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TMI Blog2023 (4) TMI 833X X X X Extracts X X X X X X X X Extracts X X X X ..... bile batteries and wrist watches. The driver of the vehicle Shri Raju Hak stated that goods were loaded by one Shri Amarjit Sahu of Imphal. Shri Amarjit Sahoo was brought to the Customs Divisional office in Imphal and in his presence the Customs officers opened the boxes and HDPE bags, examined the goods and counted the contents. Shri Amarjit Sahoo in his statement submitted as under:- (i) The contraband goods belong to Shri Ajay Sarawagi, Son of Shri Hanuman Prasad, R/o Balaji Niwas, 3rd Floor, RKC Road, Near Railway Gate No.9, Bharalumukh Kamrup Metro, Assam-781009 (Appellant) (ii) He was working on behalf of Shri Ajay Sarawagi, as a supplier as well as caretaker of contraband goods after purchasing the same from Nampholong, Myanmar. (iii) The goods were sent by one Zuber Ali of Moreh in 4 Tata DI mini truck on 11.08.2019 and the same were received on 12.08.2019 at about 1000 hrs. (iv) After that the goods were loaded in the Truck NL 01-AC-1931 belonging to M/s. Chitransh Express Cargo Pvt.Ltd., which was arranged by Shri Ajay Sarawagi. (v) Shri Ajay Sarawagi gave him the mobile number of the driver of the truck and told him to contact him. He contacted the driver and t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... justice as the Appellant was punished without being given an opportunity to plead his case. He relied upon various judgements in support of his arguments. 5. The Ld. Authorized Representative for the Department reiterates the findings of the impugned order giving major thrust on the statement recorded from Shri Amarjit Sahu. 6. Heard both sides and perused the Appeal records. 7. I find that the role of the Appellant in the whole episode has been derived only from the statement of Shri Amarjit Sahu and two past penalties imposed on the Appellant. 8. I find from the submissions of the Ld. Consultant that Shri Amarjit Sahu might have concealed facts. It is not believable that he did not know the address or contact of Shri Zuber Ali, who has delivered the contraband goods worth Rs.4.00 Crores approx.. Call log records could have been verified to identify the persons, who were in contact with Shri Amarjit Sahu at the time of supply/movement of the goods, which could have conclusively proved the complicity of Appellant in the case or not . Proceeding on the basis of statement of co-accused is not sufficient to hold the Appellant guilty of smuggling in absence of any search and recove ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gold smuggling, especially when no search and recovery has been done at his place. Even there is no evidence of previous record of gold smuggling against him. The appellants Ravi Garg, Surinder Kumar Anand and Shyam Babu Verma have implicated Mohinder Singh but these statements which are self implicating in nature, should have been confronted to Mohinder Singh. It is not sufficient to say that the summons were pasted on his shop and merely because he has not come forward to give statement to explain the allegation made against him by co-accused, therefore, the case against him stands proved. The principles of natural justice require that the accused in a matter is required to be confronted with the evidence, which the department has collected against him and full opportunity should be given to an accused to defend himself. It is not the case of the department that the address of Mohinder Singh is not correct. The postal remarks on the summons sent by the DRI shows that on repeated visits the shop was found to be closed and hence, the cover containing the summons were returned to the sender. The department officers cannot take this postal endorsement as `refusal of summons' and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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; in the case of goods falling both under clauses (i) and (iv) (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; in the case of goods falling both under clauses (ii) and (v) (iii), to a penalty [not exceeding the duty sought to be evaded on such goods or the difference between the declared value and the value thereof or five thousand rupees], whichever is the highest.] Section 112(b) of the Customs Act, 1962, is identical to earlier Rule 209A of the Central excise Ru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r : "Rule 209A. Penalty for certain of fences. - Any person who acquires possession of, or is any way concerned in transporting, removing, depositing, keeping, concealing, selling or purchasing, or in any other manner deals with, any excisable goods which he knows or has reason to believe are liable to confiscation under the Act or these rules, shall be liable to a penalty not exceeding three times the value of such goods or five thousand rupees, whichever is greater." The sine qua non for a penalty on any person under the above rule is : either he has acquired possession of any excisable goods with the knowledge or belief that the goods are liable to confiscation under the Act or Rules or he has been in any way concerned in transporting, removing, depositing, keeping, concealing, selling or purchasing or has in any other manner dealt with any excisable goods with such knowledge or belief. Acquisition of possession of goods is, indisputably, a physical act i.e. the act which could not have been done without handling or movement of excisable goods as mentioned in the rule. The words "who acquires possession" would indicate that the person sought to be penalized under this rule ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Clause (j) of Section 111 of the Customs Act. The confiscation ordered by the Commissioner is not to be faulted. However, whether the above penalty was liable to be imposed on the appellant would depend on whether his conduct satisfied the requirement of Clause (b) of Section 112 of the Act. This clause reads as under :- "(b) who acquires possession of or is 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 are liable to confiscation under section 111......." In order that a person is penalised under the above provision, it has to be established that he acquired possession of or was 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 knew or had reason to believe, were liable to confiscation under Section 111 of the Act. Ld. DR has harped on the expression underlined above and submitted that the appellant had dealt with the goods by associating himself with the modus operandi of clearance of the goods. Ld. Counsel ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the goods in question were smuggled into the India. The penalty imposed on Appellant, therefore, cannot be sustained." 12. I find that Section 112(b) of the Customs Act, 1962 is not applicable to the facts of the present case because records show that the Appellant had never acquired possession or in any way was connected with the activities mentioned in the Section or in any manner dealing with any goods which the Appellant knew or had reason to believe are liable to confiscation. It is now well established that mens rea is an important ingredient for imposing penalty on the persons enumerated in Section 112(b) of the Customs Act, 1962. The evidence brought out by the department nowhere suggests that the Appellant was aware that the goods in question were smuggled into the country. The penalty imposed on the Appellant, therefore, cannot be sustained. 13. Past offence can be at best enhancer of civil and/or criminal liabilities, but no penalty can be imposed on any concurrent alleged offence. It is well settled law that no penalty under section 112(b)(ii) of the Customs Act, 1962, can be imposed without proving the nexus with the goods under seizure which are liable for confis ..... X X X X Extracts X X X X X X X X Extracts X X X X
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