2004 (4) TMI 114 - AT - Customs

Summary

Issues Involved:
1. Legality of the penalty imposed under Section 112(b) of the Customs Act, 1962.
2. Alleged abetment by the CHA in the illegal import activities.
3. Jurisdiction of the Single Member Bench to decide the case.

Issue-wise Detailed Analysis:

1. Legality of the Penalty Imposed under Section 112(b) of the Customs Act, 1962:
The appellant, a CHA, was penalized Rs. 2.50 lakhs under Section 112(b) of the Customs Act, 1962. The appellant contended that he had no knowledge of any illegal activities and had not filed any Bill of Entry for the consignment in question. The Commissioner's findings were based on assumptions and lacked positive evidence of the appellant's involvement in the alleged illegal activities. The Tribunal noted several precedents, including the Hon'ble Supreme Court's ruling in Shri Ram v. The State of UP and Tribunal's decisions in A.N. Bhat v. CCE and Liladhar Pasoo Forwarders Pvt. Ltd. v. CC, which emphasized that abetment requires intentional aiding of the crime. The Tribunal concluded that the appellant did not intentionally aid the commission of the offense and set aside the penalty.

2. Alleged Abetment by the CHA in the Illegal Import Activities:
The Commissioner had held that it was difficult to believe the CHA undertook clearance without meeting the importer and assumed that the CHA was aware of the nature of the goods being imported. However, the Tribunal found no positive evidence to support these assumptions. The Tribunal referenced multiple judgments, including K.L. Alagu Murugappan v. CC, Trichy and P.S. Bedi & Co. v. CC, New Delhi, which held that negligence alone does not justify the imposition of a penalty for abetment. The Tribunal concluded that the appellant did not abet the commission of the offense as there was no intentional aiding or active complicity.

3. Jurisdiction of the Single Member Bench to Decide the Case:
The JDR challenged the jurisdiction of the Single Member Bench based on an Office Order No. 41/98, suggesting that cases involving CHAs should be listed before Double Member Benches. However, the Tribunal clarified that this office order was for internal guidance and not binding. Section 129C(4)(c) of the Customs Act, 1962, stipulates that cases with penalties not exceeding Rs. 10 lakhs can be decided by a Single Member. The Tribunal also noted that similar cases had been decided by Single Member Benches previously. Therefore, the Single Member Bench had the jurisdiction to hear the appeal.

Conclusion:
The Tribunal found that the penalty imposed on the appellant under Section 112(b) of the Customs Act, 1962, was based on assumptions without positive evidence of intentional aiding in the commission of the offense. The Tribunal set aside the penalty and allowed the appeal, confirming the jurisdiction of the Single Member Bench to decide the case.