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Confiscation of vessel under the Customs Act. Analysis: The judgment concerns the confiscation of a vessel under the Customs Act. The central issue was whether the vessel could be confiscated despite the adjudicating authority holding that neither the owner nor the master of the vessel were liable for any penal action related to smuggling activities. The petitioners, owners of the vessel, challenged the confiscation order, arguing that if the owner or master of the vessel were not involved in smuggling, confiscation was unjustified. They relied on a previous court judgment to support their position. On the other hand, the respondents contended that the failure of the company or the captain to take immediate action after a duplicate key to a cabin was misplaced led to smuggling, justifying the vessel's confiscation. They cited a Supreme Court decision to support their argument. The court examined the provisions of Section 115(2) of the Customs Act, which allows confiscation of conveyance used in smuggling unless the owner proves lack of knowledge or connivance. It noted that the adjudicating authority did not find any such involvement of the owner, agent, or captain in the smuggling activity, making the vessel's confiscation unjustified. The court highlighted that a vessel could not be confiscated merely due to a lapse in taking precautionary measures, as the relevant provision allowing such confiscation had been deleted post an amendment in 1988. It emphasized that negligence without intent to aid smuggling cannot warrant confiscation. The court distinguished a previous Supreme Court decision cited by the respondents, noting that in that case, there was a clear finding of fraudulent intent by the captain, unlike in the present case. As no penalty was imposed on the owner or captain in the current case, confiscation was deemed unwarranted. Ultimately, the court ruled in favor of the petitioners, quashing the confiscation order and directing the return of the bank guarantee executed by the petitioners. The judgment clarified the legal principles governing confiscation under the Customs Act and emphasized the necessity of establishing a direct nexus between the owner/captain's actions and the smuggling activity to justify confiscation.
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