1984 (3) TMI 384 - AT - Customs

Summary

Issues Involved:
1. Confiscation of the vessel under Section 115(2) of the Customs Act, 1962.
2. Imposition of redemption fine in lieu of confiscation.
3. Imposition of personal penalty under Section 112 of the Customs Act, 1962.
4. Alleged bias and procedural violations in the adjudication process.
5. Denial of cross-examination of the officer who issued the show cause notice.
6. Disparate treatment of appellants compared to other crew members.

Detailed Analysis:

Confiscation of the Vessel under Section 115(2) of the Customs Act, 1962
The Tribunal upheld the confiscation of the vessel M.V. JAG DHIR under Section 115(2) of the Customs Act, 1962. The vessel was found to be transporting contraband goods, including various brands of Scotch whisky, cigarettes, and electronic items. The appellants argued that they had no knowledge of the contraband goods and that no rules had been framed under Section 115(2) prescribing the precautions to be taken by the owner or person-in-charge of the vessel. However, the Tribunal rejected this argument, stating that the onus of proof was on the appellants to show that the transport of contraband goods was without their knowledge or connivance. The Tribunal cited a Supreme Court ruling which held that mens rea is not a sine qua non for confiscation under similar circumstances.

Imposition of Redemption Fine in Lieu of Confiscation
The Tribunal affirmed the imposition of a redemption fine of Rs. 35,000 in lieu of confiscation. The appellants failed to discharge the burden of proof to show that the contraband goods were transported without their knowledge. The Tribunal found that the mere circulation of instructions to the crew against smuggling activities was insufficient to discharge this burden.

Imposition of Personal Penalty under Section 112 of the Customs Act, 1962
The Tribunal set aside the personal penalty of Rs. 50,000 imposed on each of the appellants under Section 112 of the Customs Act, 1962. The appellants argued that they had no knowledge of the contraband goods and that the adjudicating authority had exonerated the Chief Engineer and Chief Officer on the same evidence. The Tribunal agreed, stating that the adjudicating authority could not adopt different standards for evaluating the same evidence. The Tribunal concluded that the circumstances did not warrant a finding of guilt under Section 112 against the appellants.

Alleged Bias and Procedural Violations in the Adjudication Process
The appellants contended that the show cause notice was issued with a pre-conceived bias and that the adjudicating authority had initiated proceedings without any material evidence. The Tribunal rejected this contention, stating that the show cause notice was based on materials collected during the investigation and did not indicate any bias.

Denial of Cross-Examination of the Officer Who Issued the Show Cause Notice
The appellants argued that they were not permitted to cross-examine the officer who issued the show cause notice, which was a violation of the principles of natural justice. The Tribunal found this argument legally untenable, noting that the investigating officer who conducted the investigation was cross-examined at length. Since the officer who issued the show cause notice did not conduct any investigation, cross-examining him would serve no purpose.

Disparate Treatment of Appellants Compared to Other Crew Members
The appellants argued that the adjudicating authority exonerated the Chief Engineer and Chief Officer but imposed penalties on them, which was inconsistent. The Tribunal agreed, stating that the adjudicating authority could not adopt different standards for evaluating the same evidence. The Tribunal exonerated the appellants of the charge under Section 112 of the Customs Act, 1962, based on the same reasoning that led to the exoneration of the Chief Engineer and Chief Officer.

Conclusion
The Tribunal affirmed the confiscation of the vessel and the imposition of the redemption fine but set aside the personal penalties imposed on the appellants. The appeal was thus partly allowed.