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Issues Involved:
1. Confiscation of the ship under Section 115(2) of the Customs Act. 2. Knowledge and precautions taken by the owner and Master of the vessel. 3. Issuance of notice under Section 124 of the Customs Act. 4. Application of Section 110(2) of the Customs Act regarding the time limit for issuing the notice. Issue 1: Confiscation of the ship under Section 115(2) of the Customs Act The appeal was against the confiscation of the vessel Henriette Maersk and the imposition of a redemption fine of Rs. 2,00,000/-. The Additional Collector of Customs had confiscated the ship under Section 115(2) of the Customs Act, which was upheld with modifications by the Central Board of Excise & Customs. The Tribunal examined whether the confiscation was justified under the said section. Issue 2: Knowledge and precautions taken by the owner and Master of the vessel The appellant argued that the owners had no knowledge of the smuggling activities and that the Master had taken all necessary precautions. The Tribunal noted that there was no allegation or evidence that the owners were aware of the smuggling. However, it was observed that the Master failed to take proper precautions against the misuse of the ship, as required under Section 115(2). The Tribunal referred to the Bombay High Court's decision in Moghul Lines Ltd. v. A.K. Dutt, which stated that even in the absence of specific rules, the Master is expected to take reasonable precautions. Issue 3: Issuance of notice under Section 124 of the Customs Act The appellant contended that the confiscation was illegal as no notice was issued to the owners of the ship as required under Section 124 of the Customs Act. The Tribunal found that the steamer agents, who were expressly authorized by the owners, were given the notice, thus fulfilling the requirements of Section 124. The Tribunal dismissed the appellant's argument, stating that the steamer agents had the necessary authority to act on behalf of the owners. Issue 4: Application of Section 110(2) of the Customs Act regarding the time limit for issuing the notice The appellant argued that the notice was issued after the expiry of the six-month period stipulated under Section 110(2) of the Customs Act, making the confiscation illegal. The Tribunal clarified that Section 110(2) was not applicable as the ship was not seized and retained by the Customs but was allowed to leave. The show cause notice was issued under Section 124, which does not prescribe a time limit. Therefore, the Tribunal found no merit in this argument. Conclusion: The Tribunal concluded that the confiscation of the ship under Section 115(2) was justified due to the failure of the Master to take adequate precautions against smuggling. The issuance of notice to the steamer agents was deemed sufficient under Section 124, and the argument regarding the time limit under Section 110(2) was dismissed. The appeal was rejected, upholding the confiscation and the redemption fine.
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