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2019 (5) TMI 928 - AT - CustomsImposition of penalty u/s 112(a) of the Customs Act, 1962 on CHA - Smuggling of Cigarettes - whether the Appellant, who is a CHA, is liable for penalty under Section 112(a) ibid? HELD THAT:- This section deals with the cases of confiscatory goods where abetment goes to the root of the matter. It stipulates that a person shall be liable to penalty, who, in relation to any goods does or omits to do any act, which act or omission would render such goods liable to confiscation under section 111 or abets the doing or omission of such an act. The said section provides for imposition of penalty on any person who abets the doing or omission, of any act or omission, which will render the goods liable to confiscation - Cogent, tangible and reliable evidence is required for such penal actions. There is no evidence to establish that the appellant was aware that the clearance work undertaken by them at the instance of the said Mukhtar Sheikh, was not of a genuine importer. Nor any evidence has been produced to show that the appellant had the knowledge of any fraud or mis-declaration. As per the evidence on record, import of cigarettes under the guise of trolley bags was not within the knowledge of the Appellant and this establishes that the CHA was not aware about the violations beforehand. No evidence has been brought out about the prior knowledge of the appellant regarding violation of the provisions of Customs Act. As per evidence brought on record, it is not a case that the appellant had wrong intent. It is also not a case that the appellant worked as an accomplice. It is settled principle that lack of due diligence and failure to take more precautions cannot, by itself bring in penal consequences under Section 112(a). When there is no evidence to establish that the appellant had prior knowledge of the illegal import of cigarettes and also when there is no evidence to establish any wrongful intent on the part of the appellant then there is no justification to impose penalty under section 112(a) ibid - penalty set aside - appeal allowed - decided in favor of appellant-CHA.
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