Penalty under Customs law set aside where acquittal stood affirmed and no independent evidence proved abetment.

Penalty under Section 112(b) of the Customs Act was held unsustainable where the same facts had already led to acquittal in the connected criminal case, affirmed on appeal, and the department relied on no independent evidence in adjudication. Although criminal and departmental proceedings are distinct, the material was identical in both proceedings, the appellant's explanation for possession of the foreign currency remained consistent, and the department failed to prove the alleged third person's role or any abetment. In the absence of corroborative evidence, the evidentiary basis for penalty was not established, and the penalty was set aside.

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Issues: Whether the penalty imposed under Section 112(b) of the Customs Act, 1962 was sustainable despite the appellant's acquittal in the connected criminal proceedings and the absence of independent evidence in the adjudication proceedings.

Analysis: The criminal case arising out of the same set of facts had ended in acquittal, and that acquittal was affirmed in appeal, resulting in concurrent findings in favour of the accused. Although criminal and departmental proceedings are distinct, the material relied upon in both proceedings was the same. The appellant's explanation regarding possession of the foreign currency remained consistent, and the department produced no contra evidence to discredit it or to establish the role of the alleged third person said to have supplied the currency. In the absence of independent evidence to support the charge of abetment, the evidentiary basis for the penalty was not made out.

Conclusion: The penalty was unsustainable and was set aside in favour of the appellant.

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