Customs confiscation requires owner knowledge or connivance, and liability fails without prescribed precautionary rules.

A conveyance could not be confiscated under Section 115(2) of the Customs Act where there was no proof of the owner's knowledge or connivance and the prescribed precautionary rules had not been made. The Tribunal applied the binding Bombay High Court precedent, which treated the absence of those rules as fatal to owner-based liability, and noted that the omission of precautionary words by Section 79 of the Finance Act, 1988 did not alter that controlling position. The confiscation order was therefore unsustainable, was set aside, and consequential relief followed.

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Issues: Whether the vessel was liable to confiscation under Section 115(2) of the Customs Act in the absence of proof of the owner's knowledge or connivance and in the absence of rules prescribing the requisite precautions.

Analysis: The confiscation provision was read to require proof that the conveyance was used for smuggling with the owner's knowledge or connivance. The Tribunal also applied the prevailing jurisdictional precedent of the Bombay High Court, which held that, until the relevant rules are made, the owner cannot be fastened with liability on that footing. The omission of the precautionary words by Section 79 of the Finance Act, 1988 was noticed, but the controlling point remained the absence of the prescribed rules and the binding effect of the Bombay High Court decision.

Conclusion: The confiscation order was not sustainable and the appeal succeeded.

Final Conclusion: The impugned order of confiscation was set aside and the appellant obtained consequential relief.

Ratio Decidendi: Where confiscation of a conveyance depends on the owner's knowledge or connivance, liability cannot be imposed in the absence of the prescribed rules, and the jurisdictional High Court's contrary view is binding on the Tribunal.

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