2014 (6) TMI 338 - AT - Customs

Penalty u/s 112 - Goods seized from train - proceedings against the lease holder of the Shatabdi Express train - nobody claim the ownership of 70 packets of foreign origin mobile phones which were defaulted in terms of Import Policy - Held that - appellant is a lease holder of Shatabdi Expres train for a period of 3 years. It is also not disputed by the appellant that the goods were booked by him on 23.6.11. However, as he was unable to give the complete address of Shri Guddu Pandey, who had got the goods booked, the adjudicating authority has observed that the appellant was in knowledge of the fact that booked goods were in the nature of smuggled goods and were illegally imported into India. As such, he has imposed penalty upon him. The finding arrived at by the adjudicating authority are in the nature of inference. He has concluded knowledge on the part of the appellant on the ground that he granted/created fabricated and fake consigner / consignee for illegal transportation of smuggled goods with intent to mis-guide the customs officer. However, I find that there is no evidence available on record to show that the appellant who admittedly booked the goods in question is the lease holder of the train, was having any knowledge about the contents of the packets. As per the appellants he was not aware of the complete address of Guddu Pandey. As such, Shri Guddu Pandey was to take delivery of the goods himself at Kanpur Railway Station. From the said fact itself, it cannot be held that the appellants was aware of the facts of being tainted goods. Apart from the fact that appellant took the consignment in question as the lease holder of Shatabdi train, there is virtually no evidence to show that he was aware of the contents of packets or tainted character of the same. - Penalty set aside giving benefit of doubt - Decided in favour of appellant.

Summary

Issues:
1. Confiscation of goods and imposition of penalty on the appellant under the Customs Act.
2. Knowledge and involvement of the appellant in the transportation of smuggled goods.

Analysis:

Issue 1: Confiscation of goods and imposition of penalty
The case involved the detention of a consignment containing mobile phones and electronic items of foreign origin along with indigenous goods. The consignment was booked by an individual, and the appellant, who was the lease holder of the train, was associated with the booking. The Commissioner passed an order confiscating the goods and imposing a penalty of Rs.10 lakhs on the appellant. However, no penalty was imposed on the person who booked the goods. The appellant challenged the imposition of the penalty under section 112 of the Customs Act. The adjudicating authority concluded that the appellant had knowledge that the goods were smuggled and imposed the penalty based on inference. The appellant argued that he was not aware of the complete details of the person who booked the goods and should not be held responsible for the contents of the packets. The Tribunal noted that there was no evidence to prove that the appellant had knowledge of the tainted goods. Citing a previous case, the Tribunal emphasized that mere possession of the consignment does not imply awareness of its contents. Consequently, the penalty imposed on the appellant was set aside, and the appeal was allowed.

Issue 2: Knowledge and involvement of the appellant
The Tribunal analyzed the appellant's role as the lease holder of the train and his connection to the booked consignment. Despite being associated with the booking, the appellant claimed ignorance regarding the contents of the packets and the person who booked the goods. The Tribunal observed that there was a lack of evidence demonstrating the appellant's awareness of the nature of the goods. By giving the appellant the benefit of the doubt, the Tribunal overturned the penalty imposed, highlighting the importance of concrete evidence to establish knowledge and involvement in cases of confiscated goods. The judgment underscored the principle that possession alone does not indicate complicity in illegal activities, especially in cases where the individual may not have detailed knowledge of the goods being transported.

This detailed analysis of the judgment highlights the key legal issues, the arguments presented by the parties involved, and the Tribunal's reasoning leading to the decision to set aside the penalty imposed on the appellant.