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TMI Blog2019 (7) TMI 466X X X X Extracts X X X X X X X X Extracts X X X X ..... has also failed. The learned counsel for the Revenue could not point out any additional evidence or material available with the Revenue other than the one, which was considered by the Courts with regard to the prosecution of Respondents under Section 135 of the Act. The reason of such double jeopardy to be avoided is obvious, even though the two proceedings may operate in different fields and may have different nature. The Departmental proceeding on civil side, which is based on preponderance of probability premise based, whereas on the criminal side, it is the proof beyond the reasonable doubt, which forms the basis of conviction or acquittal, are different but the distinguishing feature to allow the two proceedings to go ahead parallely is that the different set of facts and evidence should be available before the concerned authorities proceeding in two parallel proceedings. The same principles would apply in a taxing statute like the Customs Act, 1962, also because the ingredients sought to be satisfied for imposition of penalty as well as for prosecution of the concerned accused persons is same and identically worded, as it would appear from the quotation of the two provisions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... This request was turned down by the respondents. The appeal filed against the respondent's decision was rejected by the appellate authority. The appellant then approached the High Court with a Writ petition challenging the validity of the order of dismissal on various grounds. In that Writ petition, he, inter alia, contended that the departmental proceedings and the criminal case against him were based on the same set of facts. The departmental proceedings should have been stayed till the outcome of the criminal case. The writ petition was allowed by a single Judge of the High Court directing the respondents to reinstate the appellant. The High Court, however, gave the liberty to the respondents to initiate fresh proceedings against the appellant after perusing the judgment passed in the criminal case. The judgment passed by a learned Single Judge was set aside by a Division Bench of the High Court in a letters patent appeal filed by the respondents. The judgment of the Division Bench was taken in appeal to the Supreme Court. The apex Court found that the appellant had been acquitted in the criminal case on the same set of facts and evidence as used in the disciplinary proce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he prosecution could not prove the charge framed against the appellants by the customs authorities in terms of Section 135(1)(b), i.e., they failed to show that the appellants had physically dealt with the ball bearings with the knowledge or belief that these goods were liable to confiscation under Section 111. The court doubted the veracity of the prosecution plea that the accused had physically dealt with 1,31,076 ball bearings recovered from the ship. After examining files relating to auction sale of the confiscated ball bearings, the court found that over 21,000 ball bearings in excess of the confiscated ball bearings (1,31,076) had been auctioned by the Department, which could not be explained by the prosecution witnesses. The court pointed out many other defects of investigation and flaws of prosecution and came to the conclusion that the charge against the accused had not been proved beyond doubt. Thus, it is discernible from the criminal court's judgment that the prosecution could not even prove the alleged fact that the accused physically dealt with 1,31,076 ball bearings. Hence the court had no occasion to presume anything against the accused in terms of Section 138 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... een enacted in the Customs Act, 1962, for different purposes and while Section 112 permits imposition of penalty upon the persons, who acquires possession of or in any way concerned in carrying, removing, depositing, harbouring, keeping concealing, selling or purchasing or in any other manner dealing with any goods which he knows or has reason to believe such persons are liable to confiscation under Section 111. Such persons shall be liable for penalty under Section 112(b) of the Act. He submitted that Section 135 of the Act, which provides for prosecution and imprisonment of such persons, is therefore a different provision and mere acquittal of these respondents cannot per se automatically result in the setting aside of the penalty, as the respondents in the present case had a passive knowledge of the existence of the banned goods in the vessel, which were liable to be confiscated under Section 111 of the Act. The goods in question were "Ball Bearings" contained in 24 boxes, which were found at the time of checking by the concerned Customs Authorities and proceedings were initiated in the year 1995 by show cause notice dated 04.01.1995 against them. He relied upon the ju ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, whichever is higher: Provided that where such duty as determined under sub-section (8) of section 28 and the interest payable thereon under section 28AA is paid within thirty days from the date of communication of the order of the proper officer determining such duty, the amount of penalty liable to be paid by such person under this section shall be twenty-five per cent of the penalty so determined; (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 the difference between the declared value and the value thereof or five thousand rupees], whichever is the greater; (iv) in the case of goods falling both under clauses (i) and (iii), to a penalty [not exceeding the value of the goods or the difference between the declared value and the value thereof or five thousand rupees], whichever is the highest; (v) in the case of goods falling both under clauses (ii) and (iii), to a penalty [not exceeding the duty sought to be evaded on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d is obvious, even though the two proceedings may operate in different fields and may have different nature. The Departmental proceeding on civil side, which is based on preponderance of probability premise based, whereas on the criminal side, it is the proof beyond the reasonable doubt, which forms the basis of conviction or acquittal, are different but the distinguishing feature to allow the two proceedings to go ahead parallely is that the different set of facts and evidence should be available before the concerned authorities proceeding in two parallel proceedings. The same principles would apply in a taxing statute like the Customs Act, 1962, also because the ingredients sought to be satisfied for imposition of penalty as well as for prosecution of the concerned accused persons is same and identically worded, as it would appear from the quotation of the two provisions above. 12.A similar situation also appears to have arisen before the Rajasthan High Court in the case of Bhagwati Metals vs. Union of India, 2008 (228) ELT 20 (Raj), which was decided by the Division Bench of that Court on 23.01.2007, in which one of us (Dr.Vineet Kothari,J) was a Member of the Bench. The Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... than (supra). The said later view of the Division Bench of this Court in K.Renganathan's case by a short order proceeded on the basis of admission of the concerned Assessee or accused persons before the statutory authorities on the basis of which, the penalty in question appears to have been sustained by the Division Bench of this Court, even though for lack of evidence, the criminal court had acquitted such persons. Here, we find, in distinction, a full discussion by the Criminal Court on the entire relevant evidence and then acquittal of these accused respondents giving them the benefit of doubt, which upon further appeal filed by the Revenue is upheld by this Court. 15.Therefore, in the absence of any additional or further material with the Revenue, we do not find any error committed by the learned Tribunal to set aside the penalty under Section 112 (b) of the Act on the basis of the order of acquittal by the concerned trial court below. As a later development, we also find that the appeal of the Revenue in this regard also, has failed at the hands of this Court that further fortifies the view that the Revenue's case for prosecuting the accused/respondents persons did ..... X X X X Extracts X X X X X X X X Extracts X X X X
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