellant produced the actual IEC holder, therefore, the appellant has imported the goods in the name on non-existent IEC holders, the penalty is rightly imposed on the appellant as the import can be made by only the IEC holder only. As held by this Tribunal in the case of Nazir-ur-Rahman v. CC, Mumbai [ (Tri.-Mum.)].
5. Heard both sides. Considered the submissions.
6. In this case, it is not in dispute that imports have been made in the name of IEC holder. Bills of entries have also been filed in the name of IEC holder. Therefore, as per the decision of Nazir-ur-rahman (supra), Imports have been made in the name of IEC holder. Further, the appellants has produced the IEC holder before the Revenue authorities and there is no bar for imports under the Customs Act to import the goods in the name of IEC holder and there is no offence under the Customs Act for lending of IEC code. In these circumstances, relying on the decision of Atul D. Sonpal (supra), I hold that the appellant has not violated the provisions of Customs Act and there is no allegation of any mis-declaration, misrepresentation or under-valuation of the goods, Merely IEC holder lending the IEC to a third party is not an offence under the Customs Act and penalty for violation of Section 7 of Foreign Trade (Development and Regulation) Act, 1992 cannot be imposed under Customs Act. Therefore I hold that penalty on the appellant is not imposable. Accordingly, the impugned order is set aside and appeal is allowed with consequential relief, if any.
(Pronounced in the open Court)