Customs, Excise and Gold Tribunal - Delhi
Lemuir Air Express vs Collector Of Customs on 7 August, 1986
Equivalent citations: 1987(10)ECR89(TRI.-DELHI), 1986(26)ELT608(TRI-DEL)
ORDER G.P. Agarwal, Member (J)
1. The appellants are IATA approved Air Cargo Agents. It is alleged that on 19.10.84 the appellants presented export goods along with Shipping Bill No. 85986 dated 9.10.84 and other documents for export to Sweden. On examination of the packages the Customs Officer found that their contents did not agree with the description given in the Shipping Bills. After usual enquiry the goods were confiscated. However, an option to redeem the same for home consumption on payment of a fine of Rs. 15,000/- in lieu of confiscation was given to the exporter M/s. East West Linkers (P) Ltd., Delhi. Personal penalty of Rs. 5000/- was also imposed on the said exporter. The Adjudicating Authority also imposed a penalty of Rs. 1000/- on the appellants for their acts of omission and commission or abetment of doing or omission of such act which have rendered the goods liable to confiscation under Section 113, ibid.
2. Shri J.P. Tanaon, learned consultant appearing on behalf of the appellant mainly contended before me that the appellants prepared the Shipping Bills on the basis of the documents given to them by their exporters. It was submitted that the shipment was sent by the exporter-M/s. East West Linkers (P) Ltd. directly to the Air Port and the appellants had no occasion to inspect the same before their presentation to the Customs Officers for their examination. The learned consultant also invited my attention to the printed instructions contained in the Shipping Bills wherein the exporters took the responsibility for the correctness of the goods mentioned in the Shipping Bills. It was urged that the appellants had no knowledge of the misdeclaration and that the appellants had no role to play in the event. In this background it was submitted by the learned consultant that the imposition of the penalty was uncalled for. In support of his contention Shri Tandon submitted a copy of the decision rendered by this Tribunal in the case of Lernuir Air Express v. Collector of Customs, New Delhi dated 3-8-84 (Order No. A-222/84-NRB).
3. Shri Shishir Kumar, learned SDR for the respondent supported the impugned order and urged that being Shipping Agents the appellants had the responsibility to see that the goods for which they filed Shipping Bills were correctly declared. Shri Shishir Kumar, the learned SDR further submitted that the appellants cannot simply avoid the responsibility when the documentation was being done by them.
4. Before I consider the respective contentions of the parties it deserves to be mentioned here that against the impugned order the exporter also filed his appeal which was registered as appeal No. 445 of 85-NRB in the Tribunal. It was partly allowed in the following terms vide Order No. A/408/85-NRB :-
"I had carefully considered the contentions of both the parties. The main thrust of the Department's case is that the appellants had deliberately mis-declared the goods and that the goods were liable for confiscation under Section 113(d) read with Section 118, of the Customs Act, 1962. The appellants endeavoured to prove that the mistake had occurred due to bad communication. There are certain factors which lend support to the contentions. Firstly the appellants had quota both for gents' shirts and ladies' trousers. They had placed orders to the suppliers at Bombay for both the consignments. Secondly, there is no proof that the appellants had opportunity to open these consignments and know the contents. Secondly, there is no proof that the appellants had any ulterior motive in declaring the goods as gents' shirts instead of ladies' trousers and had caused any wrongful loss of the Government. The conduct of the appellants also indicates that they had admitted the genuineness of the mistake and attributed it to faulty communication. No material has been placed to conclude that the consignee and the consignor were acting in collusion and had entered into some secret unholy deal. It is well settled that if there is no intention or motive to evade tax, penalty should not be imposed because the proceedings relating to the levy of penalty are criminal and penal in character and requisite mens rea must be proved before imposition of penalty. In the circumstances, I am of the view that the levy of penalty was not justified and therefore cannot be sustained.
On the question of confiscation, there is considerable force in the submission of Shri Shishir Kumar, SDR that the goods are liable for confiscation under Section 113(d) of the Customs Act, because the description of the export of such goods would be contrary to clause 3(4) of the Export Control Order 1977. The goods in any event, are not in conformity with the declaration made in the documents. The goods were rightly ordered to be confiscated. But considering the circumstances of the case, since the possibility of genuine mistake cannot be ruled out, I am of opinion that interest of justice would be sufficiently met if the redemption fine is reduced to Rs. 2,500/-.
In the result, the appeal is partly allowed and the order relating to penalty is set aside. The redemption fine is, however, reduced to Rs. 2,500/- (Rupees Two thousand five hundred only). The appeal is dispossed of in these terms".
4. From the said observations made in the said order, it is clear that the mis-declaration occurred due to the genuine mistake on account of the faulty communication and there was no secret unholy deal with the result imposition of penalty on the exporter himself was held to be not justified. When such is a situation, explanation of the appellants that they had no knowledge about the contents of the consignments and relied upon the information passed on by the exporter to them cannot be said to be without substance in the absence of any direct evidence on record against the appellants. With the result the appeal has to be allowed and the penalty imposed on the appellants cannot be sustained. Accordingly appeal is allowed and the impugned order is set aside.
5. Before I part with the case I would like to observe that in the past the appellants were also given the benefit of such ignorance in the case of Lemuir Air Express v. Collector of Customs, Delhi - Order No. A/222/84-NRB dated 3-8-84. This is the second occasion when such benefit is given in the instant case mainly relying on the Order No. A/408/85 NRB dated 12.12.85 rendered by this Tribunal in the appeal filed by the exporter M/s. East West Linkers (P) Ltd., supra, who was also found guilty and punished by the impugned order. I hope the appellants would now be careful while acting as Air Cargo Agents.