Knowledge of smuggled character must be proved before Customs penalties on transporters can stand

Penalties under Section 112(b) of the Customs Act were unsustainable where the only basis was transport of goods without bilti. The absence of bilti, by itself, did not establish that the driver or transporter knew the goods were of smuggled character, and the record contained no further material proving such awareness. The appellants' exculpatory statements were also considered. The penalties were therefore set aside and the benefit of doubt was given to the appellants.

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Issues: Whether penalties imposed under Section 112(b) of the Customs Act, 1962 were sustainable against persons who transported goods without bilti, on the allegation that they knew the goods were of smuggled character.

Analysis: The penalties were founded only on the circumstance that the goods were transported without bilti. That fact, by itself, was held insufficient to establish knowledge on the part of the driver or transporter regarding the smuggled nature of the goods. Their exculpatory statements were also noted, and no other material was found to show awareness of the goods' smuggled character.

Conclusion: The penalties were not sustainable and were set aside, with the benefit of doubt extended to the appellants.

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