Evidentiary support for customs penalties failed where untested statements and no corroboration linked parties to misdeclaration.

Penalties under Section 112 of the Customs Act require reliable evidence linking the alleged offenders to the misdeclaration. The penalty here rested mainly on a disclosure made only at the personal hearing and on the statement of the clearing agent. Because the disclosure was not recorded during investigation or tested by rebuttal, and cross-examination of the clearing agent was denied, the evidentiary basis was inadequate. The record also lacked independent corroboration connecting the parties with the misdeclaration, bank accounts, or proprietary concerns involved in the imports. The penalties were therefore held unsustainable and set aside.

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Issues: Whether the penalties imposed under Section 112 of the Customs Act on the appellants were sustainable on the evidence relied upon to show their involvement in the misdeclaration of imported goods.

Analysis: The penalty was founded mainly on a disclosure made by the noticee at the stage of personal hearing and on the statement of the clearing agent. The disclosure was not made during investigation or put to the appellants for rebuttal, and the request to cross-examine the clearing agent was declined. The statement of the clearing agent showed only that the appellants had made enquiries about the import and were interested in the clearance of goods after having paid advance amounts. The record did not contain independent corroboration linking the appellants with the misdeclaration or with the bank accounts and proprietary concerns involved in the imports.

Conclusion: The penalties under Section 112 of the Customs Act were not sustainable and were set aside.

Final Conclusion: The appeals succeeded and the appellants were relieved from the penal consequences.

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