2002 (1) TMI 357 - AT - Customs

Summary

Issues Involved:
1. Imposition of penalty on R.P. Sethi under Sections 112(a) and (b) of the Customs Act.
2. Confiscation of the car and imposition of penalty on Rajesh Bhaskar.
3. Confiscation of goods and Indian currency from Ajay Rajpal's premises and imposition of penalty on him.

Issue-wise Detailed Analysis:

1. Imposition of Penalty on R.P. Sethi:
Arguments:
- The appellant argued that the imposition of penalty was beyond the scope of the Show Cause Notice (SCN) as there was no specific proposal for penalty against R.P. Sethi.
- The SCN only proposed the confiscation of books used for concealing smuggled goods.
- The Commissioner's finding that Sethi failed to discharge his responsibility as a Customs House Agent (CHA) was beyond the SCN, and Section 112 was not applicable for violations of CHA Licensing Regulations.

Judgment:
- The Tribunal found that there was no specific allegation against R.P. Sethi in the SCN.
- For imposing penalty under Section 112(a), a person must be found to have done or omitted an act rendering goods liable to confiscation under Section 111 or must have abetted such act.
- For Section 112(b), the person must have dealt with import goods knowing they are liable to confiscation under Section 111.
- There was no allegation involving these ingredients against R.P. Sethi.
- The Commissioner's finding regarding Sethi's responsibility as a CHA was beyond the SCN.
- Penalty imposed on R.P. Sethi under Sections 112(a) and (b) was set aside.

2. Confiscation of the Car and Imposition of Penalty on Rajesh Bhaskar:
Arguments:
- The appellant contended that he was unaware of his brother Sandeep Bhaskar using his car for carrying smuggled goods.
- There was no proof of Rajesh's connection with the smuggled goods or M/s. Umesh Book Service.
- The Commissioner's finding of Rajesh's "complicity in the smuggling of watch movements" was not sustainable.

Judgment:
- The Tribunal noted that for imposing penalty under Section 112, there must be specific allegations involving the ingredients of the section.
- The SCN did not allege any act or omission by Rajesh Bhaskar rendering goods liable to confiscation under Section 111.
- The Commissioner's reasoning did not satisfy the requirements for invoking Section 112.
- Penalty imposed on Rajesh Bhaskar under Sections 112(a) and (b) was set aside.
- The confiscation of the car was remanded for fresh decision, as the Commissioner had not considered Rajesh's plea that the car was used without his knowledge or consent.

3. Confiscation of Goods and Indian Currency from Ajay Rajpal's Premises and Imposition of Penalty on Him:
Arguments:
- The appellant argued that he was falsely implicated by co-accused Vipin Kalra and Sandeep Bhaskar.
- There was no evidence connecting him with M/s. Umesh Book Service or the consignment of watch movements.
- The seized currency was legally withdrawn from a bank, and the goods seized from his shop were lawfully acquired.

Judgment:
- The Tribunal noted that the Commissioner's decision was based almost entirely on the retracted statements of co-accused.
- Ajay Rajpal's own statements and submissions were not considered by the Commissioner.
- The Commissioner did not properly evaluate the evidence, including the banker's certificate and purchase bills.
- The order of confiscation of currency and goods was set aside due to lack of proper application of mind.
- Penalty imposed on Ajay Rajpal under Sections 112(a) and (b) was set aside.
- The issue of confiscation of goods and currency was remanded for fresh decision.

Conclusion:
- Appeal No. C/82/2000 was allowed.
- Appeal Nos. C/117 and 120/2000 were allowed on the penalty issue and remanded on the confiscation issue.
- The Commissioner was directed to decide afresh on the remanded issues in accordance with law and principles of natural justice, giving the parties a reasonable opportunity of being heard.