2016 (6) TMI 626 - HC - Customs

Levy of penalty on person-in-charge of vessel or its agent - scope of the term agent / any other person - Import of MS Scrap/plates from UAE - Import General Manifest - entire manifested quantity of 797.37 MTS of MS Steel Scrap and 302.29 MTS of MS Plates, has not landed as all the 40 containers were found empty. - penalty proceedings for short landing of the goods has been initiated under Section 116 of the Act. - Held that - A careful scrutiny of Sub-Section (2) of Section 148 of the Act makes it abundantly clear that an agent appointed by the person-in-charge of a conveyance and any person who represents himself to any officer of customs as an agent of any such person-in-charge, and is accepted as such by that officer, shall be liable for the fulfilment in respect of the matter in question of all obligations imposed on such person-in-charge by or under the Act. Thus, the liability to pay penalty set forth in Section 116 of the Act upon the person-in-charge is, therefore, liable to be fulfilled by the agent appointed by such person-in-charge of the conveyance as well. The import manifest is not a mere document of intimation of arrival of a vessel carrying imported goods but also contains a verified statement to vouchsafe for the truthfulness of the contents of the import manifest. The importance and significance of lodging import manifest can be gazed from Section 31 of the Act. Lodging import manifest under Section 30 of the Act has a direct bearing upon the controversy at hand. Thus, whoever lodges the import manifest with the proper officer of the Customs, acts as such, as an agent of the Master of the vessel. Whoever delivers the import manifest under sub-section (1) of Section 30, other than the person-in-charge of the carrier/conveyance falls within the expression any other person The appellant, for all practical purposes, is liable to be treated as any other person if not as an agent of the person-in-charge of the conveyance and hence liable to suffer the penalty as provided for under Section 116 of the Act. - Decided against the appellant.

Issues Involved:
1. Legality of the penalty imposed under Section 116 of the Customs Act, 1962.
2. Liability of the agent under Section 148 of the Customs Act, 1962.
3. Interpretation of the term "person-in-charge" under Section 2(31) of the Customs Act, 1962.
4. Validity of the Import General Manifest (IGM) and its declarations under Section 30 of the Customs Act, 1962.

Detailed Analysis:

1. Legality of the penalty imposed under Section 116 of the Customs Act, 1962:
The principal question was whether the imposition of a penalty under Section 116 of the Customs Act, 1962, was proper and justified. The court noted that Section 116 stipulates a penalty for not accounting for goods loaded in a conveyance for importation into India if they are not unloaded at their destination. The uncontroverted facts established that the Import General Manifest was filed with a proper declaration, the seals on the 40 containers were intact, but the containers were found empty, indicating the manifested cargo had not been delivered. Thus, the court upheld the penalty imposed by the primary authority, as the failure to unload the goods was not satisfactorily accounted for.

2. Liability of the agent under Section 148 of the Customs Act, 1962:
The appellant argued that the penalty could not be imposed on them as they were not the "person-in-charge" of the conveyance. However, the court highlighted Section 148, which extends the liability to the agent appointed by the person-in-charge of the conveyance. The court emphasized that the agent is liable for all obligations imposed on the person-in-charge by the Act and to penalties and confiscations incurred in respect of that matter. The court concluded that the appellant, acting as an agent, was liable under Section 148 for the penalty imposed under Section 116.

3. Interpretation of the term "person-in-charge" under Section 2(31) of the Customs Act, 1962:
The court examined the definition of "person-in-charge" under Section 2(31) of the Act, which includes the master of a vessel, the commander or pilot-in-charge of an aircraft, the conductor or guard of a railway train, or the driver of any other conveyance. The court noted that while the master of the vessel is the person-in-charge, Section 148 allows for the agent to act on behalf of the person-in-charge. Therefore, the appellant, as the agent, was deemed equally responsible for fulfilling the obligations of the person-in-charge.

4. Validity of the Import General Manifest (IGM) and its declarations under Section 30 of the Customs Act, 1962:
The court underscored the importance of the Import General Manifest (IGM) under Section 30, which requires the person-in-charge or any other person specified by the Central Government to deliver the manifest with a declaration of its truthfulness. The court noted that the IGM is a crucial document for customs procedures, and the declarations made therein are legally binding. The appellant, having filed the IGM, was responsible for its contents and the short landing of the cargo. The court affirmed that the appellant, acting on behalf of the person-in-charge, was liable for the penalty due to the discrepancies in the cargo delivery.

Conclusion:
The court dismissed the appeal, affirming the penalty imposed under Section 116 of the Customs Act, 1962. The appellant, as the agent of the person-in-charge, was held liable under Section 148 for the short landing of the cargo. The court also upheld the validity and binding nature of the declarations in the Import General Manifest under Section 30. The judgment emphasized the comprehensive liability of agents acting on behalf of the person-in-charge in customs procedures.

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