Appellate tribunal reduces Customs Act penalty citing disparity, deems reduced amount proportionate.

The appellate tribunal reduced the penalty imposed on the appellant under Section 112(b) of the Customs Act from Rs. 1 lakh to Rs. 50,000, citing disparity in penalties imposed on other individuals involved in the case. Despite acknowledging the recovery of counterfeit currency from the appellant, the tribunal deemed the original penalty excessive and opted for a reduced amount, considering it more proportionate to the offense. The appeal was disposed of with the modified penalty amount.

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Issues: Imposition of penalty under Section 112(b) of the Customs Act on the appellant for alleged involvement in smuggling activities.

Analysis:
1. Background: The appellant was one of 13 individuals intercepted by Customs officers, with foreign goods recovered from others but not from the appellant. Fake Indian currency was found on two individuals, including the appellant. The department seized the goods under a Panchnama, conducted investigations, and issued show cause notices for penalties under Section 112(b) of the Customs Act.

2. Adjudication: The Commissioner of Customs imposed a penalty of Rs. 1 lakh on the appellant, considering him an accomplice in smuggling activities. The impugned order detailed the appellant's involvement, including the recovery of counterfeit Indian currency from his possession and his arrest under Section 104 of the Customs Act.

3. Appellant's Arguments: The appellant's counsel argued that no foreign goods were found on the appellant, questioning the basis for imposing a penalty under Section 112. The appellant claimed ignorance regarding the fake currency found in the bags he carried, emphasizing his lack of involvement. However, the absence of copies of appellant's statements and the show cause notice complicated the defense's presentation.

4. Commissioner's Findings: The Commissioner upheld the penalty, noting the recovery of counterfeit currency from the appellant and his purported lack of knowledge about it. Despite the appellant's denial, the Commissioner found evidence establishing the appellant's awareness of possessing the counterfeit Indian currency, justifying the penalty under Section 112(b) of the Act.

5. Appellate Decision: The appellate tribunal acknowledged the recovery of counterfeit currency from the appellant but found the penalty of Rs. 1 lakh excessive compared to penalties imposed on other noticees. Citing a perceived element of discrimination, the tribunal reduced the penalty to Rs. 50,000, deeming it more appropriate given the offense. The appeal was thus disposed of with the modified penalty amount.

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