Penalty must specify the exact Customs Act clause invoked; vague section 112 penalties are invalid.

Penalty under section 112 of the Customs Act was held unsustainable where the adjudication order imposed penalty without specifying whether clause (a) or clause (b) applied. Because the provision contains distinct clauses covering different conduct, the authority must clearly identify the exact clause invoked so the ingredients of liability are known with certainty. An ? No, avoid. Since the order merely referred to section 112 generally, the ambiguity was treated as a substantive defect, not a technical omission, and the penalty was invalid for vagueness.

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Issues: Whether the omission in the adjudication order to specify whether penalty was imposed under clause (a) or clause (b) of section 112 of the Customs Act, 1962 vitiated the penalty.

Analysis: The penalty provision contains distinct clauses dealing with different categories of conduct. The authority must be clear and precise as to the clause invoked when penal action is taken, because ambiguity in the basis of penalty creates uncertainty about the ingredients of the offence and the foundation of the liability. Since the impugned order merely imposed penalty under section 112 without identifying the applicable sub-clause, the defect was not a mere technicality but went to the validity of the penalty order.

Conclusion: The omission to specify the sub-clause of section 112 rendered the penalty unsustainable; the assessee succeeded on this issue.

Ratio Decidendi: Where a penalty provision contains distinct and separate clauses creating different liabilities, the adjudicating authority must specify the exact clause under which penalty is imposed, failing which the penalty order is invalid for vagueness.

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