2017 (6) TMI 256 - AT - Customs

Imposition of penalty on Inspectors of Customs u/s 117 of the CA, 1962 - appellant failed to discharge their duties properly as laid down u/s 117 and 51 of the Act, 1962, for the purpose of scrutiny of Bill of Export and examination of the goods - Held that - similar issue decided in the case of Suvasis Banerjee, Samir Kumar Das, Dipak Kumar Sardar, Ajoy Nath Versus Commissioner of Customs, (P) W.B. 2016 (8) TMI 874 - CESTAT KOLKATA , where it was held that if protection to officers against proceedings in courts can be given, there is no reason why such a protection cannot be given to proceedings before quasi judicial authorities. Also, held that protection under Section 155 of the Customs Act is available even in respect of adjudication proceedings - the imposition of penalty under Section 117 on the appellants is not justified - appeal allowed - decided in favor of appellant.

Summary

Issues:
Imposition of penalty under Section 117 of the Customs Act, 1962 on Customs Inspectors for alleged abetment and collusion with an exporter.

Analysis:
The Adjudicating Authority found that the appellants, who were Customs Inspectors, had colluded with an exporter to contravene Customs Act provisions. They were penalized under Section 117 for failing to discharge their duties properly regarding scrutinizing Bill of Export and goods examination. The appellants challenged the penalty, citing the Central Excise Manual and a Tribunal decision in a similar case. The Tribunal in the referenced case had allowed the appeals against penalties imposed under Section 117, emphasizing the necessity of issuing a notice within the specified time under Section 155(2) of the Customs Act.

The Adjudicating Authority in the present case dropped the proceedings based on two grounds: the proceedings being time-barred under Section 155(2) and the acts of the appellants not rendering the goods liable to confiscation under the Act. The Tribunal analyzed the applicability of Section 155(2) to adjudication proceedings against Customs Officers, citing precedents and the Customs Act's protection clauses. It noted that the time limit for initiating proceedings was not adhered to in this case, leading to the conclusion that the Commissioner was legally correct in dropping the proceedings based on limitation grounds.

The Tribunal found the present case's facts and circumstances aligned with the earlier decision in a similar case, where penalties under Section 117 were set aside. Consequently, the Tribunal held that the penalty imposed on the appellants was not justified and set it aside, allowing the appeals filed by the Customs Inspectors against the penalties under Section 117 of the Customs Act, 1962.