C. Venkateswara Rao vs Commissioner Of Central Excise, ...

[Arising out of Order-in-Appeal No. 48 TO 51-2012 dated 27/07/2012 passed by Commissioner of Customs & Central Excise (Appeals), Hyderabad]

For approval and signature:

HON'BLE SHRI B.S.V.MURTHY, TECHNICAL MEMBER

1 Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No 2 Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? No 3 Whether Their Lordships wish to see the fair copy of the Order? Seen 4 Whether Order is to be circulated to the Departmental authorities? Yes

C. VENKATESWARA RAO HOUSE NO.3660, SECTOR 23, PALAM VIHAR, GURGAON 122 001 Appellant(s)

J. CHANDRA SEKHAR F-301, SAI DURGA TOWERS, NEAR ANDHRA BANK, SANJEEVA REDDY NAGAR, HYD AP Appellant(s)

S. KOTESWARA RAO 105, MANI ENCLAVE, PLOT NO. 55 & 56, RAMAKRISHNA STREET, VIVEKANANDA COLONY, KUKATPALLY, HYDERABAD AP Appellant(s)

Versus

Commissioner of Central Excise, Customs and Service Tax HYDERABAD-II L.B STADIUM ROAD, BASHEERBAGH, HYDERABAD, - 500004 ANDHRA PRADESH Respondent(s)

Appearance:

None For the Appellant

Mr. S. Teli, A.R. For the Respondent

Date of Hearing: 01/05/2015

Date of Decision: 01/05/2015

CORAM:

HON'BLE SHRI B.S.V.MURTHY, TECHNICAL MEMBER

Final Order No. 21478-21480 / 2015

Per : B.S.V.MURTHY

All the three appeals filed by the appellants are disposed by a common order as they arise out of a common impugned order.

2. The appellant Shri C. Venkateswara Rao, is the General Manager of M/s Nuance Group (India) Pvt Ltd. (NGIPL for short) Bangalore, who was running a customs duty free shop at Rajiv Gandhi International Airport at Hyderabad. He was overall in-charge of stores, purchases, sales and administration of NGIPL at Hyderabad. Shri J. Chandrasekhar is the senior executive in the duty free shop at Rajiv Gandhi International Airport at Hyderabad during the period from February 2008 to May 2009. His job was recruitment of employees and to take care of their welfare activities. Shri S. Koteswara Rao, is in real estate business. He used to collect liquor bottles from the international passengers and sell in the market for certain period.

3. All the three individuals mentioned herein above are in appeal against the impugned order. In the impugned order, a penalty of Rs. 50,000/- has been imposed on Shri C. Venkateswara Rao on the ground that he was involved and devised a plan to clear goods from bonded warehouse (duty free shop in the airport) without payment of duty. One Television and one liquor bottle valued at Rs. 55,000/- was seized from his house. Shri J. Chandrasekhar Rao, senior executive was also involved in the activities and expired chacolotates and 138 liquor bottles were seized from his house. 34 bottles or whiskey and Rs. 65,000/- cash was seized from the residence of Shri S. Koteswara Rao and a penalty of Rs. 25,000/- has been imposed on him .

4. The officers of DRI Hyderabad raided the duty free shop and bonded warehouse premises of NGIPL and found discrepancies in the stock. Thereafter residential premises of the three individuals was raided and goods were seized. Thereafter, proceedings were initiated. The methodology adopted was to show sale of some goods against international passenger but sell the goods actually to a local person (outsiders). Employees of NGIPL, in their statements had accepted that sale proceedings were realized in cash and amount was deposited in Indian currency in the account of duty free shop of NGIPL. THE Commissioner(Appeals) also observed that that goods were seized from the truck near the residence of Shri J. Chandrasekhar and confessional statement of Shri J. Chandrasekhar that goods were clandestinely removed.

5. It was submitted by the learned counsel that in all these cases it is the only case of the department that duty was not paid. It was submitted that in all cases, the goods were appropriately accounted for and the sales were made only to international passengers.

6. I have considered the submissions. I find that there is a clear admission statement about diversion of goods to the local market from the duty free shop. Seizure of goods have not been questioned. In such a situation, it is quite clear that the appellants are involved in diversion of duty free goods to the local market. Nevertheless, however, the entire quantity of goods have been confiscated and not allowed to be redeemed on payment of fine also. This would show that appellants have already lost the amount involved as far as the value of goods is concerned. Having regard to the fact that appellants are employees of the company and there is no evidence to show how much money they have earned by such activities, I consider that some reduction in penalty is warranted. Accordingly, penalty on Shri C. Venkateswara Rao is reduced to Rs 25,000/- (rupees twenty thousands only); Penalty of Shri J Chandrasekhara Rao is reduced to Rs. 12,500/- (rupees twelve thousand ive hundred only) and penalty of Shri S. Koteswara Rao is reduced to Rs. 12,500/- (rupees twelve thousand five hundred only). Appeals are disposed of in above terms.

(Operative portion of the order pronounced in open court on conclusion of the hearing)

B.S.V.MURTHY TECHNICAL MEMBER

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