2017 (11) TMI 51 - AT - Customs

Penalty u/s 112(a) of the CA, 1962 - abetting smuggling - Held that - the imposition of penalty on the appellant under the provisions of Section 112(a) of the Customs Act, 1962 is not sustainable in law, as the same has been passed without any clinching evidence against the appellant showing his involvement in abetment of clearance of imported parcels without payment of customs duty. If when disciplinary proceedings under CCS (CCA) Rules, 1965 are dropped, then the imposition of penalty under Section 112(a) of the Customs Act, 1962 on the same charges and same evidence cannot survive. Appeal allowed - decided in favor of appellant.

Summary

Issues:
- Imposition of penalty under Section 112(a) of the Customs Act, 1962 for abetting smuggling based on intercepted parcels.
- Jurisdiction of DRI to issue show-cause notices and sustainability of penalty imposition.
- Lack of clinching evidence against the appellant for abetment.
- Comparison with parallel CBI Court acquittal and disciplinary proceedings outcome.
- Examination of imported parcels and involvement of other relevant parties.
- Detailed reasoning and evidence considered by the Commissioner in the impugned order.

Imposition of Penalty for Abetting Smuggling:
The appeals were filed against adjudication orders imposing a penalty of ?1,00,000 each on the appellant under Section 112(a) of the Customs Act, 1962 for allegedly abetting smuggling. The case involved intercepted parcels received by a person on behalf of a company without paying customs duty. The Commissioner confiscated the parcels and imposed penalties after due process.

Jurisdiction and Sustainability of Penalty Imposition:
The appellant argued that the show-cause notice issued by DRI lacked jurisdiction due to amendments in the definition of "Customs Officer." The appellant cited legal precedents to support the claim that the penalty imposition based on the notice was not sustainable. Additionally, the appellant highlighted the lack of evidence and discrepancies in the proceedings.

Lack of Clinching Evidence and Comparison with CBI Court Acquittal:
The appellant emphasized the lack of conclusive evidence against them for abetting smuggling. Reference was made to a CBI Court acquittal and disciplinary proceedings where the appellant was exonerated. The appellant argued that the same charges and evidence could not lead to penalty imposition under Section 112(a) of the Customs Act, 1962.

Examination of Imported Parcels and Involvement of Other Parties:
The appellant contended that the proper officer for examining imported parcels should be held accountable, questioning the penalty imposition solely on the appellant. Lack of investigation on postal officers and other parties involved in possession of the parcels was highlighted as a procedural flaw.

Detailed Reasoning and Evidence Considered by the Commissioner:
Both parties presented their arguments, with the appellant challenging the sustainability of penalty imposition and the respondent supporting the impugned order. The Commissioner's detailed reasoning, evidence assessment, and the appellant's statements under Section 108 of the Customs Act, 1962 were crucial in the case.

Final Decision:
After considering submissions and evidence, the judicial member found the penalty imposition unsustainable due to insufficient evidence against the appellant. Citing the CBI Court acquittal, disciplinary proceedings outcome, and legal precedents, the member set aside the impugned orders, allowing both appeals of the appellant.

Case Reference:
- Mangali Implex Ltd. Vs. UOI: 2016 (335) ELT 605 (Del.)
- Department of Customs Vs. Arvind Kumar: 2017 (348) ELT 411 (Del.)
- Commissioner vs. Parminder Jit Singh: 2013 (293) ELT 241 (Tri.)
- Suraj Prakash vs. CC, New Delhi: 2016 (333) ELT 366 (Tri.-Del.)