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TMI Blog2024 (3) TMI 1113X X X X Extracts X X X X X X X X Extracts X X X X ..... otal valued at Indian Rs.29,37,702/-. On enquiry, the appellant informed that these currencies were given to him by Mr. Fazal. Since these currencies were smuggled out of India in violation of Customs Act, 1962 read with the provisions of Foreign Exchange Management Act, (FEMA), 1999. The currencies were seized under Mahazar dated 13.1.2016. On verification of records, it was found that Mr. Fazal Akrami and Mr. Mohammed S. Bahadur had handed over these currencies to the appellant. Accordingly, notice was issued to the appellant and the other two individuals referred above. 2. Upon adjudication, the adjudicating authority vide Order-in-Original No.83/2016-17 dated 23.03.2017 held that the appellant had attempted to smuggle the foreign curre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the penalty and filed a refund claim dated 27.10.2021 before the original authority. 3.1 The original authority while processing the refund claim sanctioned an amount of Rs.29,05,597/- after adjusting an amount of Rs.29,350/- towards 1% bank charges and rejecting an amount of Rs.2,755/-. However, at para (iv) of the order portion, it is stated that he has adjusted the penalty amount of Rs.9,00,000/- each imposed on Mr. Fazal Akrami and Mr. Mohammed S. Bahadur from the amount sanctioned to the appellant. Further the original authority has stated that after observing the pre-audit observation which stated the arrears arising out of Order-in-Original No.83/2016-17 dated 23.03.2017 against the other two notices, penalty of Rs.9,00,000/- im ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in following decisions of the Hon'ble Supreme Court. * Union of India and another vs. Mustafa & Najibai Trading Co. and others: (1998) 6 SCC 79 * Sewapujanrai Indrasanrai Ltd. vs. Collector of Customs and others: AIR (1958) SC 845 * Collector of Customs, Madras and others vs. D. Bhoormall: ( 1974) 2 (SCC) 544 5. The learned Authorised Representative for the Revenue reiterated the findings of the lower authorities. 6. Heard both sides. In the first round of litigation the original authority clearly held that the appellant had attempted to smuggle the foreign currencies out of India by way of concealment and on account of non-declaration to the customs, seized the foreign currency and levied penalty on the appellant. Personal penal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e above recoveries under Section 142 is beyond the scope of the Order-in-Original. However, one needs to examine whether Section 142 of the Customs Act 1962 allows recovery of personal penalties from the refund amount sanctioned to the appellant. Section 142 (a) of the Customs Act 1962 reads : SECTION 142. Recovery of sums due to Government. - (1) [Where any sum payable by any person] under this Act [including the amount required to be paid to the credit of the Central Government under section 28B] is not paid, - (a) the proper officer may deduct or may require any other officer of customs to deduct the amount so payable from any money owing to such person which may be under the control of the proper officer or such other officer of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 111 and 113 of the Act is a penalty in rem which is enforced against the goods, while the personal penalty imposed under section 112 and other provisions of the Act are in the nature of penalty in personam which are enforced against the person concerned." In view of the above, the penalties being penalty in personam against the individuals, same cannot be adjusted against the refund sanctioned to the appellant. 11. The Hon'ble High Court of Kerala in the case E. Abdul Rahiman Versus Union of India 2009 (235) E.L.T. 227 (Ker.) dated on 18-12-2007 observed as follows: "A Toyota Land Cruiser Jeep imported by the petitioner from U.A.E. was confiscated by the Customs under Sections 111(d) and 111(m) of the Customs Act and was ordered t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er Ext.P1 that separate penalty is levied on the importer namely, the petitioner and two other persons against whom proceedings for penalty was initiated under Section 112(a) of the Customs Act. The personal penalty levied against Shri Yahoo under Section 112(a) of the Customs Act is for helping the petitioner to commit the offence i.e. for abetment. The penalty so levied being personal cannot be recovered from the importer or any other person. Therefore, the petitioner is not personally liable for the penalty levied on Shri Yahoo and the amount also cannot be recovered from the petitioner. The next question to be considered is whether the vehicle imported by the petitioner could be detained by the Customs until personal penalty levied on S ..... X X X X Extracts X X X X X X X X Extracts X X X X
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