Trucks Used to Smuggle Vietnamese Pepper via Nepal Without Owner’s Knowledge: CESTAT Quashes Redemption Fine [Read Order]
CESTAT quashes penalty and confiscation of trucks used to smuggle Vietnamese pepper via Nepal, citing lack of owner’s knowledge or involvement.
![Trucks Used to Smuggle Vietnamese Pepper via Nepal Without Owner’s Knowledge: CESTAT Quashes Redemption Fine [Read Order]](https://images.taxscan.in/h-upload/2025/06/25/2054311-trucks-smuggle-vietnamese-pepper-taxscan.webp "Trucks Used to Smuggle Vietnamese Pepper via Nepal Without Owner’s Knowledge: CESTAT Quashes Redemption Fine [Read Order]")
The Kolkata Bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) ruled that a truck used in the smuggling of Vietnamese black pepper via Nepal could not be confiscated or penalized when the owner had no knowledge of the smuggling activity.
Vinod Kumar Agarwal, the appellant, was the registered owner of a truck intercepted by the Directorate of Revenue Intelligence (DRI) near Bettiah, Bihar. The truck was found to be carrying 3,975 kilograms of Vietnamese black pepper and 17,021 kilograms of arhar dal. The DRI alleged that the goods were smuggled from Nepal into India and issued a show cause notice proposing confiscation of the goods and the vehicle, along with a personal penalty on the owner under Section 112 of the Customs Act, 1962.
The adjudicating authority imposed a redemption fine of Rs. 80,000 on the vehicle and a personal penalty of Rs. 20,000 on the appellant. The Commissioner (Appeals) upheld this decision. Aggrieved by the order, the appellant approached the CESTAT.
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The appellant’s counsel argued that he had no knowledge that the goods carried in the truck were smuggled. They submitted that the truck was handed over to a driver for a transportation job and that the appellant was not involved in the loading or documentation of the consignment. They claimed to have acted only as a transporter and was paid freight charges. He further argued that no evidence was produced by the department to show that he had any involvement or intent to participate in the smuggling.
The revenue counsel argued that the goods found in the truck were smuggled into India in violation of customs law. They claimed that since the truck was used for transporting smuggled goods, it was liable for confiscation, and the owner could be penalized under Section 112 of the Customs Act.
The single-member bench comprising K. Anpazhakan (Technical Member) found that the revenue had not submitted any evidence to prove that the appellant had knowledge of the illegal nature of the goods or had any role in the smuggling. It held that the mere use of the vehicle in smuggling, without proof of the owner's involvement or intent, was not sufficient to justify confiscation or penalty.
The tribunal ruled that the confiscation of the truck and the redemption fine imposed were unjustified. It also set aside the personal penalty under Section 112. The appeal was allowed in full, and the appellant was granted relief.
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