1991 (4) TMI 233 - AT - Customs

Summary

Issues Involved:
1. Mixing up of items belonging to other persons.
2. Recording of the appellant's statement under duress.
3. Reliance on retracted statements of co-accused.
4. Failure to specify the sub-section of Section 112 of the Customs Act for penalty.
5. Allegations of conspiracy and abetment.
6. Inadequate investigation and adjudication.

Detailed Analysis:

1. Mixing up of items belonging to other persons:
The learned counsel highlighted discrepancies in the number of suitcases and bags mentioned in the Panchanama and the appellant's statement, indicating that goods belonging to multiple persons and brought on different flights were mixed up. This was corroborated by the cross-examination of Inspector Shri Harish Chander, who admitted that the goods were found in a hotch-potch condition and were mixed together. The Tribunal noted that the confiscation of goods was not challenged in this appeal, and the appellant did not claim the goods, focusing solely on the penalty imposed on her.

2. Recording of the appellant's statement under duress:
The appellant contended that her statement was recorded under duress, threat, and coercion while she was unlawfully in custody. The learned Additional Collector did not address this contention, rendering the order defective. The Tribunal found merit in the appellant's argument, noting that the Additional Collector failed to consider the appellant's plea regarding the coercive circumstances under which her statement was obtained.

3. Reliance on retracted statements of co-accused:
The learned Additional Collector relied on the statements of Shri Ajay Kumar without providing an opportunity for cross-examination by the appellant, violating Section 138(b) of the Customs Act, 1962. Additionally, Shri Ajay Kumar had retracted his statements, which could not be relied upon without full corroboration. The Tribunal found that the reliance on retracted statements without proper examination and corroboration was a significant flaw in the adjudication process.

4. Failure to specify the sub-section of Section 112 of the Customs Act for penalty:
The show cause notice invoked Section 112 of the Customs Act without specifying the relevant sub-section, which was a procedural defect. The Tribunal emphasized that specifying the sub-section is necessary to clearly bring home the charge. This oversight further weakened the case against the appellant.

5. Allegations of conspiracy and abetment:
The learned Additional Collector recorded a finding of conspiracy without a specific charge of abetment or conspiracy. The Tribunal noted that the definition of abetment in the Indian Penal Code applies to all Central Acts, including the Customs Act. The department failed to provide evidence of intentional participation or facilitation by the appellant in the alleged smuggling activities. Mere presence, awareness, or acquaintance with the alleged masterminds was insufficient to prove abetment or conspiracy. The Tribunal concluded that the department did not establish a case of abetment by aiding or conspiracy as understood in law.

6. Inadequate investigation and adjudication:
The Tribunal criticized the department for not addressing the major points raised by the appellant during adjudication. The investigation was found to be deficient, with discrepancies in the number of children and ladies involved, and inconsistencies in the statements provided. The department's failure to ascertain the exact quantity and type of goods attributable to the appellant and the children who accompanied her further undermined the case. The Tribunal extended the benefit of doubt to the appellant due to these deficiencies and set aside the penalty imposed on her.

Conclusion:
The Tribunal found significant procedural and substantive flaws in the adjudication process, including reliance on retracted statements, failure to specify the relevant sub-section of the Customs Act, and inadequate investigation. Consequently, the penalty imposed on the appellant was set aside, and the appeal was accepted. The order of the Collector was modified only to the extent it related to the penalty imposed on the appellant. The Tribunal did not pass any order regarding the confiscated goods, as no appeal was filed concerning their confiscation.