Corporate penalty requires attributable culpability, while courier deregistration cannot rest on retrospective application of later regulations.

Penalty under Section 112(a) and Section 112(b) of the Customs Act, 1962 was not sustainable against the courier company because its employees' concealment and attempted clearance of auto parts for personal gain were not shown to be authorised by, or attributable to, the company itself. The individual appellant's penalty was upheld because the record established his active role in procuring, financing, clearing, and disposing of smuggled computer parts. Cancellation of courier registration under Regulation 17(c) of the Courier Imports (Clearance) Regulations, 1995 was set aside, as it was founded on the unsustained penalty order and could not be applied retrospectively to conduct predating the Regulations.

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Issues: (i) whether the courier company was liable for penalty under Section 112(a) and Section 112(b) of the Customs Act, 1962 for the acts of its employees in attempting to clear concealed auto parts without payment of duty; (ii) whether the individual appellant was liable for penalty under Section 112(a) and Section 112(b) of the Customs Act, 1962 on the evidence of his involvement in procuring and clearing smuggled computer parts; and (iii) whether cancellation of courier registration under Regulation 17(c) of the Courier Imports (Clearance) Regulations, 1995 could be sustained, including on the ground of prior misconduct and alleged retrospective application of the Regulations.

Issue (i): whether the courier company was liable for penalty under Section 112(a) and Section 112(b) of the Customs Act, 1962 for the acts of its employees in attempting to clear concealed auto parts without payment of duty.

Analysis: The employees had admitted their own acts of concealment and attempted clearance of auto parts for personal gain, and the evidence showed a conspiracy among them. The company, however, was not shown to have authorised the misconduct or to have possessed the requisite mental element for fastening liability for the employees' acts. The facts did not justify extending the employees' personal wrongdoing to the corporate appellant so as to attract penalty.

Conclusion: The penalty on the courier company under Section 112(a) and Section 112(b) of the Customs Act, 1962 was not sustainable and was set aside.

Issue (ii): whether the individual appellant was liable for penalty under Section 112(a) and Section 112(b) of the Customs Act, 1962 on the evidence of his involvement in procuring and clearing smuggled computer parts.

Analysis: The material on record showed the appellant's active role in procuring goods from abroad, using intermediaries, financing the transactions, and participating in the clearance and disposal of smuggled goods. The evidence was treated as sufficient to establish his complicity in the contravention and to prove violation of the penal provisions.

Conclusion: The penalty imposed on the individual appellant under Section 112(a) and Section 112(b) of the Customs Act, 1962 was upheld and his appeal failed.

Issue (iii): whether cancellation of courier registration under Regulation 17(c) of the Courier Imports (Clearance) Regulations, 1995 could be sustained, including on the ground of prior misconduct and alleged retrospective application of the Regulations.

Analysis: The registration cancellation was founded on the earlier penalty order. Once that penalty order against the courier company did not survive, the foundation for deregistration disappeared. The Regulations were brought into force only in 1995, whereas the alleged misconduct occurred in 1993, so action under those Regulations in respect of the earlier was held impermissible. The order was also found unsustainable on the available record.

Conclusion: The cancellation of courier registration under Regulation 17(c) of the Courier Imports (Clearance) Regulations, 1995 was set aside.

Final Conclusion: The appeals resulted in relief to the courier company and in challenge to the deregistration order, while the penalty against the individual appellant was maintained.

Ratio Decidendi: Penalty under Section 112(a) and Section 112(b) of the Customs Act, 1962 cannot be fastened on a company merely because its employees committed smuggling-related acts for personal gain unless the company's own liability is established; and a regulatory cancellation based on post facto application of a later-enacted regime cannot be sustained for earlier conduct.

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