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TMI Blog1985 (1) TMI 179X X X X Extracts X X X X X X X X Extracts X X X X ..... peal No. 385A-387A of 1980 dated 22-2-1980 disposed of the appeals. The Board reduced the penalty amount from Rs. 1,00,000/- to Rs. 50,000/- in respect of Shri Muk Tin Fui while rejecting the appeal of M/s. Hongkong Island Shipping Co. These two parties filed applications to the Government which are now transferred as appeals. 3. The facts of the case are that the Customs officers searched the vessel s.s. "Ngan Chau" on 16-9-1974 and as a result of this search, they found a container under the cargo hatch No. 3 on port side- of the vessel and seized therefrom and navigation light locking 166 packages. These packages were examined and they were found to contain dutiable and restricted goods like cassette tape recorders, radio cassette tape recorders etc. totally valued at Rs. 1,71,600/- CIF and Rs. 5,14,800/- at the market rate. Necessary investigations were made and after holding an inquiry, the Collector of Customs (P) passed the impugned order on 1-10-1976. 4. Shri Pochkhanwala, the learned advocate of the appellants submitted during the course of the oral arguments that the ship Ngan Chau left Hongkong on 10-7-1974 and was bound for Singapore, Red Sea ports, Gulf por ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ombay was not originally on the itinerary of the ship as there was no cargo meant for discharge at or loading from Bombay. The ship called at Bombay on 9-9-1974 only for supply of provisions. Referring to the Collector's order, the advocate argued that it was not correct on the part of the Collector to hold that 166 packages were intended to be smuggled into the country even though they were declared as same bottom cargo. In this behalf, the advocate referred to the evidence of the Customs officer Shri S.R. Gajjar as incorporated in the Collector's order. Continuing his argument, the advocate stated that the Collector had at best found an intention to smuggle goods but intention was not a crime and it could not be punished. Therefore, there was no scope for confiscation of the goods and hence the levy of penalty on the Master and the Ship owners was bad. The advocate referred us to the grounds of the petition which covered these facts. Referring to Para 10 of the Board's order in appeal, the advocate further argued that the Board did not accept the contention that the goods were in transit. This was because it was not shown that the goods had been loaded at Hongkong for discharge a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t controvert this fact. He, therefore submitted that in the circumstances of the case, Section 115 was not attracted and therefore the ship was not liable to confiscation. Similarly, he argued that the owners of the ship were not a party to the smuggling and hence they were not liable to penalty under Section 112. The Collector in his order had held that the owners had failed to discharge the burden under Section 115(2). The advocate referred to the Collector's finding in this behalf. These were to the effect that the owners had failed to take notice of the warning of smuggling sent by their agents in Bombay, and the involvement of their ships in smuggling and the failure of the owners to reply to the agents' warnings. The advocate argued that the Collector's reliance on the past conduct in levying penalty on the owners was not correct. In a similar case, the advocate submitted that regarding a sister ship belonging to the same shipping Co. the Board had set aside the order of penalty levied by the Collector on the owners of the ship and the Tribunal had decided this appeal vide the Tribunal's order No. 1198-99/85 dated 7-10-1985. In the present case, the owners were not at all inv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se (2) only the specific items were required to be mentioned even if the cargo was in transit. The goods seized and confiscated by the Customs did not find a mention in sub-clause (2). Taperecorders were not required to be specifically mentioned. The IGM and the cargo summary as filed by the steamer agents mentioned 166 cartons. Therefore, the steamer agents had complied with the aforesaid regulations. There was therefore no justification for coming to the conclusion that the goods were meant for smuggling into India. The findings of the Collector were that the goods were intended for smuggling into Bombay. This was only his belief and there was no evidence for this purpose. When the ship touched Cochin on the outward voyage on 28-7-1974, the manifest was filed in the same form. Therefore, the goods do not become prohibited goods under Section 111(d) of the Customs Act and therefore they were not liable to confiscation. Shri Rana therefore submitted that the Collector's order be set aside. 6. The Learned Senior Departmental representative contended that the Collector's order was based on certain circumstances which were mentioned in his order. These were hand written entries ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t prosecution and adjudication were seperate proceedings and the judgment of the Bombay High Court in Petition No. 1004/81 dated 14-2-1985 in Maniklal's case held this point of view. It was therefore not necessary for the departmental authorities to go by the verdict of the magistrate completely. He drew our attention to Section 127 of the Customs Act in this behalf. He also read Para 11 of our Order No. 1198-99/885 dated 7-10-1985 to show the culpability of the Master. He pleaded that the same view should be upheld in the present case. Shri Pal also drew our attention to para 12 of the Board's order-in-appeal highlighting the role of the Master and the Chief Officer. Shri Pal submitted that the same arguments will apply to the role of the owners of the ship. He, therefore, pleaded that both the appeals should be rejected. 7. Shri Rana contended in reply that the Bombay High Court's decision in exonerating the Master was competent and could not be doubted as the High Court had come to the aforesaid finding after consideration of the evidence. Though the decision in a criminal case was not binding in civil matters, he had only urged the propriety of accepting such a decision s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no B/L was available vide the statement of Shri Muk Tin Fui, Master of the ship on 11-9-1974. Besides, there was tampering of the documents as mentioned in the Collector's order. The transit manifest for Hongkong-Bangkok cargo was admitted to have been signed by the Master only after leaving Cochin vide his statement dated 20-9-1974 i.e. when the ship arrived at Cochin on 28-7-1974 no such document was available. This further confirms the Collector's findings that there had been tampering with the documents to provide legal cover to the 166 cartons shown as consigned for Bangkok. The shipping order produced by Mr. LoMan in the name of M/s. Hongkong Island Shipping Co. Ltd. does not appear to be genuine. Besides it shows tampering with the date of the shipping order. The Chief Officer had been working in that capacity for more than 4 years and he was well aware of the need for proper documentation for the cargo carried on board the ship. Therefore the failure to have proper documentation is very significant. It leads to inescapable conclusion that the cargo was not meant for Bangkok as made out to be. As regards the filing of the manifest and the acceptance of the same, it is to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... scation of the vessel and therefore there is no illegality in the Collector's order for the levy of the fine. This part of the order is correct. As regards the Collector's order of levying a penalty of Rs. 50,000/- on M/s. Hongkong Island Shipping Co. Ltd. who are the owners of the vessel, it has been pleaded that the owners are not liable to any penalty. It has been urged that if there was any offence, it was committed by the master and the chief officer and that the owners were innocent. Even the Trial Magistrate had found only the Chief officer guilty. The department's appeal to the High Court had been dismissed. It has been urged that the ratio of the High Court's decision should be followed in the quasi-judicial proceedings before the departmental authorities. Besides it has also been urged that in case of a sister ship belonging to the same Company, the Board had set aside the order of penalty on the owners and reliance had been placed on the Board's order in this behalf which came up before the Tribunal for consideration in our Order No. 1198-99/85 dated 7-11-1985. The appellants have therefore urged that no penalty should be levied on the owners and that the Collector's ord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the ship in this act of smuggling. Besides, there is a great deal of force in the appellant's contention that in the case of another ship of the same lines, the Board had set aside the order of penalty imposed by the Collector on the owners, vide our Order No. 1198-99/85 dated 7-10-1985 considering these aspects we find that the levy of penalty of Rs. 50,000/- on M/s Hongkong Island Shipping Co. Ltd. under Section 112 of the Customs Act is not justified and we set aside the same. 10. As regards the appeal of the Master Shri Muk Tin Fui, it is seen that he is very much concerned with the unauthorised importation of 166 packages of contraband goods. His exoneration by the magistrate and the dismissal of the department's appeal by the High Court do not have any relevance to the levy of the penalty on the Master. The Learned SDR has rightly opposed the contention of the appellant in this behalf while relying on the judgment of the Bombay High Court in the case of Maniklal U. Jain. This judgment is more specific to the case in question than the Supreme Court's decision in the case of City of Nagpur v. Ram-chandra & Others relied on by the appellants. The Master had been a party ..... X X X X Extracts X X X X X X X X Extracts X X X X
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