Customs, Excise and Gold Tribunal - Tamil Nadu
Halithu Ibrahim vs Commissioner Of Customs (Airport) on 3 January, 2005
Equivalent citations: 2005(100)ECC236, 2005(183)ELT307(TRI-CHENNAI)
ORDER P.G. Chacko, Member (J)
1. The brief facts of the case are as stated below :
On 18-6-97 Miss Parvathy who was a passenger bound for Singapore by Indian Airlines flight, was intercepted by customs officers when she was proceeding to security check after customs and immigration clearance. She was questioned to as to whether she was in possession of any foreign currency. She replied that she was carrying one lakh US dollars kept in her checked-in baggage. She also informed that she brought the above foreign currency to India when she came to India on 16-6-1997 and the same was declared before the Customs vide currency declaration Form No. 15130/16-6-1997 issued by Chennai Air customs. She produced her currency declaration form. She was asked by the officers to identify her checked-in baggages and thus she identified and brought the following two checked-in baggages. (1) Black colour zipper trolley bag with tag No. IC 22026 and (2) Bamboo basket with tag No. 22019. The officers examined both the checked-in baggages. Bamboo basket was found to contain mangoes. Black colour zipper trolley bag was found to contain used clothes and one black colour canvas bag. Canvas bag was found to contain US dollars one lakh in 50 denominations. She was not having baggage identification tags for the checked-in baggages. She informed the officers that baggages identification tags are with one Seeni Mohamed Alim, co-passenger. Then the customs officers located Seeni Mohamed Alim in the aircraft and he was brought down to visadex room. When the officers asked him about the checked-in baggages, Seeni Mohamed Alim, replied that they pooled together and checked-in 7 baggages belonging to himself, Miss Parvathy and Halithu Ibrahim. Seeni Mohammed identified the remaining 5 baggages. In the meantime, Halithu Ibrahim, the appellant herein who was a co-passenger, was intercepted when he was in security hold area. On questioning about the amount of foreign exchange carried by him he replied that he was carrying only 500 US dollars and he produced the same before the officers. Then his checked-in baggages were examined. 1. Black colour zipper trolley bag with tag No. IC 22020 was found containing used clothes and one newspaper bundle. Newspaper bundle was examined and it was found to contain the following. 1784 numbers of 100 US dollars and 234 numbers of 50 US dollars. Thus, there was totally 1,90,000 US dollars. Halithu Ibrahim has not produced his currency declaration form No. 30502 dated 30-5-97 which he had obtained at Delhi Airport on his arrival from Singapore on 30-5-97 for US dollars 2,02,550. Since Parvathy and the appellant failed to declare to the customs officers at the time of customs clearance about the US dollars they were carrying and since Seeni Mohamed Alim was found in possession of 7 baggage identification tags, the customs officers detained US dollars one lakh carried by Parvathy and US dollars 1,95,000 carried by the appellant under detention mahazars dated 18-6-97 for further action. On 19-6-98 customs officers seized the above foreign currency and declaration forms under the Customs Act and Foreign Exchange Regulation Act. On 18/19-6-97 Halithu Ibrahim gave a statement before the customs officers. In the above statement Halithu Ibrahim stated that he brought 2,02,550 US dollars when he came from Singapore to India, declared the same before Delhi Customs and obtained currency declaration Form No. 30502 dated 30-5-97 from Delhi Airport Customs. In the above statement he further stated that out of 2,02,550 US dollars he spent 7,550 US dollars through one broker and he was taking the balance amount of foreign currency to Singapore. In the above statement Halithu Ibrahim also stated the foreign currency was handed over to his mother in Kilakarai for safe custody for sometime. On 19/20-6-97 Halithu Ibrahim gave further statement. On 18/19-6-97 Miss Parvathy gave a statement. In her statement Miss Paryathy stated that the foreign currency carried by her is covered by currency declaration Form No. 15130 dated 16-6-97 obtained from Chennai customs when she came to India on 16-6-97. On 19/20-6-97 Miss Parvathy gave further statements. On 18/19-6-97 and on 19-6-98 Seeni Mohamed Alim gave statements. In his statement Seeni Mohamed Alim stated that since the Airport was crowded all the baggages were pooled together and checked-in by him. On 20-6-98 Halithu Ibrahim, Miss Parvathy and Seeni Mohamed Alim were arrested under the Customs Act. On 19-6-98 Chennai customs sent letter to Delhi customs asking them to verify the genuiness of the currency declaration forms. On 22-6-98 Delhi customs sent a reply stating that the currency declaration forms are genuine and in order. The customs officer searched the residence of the mother of the appellant. The appellant's mother gave a statement confirming the fact that the appellant handed over a bag containing foreign exchange to her for safe custody and the same was returned to him on 16-6-97. On 20-8-98 they were released on bail. On 27-8-98 Chennai customs sent a fax to the Delhi customs asking them to confirm whether currency declaration form No. 30502 issued to the appellant tallies with the original. Delhi customs sent a reply stating that Halithu Ibrahim declared US dollars 2,02,550 vide currency declaration form No. 30502 dated 30-5-97. On 16-12-97 show cause notices were issued to the following persons: (1) Halithu Ibrahim, Appellant (2) Miss Parvathy, and (3) Seeni Mohamed Alim. The above show cause notices were issued on the basis of the following allegations. Even though Halithu Ibrahim declared US dollars 2,02,550 and obtained currency declaration form, he exchanged US dollars 7,550 through one unauthorised money changer in violation of Section 8 of Foreign Exchange Regulation Act. Halithu Ibrahim declared only 5,000 US dollars at the time of his departure and he attempted to take out of India US dollars 1,90,000 by way of non-declaration and without producing currency declaration form to the customs officers Violating Sections 77, 113(d), (e) and (h). On 5-1-99 the counsel for the appellant sent reply denying the allegations. On 21-1-98 the customs officer was cross-examined at the time of personal hearing. On 10-2-98 adjudication order was passed as mentioned below: (a) US dollars 1,95,000 seized from the Appellant was absolutely confiscated under Section 113(d), (e) and (h) and penalty of Rs. 70,000/- on the appellant, (b) US dollars one lakh seized from Parvathy was ordered to be returned to her and a penalty of Rs. 5,000/- was imposed on her. (c) Proceedings against Seeni Mohamed Alim were dropped. Being aggrieved by the above adjudication order dated 10-2-98, the appellant filed Appeal No. C/453/1998 before 'this Hon'ble Tribunal. On 22-2-2002 this Hon'ble Tribunal, by the majority order, set aside the above adjudication order and remanded the matter to the adjudicating authority for de novo consideration for considering the release of foreign currency on payment of redemption fine in the light of the judgment. On 25-11-2002 the adjudicating authority passed an adjudication order confiscating US $ 1,95,000 under Section 113(d), (e) and (h) of the Customs Act, 1962, but allowing the same to be redeemed on payment of a fine of Rs. 45 lakhs and imposing a penalty of Rs. 5.00 lakhs on the appellant.
2. The present appeal by Shri Halithu Ibrahim is against what he claims to be unjustifiably excessive quanta of redemption fine and penalty.
3. Heard both sides. Ld. Counsel for the appellant submits that the offence found against the appellant is procedural in nature and, therefore, such redemption fine and penalty as imposed by the Commissioner are unjustifiable. He submits that the allegations against the appellant and Ms. Parvathi, raised in the show-cause notice, were more or less the same. Both of them were alleged to have violated Section 77 of the Customs Act by not having declared the contents of their baggage to the customs authorities. In this connection, ld. Counsel reads out the relevant findings recorded by the Commissioner in relation to Ms. Parvathi, in Order-in-Original No. 57/97, dated 10-2-1998, and submits that the benefit of doubt was given to her and a lesser amount of penalty was imposed on her. On the other hand, in the appellant's case, a disproportionate penalty was imposed by the Commissioner, without stating sufficient reasons. Ld. Counsel submits that, though undeclared currency was liable to confiscation, the facts and circumstances of the case should have been taken into account while determining the quantum of redemption fine to be imposed in lieu of such confiscation, the mistake committed by the appellant was that he did not declare the currency to the customs authorities at the appropriate stage. The quantum of redemption fine and that of penalty are too excessive to match the nature of this mistake. Ld. Counsel, in this context, relies on the Tribunal's decision in Philip Fernandes v. C.C., Mumbai - 2002 (146) E.L.T. 180 (Tri. Mumbai), wherein an excessive amount of redemption fine imposed by the Commissioner on the passenger for his lapse of not having declared foreign currency to the customs authorities before boarding a flight leaving for Dubai was reduced and the penalty imposed on him was set aside.
4. We have heard ld. DR also, who seeks to justify the findings of the Commissioner against the appellant, by pointing out the factual distinction between the appellant's case and that of Ms. Parvathi. It is submitted that though both Parvathi and Halithu Ibrahim were found to have not declared the foreign currencies to the customs authorities before proceeding to board their flight out of the country, the former readily admitted the mistake and produced the relevant declaration forms to the customs authorities on being interrogated, while the latter denied having any foreign currency with him in the first instance upon interrogation. It was only when his baggage was opened by the officers of customs that it was found that the appellant was carrying with him US $ 1.95 lakhs. In such circumstance, according to ld. DR, Halithu Ibrahim had a criminal intent and his case stands distinguished from that of Ms. Parvathi who honestly answered to queries of customs officers.
5. We have given careful consideration to the submissions. We find that this matter is arising in a second round of litigation. In the earlier round, this Bench considered an appeal filed by the appellant against Order-in-original No. 57/97, dated 10-2-98 ibid, wherein the foreign currency [US $ 1.95 lakhs], equivalent to Indian rupees 68,54,250/-, seized from the appellant's possession was absolutely confiscated under Section 113 of the Customs Act read with Section 67 of the Foreign Exchange Regulation Act, 1973 and also a penalty of Rs. 70,000/- was imposed on him under Section 114(i) of the Customs Act. That appeal was allowed by way of remand, whereby we directed the Commissioner to consider grant of option for redemption of the currency. Pursuant to our remand order, ld. Commissioner of Customs passed the order impugned in the present appeal.
6. There is no challenge, in this appeal, to the liability of the currency for confiscation. The challenge is against the quantum of redemption fine and that of penalty. Ld. Counsel has relied on a decision of this Tribunal in a case involving more or less similar facts. In the case of Philip Fernandes, foreign currencies were seized from him at the CST Air Port Mumbai after his clearance through Customs. When questioned, he stated that he was carrying with him foreign currency worth Rs. 86,44,140/- but he subsequently retracted this statement and produced certificates issued by M/s. Thomas Cook, Al Rostamani, Dubai certifying the exchange of foreign currencies for Philip Fernandes. This evidence was accepted by the Tribunal and it was found that the foreign currency had been legitimately acquired and imported by Philip Fernandes into India. However, it was also found that Philip Fernandes had not declared the foreign currency to the customs authorities when he passed through customs clearance. The Tribunal, after examining the evidence in the case, found that his failure to declare the currency in the currency declaration form was only a technical lapse on his part. Accordingly, redemption fine was reduced from Rs. Ten lakhs to Rs. One lakh and penalty imposed on him was set aside. As rightly pointed out by ld. DR, Parvathi's case stands on a different footing inasmuch as she was honest in responding to the queries of customs authorities and swiftly disclosed the correct facts to them. She also produced the relevant Currency Declaration Forms and established the veracity of what she stated to the authorities. On the other hand, the appellant behaved differently in a manner, which we have already narrated. Such leniency as shown to Parvathi by ld. Commissioner cannot be extended to the appellant. We also do not think that the omission on the part of the appellant in the matter of declaring his foreign currencies to the customs authorities can be brushed aside as a mere procedural lapse as noted in the case of Philip Fernandes. Apparently, it was a wilful omission. The real purpose of the appellant in not declaring the currencies to the authorities is evident from the way he replied to their queries. Had the customs authorities not examined his baggage, he would have carried the undeclared foreign currencies abroad, in violation of the provisions of Customs Act and the Foreign Exchange Regulation Act. Nevertheless, we have taken into account all the facts and circumstances of the case as required for the proper exercise of our jurisdiction in determining the quanta of fine and penalty. Accordingly, we reduce the quantum of fine to Rs. Ten lakhs and that of penalty to Rs. One lakh.
7. The impugned order will stand modified to the above extent. The appeal is disposed of.