1957 (8) TMI 40 - HC - Customs

Enforcement of Central Board of Revenue penalties under Sea Customs Act

Shree Digvijaysinhji Spinning Versus The Collector Of Customs, Baroda

The Court determined that penalties adjudged by the Central Board of Revenue cannot be enforced through the procedure outlined in Section 193 of the Sea ... - Issues Involved:1. Construction of Section 193 of the Sea Customs Act, 1878.2. Jurisdiction of the Customs Collector to notify penalties adjudged by the Central Board of Revenue.3. Validity of the orders passed by the Central Board of Revenue.4. Authority of the Magistrate to issue warrants of attachment for penalties adjudged by the Central Board of Revenue.Detailed Analysis:1. Construction of Section 193 of the Sea Customs Act, 1878:The primary issue revolves around the interpretation of Section 193 of the Sea Customs Act, 1878. The section outlines the procedure for the recovery of penalties or increased rates of duty adjudged by an officer of Customs. The section states that if such penalties or duties are not paid, the officer may levy the same by selling any goods of the person in his charge or in the charge of any other officer of Customs. If the officer is unable to realize the unpaid amount, he may notify a Magistrate who will then enforce payment as if it were a fine inflicted by the Magistrate himself.2. Jurisdiction of the Customs Collector to Notify Penalties Adjudged by the Central Board of Revenue:The Company contended that the penalties were adjudged by the Central Board of Revenue and not by the Customs Collector. Therefore, under Section 193, it was not within the Customs Collector's jurisdiction to notify the Magistrate for recovery of these penalties. The Court noted that the Central Board of Revenue is not an officer of Customs within the meaning of Section 193. Consequently, penalties adjudged by the Central Board of Revenue cannot be considered penalties adjudged by an officer of Customs.3. Validity of the Orders Passed by the Central Board of Revenue:The Company argued that the orders passed by the Central Board of Revenue were without jurisdiction and null and void. However, the Court found no evidence to support this claim. The appellate authority, under Section 190, has the power to commute an order of confiscation to a penalty with the consent of the owner of the goods. The Court observed that there was no indication that the necessary consent was not obtained, and thus, the orders were not without jurisdiction.4. Authority of the Magistrate to Issue Warrants of Attachment for Penalties Adjudged by the Central Board of Revenue:The Court held that Section 193 does not apply to penalties adjudged for the first time by the appellate authority, such as the Central Board of Revenue. The Magistrate at Jamnagar issued warrants of attachment to enforce the payment of penalties adjudged by the Central Board of Revenue. The Court concluded that the Customs Collector did not have the authority to notify these penalties to the Magistrate, and therefore, the Magistrate was not entitled to issue the warrants of attachment.Conclusion:The Court identified a lacuna in the Act, noting that it does not provide for the realization of penalties adjudged by the appellate authority through the summary procedure outlined in Section 193. Consequently, the Court set aside and canceled the warrants of attachment issued by the Magistrate and overturned the Magistrate's order.Order:The warrants of attachment issued by the First Class Magistrate, Jamnagar, were set aside, and the Magistrate's order was canceled.