The Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Chennai Bench set aside the Penalty for alleged gold smuggling as Customs Authority failed to conduct proper investigation.
The Show Cause Notice was issued to the appellants, Jaison James inter alia proposing confiscation of the gold which was smuggled into India, apart from proposing to impose personal penalty on both the appellants under Section 112 of the Customs Act, 1962.
The appellants, in their reply to the Show Cause Notice, have pleaded innocence and contended that they were not aware of the contents of the parcel, but have never denied having known the person who sent those parcels i.e., one Salman. Penalty under ‘Section 112’ of the Customs Act, 1962 is attracted for improper importation of goods that ultimately makes the goods liable for confiscation under Section 111 ibid. It emerges that any person who does or omits to do any act which would render the goods liable for confiscation or abets the doing or omission of such an act is held liable under ‘Section 112’ and the consequential penalty as well. The proposals made in the Show Cause Notice were adjudicated vide Order-in-Original wherein the same were confirmed.
The coram of Judicial Member, P.Dinesha held that the Revenue, having alleged one Salman as the mastermind, has not bothered to place anything on record, which has left innumerable doubts and questions unanswered, like the above. Penalty, therefore, cannot be imposed on surmises, assumptions and presumptions and there is not even any circumstantial evidence brought on record against these appellants, to justify penalty under Section 112. The one and only allegation against these appellants is that they knew one Salman, the alleged mastermind. They have not even bothered to make proper investigation, and not even of the courier agency who is responsible for couriering the parcel without proper verification, at its end. The penalty levied under ‘Section 112’ of the Customs Act, 1962 is arbitrary and unjustifiable and accordingly, the impugned order is liable to be set aside.
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