Personal penalty based on hearsay and uncorroborated statements was held unsustainable in customs proceedings.

Personal penalty could not be sustained where the only material against the respondent consisted of uncorroborated co-accused statements and hearsay. Statements of the driver and khalasi merely repeated what they had heard from a third person and did not amount to direct evidence linking the respondent to the alleged contravention. An earlier case against the respondent was also not accepted as a valid basis for imposing penalty in the present proceedings. The penalty was therefore set aside and the Revenue's appeal failed.

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Issues: Whether the personal penalty imposed on the respondent was sustainable when the evidence relied upon consisted of uncorroborated statements and hearsay, including reference to an earlier case against the respondent.

Analysis: The penalty had been set aside in appeal on the footing that the co-accused statements were uncorroborated. The statements of the driver and khalasi, as relied upon in the original order, only indicated what they had heard from a third person and did not furnish direct evidence against the respondent. Such material was treated as hearsay and was insufficient to justify the penalty. Reliance on an earlier case against the respondent was also not accepted as a valid basis for imposing penalty in the present proceedings.

Conclusion: The personal penalty was not sustainable and the Revenue's appeal was rejected.

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