2024 (2) TMI 1243 - AT - Customs

Customs officials claim to have received illicit gratification - Clearance of restricted goods without following proper procedures - improper finalization of provisional assessment - For clearance of goods belonging to the syndicate - cross-fire between importers of mixed hydrocarbon oil and customs administration - Imposition of penalty - confiscation - disciplinary proceedings tantamount to double jeopardy - HELD THAT - we find that the case for confiscation of the imported goods rests upon mixed hydrocarbon oil having been high speed oil and, it being nobody s case that substitution had taken place at some stage after arrival in India, the finding of the adjudicating authority that the goods were, indeed, high speed diesel would attend upon the goods from the moment of import; consequently, the cause for liability to confiscate was present even upon declaration in the bill of entry that mixed hydrocarbon oil had been imported well before any act, if any, on the bills of entry and assessment thereto by customs officials. In the light of intent of section 112 of Customs Act, 1962, the respondents could not have been charged with contributing, by act of omission or commission, to confiscation of the impugned goods owing to crystallization of liability on the goods with the declaration. As the finding of the adjudicating authority remains unchallenged except to the extent that review has contended that illicit gratification should have sufficed as reason enough to fasten the finding of abetment, we turn to that aspect first. We have perused the relevant portions of the show cause notice comprising the depositions of Mr Kishan Pote and Mr Manish Thakkar, who did admit to some payment having been made over for each container to different levels in the customs hierarchy, but these are general allegations which do not name the respondent-officials as recipients. The other statements, too, are as deficient in specifics though it does appear that payment, if at all, was not made for finalization of provisional assessment. The appeal of the Principal Commissioner of Customs deputed for the purpose by the review committee is glaringly deficient in any factual submission that links the general averments in the depositions to the respondent-officials. The ground now pleaded does not add to the available records but seeks to widen the charge framed in the notice issued to the respondent-individuals. We, therefore, are in full accord with the findings of the adjudicating authority that there is no evidence of any illicit gratification having been received by the respondent-officials for any decision of theirs. We also hold that the attempt to insinuate padding, by invoking of appellate remedies, to a failed proposal is neither legally condonable nor procedurally validated. We do believe that the notice issuing authority would not have been callow enough to confuse section 110A of Customs Act, 1962, operating to enable conditions that permit imposition of redemption fine, with section 18 of Customs Act, 1962 that operates to remove goods from reach of availability for confiscation at the stage of provisional assessment. Therefore, we fail to see any role of the respondent-officials in not retaining the goods to enable collection of redemption fine; the law had already operated to alienate physical confiscation. It does not surprise us that the adjudicating authority found even less cause to consider imposition of penalty on the respondent-officials from such flimsy, and superficial, proposition in the show cause notice. The plea of protection of section 155 of Customs Act, 1962 and double jeopardy had been raised by the officials in their response to the notice and it was incumbent on an adjudicating authority to dispose of all pleas. That he did so is not a fault. That he did so in a manner which has aggrieved the committee of review sufficiently to plead for re-determination in remand proceedings is to accord it gravity beyond that evident from a reading of that portion of the impugned order. The adjudicating authority has not decided on the outcome on such preferential progression and has not concluded therefrom that only this would suffice for dropping of proceedings. As we have premised in relation to plea for statutory protection, the adjudicating authority was obliged to dispose of this plea too. That such disposal may have evinced his sympathy over the initiation of multiple proceedings, or even his conviction that they should not have been, does not alter the lack of any effect on the findings on merit that remain unimpeached for reason of absence of valid challenge in appeal and our own observations supra on the deficiencies in the notice issued to respondent-officials. That the impugned order referred to, and held forth, on the plea of double jeopardy claimed by the respondent-officials without acting upon it is not the deficiency, of not being legal and proper , contemplated in section 129A of Customs Act, 1962 warranting remedial action. Thus , we find no reason to accede to the prayer for the notice to be re-determined in remand proceedings. We also do not find any reasons in the grounds of appeal to modify the order of the adjudicating authority. Appeals are dismissed.

Summary

Issues Involved:

1. Imposition of Penalty under Section 112 of Customs Act, 1962.
2. Finalization of Provisional Assessments and Alleged Abetment.
3. Applicability of Section 155 of Customs Act, 1962.
4. Double Jeopardy and Disciplinary Proceedings.

Summary:

1. Imposition of Penalty under Section 112 of Customs Act, 1962:
The customs officials were accused of abetting the importation of 'high speed diesel' under the guise of 'mixed hydrocarbon oil,' which led to evasion of customs duties. The adjudicating authority found no evidence of intentional abetment or illicit gratification by the officials, thus negating the imposition of penalties under Section 112 of the Customs Act, 1962. The appeal by the Principal Commissioner of Customs sought to remand the case for reconsideration, which was dismissed by the Tribunal.

2. Finalization of Provisional Assessments and Alleged Abetment:
The provisional assessments were finalized based on the importer's declaration and test reports. The adjudicating authority noted that the officials were under work pressure and failed to scrutinize the test reports adequately. However, it was concluded that there was no evidence of mala fide intention or collusion with the importers. The Tribunal upheld this finding, emphasizing that the officials' actions did not amount to abetment as defined under Section 107 of the Indian Penal Code.

3. Applicability of Section 155 of Customs Act, 1962:
The adjudicating authority found that any action against the officials should have been governed under Section 155 of the Customs Act, 1962, which was not followed in this case. The Tribunal agreed, noting that the protection under Section 155 was not applicable as the proceedings were dropped on merit, not on procedural grounds.

4. Double Jeopardy and Disciplinary Proceedings:
The adjudicating authority acknowledged that disciplinary action had been initiated against the officials under the CCS (Conduct) Rules, 1964, and held that penalizing them again under the Customs Act would amount to double jeopardy. The Tribunal concurred, stating that proceedings under different laws for the same act should not lead to multiple punishments. The appeal's contention on this ground was also dismissed.

Conclusion:
The Tribunal dismissed the appeal, finding no reason to remand the case or modify the adjudicating authority's order. The officials were absolved of the charges, and the penalties under Section 112 of the Customs Act, 1962, were not imposed. The Tribunal emphasized the lack of evidence for intentional abetment and illicit gratification, and upheld the protection under Section 155 and the principle of double jeopardy.