2018 (10) TMI 1082 - AT - Customs

Penalty u/s 114(i) of the Customs Act, 1962 - Smuggling - Red Sanders - prohibited item - Held that - The learned Commissioner in para 71 of the impugned order has correctly observed that the Appellant, Shri Dinesh Panwar has not merely acted as a Customs House Agent but acted as an authorized signatory of the exporting firm - further the goods which were to be exported were prohibited goods. Therefore, in view of above, Appellant, Shri Dinesh Panwar, has violated the provisions of Section 114(i) of the Customs Act, 1962. However, in the given facts and circumstances of the case, the penalty imposed appears to be on higher side and, therefore, same is reduced from ₹ 5,00,000/- to ₹ 50,000/- - penalty upheld - quantum reduced. Penalty on Shri Abad Ahmed and Shri Saddam Ahmed - Held that - Both Shri Abad Ahmed and Shri Saddam Ahmed have taken godown on rent, where the Red Sander Wood, which is prohibited item, were found stored - they have not done any act violating the provisions of the Customs Act - penalty not warranted. Appeal allowed in part.

Summary

Issues:
- Smuggling of Red Sanders logs through Nhavasheva Port
- Examination of container at container freight station
- Search at premises of exporting firm
- Statements recorded under Section 108 of Customs Act, 1962
- Search at godown near Kailashpur Petrol pump
- Search at godown located at Vardhaman Colony
- Confiscation of red sanders wood and imposition of penalties
- Appeal against the impugned order

Analysis:

1. The judgment revolves around the smuggling of Red Sanders logs through Nhavasheva Port by concealing them in wooden crafts. A specific intelligence led to the interception of a container at Nhava Sheva Port, revealing the concealment of Red Sanders logs within wooden articles. The subsequent searches at various locations uncovered further evidence of the smuggling operation.

2. The examination of the container at the container freight station in Raigarh, Maharashtra, exposed the deceptive nature of the wooden articles used to conceal the Red Sanders logs. The discovery led to a chain of events involving searches at multiple premises and the recording of statements under Section 108 of the Customs Act, 1962.

3. Searches conducted at the premises of the exporting firm and at a godown near Kailashpur Petrol pump revealed additional evidence linking individuals to the smuggling operation. Further searches at another godown located at Vardhaman Colony resulted in the detection of a significant quantity of Red Sanders wood, leading to its detention under Panchanama.

4. The judgment details the confiscation of the Red Sanders wood and the imposition of penalties on various individuals involved in the smuggling operation. The penalties were imposed based on violations of the Customs Act, with specific sections cited for the confiscation and penalty imposition.

5. The appeal against the impugned order was heard, and arguments were presented by counsels representing the appellants. The judgment carefully considered the contentions raised by the appellants and the Department, ultimately leading to a partial allowance of the appeal for one appellant and a full allowance for others based on the specific roles and involvements established during the proceedings.

6. The judgment concluded with the pronouncement of the decision on penalties, reducing the penalty for one appellant while setting aside the penalties for others based on their roles and lack of direct involvement in the smuggling activities. The detailed analysis and consideration of the facts and circumstances led to a nuanced decision on the penalties imposed under the Customs Act, 1962.