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of <h1>Court quashes penalty under Customs Act, emphasizes evidence at unloading.</h1> <h3>FORBES FORBES CAMPBELL & CO. LTD. Versus DY. COLLECTOR OF CUSTOMS</h3> FORBES FORBES CAMPBELL & CO. LTD. Versus DY. COLLECTOR OF CUSTOMS - 2003 (162) E.L.T. 88 (Bom.) Issues Involved: Challenge to penalty u/s 116 of the Customs Act, 1962 based on alleged shortlanding of goods as per outturn report of Bombay Port Trust.Summary:Issue 1: Alleged Shortlanding of GoodsThe petitioners, acting as Agents for a foreign flag vessel, faced penalty under Section 116 of the Customs Act, 1962, due to alleged shortlanding of goods as per the outturn report of the Bombay Port Trust. The initial order imposing the penalty was challenged in a writ petition, which was allowed, directing fresh adjudication proceedings. Subsequently, a new penalty was imposed based on the outturn report, leading to the current petition challenging this order.Details:The petitioners argued that the liability could not be solely based on the outturn report, as per previous court judgments. They contended that the Port Trust had a statutory obligation to provide a copy of the tally sheet to Customs authorities, which was not done in this case. The respondents, however, defended the penalty, stating that the order was well-reasoned and that the petitioners failed to produce the tally sheet to prove their case satisfactorily.Issue 2: Legal Obligations and Burden of ProofThe court emphasized that the basis of the show cause notice should not solely rely on the outturn report obtained after cargo discharge. It highlighted the importance of evidence at the time of unloading from the vessel and the duty of Customs authorities to produce the tally sheet. The court rejected the reliance on the outturn report for penalizing the petitioners for shortlanding, emphasizing the need for evidence at the time of discharge from the vessel.Outcome:The court found the impugned order unsustainable, quashed it, and ruled in favor of the petitioners. It emphasized the duty of Customs authorities to provide necessary evidence and the insufficiency of penalizing based solely on post-discharge reports. The petition succeeded, with no costs awarded in the circumstances.
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