1

 IN THE SUPREME COURT OF INDIA

CIVIL  APPELLATE JURISDICTION  

CIVIL APPEAL NOS.3080-3081  OF 2005

COMMISSIONER OF CUSTOMS, MEERUT             Appellant(s)

                VERSUS

ASHWANI KUMAR JAIN AND ANR.                 Respondent(s)

(WITH CIVIL APPEAL NO.3082 OF 2005)

           O R D E R

C.A. NOS.3080-3081/2005: 1. These  appeals  emanate  from  the  judgment  dated  

18.6.2004 passed by the Customs, Excise & Service Tax  

Appellate Tribunal, New Delhi (“Tribunal”, for short) in  

Appeal Nos.C/78-79/02-NB(A) whereby the appeal filed by  

the respondents was allowed and the penalty imposed upon  

respondent  No.1  Ashwani  Kumar  Jain  was  fixed  at  Rs.1  

crore. However, the penalty imposed upon respondent No.2  

Balbir Singh Sethi was set aside by the Tribunal.  

2. Mr. Mohan Parasaran, learned Additional Solicitor  

General appearing for the appellant contends that the  

impugned judgment suffers from serious infirmities. He  

has drawn our attention to paragraph 9 of the impugned  

judgment wherein the Tribunal has observed as under:

2

“During the hearing of the case, the learned counsel  for the appellants pointed out that the penalty on  Shri Balbir Singh Sethi was entirely unwarranted. He  has pointed out that the show-cause notice did not  even  allege  that  Shri  Sethi  was  part  of  the  conspiracy. There is also no material to show that  he  was  aware  of  the  excess  quantity  or  undervaluation of the goods.”

3. Learned Additional Solicitor General submitted that  

the  aforementioned  findings  of  the  Tribunal  are  

untenable. He has also drawn our attention to the Show  

Cause Notice dated 5.1.2001 sent by the Directorate of  

Revenue  Intelligence,  I.P.  Bhawan,  I.P.  Estate,  New  

Delhi, the relevant portion of which reads as under:    

“(iii)  The  said  M/s.  Meerut  Exim,  Meerut,  Shri  Ashwani Kumar Jain, Prop. M/s. Meerut Exim, Meerut,  who masterminded the entire operation. Shri Balbir  Singh Sethi, who was actively involved in the entire  operation as an authorised signatory of M/s. Meerut  Exim,  Meerut,  and  ensured  the  improper  clearance  from Customs and subsequent storage of goods, Shri  Trilok Nath Mittal, who was also actively involved  in planning the operation with A.K. Jain, and later  on was involved in disposing of the smuggled goods  in the market knowing well that they were improperly  imported  goods  and  were  liable  to  confiscation  appear liable to penal action under Section 112(1)  and  (b)  and/or  Section  114A  of  the  Customs  Act,  1962.”

4. Mr. Parasaran has also drawn our attention to the  

order  dated  29.10.2001  passed  by  the  Commissioner,  

Customs & Central Excise, Meerut, in which the learned  

Commissioner has clearly observed as under:  

3

“The  said  M/s.  Meerut  Exim,  Meerut,  Shri  Ashwani  Kumar  Jain,  Prop.  M/s.  Meerut  Exim,  Meerut,  who  master  minded  the  entire  operation,  Shri  Balbir  Singh Sethi, who was actively involved in the entire  operation as an authorised signatory of M/s. Meerut  Exim,  Meerut,  and  ensured  the  improper  clearance  from Customs and subsequent storage of goods, Shri  Tirlok Nath Mittal, who was also actively involved  in planning the operation with A.K. Jain, and later  on was involved in disposing of the smuggled goods  in the market knowing well that they were improperly  imported goods and were liable to confiscation are  liable to penal action under Section 112(a) and (b)  and/or Section 114A of the Customs Act, 1962.”

5. As regards, Balbir Singh Sethi, issue No.(iii) was  

framed by  the Commissioner of Customs & Central Excise,  

Meerut and the Commissioner of Customs having arrived at  

a clear finding of conspiracy in which Balbir Singh Sethi  

was involved, the Tribunal could not have arrived at the  

finding that Balbir Singh Sethi was not involved in the  

conspiracy.   

6. In this view of the matter, we are constrained to  

set aside the impugned judgment and remit the matters to  

the Customs, Excise & Service Tax Appellate Tribunal.  We  

direct the said Tribunal to decide the appeals de novo  

after hearing the parties. All questions are left open  

for the parties to be raised before the Tribunal.

4

7. In order to avoid further delay in the matter, we  

direct the parties to appear before the Tribunal on 25th  

October,  2010.  We  request  the  Tribunal  to  decide  the  

appeals as expeditiously as possible.   

8. With the aforementioned observation and direction,  

these appeals are disposed of.   

C.A. No.3082/2005:

9. In view of the order passed by us in Civil Appeal  

Nos.3080-3081/2005, this appeal becomes infructuous and  

is dismissed as such.    

.....................J (DALVEER BHANDARI)

.....................J (DEEPAK VERMA)

New Delhi; September 29, 2010.