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TMI Blog1991 (8) TMI 173X X X X Extracts X X X X X X X X Extracts X X X X ..... wed to be imported by the private individuals. The respondents in all the aforesaid cases pleaded before the Collector that the licences have been misplaced and they could not produce any valid licence for the clearance of the goods. It is the case of the Department that in all the cases one Mr. M.C. Desai was the brain behind all the imports and he is associated with the firms in one way or the other either as Director, Manager, Partner or Proprietor. He has obtained REP licences and thereafter forged certain endorsement on these licences to import large quantities of canalised and other prohibited items, under the cover of the endorsements. This matter was investigated into Bombay Customs. Shri M.C. Desai admitted the fact before Bombay Customs that he was aware that the licences were having forged endorsements and hence he has destroyed the same. However, before Kandla Customs House, he changed his stand by filing an affidavit at a much later date giving a different version that the licences along with the letter of authorities were lost, after the opening of the letters of credit and the same could not be produced and hence sought for adjudication. The Collector of Customs, Raj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... toms contending that the licences along with the letters of authority have been lost after the opening of L/C. The Collector, while adjudicating, did not consider the background against which the licences were not produced by the Respondents and treated the matter without the due seriousness it deserves. He has only treated this import as one without valid licences, which were stated to have been lost. The gravity of the offence has not been properly appreciated by him, on account of which, fines and penalties imposed are too insignificant compared to the large volume of import of the canalised items valued about Rs; 78.46 lakhs (cif). The Collector s order is, therefore, not proper and hence the Department has come in appeal before the Tribunal for viewing the offence in the proper prospective and enhancing the quantum of fines and penalties. On the quantum of redemption fine, he stated that no one can get away with bonanza of profit made through an illegal import and in this context he cited the judgment of the Delhi High Court in the case of Jain Exports [1987 (29) E.L.T. 753 (Delhi)]. 5. Giving facts on landed costs and sale price, Shri Mondal contended that the Department ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... charges and insurance charges have been incurred in regard to the very same goods. If these are not taken into consideration, it would amount to grave injustice because even going by the Delhi High Court s judgment in the aforesaid case, one should not get away with the huge margin of profit. In this case, when the respondents could establish that there is no margin of profit left over and the Department does not have any evidence to rebutt it, on the contrary, chooses to adopt the same sale price given by them, it cannot be held that the respondents have got away with huge margin of profit. All these expenses have been incurred in clearances of the goods and this clearly shows that the margin of profit left was only Rs. 2 per kg. and on that basis the fines imposed are already on the higher side and do not call for any modification. 8. On the question of malafides and imposition of penalty, Shri Pochkhanwal-la contended that the Collector has rightly passed the order. There had been no need to look into the affidavit or the retraction of the statement given before the Bombay Customs House, since in this case Shri Desai has pleaded that the goods imported are not covered by valid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibunal for the determination of such points arising out of the decision or order as may be specified by the Board, in its order . From the above, the purpose of satisfying should be with regard to the legality or propriety of the decision taken by the Collector in his order. It is not the case of the Department in these cases that the Collector s orders suffer from any legal infirmity. Both the sides accept that the goods are liable to confiscation and penalties could be imposed on the respondents. The question, therefore, boils down only to the one of propriety of the orders passed by the Collector. The ground of propriety taken by the Department in these cases, is that the offence being deliberate and the quantum of imports being huge and the attempt to clear them by diverting the goods from Bombay to Kandla have not been properly appreciated by the Collector, and hence on this ground the order of the Collector is not proper and is required to be modified by enhancing the fines and penalties. 11. Normally, on the ground of propriety, if any order of the Collector is challenged by the Department, it is put to a more vigorous test. The Department is required to discharge the bu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mitting that the offence is deliberate and there is a malafide, it is not as though the Collector has let off the respondents without any penalties. He has imposed penalties against each of the respondents. The question is what should be the quantum of penalty. It is again a matter of discretion and the discretion is to be exercised judiciously. When the Department could not establish the existence of a huge margin of profit made by the respondents in the case for enhancing redemption fine, we cannot find fault in the discretion exercised by the Collector in imposing the penalties as thought by him. So long as penalties have been ordered and they are also not a mere token, they cannot be held to be improper. We also take note of the fact that the main person alleged to be the brain behind these imports has already been penalised by Bombay Customs and substantial portion of the same has been upheld by this Bench. We, therefore, do not propose to interfere with the quantum of penalties also, since the alleged main brain is already heavily penalised. In the result, the Department s appeals fail on both the counts. Accordingly, we dismiss the same. 15. [Assent per : P.K. Desai, Mem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (i) in the case of goods in respect of which any prohibition is in force under this Act or any other law for the time being in force, to a penalty not exceeding five times the value of the goods or one thousand rupees, whichever is the greater; (ii) in the case of dutiable goods, other than prohibited goods, to a penalty not exceeding five times the duty sought to be evaded on such goods or one thousand rupees, whichever is the greater; (iii) in the case of goods in respect of which the value stated in the entry made under this Act or in the case of baggage, in the declaration made under Section 77 (in either case hereafter in this section referred to as the declared value) is higher than the value thereof, to a penalty not exceeding five times the difference between the declared value and the value thereof or one thousand rupees, whichever is the greater; (iv) in the case of goods falling both under Cls (i) and (ii), to a penalty not exceeding five times the value of the goods or five times the difference between the declared value and the value thereof or one thousand rupees, whichever is the highest; (v) in the case of goods falling both under Cls (ii) and (iii), to a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the principles applicable or when the penalty imposed was disproportionate to the gravity of the crime/breach committed, resulting into miscarriage of justice. The principles are so well settled, and accepted as good law, that no citations are called for to substantiate the same. However, to pick up some few of them, reference can be had to the Supreme Court decision in Corporation of Calcutta v. Mulchand Agarwala reported in AIR 1956 S.C. 110; Samwat Singh Others v. State of Rajasthan AIR 1961 Supreme Court 715; Sitaram Durga prasad v. State of M.P. AIR 1975 Supreme Court 77. Though all these decisions pertain to trials under the Criminal Law, when the question of imposition of personal penalty under Section 112 of the Customs Act is concerned, the adjudicating as well as the appellate authorities exercise quasi-judicial powers and the proceedings are treated as quasi-criminal proceedings and therefore the ratio of the aforesaid decisions would squarely stand attracted. The said ratio is made applicable even to the adjudication proceedings as is evidenced from the order of the North Regional Bench in Collector of Central Excise v. M/s. Sahni Saree Emporium -1986 (26) E.L.T. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f forged endorsements on the licences, which otherwise were not available for import of the canalised items. As pleaded by the Department, the import at Bombay and Kandla being in the course of the same transaction, the import at Kandla also being based on the forged and/or fabricated entries in the licences, could not be viewed as lightly as is done by the adjudicating authority and gravity of the inner conspiracy to defraud the Government called for very heavy and rather exemplary punishment and as such the penalties imposed be enhanced. 25. When the imports at Bombay and Kandla are sought to be tagged, and role allegedly played by Mr. M.C. Desai is sought to be highlighted, and his connection with the respondents has been emphasised, a note has to be taken that adjudication proceedings against the said Mr. M.C. Desai, and those who were projected as the ostensible importers at Bombay were initiated, and personal penalty of Rs. 25,00,000/- was imposed on Mr. M.C. Desai, and each one of the party shown as importing parties was imposed personal penalty of Rs. 1,50,000/-. In the appeal before this Bench of the Tribunal, penalty on Mr. M.C. Desai was reduced to Rs. 20,00,000/-, whe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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