TMI Blog2019 (3) TMI 1240X X X X Extracts X X X X X X X X Extracts X X X X ..... he acts and omissions on the part of Mohammed Rabeek and Rahamath Ali will attract penalty for abetting the said attempted smuggling under Section 112 of the Customs Act, 1962. However, the quantum of such penalty will have to be commensurate not only to the degree of proof that the investigation has been able to throw up against these two persons but also / to the degree of complicity and abetment of each of them. Undoubtedly, there is a needle of suspicion that had the earlier container TLXU 2021855 not been seized and Shri Mohammed Rabeek and Shri Rahamath Ali not been in judicial custody, they would have caused clearance of the second container CAXU 3151576 also, and facilitated Mr.Roselan on the smuggling gold and cigarettes etc. from Malaysia and handed over the same to persons as instructed by Roselan. But it remains only a needle of suspicion. As mentioned earlier, statements from Rabeek have been recorded after the seizure from container CAXU 3151576 which in any case have been retracted subsequently. The main linkage that now connects Mohameed Rabeek with the seizure from the second container is the exchange of e-mails between Roselan and him with regard to attempt of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1262/2018, C/41263/2018, C/41264/2018, C/41265/2018 C/41267/2018 2.2 Based on specific intelligence that gold bars are being smuggled into India through Tuticorin port by concealing them in consignment of unaccompanied baggage imported in container No. TLXU 2021855 arriving from Malaysia, the officers of DRI kept vigil on the movement of the said container at PSA SICAL Terminal, Tuticorin Port. The intelligence also suggested that the container may be diverted to a private godown in Tuticorin and that it may be replaced by another container carrying cover goods. The container TLXU 2021855 arrived at Tuticorin Port by vessel Cape Nemo on 10.02.2016. As per the Bill of Lading No. TALTKL01932656 issued by M/s.Trans Asia Lines, the container had 65 packages shipped and consigned to one Shri Abdul Wahab Ashkar Ali (PP No.J6944766). The contents therein were declared by the shipper in the said Bill of Lading as Used Personal effects . The officers intercepted the said container at PSA SICAL Terminal, Tuticorin Port itself on 10.02.2016, loaded in one lorry Registration No.TN69K8611, laden without any documents. S/Shri Binu Raj, Driver of the Lorry and Shri M. Mohammed Sadham wer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rabands at the godown; That Lorry bearing actual Registration No.TN29B 6909, belonging to Shri Mohammed Rabeek was used to carry / transport smuggled gold bars concealed in the container and lorry bearing actual Registration No.TN69K 8611 owned by Shri Rahamath Ali was always kept ready for substituting the actual container and parked in the godown. (iv) That Shri Binu Raj, Driver had knowingly indulged in smuggling of gold bars and cigarettes and diversion of actual container to the godown for the purpose of unloading the contraband as instructed by Mohammed Rabeek. (v) That one Shri A. Selvaraj had managed all the accounts relating to clearance of unaccompanied baggage to the godown and despatch of goods, was aware of clearance of contraband and had abetted Mohammed Rabeek and Rahamath Ali in the diversion of container from PSA Terminal to the godown by way of accompanying Binu Raj. (vi) That Shri Mohammed Sadham, son of Shri Mohammed Rabeek, had abetted his father in the diversion of container from PSA SICAL Terminal to the godown by way of accompanying Shri Binu Raj, Driver. (vii) That Shri A.Ashkar Ali had lent his passport for pecuniary gain and knowingly enabled ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n in the SCN, the D.R.I officers, based on specific intelligence that gold is being smuggled into India by concealment in an import consignment of stock lot of Elastic Tape (Cut Pieces) in container CAXU 3151576 arriving from Malaysia, monitored the arrival of the container which was listed in line No.55 of the IGM No.2130862 dt. 14.02.2016 (Voyage No.442A) filed by M/s.Relay Shipping Agency Ltd. (OEL), Tuticorin for vessel OEL COLOMBO. The officers intercepted the container at PSA SICAL Terminal, Tuticorin Port itself on 15.12.2016. After taking proper permission from the competent authority, the container was taken to mobile scanner installed at Tuticorin port whereupon officers suspected that certain contraband material might have been concealed therein and hence officers escorted the container to Hari CFS under Customs escort for detailed examination. As per the above mentioned IGM and Bill of Lading TALTKL01933916 dt. 04.02.2016, the consignment was filed in the name of M/s.Bin Dawood Travels Cargo Service for clearance of 132 packages of stock lot of Elastic Tapes (Cut Pieces). One Shri Rahamath Ali was found to be proprietor of the said concern. Detailed examination of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ine of ₹ 1,50,000/-; (iv) confiscated 130 packages of elastic tapes valued at ₹ 75,000/- under various provisions of Customs Act,1962, however gave option of redeeming the same on payment of a fine of ₹ 25,000/-; (v) imposed penalty of ₹ 50,00,000/- on M/s.Bin Dawood Travels Cargo, Chennai under Section 112 (a) ibid; (vi) imposed penalty of ₹ 25,00,000/- on Shri S. Mohammed Rabeek under Section 112 (a) ibid; (vii) imposed penalty of ₹ 25,00,000/- on Shri S. Rahamath Ali under Section 112 (a) ibid. (viii) No penalty was imposed on Mr.Roselan, resident of Malaysia under Customs Act on the grounds that the said person was a foreign national. 3.4 In appeal, the Commissioner (Appeals) vide Order Nos.106 to 108 (2018) dt.10.04.2018 upheld the order of original authority. Aggrieved, Bin Dawood Travels and Cargo, S. Rahamath Ali and S. Mohammed Rabeek have filed Appeals Nos. C/41819/2018, C/41820/2018 and C/41821/2018 respectively. 4.1 Appeal C/41432/2018 (Afrin Express Courier Service) 4.2 Pursuant to issue of SCNs dt. 05.08.2016 and 11.8.2016 in the aforesaid cases, DRI forwarded a letter dt. 27.07.2017 to the Commissione ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eement of Rahamat Ali for all the registrations. (iv) However, from 2012, the appellant had taken over all the operations of the firm and was running the business, which has not been disputed by him or by anyone else implicated in the Show Cause Notice. (v) From 2012 to 2016, the appellant was running the operations smoothly without any blemish. (vi) The business of the firm is to bring house hold articles from labourers in Malaysia which was to be gifted to relations and friends of them in Tamilnadu. The consolidation of baggage or cargo was done at Malaysia by Roselan of Bin Dawood Cargo and Travels SDN BHD (which was later renamed as Rahbiah Bi Enterprise, in the name of one of the partners there) (vii) While small packages would come in the form of unaccompanied baggage from a person coming on Transfer of Residency Rules, larger baggages would come as cargo in a container. (viii) Exporter in Malaysia would collect goods from various labourers in Malaysia and consolidate it in a single container and send it to Tuticorin along with the list of consignees and their addresses. (ix) Rabeek used to clear the containers/unaccompanied baggage from CFS using a local CH ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s well and to be painted as habitual offender when there is nothing on record to prove except his so called voluntary statement. It is inconceivable that any one will voluntarily give statement about alleged two such smugglings in the past unless the statement is recorded under duress and threat. There is no other evidence (not even Whats app messages, unlike on the disputed two shipments between Roselan and Rabeek). Even that statement has been retracted vide letter of the Appellant dated 28-3-2016 dated 38 of Additional paper book submitted during the course of hearing. (xviii) The Show Cause Notice and the order have not disputed the fact that the appellant acted only as a door to door delivery agent and abetted in the smuggling of gold by the Malaysian party Roselan for a consideration of ₹ 30,000/- per Kg (xix) In fact Roselan (Rahbiah Bi Enterprise) has been served Show Cause Notice DRI / CZU/TTN /VIII/48/02/INT-1/2016 dated 05.08.2016 for the first container and DRI / Customs strangely claimed in para 20 of the OIO 99/2017 that they could not serve second notice DRI / CZU/TTN /VIII/48/03/INT-1/2016 dated 11/8/2016 (just 6 days from the first notice), i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 11.993). 5.3 Appeal No. C/41267/2018 OIO No. 96/2017 dated 28.04.2017 - Shri Rahamat Ali (Container No.1 TLXU 2021855) (i) Rahamat Ali was in the business of buying and selling of iron scrap with a small rented office at Egmore, Chennai. (ii) During that time, his brother Mohammed Rabeek was in Malaysia and after working in Malaysia for many years, his brother started door to door courier service in Malaysia (iii) Rabeek returned to India during 2012 after relinquishing partnership in the Malaysian entity by handing over the firm to Roselan and Rahbiah, the other two partners of the firm. (iv) Rabeek after return started door-to-door courier service in India and since he did not have any premises, he started his business using the appellant s office. Since, Rental agreement was required for getting registration for his business, he used the Rahamat Ali rental agreement and stared the business named M/s.Bin Dawood Tours and Cargo. (v) His brother Rabeek was in complete control of the business of door-to-door delivery and Rahamat Ali was used only to deliver the goods to Chennai and certain districts surrounding Chennai. However, his brother Rabeek was taking c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he truth. (xv) To demonstrate that appellant had no knowledge whatsoever, he requested twice for cross examination of such people who gave the statements but the same was rejected by Additional Commissioner for reasons best known to him. (xvi) Under the above said facts and circumstances, the appellant is innocent and was implicated without any knowledge whatsoever and has not violated any of the provisions of Section 111 as relied in the order and therefore no Penalty should be levied. 5.4 Appeal No. C/41262/2018 - OIO No. 96/2017 dated 28.04.2017 Shri Mohammad Sadham (Container No 1. TLXU 2021855) (i) Shri Sadham had no role whatsoever in connection with the alleged seizure of the container containing gold. He was implicated for the only reason that he was the son of Mohammed Rabeek and was present at the godown on the day of seizure by DRI officials. (ii) It is pertinent to note that statement was obtained from Shri Sadham which was pre typed and obtained on 26.04.2016 through coercion and threat. He has filed a letter with ADG, DRI on 03.05.2016 explaining the facts in detail. (iii) The Adjudicating Authority has referred to the letter dated 03.05.2016 in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lso did not have any knowledge whatsoever regarding the same. (iv) Thus he is innocent and implicating him only because he lent his passport for ₹ 5,000/- . Imposing harsh penalty on a poor laborer like him is legally not sustainable and therefore his appeal for setting aside penalties imposed on him maybe allowed 5.7 Appeal No.C / 41821/2018 - OIO No. 99/2017 dated 28.04.2017 - Shri Mohammed Rabeek (Container No 2. CAXU 3151576) (i) In respect of the second container, the appellant was in judicial custody and realizing that he would not be in a position to handle that container, the exporter in Malaysia, Roselan had sent an email to liner to hold the container at Colombo and ultimate re-export to Malaysia. Copy of the email sent by the Malaysian entity to liner is at page 44 to 48 of the Paper Book. (ii) However later, it was found that, DRI contacted not only the liner but also the Tuticorin Customs Officials, Port Officials at Srilanka, Cargo Handlers, Srilankan Customs etc. and insisted that the liner should bring the container to Tuticorin instead of holding it in Colombo or sending it back to Malaysia. (iii) It was learnt from liner that, vide letter i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It is the DRI who forcefully brought the gold from Colombo. E Any dutiable or prohibited goods found concealed in any manner in any conveyance. Not Applicable in view of above. F Any dutiable or prohibited goods required to be mentioned under the regulations in an import manifest or import report which are not so mentioned Not Applicable in view of above. H Any dutiable or prohibited goods unloaded or attempted to be unloaded in contravention of the provisions of Section 33 or Section 34. Not Applicable in view of above. J Any dutiable or prohibited goods removed or attempted to be removed from a customs area or a warehouse without the permission of the proper officer or contrary to the terms of such permission Not Applicable in view of above. I Any dutiable or prohibited goods which are not included or not included or are in excess of those included in the entry made under this act or in the case of baggage in the declaration made und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er to respective persons. None of the sub-sections of Section 111 of the Customs Act, 1962 have been violated by this appellant. The appellant was prevented from considering response to the SCN as documents seized and relied were not supplied at all. Cross examination of various persons sought by the appellant was denied by the adjudicating authority. iv) There is no evidence other than one retracted statement of proprietor to implicate the appellant in alleged smuggling activity. Voluntary statement dt. 10.02.2016 stating innocence in the offence was suppressed and not relied in investigation, whereas a dictated and restricted statement dt. 11.2.2016 alone was relied. v) No documentary / material evidence was recovered from appellant s premises / office to implicate them in offence. All the above contentions were disregarded by the original authority and who even passed order dt. 8.5.2017 in disregard of the notice issued by Hon ble High Court of Madras (Madurai Bench). vi) Without prejudice to above submissions, such a huge penalty is uncalled for when there is no dispute about the fact that appellant is only a courier agent and not an illegal importer of contraband good ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i) This was a well planned operation in connivance with foreign counterpart Shri Roselan of Malaysia on the part of these appellants who had been in the know and had conspired to smuggle the contraband goods into the country. ii) To facilitate the smuggling activities Mohammed Rabeek had even purchased a lorry, second hand container and hired a godown. iii) As per his own admission, appellant Mohammed Rabeek had brought goods in excess of what was declared in the containers wherein unaccompanied baggages of a number of persons were consolidated and imported. iv) Mohammed Rabeek without revealing his identity had bought a lorry to make things easier for diversion of consignments with the contraband to the godown. A godown had been taken to facilitate the smuggling activities in the name of Bin Dawood Travels and Cargo on rental basis by Rahamath Ali. During search of the godown by DRI officers, both Mohammed Rabeek and Rahamath Ali were found present. DRI officers found two lorries of identical numbers with laden container available for the purpose of swapping original container with bogus container for transportation to CFS. v) Mohammed Rabeek and Rahamath Ali ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rough containers carrying unaccompanied baggage. (ii) Proprietor Shri. Rahamath Ali, in his voluntary statement dated 24.03.2016/11.02.2016, has admitted his role as well as that of his brother Shri. S. Mohammed Rabeek and Shri. Roselan of Malaysia in the smuggling of gold and foreign cigarettes under concealment in elastic tapes.The details of the diversion of import container from PSA SICAL Terminal of Tuticorin Port to their godown before going to the CFS for destuffing some cargo, have all been divulged by Shri. Rahamath Ali in his statement. The statement of Shri. Rahamath Ali was not retracted in the immediate vicinity of time. (iii) So also, Shri. Mohammed Rabeek in his statements has admitted his own role and that of his brother Shri. Rahamath Ali and Shri. Roselan of Malaysia in the smuggling of gold. He also admitted to having received Whatsapp messages pertaining to cartons found with gold of foreign origin. He has also admitted that they are indulged in the smuggling of gold for monetary consideration of ₹ 30,000/- per kg each. (iv) Both Shri. Mohammed Rabeek and Shri. R. S. Rahamath Ali have been consistently indulging in smuggling activity even earlie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Imports and Exports (Clearance) Regulations, 1998 (CIE(C)R) is very much in order since as per that Regulation, the Commissioner of Customs is empowered to revoke the registration and also order forfeiture of security for any misconduct on the part of the authorized courier, whether within the jurisdiction of the said Commissioner or anywhere else, which renders him unfit to transact in business in the Customs Station. (vi) The misconduct on the part of the courier agency need not only be restricted to the work handled by them as courier. The misconduct can also very well be displayed by the Proprietor in any other transaction or matter, even if it is not relating to the activities of the courier agency. (vii) For these reasons, the revocation of courier registration granted to M/s. Afrin Express Courier Service made in the impugned Order is very much justified. 8. In response to synopsis and submissions filed by the Ld. Counsel for all the appellants, the department furnished comments thereon on 20.02.2019. These counter responses can be summarized as under : I. Mohammed Rabeek: Appeal No. C/41265/2018 for container: TLXU2021855: i) The fact of Shri.Rabeek kn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... authorities, if his claim of innocence had any iota of truth. ix) There are no allegations in the show cause notices that Shri Mohammed Rabeek and Shri Rahamath Ali are the owners of the smuggled gold. x) The provisions of the Customs Act, 1962, under which penalty has been imposed on the appellant, does not differentiate between actual smugglers and an abettor and the penalty imposed on the appellant in the impugned case is for his role in rendering the goods liable for confiscation under Section 111. The claim that the appellant was only an abettor itself is spurious, since the entire activity of smuggling could have been thwarted had the appellant decided to inform the customs authorities. Indeed, the smuggling happened because he was indulged in abetment of smuggling. II Shri Rahamath Ali: Appeal No. C/41267/2018: Container: TLXU2021855: i) Had Shri Mohammed Rabeek wanted to start his independent business, he would have taken the godown on rent in his name. As Shri Mohammed Rabeek and Shri Rahamath Ali were business partners, the premises was rented in the name of Shri Rahamath Ali. ii) Shri Rahamath Ali and his brother Shri Mohammed Rabeek jointly orchestra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... taining gold. ii) The contents of statement dated 26.04.2016 were backed by material evidence and the statements of others. Hence, the Adjudicating Authority held that the retraction was not valid. IV Shri Selvaraj: Appeal No. C/41263/2018: Container: TLXU2021855: i) It was Shri Selvaraj who was maintaining the accounts relating to the payment of godown rent, miscellaneous payments with regard to clearance of unaccompanied baggage s and dispatch of the goods, on behalf of Shri Rahamath Ali. ii) The retraction of statement dated 10/11.02.2016 was only a ploy to extricate himself from the consequences of his action in enabling Shri Rahamath Ali and Shri Mohammed Rabeek to smuggle gold and cigarette in the import consignments of house hold articles and elastic tape. iii) Shri Selvaraj had handled the accounts of Shri Rahamath Ali and was in the know of what was being transacted. iv) He knowingly assisted Shri Rahamath Ali and Shri Mohammed Rabeek in the smuggling of gold and cigarettes, besides diverting of import container to the godown rented by Shri Rahamath Ali. Hence, the penalty imposed is justifiable. V Shri Rahamath Ali: Appeal No. C/41820/2018: Con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on hand, the Adjudicating Authority rightly denied the request. The denial of request would in no way take away the role played by the appellant in making arrangements for receipt of the container with 180 cartons (18,00,000 sticks) of foreign cigarette, 128 packages of household articles, including six packages with one kilogram gold bar each, all in the name of import of stock lot of elastic tape in the name of M/s Bin Dawood Travels Cargo Services, owned by Shri Rahamath Ali. v) The plea for nominal penalty cannot be accepted for the fact that the appellants were actively indulging in the abetment of smuggling and thus the claim that they are not the owners of confiscated item does not deserve any leniency towards the penalty. Moreover, the fact that gold has been confiscated is immaterial to the quantum of penalty leviable in any case. VII Shri Ashkar Ali: Appeal No. C/41264/2018 : Container No. TLXU2021855: i) Shri Ashkar Ali for a monetary benefit lent his passport for import of the container No. TLXU2021855, supposed to contain house hold articles. This has enabled Shri Rahamath Ali and Shri Mohammed Rabeek to smuggle gold in the said container. VIII ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lted inter alia in seizure of 12 pieces of foreign marked gold (FMG) bars and 2 cut pieces of foreign origin gold, totally weighing 11993.400 gms and valued at ₹ 3,43,01,124/- and 4,00,000 cigarette sticks valued at ₹ 30,00,000/-. 10.4 From the facts on record, these two brothers Shri Mohammed Rabeek and Shri S. Rahamath Ali are the two constants in both the above D.R.I. cases. 10.5 Mr. Rahamath Ali was admittedly the proprietor of Bin Dawood Cargo and Travels Service India (BDC), in whose name private godown had been rented at Mapillaiyurani , Tuticorin. From this godown, on 10.02.2016, the investigating officers had seized 4,00,000 sticks of cigarettes and also a lorry. 10.6 In their defence. Mohammed Rabeek and Rahamath Ali have submitted that BDC was set up to help labourers bring their household articles from Malaysia to India for gifting to the relatives and friends of them in Tamilnadu; that consolidation of cargo at the Malaysian end was done by their affiliate Shri Roselan of Rahbiah Bi Enterprise (Earlier Bin Dawood Cargo and Travels SDN BHD). Both the brothers have also maintained that the godown was used only for unloading . repacking, sorting etc. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... name, he had sought cross examination of the persons who gave statements of two accused, however has requested was not acceded to. 11.1 We however not very much impressed by these protestations of innocence from Shri Mohammed Rabeek and Shri S.Rahamath Ali. At least in respect of the seizure from the first container TLXU 2021855, it cannot be denied that it was intercepted well after arrival at PSA SICAL Terminal at Tuticorin Port on 10.2.1016 and was found loaded in one lorry No.TN69-K-8611. 11.2 From the facts, it also emerges that at the time of interception Shri Binu Raj, Driver and Shri Mohammed Sadham, son of Mohammed Rabeek were in the lorry. The driver Shri A. Binu Raj in his statement has spilled quite a few beans, including the admission that he was working as a driver in the school run by Mohammed Rabeek and would come down to Tuticorin Port whenever such a container would require to be cleared; that he would stay in the godown of Rahamath Ali only; that after taking delivery of the container he used to take the lorry with the laden container to the godown instead of CFS. Shri Binu Raj has also given the details of manipulation of the seals and removal of contraban ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o brothers, but the said admissions have been retracted subsequently. There is also no corroborative evidence or statements of buyers or recipients of the earlier smuggled gold that have been ferreted out in investigation. Hence the allegation that gold was smuggled on earlier occasions also in the same manner is bereft of any evidential legs to stand upon. There have also been some other unproven allegations, for example, in para 3 of the OIO dt. 28.4.2017, the original authority has concluded that Mohammed Rabeek and Rahamath Ali had been misusing the passport of passengers coming to India importing goods in commercial quantity in the name of passport holders; that these goods included cosmetics, confectioneries, new television sets of various brands, textiles etc. These unsubstantiated conclusions are only based on statements which have been retracted. Further, although adjudicating authority has admitted that although Mohammed Rabeek, Rahamath Ali, Binu Raj and Mohammad Sadham had asked for cross examination of co noticeees and other persons, the authority in para 27.01 of the order has denied the same on the ground that since the said noticees have admitted to their respec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is evident that it became necessary to make such presumptive scenarios, since the interception of the container was not made at the point of the alleged swapping with another container, but in the Tuticorin Port itself. Nonetheless, there is a preponderance of probability that had the container not been stopped within the port and had been driven out of the port without incident, the driver would have made a beeline to the godown and swapping of goods and / or container may very well have been actualised. There could also be a damning possibility that the duplicate one time seal found in the godown may well have been used after such swapping of goods and / or container. 11.5 Viewed in this light, we have no doubt whatsoever that penalty under Section 112 (a) of the Customs Act, 1962 is very much imposable on Mohammed Rabeek and Rahamath Ali So also, at first blush, the other players in this failed exercise of smuggling gold and contraband appear to be liable to penalty under Section 112 ibid. 11.6 However, as discussed herein above, the part played by each of these players is not surely the same and are in various degrees of complicity. This being so, the penalties that are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld come in concealment; that it is illogical to claim that he was unaware of such concealed items; that Rabeek had admitted to handle the cargo for monetary benefit which revealed the conscious attempt on his part to illicitly transport the cargo. 11.8 It is also interesting to note that in para 45 of the related SCN while proposing personal penalty under Section 112 ibid on the aforesaid persons, an allegation has been made that they would have smuggled around 42 kgs. of gold previously smuggled with estimated value of ₹ 12.01 crores. At the same time, the SCN has the disclaimer that such previously smuggled gold could not be seized nor sale proceeds are available for seizure. It is also conceded that the value has been arrived Going by a conservative estimate in line with the present seizure The adjudicating authority has also quoted the same sentiments in para 45 of the Adjudication Order dt. 28.4.2017 (internal page 31). On this basis only, the adjudicating authority has proceeded to impose penalty under Section 112 ibid commensurate with the seriousness of the offence committed by them, it could be equal to the value of gold bars so arrived successfully smug ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in investigations discussed supra, we are of the considered opinion that the penalty of ₹ 75 lakhs imposed under Section 112 (a) requires to be modified and reduced and imposed commensurate not with a value including presumptive value of uncorroborated earlier quantities of gold presumed to have been smuggled, but only with the value of the undisputed actual seizure of gold and other goods from container number TLXU 2021855. Viewed in this light, we hold that penalty of ₹ 15,00,000/- on Shri Mohammed Rabeek under Section 112 ibid would meet the ends of justice in this case. Accordingly, penalty of ₹ 75,00,000/- imposed on Shri Mohammed Rabeek is modified and reduced to Rs.15,00,000/- (Rupees Fifteen lakhs only). Appeal C/41265/2018 is thus partly allowed. 11.12 The role played by second brother Rahamath Ali is undoubtedly of a lesser degree than that of Mohammed Rabeek. He had only hired the godown for his brother in the name of his proprietorship firm (Bin Dawood Travels Cargo) There is also no allegation that he was in direct touch or correspondence with Roselan of Malaysia. He has retracted his statements. Cross examination of other persons who have n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e son of Shri Mohammed Rabeek, it does not mean that sins of the father must visit the son in awarding penalty and that too to the extent of ₹ 15 lakhs. We hold that penalty in this regard also is unjustifiably high and accordingly we hold that it should modified and reduced to Rs.1,50,000/- (Rupees One lakh fifty thousand only). So ordered. Appeal C/41262/2018 is thus partly allowed. 13. Appellant Shri A. Selvaraj is the proprietor of K3N Shipping Services and has also been accused of having managed all the accounts related to the clearances of unaccompanied baggage, godown and despatch of goods. On this premise, it has been alleged that he was aware of the clearances of the contraband and so abetted Mohammed Rabeek and Rahamath Ali. Even in his statement narrated in para-11 of the SCN, on a specific query regarding ownership of the consignment TLXU2021855, Shri Selvaraj had stated that he was not aware of the same. As seen from para 11 of the adjudication order, it comes to the fore that even in his statement dt. 10.2.2016 and 11.2.2016 Selvaraj had stated that when was not aware of the ownership of the consignment TLXU 2021855; that he was only facilitating clearanc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ade with any other part of the impugned order including the upholding therein of confiscation of 12 pieces of FMG bars, 2 cut pieces of foreign origin gold, contraband cigarettes and other goods by the original authority. 16.1 On the matter of imposition of penalties on M/s.Bin Dawood Travels Cargo (Appeal C/41819/2018), Shri Rahamath Ali (Appeal C/41820/2018) and Shri Mohammed Rabeek (Appeal C/41821/2018) 16.2 In respect of second set of appeals namely C/41819/2018, C/41820/2018 and C/41821/2018, the appeals have been filed against imposition of the following penalties under Section 112 (a) of the Customs Act, 1962 : (i) Penalty of 50,00,000/- has been imposed on Bin Dawood Travels Cargo (Appeal C/41819/2018) (ii) Penalty of ₹ 25,00,000/- S.Mohammed Rabeek (C/41821/2018) (iii) Penalty of ₹ 25,00,000/- on S.Rahamath Ali (Appeal C/41820/2018) 16.3 The facts and the issues leading to these appeals have already been discussed in para 3.2 to 3.4 (supra). The issue that comes up therefore concerns legal propriety and imposability of these penalties under Section 112 (a) of the Customs Act, 1962 and if so, the appropriateness of the quantum imposed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellants that the container was brought forcibly by DRI from Colombo to Tuticorin. In their written submissions dt. 20.2.2019 filed by Revenue, it has been vehemently stated that such a contention is based on presumptions and assumptions; and that such things will not fall under the purview of D.R.I. Notwithstanding all such protestations, no response has been given in respect of a contention made by appellants (in their written submissions) that DRI had issued letter dt.06.02.2016 from File No.DRI/CZU/TTN/VIII/48 giving directions to the liner to bring the container to Tuticorin instead of holding it in Colombo or sending it back to Malaysia. No response has also been given to the contention by appellants that DRI had contacted not only the liner but also the Tuticorin Customs officials, Port officials in Sri Lanka, Cargo Handlers and Sri Lankan Customs in this exercise. 16.6 From the facts on record, it is also seen that at the time and place of detailed examination of the said container CAXU 3151576 and the recovery and seizure of gold and cigarettes on 16.2.2016, both Mohammed Rabeek and Rahamath Ali were not available or present, as they were then under judicial custody ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... specifically requested for supply of correspondences made between 06.02.2016 to 14.02.2016 between the DRI and Tuticorin Port authorities, Customs Tuticorin, Handling agent, Liner, Overseas (Customs Srilanka) Lanka authorities etc. which had not been relied upon in the SCN stating that those documents were very much required in defending the case of their clients in the adjudication proceedings before quasi-judicial authority. The request for correspondence was voiced by the Ld. Advocate for the appellants vide letter of 3.1.2017 which was reiterated in subsequent letters dt. 3.2.2017, 22.02.2017 and 28.02.2017. The hearing was requested to be deferred. However, the original adjudicating authority on the grounds that three opportunities had been given to the noticees took up the matter for exparte adjudication. 16.9 The adjudication order which has been upheld by the LAA, has a few more red herrings. For example, the adjudicating authority in para 19 (xvii) of his order has concluded that the letter from shipper for return of container from Colombo was only after the processes initiated by persons involved in an attempt to escape from consequence of law. At the same time, we fin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al with Seal No.TAS020093 seized by the officers from the godown, which tallied with the actual seal number in respect of the container, which leads to preponderance of probability that the seal was prepared for resealing the said container after removing the contraband at the godown. 16.12 It is also evident that the container CAXU 3151576 was initially consigned by Roselan of Malaysia to Tuticorin Port. However after seizure of the first container TLXU 2021855. Roselan made every effort with the shipping lines etc. to get the container returned back to Malaysia from Colombo Port. Possibly, only due to the efforts of the D.R.I, the container was brought to Tuticorin Port by the shipping line and enabled to be examined. Though Mohammed Rabeek and Rahamath Ali were not available at the time of interception and examination on 15.02.2016, since they were under judicial custody in connection with the earlier seizure, detailed examination was conducted before other independent witnesses. 16.13 In our view, although the said container may well have been brought from Colombo to Tuticorin Port at the behest of the D.R.I, nonetheless, it had been initially destined for Tuticorin Port ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bin Dawood Travels Cargo have not been made a co-noticee and nor have any allegations against the said firm been made in the said notice. In this background when, in the present case where seizure of gold and other contraband from container CAXU 3151576 was entirely an operation related within the Tuticorin Port and no further visit was made to rented office of Bin Dawood Travels Cargo as also no incriminating documents or goods were seized therein in respect to the second case, we are not able to fathom how the said firm has been made a noticee here, when it was not thought proper to do so in the first case. Nor have Bin Dawood Travels Cargo the consignee as per the IGM, filed any import documents or baggage declaration for the second container. The only scene in which Bin Dawood Travels Cargo features in the drama related to container CAXU 3151576 is that the IGM of the shipper showed them as the consignee. But every other alleged act or omission have been alleged only on Mohameed Rabeek and Rahamath Ali. This being so, as per the well established law, if penalty is imposed on S. Rahamath Ali, it cannot be imposed for same offences on Bin Dawood Travels Cargo of which h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... degree of abetment and complicity that has been alleged in the SCN. In the circumstances, the penalty of ₹ 25 lakhs is unnecessarily high and not commensurate with all these factoids. In our view, interest of justice will be more than adequately served by modifying and reducing the penalty imposed on Shri Mohammed Rabeek under Section 112 of the Customs Act, 1962 to Rs.5,00,000/- (Rupees Five lakhs only). Appeal C/41821/2018 is partly allowed. 18.4 Coming to the penalty imposed on Shri Rahamath Ali, the inadequacies in investigation and adjudication proceedings in respect of Mohammed Rabeek rear their head in respect of this appeal also. As in the previous set of Appeals C/41262-41265/2018 and C/41267/2018, Rahamath Ali on 28.3.2016 has pointed out that his brother Mohammed Rabeek only was responsible for the entire operations. In a later letter dt. 29.08.2016 Rahamath Ali has tried to distance himself from the seizure. In a further letter dt. 22.12.2016, Rahamath Ali has contended that he had not filed any Bill of Entry, made any declaration, not filed any documents with the Customs; that the person mentioned in the IGM had sent a letter that the container was not me ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... old that the penalty of ₹ 25,00,000/- imposed on Shri Rahamath Ali under Section 112 ibid is undoubtedly high and that penalty of Rs.2,50,000/- (Rupees Two lakhs fifty thousand only) would meet the ends of justice in this case. So ordered. Appeal C/41820/2018 is partly allowed. 18.5 For the reasons already discussed herein above, the penalty imposed on Bin Dawood Cargo Travels, Chennai is set aside since the penalty has already been imposed on its proprietor of Shri S. Rahamath Ali. Appeal No. C/41819/2018 is allowed. Appeal C/41820/2018 is partly allowed on above terms. 18.6 We make it clear that no other interference is made in respect of another part of the order including the confiscation of 6 FMG gold bars, foreign origin cigarettes and other goods found in the container CAXU3151576. 19.0 Appeal No.C/41432/2018 (Appellant M/s.Afrin Express Courirer Services, Chennai. 19.1 The facts of the matter are that pursuant to interception of container TLXU 2021855 and CAXU 3151576 at Tuticorin Port and seizure of gold and other contrabands, the Directorate of Revenue Intelligence forwarded a letter dt. 27.07.2017 enclosing copies of SCNs dt. 11.08.2016 an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Arvind made oral and written submissions which can be broadly summarized as under : i) Afrin Express is an authorized courier registered under Courier Import and Export Regulations 1998 from 24.03.2009 with Chennai customs with no blemish. ii) License granted to Afrin Express was cancelled by Commissioner of Customs Chennai vide Order in Original No. 245/2018 dated 12.03.2018, based on DRI letter dated 27.07.2017 enclosing two Show Cause Notices issued in connection with smuggling of gold in Tuticorin. iii) In Show Cause Notices, Rahamat Ali the owner of Afrin Express has been alleged to have helped his brother in smuggling of gold consigned to Tuticorin, twice vide container No. TLXU2021855. iv) However no Show Cause Notice has been issued to Afrin Express by DRI in those two notices nor Rahamat Ali has been implicated as Authorized Courier in those two cases. v) Therefore applicability of Rule 14(1)(c) of Courier Import and Export Regulations was challenged when there was no notice to Afrin Express nor there was an allegation that Rahamat Ali the owner of Afrin Express has acted as authorized courier. vi) In support of the above argument, Para 13.2 of Mumbai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Rule 14 (c) ibid reads as under : (1) The Commissioner of Customs may revoke the registration of an Authorised Courier and also order forfeiture of security on any of the following grounds namely : (a) failure of the Authorised Courier to comply with any of the conditions of the bond executed by him under regulation 11 ; (b) failure of the Authorised Courier to comply with any of the provisions of these regulations; (c) misconduct on the part of Authorised Courier whether within the jurisdiction of the said Commissioner or anywhere else, which in the opinion of the Commissioner renders him unfit to transact any business in the Customs Station. 21.2 The crucial phrase that comes up for interpretation of Rule 14 (1) (c) of the CIEC Regulations is misconduct on the part of authorized courier . Such misconduct can be either within the jurisdiction of the Commissioner concerned or any other customs station. 21.3 Discernably, there is no definition of misconduct given in the Regulations. However, Regulation 13 which lists out the obligations of an authorized courier will surely thus come into conduct that is expected of an authorized courier. We find ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mis-declared with respect to description or valuation or the like an each order become take the colour of smuggled goods. 21.5 Viewed in this light, what becomes relevant is the question whether Afrin Express Courier Service has committed misconduct in respect of any of their obligations as authorized courier or have been implicated themselves in any gross violation of the Customs Act, 1962. The answer is resoundingly in the negative. True, S.Rahamath Ali who is the proprietor of Afrin Express Courier Service, the appellants herein, may well have been implicated along with his brother in abetment of smuggling of gold and cigarettes at Tuticorin Port for which SCNs dt. 11.8.2016 5.8.2016 had been issued. Those SCNs have also been culminated in adjudication / appellate orders and have also been appealed against before this forum. We have of course found Rahamath Ali along with his brother Mohammed Rabeek had abetted the smuggling of gold and cigarettes seized in respect of the two containers in the appeals decided by us foregoing. In these cases, it was found that Rahamath Ali was the proprietor of Bin Dawood Travels Cargo which had rented a godown outside Tuticorin Port alleg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ess Courier Service. However, it is not forthcoming from the rest of the notice as to what aid from Afrin Express was extended to the brothers. There is an insinuation that Afrin has been involved in illegal import of gold and cigarettes. However, there is no evidence brought forth to support the allegation. On the other hand, from the records, we find that though Mohammed Rabeek had abetted his friend Roselan of Malaysia in the smuggling of gold through Tuticorin Port, the services of Afrin Express Courier Service, which is a Chennai based firm, have not been utilized in the said attempts of smuggling. The role of Rahamath Ali and his complicity in the two cases booked by DRI at Tuticorin port is specific as brother of Mohammed Rabeek and abetment in his personal capacity and / or through another firm BDC, and not through Afrin Express Courier Service. In the circumstances, we find that proceedings against Afrin Express Courier Service and the resultant impugned order have adopted erroneous premises and misinterpretation of the said Regulations which have no legal backing. This being so, the impugned order revoking registration of Afrin Express Courier Service cannot be sustaine ..... X X X X Extracts X X X X X X X X Extracts X X X X
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