1969 (10) TMI 24 - HC - Customs

Summary

Issues:
1. Confiscation of goods and imposition of penalties by the Assistant Collector of Central Excise.
2. Dismissal of appeals by the Appellate Collector of Customs.
3. Defects in the show cause notice issued to the petitioners.

Analysis:
1. The judgment revolves around the confiscation of goods and imposition of penalties by the Assistant Collector of Central Excise. The petitioners were found in possession of goods of foreign origin, which were alleged to be smuggled. The Assistant Collector found that the petitioners had not smuggled the goods themselves but had purchased them from someone who had smuggled the goods. The Assistant Collector based this conclusion on the fact that the petitioners paid only Rs. 495 in duty for goods valued at Rs. 3,572.70, whereas the correct duty payable was Rs. 3,836. The Assistant Collector confiscated some goods, levied a fine, and imposed a personal penalty on each petitioner. However, the judgment highlights that the Assistant Collector failed to consider that the petitioners were entitled to clear goods worth Rs. 3,200 duty-free due to their extended stay abroad, which would make the duty paid by the petitioners consistent with their case. The judgment concludes that the Assistant Collector did not adequately consider this aspect, leading to the quashing of the orders.

2. The petitioners appealed to the Appellate Collector of Customs, who dismissed their appeals except for setting aside the personal penalties imposed by the Assistant Collector. The judgment notes that the appellate order was summary and did not address the crucial aspect of the petitioners' entitlement to clear goods worth Rs. 3,200 duty-free. This failure to consider relevant arguments led to the finding that the appellate order suffered from defects and was liable to be quashed. Consequently, the judgment allows the writ petitions and quashes the orders of both the Assistant Collector and the Appellate Collector.

3. The judgment also delves into the defects in the show cause notice issued to the petitioners. It highlights that the notice failed to specify the particular allegations against the petitioners with the required definiteness. The notice grouped various offenses under the Customs Act without providing clarity on the specific charges faced by the petitioners. Additionally, the notice referenced sections of the Customs Act without factual allegations to support them, rendering it non-compliant with the law. The judgment emphasizes that the defective notice deprived the petitioners of a reasonable opportunity to present their case effectively. This deficiency in the notice further contributed to the decision to quash the orders of confiscation and penalties imposed on the petitioners.