2015 (9) TMI 1257 - AT - Customs

Tribunal revokes penalty in red sander smuggling case due to lack of evidence

Shafeek P.K., Kerala Versus CC, Cochin

The Tribunal set aside the penalty of &8377;10 lakhs imposed on the appellant for alleged involvement in smuggling red sander logs, citing lack of ... Illegal export - instead of the declared goods as cargo of coir pith, red sander logs were found to be stuffed. - Seizure of goods - Misdeclaation of goods - Clandestine removal of goods - Imposition of penalty - entire case of the Revenue rests upon the sole retracted statement of Shri Antony Morris. - Held that:- Commissioner for arriving at the findings against the appellant had also referred to the statement of one Shri Anil recorded during the earlier seizures of red sanders in an attempted export case. Apart from the fact that the said statement of Shri Anil in those cases is still at the adjudication stage, we are of the view that the said statement recorded in an altogether different case, cannot be adopted as an evidence in the present case. It is well settled that the evidences available in a particular case have to be taken into consideration for deciding disputed issue. No reference can be made to the earlier statements or the statements of any other person so as to conclude against the accused in a particular case, which is not at all connected with the cases in which statements of other persons were recorded. Shipping bill was filed showing the recipient as M/s. C.P. General Trading LLC, Deira, Dubai. There is no attempt by the Revenue to show that the said alleged recipient of the goods has any connection with the appellant. As such when the appellant’s name was not even shown as recipient, the imposition of penalty upon him based upon uncorroborated statement of one of the accused, without there being any independent, admissible and tangible evidence, is neither justified nor warranted. - no reason to uphold that part of the impugned order of Commissioner for which he imposed penalty upon the appellant - impugned order is set aside - Decided in favour of assessee. Issues Involved:1. Imposition of penalty under Section 114(i) of the Customs Act, 1962.2. Jurisdiction of the Customs Act over a resident of Dubai.3. Reliance on retracted statements and lack of corroborative evidence.Issue-wise Detailed Analysis:1. Imposition of Penalty under Section 114(i) of the Customs Act, 1962:The appellant, a resident of Dubai, was penalized &8377; 10 lakhs under Section 114(i) of the Customs Act, 1962, for his alleged involvement in the smuggling of red sander logs. The container, declared to contain coir pith, was found to have red sander logs upon inspection. Statements from various individuals implicated the appellant indirectly, primarily through the statement of Shri Antony Morris, who claimed that the appellant introduced him to individuals involved in the smuggling operation.2. Jurisdiction of the Customs Act over a Resident of Dubai:The appellant contended that as a resident of Dubai for the past 20 years, the Customs Act, 1962, which extends only to the whole of India, should not apply to him. He cited the Tribunal's decision in the case of C.K. Kunhammed Vs. CCE, which held that actions committed outside India do not fall within the jurisdiction of the Customs Act. The appellant argued that there are no provisions in the Customs Act similar to those in the Foreign Exchange Regulation Act, 1973, or the IPC, which extend their applicability to Indian citizens abroad.3. Reliance on Retracted Statements and Lack of Corroborative Evidence:The appellant's defense emphasized that the entire case against him was based on the retracted statement of Shri Antony Morris. The statement was deemed unreliable due to its self-contradictory nature and lack of corroboration from other accused individuals. The appellant argued that the statement alone, without independent evidence, could not substantiate the penalty. The Commissioner had also referred to a past smuggling case involving red sanders, but this was considered irrelevant as it was still under adjudication and not directly connected to the current case.Judgment Summary:The Tribunal found that the statements from various individuals, except for Shri Antony Morris, did not implicate the appellant. The Tribunal noted that the statement of Shri Antony Morris was self-contradictory and lacked corroboration. The call data records showing contact between the appellant and other accused individuals were insufficient to establish the appellant's involvement in the smuggling operation. The Tribunal held that the retracted statement of a co-accused could not be the sole basis for imposing a penalty without independent evidence.The Tribunal also agreed with the appellant's jurisdictional argument, citing the decision in C.K. Kunhammed Vs. CCE. The Tribunal concluded that the Customs Act, 1962, does not extend to actions committed by an Indian resident abroad.Conclusion:The Tribunal set aside the penalty of &8377; 10 lakhs imposed on the appellant, finding no sufficient evidence to support the allegations and agreeing with the jurisdictional challenge. The appeal was allowed with consequential relief.