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of <h1>High Court overturns Tribunal decision, upholds Customs Act penalties.</h1> <h3>COMMISSIONER OF CUSTOMS, BANGALORE Versus RAJAT GUPTA</h3> The High Court allowed the writ petition, setting aside the Tribunal's order and restoring the adjudicating authority's decision. This included upholding ... Maintainability of appeal - restoration of goods - Held that:- We are inclined to reject the preliminary objection regarding the tenability of the petition and would examine the merits of the petition albeit within the scope of the petition under Article 227 of the Constitution of India and not as though it is a reference in terms of Section 130A of the Act. While the submission proceeds on an assumption that the writ petition is only to be dismissed and unfortunately for the respondent, we have found this is a fit case for allowing the writ petition, we have, nevertheless, examined a possibility of an order directing the authorities to pass an order in terms of Section 125 of the Act. Here, we find that the restoration of the goods on payment of redemption fine is only in favour of the owner of the goods and with none of the persons laying claim to the ownership of the goods and on the other hand, being only eager to disown the goods, there is no way of any person redeeming the goods even on payment of redemption fine in terms of Section 125 of the Act and in this situation the argument that the sale becomes void, etc., in terms of the provisions of Section 150 of the Act becomes more an academic question than warranting examination in the present case. Thus allow this writ petition, set aside the order passed by the Tribunal and restore the order passed by the adjudicating authority in its entirety. Issues Involved:1. Tenability of the writ petition under Articles 226/227 of the Constitution of India.2. Availability and non-availment of statutory remedy under Section 130A of the Customs Act.3. Legitimacy of the importation and confiscation of goods.4. Imposition of personal penalties under Section 112(b) of the Customs Act.5. Procedural correctness of the Tribunal's order.Detailed Analysis:1. Tenability of the Writ Petition:The respondent raised a preliminary objection regarding the maintainability of the writ petition, arguing that the Commissioner of Customs should not bypass the statutory remedy under Section 130A of the Customs Act by invoking writ jurisdiction. The court, however, held that the writ jurisdiction under Articles 226 and 227 is discretionary and not barred by the availability of an alternative statutory remedy. The court emphasized that the writ jurisdiction is a constitutional power and can be exercised even if statutory remedies are available, especially when there is a need to correct an obvious illegality or misinterpretation of statutory provisions by the Tribunal.2. Availability and Non-Availment of Statutory Remedy:The Commissioner of Customs did not avail the statutory remedy under Section 130A of the Customs Act within the prescribed 180 days. The court noted that the Supreme Court's judgment in Commissioner of Customs & Central Excise v. Hongo India (P) Ltd. clarified that the period of limitation under Section 130A cannot be extended. Despite this, the court entertained the writ petition, distinguishing between the advisory jurisdiction under Section 130A and the constitutional writ jurisdiction.3. Legitimacy of the Importation and Confiscation of Goods:The case involved the seizure and confiscation of 66 bales of mulberry raw silk of Korean origin. The Tribunal had reversed the adjudicating authority's order, accepting the respondent's claim of legitimate importation. However, the High Court found that the Tribunal misapplied the law, particularly Section 123 of the Customs Act, which was not relevant to the case. The court observed that the respondent's inconsistent claims regarding the ownership and licit importation of the goods indicated a cover-up operation, justifying the confiscation.4. Imposition of Personal Penalties:The adjudicating authority had imposed personal penalties on the respondent and another individual under Section 112(b) of the Customs Act. The Tribunal had set aside these penalties, but the High Court reinstated them, noting the respondent's involvement in the scheme to cover up the illicit importation of the goods.5. Procedural Correctness of the Tribunal's Order:The High Court found that the Tribunal's order was based on irrelevant legal principles and misinterpretation of statutory provisions. The Tribunal had erroneously applied the legal position related to Section 123 of the Customs Act, which was not applicable to the case. The court emphasized that the Tribunal's reliance on irrelevant case law and incorrect statutory interpretation warranted correction under the High Court's writ jurisdiction.Conclusion:The High Court allowed the writ petition, set aside the Tribunal's order, and restored the adjudicating authority's order in its entirety, including the confiscation of goods and imposition of personal penalties. The court underscored the importance of correct statutory interpretation and the discretionary nature of writ jurisdiction, even in the presence of alternative statutory remedies.
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