2000 (9) TMI 1048 - AT - Customs

Summary

Issues Involved:
1. Liability to confiscation of the 4 containers and their cargo under Section 111(f), (g), and (h) of the Customs Act.
2. Confiscation of the vessel CMB Medal under Section 115(2) of the Customs Act.
3. Imposition of penalties on the individuals and the agency involved.

Detailed Analysis:

1. Liability to Confiscation of the 4 Containers and Their Cargo:
The Tribunal first examined the liability to confiscation under Section 111(f), (g), and (h) of the Customs Act. It was found that Section 111(h) did not apply as the unloading was done at an approved place under the general supervision of Customs, and there was no evidence of contravention. Section 111(g) was also not applicable as the containers were included in the Port Trust's records as per Section 45(2) of the Act. However, Section 111(f) was applicable since the containers were not mentioned in the import manifest, attracting confiscation. The Tribunal noted that the containers were included in the advance list filed with the Port Trust and Customs, indicating no intent to conceal their existence. The contents of the containers (zinc residue and zinc turnings) were freely importable and not contraband. The consignee, Mr. Navneet Cheddha, was a real person who had placed an order for the goods. The Tribunal concluded that the non-mention in the manifest was a technical error and not a premeditated act of smuggling.

2. Confiscation of the Vessel CMB Medal:
The Tribunal examined the confiscation of the vessel under Section 115(2) of the Customs Act. It was held that the non-declaration of the containers in the manifest was a technical error. However, the show-cause notice was found to be legally infirm as it did not name the owner of the vessel, Conti-Schepers-gessellschaft mb H & Co., as a noticee. This grave legal infirmity rendered the confiscation orders invalid, and they were set aside.

3. Imposition of Penalties:
The Tribunal reviewed the penalties imposed on various individuals and the agency. It was found that the Captain and Chief Officer of the ship did not have conscious knowledge that their actions would render the goods liable to confiscation. Their statements did not admit any knowledge of wrongdoing. Consequently, the penalties imposed on them were not sustained. Similarly, the individual officers of the shipping agents, M/s. CMB Transport, were not found personally responsible for rendering the cargo liable to confiscation, and the penalties on them were also not sustained. However, the agency, M/s. CMB Transport, was held responsible for understanding the Customs Act requirements and educating their officers. Therefore, the penalty on the agency was upheld but reduced from Rs. 25 lakhs to Rs. 2.50 lakhs.

Summary of Findings:
(i) The orders of absolute confiscation of the Zinc Residue etc. under Section 111(f) are upheld.
(ii) The orders of absolute confiscation of the containers are set aside, and they are ordered to be released to M/s. CMB Transport Agency.
(iii) The orders of confiscation of the Vessel CMB Medal are set aside.
(iv) The penalty imposed on CMB Transport is reduced from Rs. 25 lakhs to Rs. 2.50 lakhs.
(v) The penalties imposed on the following individuals are remitted in full:
1. Mr. Lehman Hans Arnold - Captain of the Ship M.V. CMB Medal.
2. Mr. Kleesse Hans Arno - Chief Officer of the said vessel.
3. Captain Ashok Dhawan - Regional General Manager, CMB Transport.
4. Mr. K. Chakravarthy - Regional Manager.
5. Mr. Ashok Patel - Manager.
6. Mr. Amit Dalal - Asst. Manager (working in Import Dept.).
7. Mr. P.P. Mohan Kutty - Asstt. Manager.
(vi) Appropriate consequential relief is ordered.