TMI Blog2016 (11) TMI 139X X X X Extracts X X X X X X X X Extracts X X X X ..... commission in relation to the contravention by the goods. Whatever may be the extent of tutelage in deviancy by the appellant, to allow such influencers to be brought within the jurisdiction of the Customs Act, 1962 has the ramification of intrusiveness into areas that go beyond the objects and purposes of customs legislation. The boundaries of action under the Customs Act, 1962 is limited to declaration (or failure to declare) vis-a-vis the compliance required thereof under the customs law. To the extent that the role of the appellant in non-compliance has not been established, he is clearly beyond the pale of penal action under that statute. The imposition of penalty on the appellant is without authority of law and is set aside - appeal allowed - decided in favor of appellant. - C/258/2006 & C/106 & 108/2007 - A/90429-90431/16/CB - Dated:- 9-9-2016 - Shri M V Ravindran, Member (Judicial) and Shri C J Mathew, Member (Technical) Shri RV Desai, Sr. Advocate with Shri RB Pardeshi, Advocate, Shri NS Patel, Advocate, Shri AM Khare, Advocate, and Shri MP Sinha, Advocate for the appellant Shri Roopam Kapoor, Commissioner (AR) for the respondent ORDER By this comm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mpugned order cannot be faulted for not conforming to prescribed process. The contention of Revenue is that the option to redeem against payment of fine should have found a place in the order. Credibility of any penal action can be sustained and justified only to the extent that it has the sanctity of rule of law. Just as importantly, credibility of such action can be undermined by reducing that action to the level of unenforceability. It would appear that the appeals of Revenue are motivated by eagerness to fasten a pecuniary liability on the exporters and to enforce its recovery. In the process, the legality of such a prayer and the practical outcome of such exercise does not appear to have been considered. 5. Section 125 of the Customs Act, 1962 comes into play when an adjudicating authority is confronted by a situation in which confiscation of goods is authorized by the Act thus: 125 ....the officer adjudging it may .. and shall, in the case of any other goods, give to the owner of the goods or, where such owner is not known, the person from whose possession or custody such goods have been seized, an option to pay in lieu of confiscation such fine as the said officer t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 1962 in the matter of alleged violations under the Customs Act, 1962 in the exports effected under claim for drawback by M/s President Fashions. 9. M/s President Fashions had effected shipment of 143 consignments of readymade garments between November 1997 and January 1999 and claimed drawback of ₹ 3,60,74,510 of which ₹ 3,17,07,934 had been sanctioned and paid into the account of the exporter with the Bank of Maharashtra. Proceedings were initiated for recovery of this amount and denial of the other claimed amount on the ground of declaration of FOB value to the extent of eight times the prevailing market price. In the impugned order-in-original no. CAO NO. 141/2005/CAC/CC/ NRN dated 15th December 2005 of Commissioner of Customs (EP), Mumbai-I, the exporter was held to be ineligible for drawback owing to the bar in section 76 of Customs Act, 1962 if the market value of the export goods exceeds the drawback amount payable. The goods were also considered liable for confiscation on account of misdeclaration of value and, consequently, the exporter and other persons concerned with the export were penalised under section 114 of Customs Act, 1962. 10. The alleg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es reliance on the decision of the Hon ble High Court of Bombay in Commissioner of Customs (EP) v. PD Manjrekar [2009(244)ELT 51 (Bom)] holding that on a charge of abetment it is for the adjudicating authority to establish the knowledge on the part of the noticee and that in RM Mehrotra v. Enforcement Directorate [2009 (246) ELT 141 (Del)] which held that, in the absence of a definition of abetment , it is the following General Clauses Act, 1897 16. that the mental state of the accused must be conditioned by one of the following states: intention, knowledge, or wilful commission. The accused must have intentionally aided or incited or knowingly conspired or wilfully omitted to do the act alleged. Negligence on the part of the Petitioners does not imply any of these mental states and therefore, the impugned notice in so far as it alleges that the Petitioners have abetted the offence, is not sound in law. that must be referred to. It was also submitted that the Tribunal in MJ Joshy v. Commissioner of Customs, Chennai [2010 (258) ELT 460 (Tri-Chennai)] had held that a customs house agent can be proceeded against under the Customs Act, 1962 for abetting in overvaluati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 14. Having heard the rival contentions at length, we must observe that the resolution is limited to evaluation of the nature of evidence that led the adjudicating authority to come to a conclusion that penalty under section 114 (iii) can be imposed on the appellant. Consequently, only the facts are relevant. Appellant has not filed any shipping bill and is not a promoter or administrator of the exporter-concern. Appellant, not unnaturally, is not a signatory on the documents. That the exported goods are readymade garments is not in dispute. Denial of the drawback owing to the restriction in section 76 of Customs Act, 1962 is not liable to be stigmatized as contravention. Appellant may have canvassed orders from abroad and procured readymade garments for the exporter at the price deduced in the impugned order and at a fraction of the value that was declared by the exporter; these, however, may not be abnormal business practices even if reprehensible to ethical values as some may find it to be. Suffice it say, moral indignation is not adequate justification for imposition of penalty. There is no evidence on record to show that appellant was the beneficiary of the drawback amou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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