2023 (5) TMI 52 - HC - Customs

Misconduct - Disciplinary Action against the erstwhile Deputy Commissioner of Customs, Central Excise - DEPB Scheme - Imposing penalty of withholding of 30% of monthly pension for the period of 5 years - failure to perform supervisory duties - HELD THAT - Petitioner at the relevant time was working in the capacity as Assistant Commissioner of Central Excise and the Customs establishment at Miraj was under his jurisdiction. True it is that being an Assistant Commissioner of Central Excise, petitioner was not supposed to personally examine the exported goods. He would be assisted in this regard by the Superintendent of Central Excise and Inspector of Central Excise posted under him. However, in the present case petitioner, being posted in a senior position as Assistant Commissioner, ought to have smelt a rat in the unusual methodology adopted by the exporter in procuring the goods meant for export at Mumbai and taking the circuitous route of carrying them to Miraj for examination by Customs Authorities. After examination, the goods were transported back to Mumbai for being exported. If the exporter weas taking such a circuitous route thereby spending extra time, energy and money for examination of goods at Miraj, petitioner ought to have been more cautious and ought to have performed his supervisory duties by either himself examining some of the samples and/or sending them to experts/labs for examination for determination of market value. Therefore the finding of guilt recorded in disciplinary proceedings would not suffer from the vice of perversity. Since the Adjudication Proceedings were dropped after passing of the penalty order, the said circumstance has not been considered while imposing penalty on petitioner. Since the imposition of penalty on the petitioner is one of the factors taken into consideration by the Disciplinary Authority for imposition of penalty on petitioner and since the penalty under the Adjudication Proceedings has subsequently been set aside, the matter needs to be reconsidered by the Disciplinary Authority in the light of the orders passed by the CESTAT and Adjudicating Authority. Petition allowed by way of remand.

Summary

Issues:
The issues involved in the judgment are the challenge to the penalty order dated 4th August 2014 passed by the Disciplinary Authority imposing a withholding of 30% of the monthly pension for 5 years.

Detailed Summary:

Issue 1: Challenge to the Penalty Order
The petitioner challenged the judgment and order dated 19th November 2019 passed by the Central Administrative Tribunal, which dismissed the Original Application No. 241 of 2015. The petitioner, a former Deputy Commissioner of Customs, was issued a charge sheet alleging misconduct related to the examination of goods by an exporter. The Union Public Service Commission (UPSC) agreed with the inquiry findings and recommended the penalty of withholding 30% of the monthly pension for 5 years. The petitioner appealed the penalty order before the Customs Excise and Service Tax Appellate Tribunal (CESTAT), which remanded the matter back to the Adjudicating Authority. The Adjudicating Authority later dropped the proceedings against the petitioner. The Tribunal dismissed the Original Application, leading to the present petition challenging the penalty order.

Issue 2: Arguments and Counter-arguments
The petitioner's counsel argued that there was no evidence to support punishing the petitioner and that the findings were perverse. The petitioner's supervisory duties were emphasized, highlighting the unusual methodology adopted by the exporter. The Union of India's counsel contended that the findings were supported by evidence, alleging serious misconduct causing public loss, justifying the imposed penalty.

Issue 3: Judicial Analysis
The Court noted that while the disciplinary inquiry findings were not considered perverse, there was a need for reconsideration regarding the penalty imposition. The Court highlighted the Adjudicating Authority's subsequent dropping of proceedings after the penalty order, emphasizing the need for the Disciplinary Authority to reassess the penalty in light of these developments. The Court set aside the Tribunal's order and the penalty order, remanding the proceedings to the Disciplinary Authority for fresh consideration based on CESTAT and Adjudicating Authority's orders.

Conclusion
The Court directed the Disciplinary Authority to expedite the reconsideration process, consulting UPSC if necessary, and to issue a final order within six months. Depending on the outcome, further actions regarding the refund of withheld retiral benefits were to be taken. The petition was partly allowed, with the Court setting aside the Tribunal's order and the penalty, remanding the matter for fresh consideration by the Disciplinary Authority.

This summary provides a detailed breakdown of the judgment, addressing the issues involved, arguments presented, judicial analysis, and the final conclusion reached by the Court.