2008 (1) TMI 123 - AT - Customs

Penalty on Inspector of Customs allegation is that he abetted exporter in overvaluation & claim higher drawback appellant didn t made any market inquiry for impugned goods & submitted the report on basis of trade opinion given by un-concerned person showing that declared value is correct - there is no allegation that same was done for any consideration - held that failure to perform the duty of scrutinizing the document is just negligence or dereliction of duty hence penalties set aside

Summary

Issues:
Penalty imposed under Section 114 of the Customs Act for alleged negligence and dereliction of duty by an Inspector of Customs. Allegations of mis-declaration of goods for higher draw back claim, withdrawal of samples without superior's direction, and failure to conduct market inquiry.

Analysis:

1. The appellant appealed against the penalty of Rs. 25,000 imposed under Section 114 of the Customs Act for alleged misconduct while working as an Inspector of Customs. The allegations included withdrawing samples without authorization, failing to conduct a proper market inquiry, and endorsing trade opinions without verification. The appellant argued that the penalty was not sustainable as the allegations were only related to negligence and dereliction of duty, not for any consideration. The appellant also pointed out that another individual, Shri R.K. Saxena, was implicated for abetting the exporter but faced no penalty.

2. The Tribunal considered the statements provided by the exporter, Shri Rajesh Sharma, which implicated Shri R.K. Saxena for aiding in the mis-declaration of goods. It was revealed that Shri R.K. Saxena admitted to receiving Rs. 2.50 lakh per container. However, the Tribunal noted that the appellant, the Inspector of Customs, did not receive any consideration according to the exporter's statement. The Tribunal also highlighted that the appellant's actions were limited to negligence and dereliction of duty, without any indication of misconduct for consideration.

3. The Tribunal further emphasized that the show cause notice only alleged negligence and dereliction of duty against the appellant, without any mention of misconduct for consideration. Relying on previous decisions, the Tribunal concluded that penalties under the Customs Act are not sustainable solely based on negligence or failure to perform duties without evidence of misconduct for consideration. Consequently, the impugned order was set aside, and the appeal was allowed, as the allegations did not establish any wrongdoing for consideration.

This detailed analysis of the judgment highlights the key issues, arguments presented by the appellant, findings of the Tribunal, and the legal reasoning behind setting aside the penalty imposed under Section 114 of the Customs Act.