TMI Blog1986 (4) TMI 57X X X X Extracts X X X X X X X X Extracts X X X X ..... mmon carriers at sea. The petitioner company's ship s.s. "Indian Reliance" arrived in Bombay in October, 1963. It was carrying certain packages intended for defence purposes and those packages were unloaded at the Bombay Port. The petitioner-company received a show cause notice No. 1352, dated 13-4-1966 on 15-4-1966 from the Assistant Collector of Customs, Manifest Clearance Department, Bombay in respect of alleged short landing under various items including Items No. G-116, G-117, G-28, G-77, G-151 and G-10. The notice was duly replied and the same resulted into adjudication by the Assistant Collector of Customs. By a short order dated 8-8-1966, the Assistant Collector of Customs imposed a penalty of Rs.92,307.26 under Section 116 of the C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Port Trust takes a tally thereof through their tally clerks. As soon as a sling containing packages is placed on the wharf, the Port Trust Tally Clerks write down on tally sheets, particulars of the packages discharged. The tally sheets have columns for noting down the individual marks of packages, the number of packages etc. which amendments there were still a large number of packages which the Embarkation Commandant could not connect or link up with any particular manifest. The outturn reports of the Bombay Port Trust, therefore, continued to show these as short landed. In certain cases, the Commandant had specifically intimated the linking of certain items but in spite of that the Port Trust Authorities insisted on proper documents fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mandant and the trustees of the Bombay Port Trust wherein efforts were made to resolve the matter. It is not necessary to reproduce the minutes of those meetings and in my opinion it would be sufficient to reproduce the relevant minutes of the last meeting, held on 19th November, 1971 in the Board room of the Bombay Port Trust. After recording the full facts in the minute, it was mentioned:- "The Embarkation Commandant say that they have no documents to confirm or deny the receipt of the packages. The Customs are calling upon lines to prove the negative especially something which the other parties involved are unable to prove what they in fact......" "The Embarkation Commandant did his best to link the unconnected packages but a state h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wise and markwise record of what was delivered to the Embarkation Commandant............." 6. In view of the aforesaid minutes and other meetings, it was decided by the Central Government to reduce the penalty to the extent of 25%. During the course of arguments another memorandum was placed before me wherein the Government had decided to reduce the penalty by further 25% over and above the 25% already allowed. 7. From the facts aforesaid it is obvious that the respondents have taken the view that once the outturn report filed by the Port Trust indicates any short landing, it is mandatory to impose the penalty under Section 116 of the Customs Act on the carrier. 8. The petition has been contested by the respondents but no counter affi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... chance of recovering other packages for which the efforts were still being made. These packages were obviously cleared after paying the custom duty and thus I am only concerned with penalty imposed on the petitioner and other carriers. 9. In order to decide the liability of the carriers, it would be useful to refer to Section 45 of the Customs Act, 1962 which was introduced in the Act by way of amendment to Section 85 of the Sea Customs Act. Section 45 is, as follows :- "Restrictions on custody and removal of imported goods. (1) Save as otherwise provided in any law for the time being in force, all imported goods unloaded in a customs area shall remain in the custody of such person as may be approved by the Collector of Customs until th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt of the Port Authority it was obligatory under Section 116 of the Act to impose penalty on the carrier. This has been done in spite of the fact that the Commandant had informed that he had been able to tally certain goods but no benefit of the same was given to the carrier in the absence of the amendment of the outturn report which, according to the Port Authority could not be done unless the proper documents were received from the Commandant. The Commandant was unable to supply the documents as he stated that he did not have any such document. This approach, in my opinion, is legally incorrect. In M/s. Hindustan Steel Ltd. v. State of Orissa, 1978 E.L.T. (J159) (S.C.)=A.I.R. 1970 Supreme Court 243, the Supreme Court was dealing with the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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