2019 (3) TMI 454 - AT - Customs

Tribunal overturns penalty for lack of evidence in red sanders logs case.

The tribunal set aside the penalty imposed on the appellant due to insufficient evidence of direct involvement in the smuggling of red sanders logs. The ... Principles of natural justice - imposition of penalty on the co-noticee/appellant - case of Revenue is that appellant has been observed to be associated with Deepak Rishi @ Rajesh And Hemant Sachdeva for the noticed stuffing and custom clearance of the container No. KKTU 7808312 mis-representing himself as G-Card holder - Held that:- Girish Kumar himself in his statement under Section 108 of Customs Act, 1962, as was recorded on 15.10.2012 has acknowledged him to be the employee of Deepak Rishi @ Rajesh & Hemant Sachdeva and about signing the impugned shipping bill. But this evidence though highlight the guilt of Deepak Rishi for whom the appellant was working but is highly insufficient to prove any act of present appellant of conspiracy with said Deepak Rishi for the stuffing of red sanders in the impugned assignment except for being the latter’s employee Without the evidence to prove the intent of appellant about the impugned stuffing and no knowledge for bill of entry, as signed by him, to be false. Liability cannot be fastened on him. Mere signing of bill that too in the capacity of being employee is not sufficient to prove gravest of allegations of improper export. The malafide cannot be attributed to Girish Kumar unless and until proved beyond reasonable doubt. Same is miserably missing. The Order of adjudicating authority as far as the imposition of penalty upon Girish Kumar appellant is concerned is opined to be based on mere presumptions, conjectures and surmises - penalty set aside - appeal allowed - decided in favor of appellant. Issues:- Alleged smuggling of red sanders logs in a container declared for export- Confiscation of seized goods and imposition of penalties- Violation of principles of natural justice and coercion in obtaining statements- Role and liability of the appellant in the smuggling incidentAnalysis:1. Alleged Smuggling of Red Sanders Logs:The case involved the interception of a container declared for export, which was later found to contain red sanders logs instead of the declared items. The container was detained by DRI officers, and the logs were seized after examination. The appellant was one of the co-noticees in the matter, and the proceedings were witnessed by various individuals, including representatives of the exporter, CHA, and customs officials.2. Confiscation and Penalties:The Customs Act was invoked for the proposed confiscation of the red sanders logs and the iron/steel mesh found in the container. The adjudication order confirmed the proposal and imposed significant penalties on multiple individuals involved in the incident. The appellant, along with others, was penalized for their alleged roles in the smuggling operation.3. Violation of Principles of Natural Justice:The appellant contended that the order was passed mechanically and in violation of natural justice. It was argued that the penalties were imposed based on incorrect and involuntary statements obtained under coercion, which were later retracted. The appellant's counsel vehemently opposed the penalties, alleging corruption in the judiciary and demanding the cancellation of the penalties.4. Role and Liability of the Appellant:The appellant's role in the incident was scrutinized, with evidence suggesting his association with individuals involved in the smuggling operation. However, the tribunal found insufficient evidence to prove the appellant's active involvement in the conspiracy to smuggle red sanders logs. While acknowledging the appellant's employment under one of the main accused, the tribunal concluded that mere association and signing of documents as an employee were not enough to establish the appellant's intent or knowledge of the illegal activities.5. Judgment and Decision:After considering all evidence and statements, the tribunal set aside the penalty imposed on the appellant, citing the lack of concrete proof of his direct involvement in the smuggling operation. The order of the adjudicating authority was criticized for being based on presumptions and conjectures, lacking substantial evidence to prove the appellant's guilt beyond a reasonable doubt. Therefore, the tribunal allowed the appeal and revoked the penalty imposed on the appellant.This detailed analysis of the judgment highlights the key issues, arguments presented by both parties, the evaluation of evidence, and the final decision of the tribunal regarding the appellant's liability in the alleged smuggling of red sanders logs.