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1. Appeal against acquittal under Section 135(1)(a) read with 135(1)(ii) of the Customs Act. Detailed Analysis: Issue 1: Appeal against Acquittal under Section 135(1)(a) read with 135(1)(ii) of the Customs Act The appeal was filed against the judgment of acquittal dated 17-5-1989 in E.O.C.C. No. 832/87 by the Assistant Collector, Special Investigation Bureau, Customs House, Madras. The accusation was that a company had clandestinely removed various raw materials from its private bonded warehouse without payment of duty, evading duty to the tune of Rs. 15,92,335. The respondents, including the company and its Managing Directors, admitted to the removal of goods without payment of duty due to financial difficulties. The adjudicating authority imposed a penalty, which remained unpaid. The trial court acquitted the accused, leading to the appeal. The Counsel for the appellant argued that there was sufficient evidence to convict the accused, while the Counsel for the respondents contended that the charge under Section 135(1)(a) of the Customs Act could not be sustained as mere removal of goods from the bonded warehouse would not amount to duty evasion. The High Court found the reasoning of the trial court for acquittal unjustified. The voluntary statements of the respondents to the Customs Officer clearly indicated clandestine removal of goods to avoid duty payment. The respondents' admission during the adjudication process further supported the evasion of duty charge. The High Court considered the provisions of the Customs Act, including Sections 46, 17, 57, 58, 60, 62, 68, 71, 72, 111, and 135. The Court concluded that the respondents had indeed evaded duty by removing goods from the bonded warehouse without following proper procedures. The adjudicating authority had correctly issued a show cause notice before imposing the penalty, which remained unpaid. Therefore, the High Court convicted the respondents under Section 135(1)(a) read with 135(1)(ii) of the Customs Act. Regarding the sentence, the Court took into account the financial difficulties of the respondents and imposed fines of Rs. 10,000 on the company and Rs. 5,000 each on its Managing Directors. The appeal was allowed, the acquittal was set aside, and the respondents were sentenced to pay the fines within one month, with the default leading to one year of rigorous imprisonment. In conclusion, the High Court overturned the acquittal and convicted the respondents for evading duty under the Customs Act, imposing fines as penalties for their actions.
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