TaxTMI 
TaxTMI 
2006 (9) TMI 445
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....lved deliberately in the act of abetting. There is no evidence to prove abetment of the officers, which is relied in the show cause notice. Therefore, in the absence of evidence of abetting, the Commissioner has noted that the offences have not been brought out on them for levy of Section 114A of the Customs Act. The Section 112 reads as follows "in terms of the above section persons who have dealt with the goods should have done or abetting to do any act which act or omission would render such goods for confiscation under Section 111 or abets the doing or omission of such an act". The Section 112(b) has noted above also deals with "requisition and possession of the goods which are liable for confiscation". Charges made against the officers in the show cause notice are under Section 112(a) of the Act. The Commissioner has recorded the findings in para 198 to 211 as follows. 198. The next issue for consideration is the proposal in the show cause notice for imposition of penalty under Section 112(a) of the Customs Act, 1962 on the charge of abetment with the importer and the CHA on the following officers, namely, Shri M. Naushad, Shri. T.M. Gopinath, and Shri. Amit Choudhary....
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....ubmitted the Bill of Entry for recording the Examination Report. The Inspector and the Appraiser incharge of the Examination recorded the examination report without highlighting the fact that there was a discrepancy in the documents submitted and also without noticing that the original documents have been substituted. It has been charged that they were aware of the substitution of the Invoice and the Packing List and despite such knowledge, they gave a factually incorrect report, thereby abetting the commission of the offence by the importer and the CHA. 201. The charge against Shri. Amit Choudhary, Appraiser is that he had assessed the Bill of Entry No. 25171 dated 28/12/2002 and as per the investigation, there was a mis-declaration of quantity of tiles in respect of the aforesaid Bill of Entry, wherein a quantity of 3976 sq. mtrs. of tiles was under-reported. He did not take adequate care to verify the quantity declared in the Bill of Entry with the Packing List resulting in evasion of duty, thereby abetting the commission of offence by the importer and rendering himself liable to penalty under Section 112(a) of the Customs Act, 1962. 202. Shri. Amit Choudhary, ....
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..... It is true that there may be mistakes committed in the matter of assessment. But that cannot be attributed to collusion with the importer or the CHA as has been rightly held by the Appellate Tribunal in the case of Commissioner of Customs, New Delhi v. Hargobind Export. Investigation has to prove that officers had the knowledge of mis-declaration by the importer and he derived some benefit from the importer for aiding the mis-declaration. In the absence of any such evidence, the charge of abetment cannot be sustained in law. Further, the Tribunal in the case of Commissioner of Customs, Mumbai v. M. Vasi 2003 155 ELT (312) held that "abetment presupposes the knowledge of the proposed offence and also presupposes the benefit to be derived from the abetment there from.... In the absence of conscious knowledge, penalty on charge of aiding and abetting would not sustain. 204. In the light of the above judicial pronouncement, I find that the investigation in this case has not brought out any evidence in support of their charge of abetment against Shri. Amit Choudhary. Therefore, X cannot uphold the proposal for imposition of penalty under Section 112(a) of the Customs Act, 196....
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....t in the case of J. Ahmed v. AIR, 1979 (S.C.) 1022 that "lack of efficiency or attainment of highest standard in discharge of duty attached to a public office would not ipsofacto constitute misconduct. The negligence or lapse on the performance of duty or error of judgment in evaluating a developing situation may be negligence in discharging of duty but would not constitute misconduct. 207. Similarly, in the Tribunal judgment relied upon by the noticee, Shri. M. Naushad, it is clear that to prove abetment, investigation has to bring on record evidences which proves prior knowledge of the offence to be committed and benefits to be gained by the officer for aiding the commission of the offence. No such evidence has been brought out by the Investigation in the instant case. Therefore, I am unable to accept the proposition in the show cause notice for imposition of penalty against Shri. M. Naushad under Section 112(a) of the Customs Act, 1962. Accordingly, I drop the proceedings proposed against him. 208. As regards Shri Dharan Kumar, Inspector and Shri. T.M. Gopinath, Appraiser who were incharge of examination, they have also denied the charges levelled against them.....
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....the light: of the foregoing, I pass the following order: Order (a) I order that vitrified tiles imported under Bills of Entry No. 21571 dated 28th December 2002, 501 dated 20th January 2003 and 2416 dated 5th April 2003 shall be classified under Chapter Heading 6907.90 of the Customs Tariff and Chapter Heading 6905.10 of the Central Excise Tariff. (b) The assessable value of the vitrified tiles imported under Bill of Entry No. 2416 dated 5th April 2003 is determined @ Rs. 46,08,848/- under Rule B of Customs Valuation Rules 1988 read with Section 14 of the Customs Act, 1962; (c) The maximum retail price for the vitrified tiles imported vide Bill of Entry No. 2416 dated 5.4.2003 shall be taken at Rs. 950/- sq. mtr. for the purpose of calculation of countervailing duty. (d) I hold that 11,094.60 sq. mtrs. of 'Vitrified Tiles' imported vide Bill of Entry 2416 dated April 2003 valued at Rs. 45,63,216 is liable to confiscation under the provisions of Section 111(l) and 111(m) of the Customs Act, 1962; (e) I hold that 16,545.60 square meters of vitrified tiles, valued at Rs. 68,83,437 (CIF imported vide Bill of Entry No. 21571 dated ....
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....l Kothari, of M/s. G.M. Exports under Section 112(a) of the Customs Act, 1962. (m) I impose a penalty of Rs. 2,00,000/- (Rupees Two lakhs only) M/s. Sri Ganesh Shipping Agency, CHA, Bangalore under Section 112(n) of the Customs Act, 1962. (n) I impose a penalty of Rs. 50,000/- (Rupees Fifty thousand only) on Shri. Lalit Kumar, Manager of the CHA firm under the provisions of Section 112(a) of the Customs Act, 1962. (o) I impose a penalty of Rs. 25,000/- (Rupees Twenty five thousand only) each on Shri. Shanmugam, Office Assistant and Shri. Vishwanath Shetty of M/s. Ganesh Shipping Agency under the provisions of Section 112(a) of the Customs Act, 1962. (p) I drop the proceedings initiated against Shri. M. Naushad, Shri. T.M. Gopinath and Shri. Amit Choudhary, Appraisers and Shri. Dharan Kumar, Inspector of ICD, Bangalore. (q) The aforesaid adjudication levies shall be paid by the respective persons within 30 days from the date of receipt of this order. 2. These findings are challenged by the Revenue on a simple ground that there was sufficient evidence available for penalizing these officers. Except for making the statement in grounds of....
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....rs for not having examined the goods and that has resulted in granting of higher drawback claim. Therefore, it is submitted that this judgment is distinguishable and the ruling of A.P. Sales (supra) of this bench would clearly apply to the facts of the case. 5. On a careful consideration of the submissions made and on perusal of the Commissioner's order which is extracted supra, we notice that the ingredients for proving the charge of abetment as required under Section 112(a) has not been brought out in the show cause notice. There is no admission made by the Customs Officers in abetting in the offence charged. The importer and the CHA have not involved the officers. The officers have not been benefited in any way. The lapse on their part in not scrutinizing the documents would at best be dereliction of duty, for which they can be proceeded in terms of CCR Rules. The act of offence is not a penal offence committed by them for involving them along with the offence of the importer and the CHA. The ruling rendered in the case of A.P. Sales (supra) is exhaustive and deals with the present situation, while the situation in the case of Zaki Anwar (supra) is different and the facts....
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.... to claim wrongful drawback amount which was not due to them. The Commissioner, under the impugned Order, after examining the evidences brought on record and referring to various statements came to the conclusion that the entire conduct of these Respondents would throw a serious doubt about discharging their duty properly but it is not sufficient to penalize them under Section 114 of the Customs Act. The Commissioner has given his findings that there is no evidence on record to show that any act or omission on the part of the Respondents has rendered the goods liable for confiscation under Section 113 of the Customs Act. In the appeal filed by the Revenue; it has not been highlighted that there is any material to show that the Respondents had connived with the exporter in mis-declaring the good. What has been mentioned in the Memorandum of Appeal, filed by the Revenue, only highlights the dereliction of the duty by the Respondents which is not sufficient for imposing penalty under Section 114 of the Customs Act. The learned Advocate has emphasized that there is no allegation or proof of consideration having been demanded by the Respondents or paid or supposed to be paid by the expo....
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....ion in Costao Fernandes case (supra) and the High Court decision in G.H. Industries, we are satisfied that there is no legal infirmity in the order passed by the Commissioner dropping the proceedings against the Respondents in these three appeals. We therefore find no reason to interfere with the impugned order in so far as they concern with the three Respondents viz., S/Shri M.I. Khan, R.K. Sharma and Hangshing. In similar circumstances, The Tribunal in the case of P.K. Sharma v. CC, New Delhi 2002 (148) E.L T. 6581 has also allowed the appeal by setting aside the penalty on the Inspector. Finding recorded in Para 5 is reproduced herein below: We have heard the rival submissions. We find that the Department's entire case is built on the date found in the computer entered against the number allotted to the appellant. We note that presently simultaneously data is recorded in the documents and fed into the computer. Thus, there should have been a hard copy of Bill of Entry where the examination report was recorded and was alleged to have been recorded by the appellant. We find that there is no mention whatsoever as to what happened to this hard copy of the Bill of Ent....
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....y, that is, not necessarily with the intention to defraud, but not with an honest belief that the transaction was a valid one, and that he was dealing with a good bill. Sale of Goods Act, 1893: A thing is done "in good faith" when it is, in fact done honestly, whether it be done negligently or not. 23. Ballentine: Law Dictionary (U.S.A.) A statutory definition of the term is, an honest intention to abstain from taking any unconsientious advantage of another, even through the forms and technicalities of law, together with an absence of all information or belief of facts which would render the transaction unconscientious. As applied to the holder of a forged cheque, to establish good faith there must not only be an absence of knowledge of any invalidity, but an absence of circumstances which would put an ordinarily prudent man upon inquiry. As an element tending to rebut malice in libel and slander, good faith requires proper consideration for the character and reputation of the person whose character is likely to be injuriously affected by the publication. There must be absence, not only of all improper motives, but of negligence. ....
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....ints which fall for consideration are three in number viz., whether, when the cheroot tobacco had been pledged to the plaintiff bank, the defendant or its servants broke open the lock of the godown; secondly, whether the action of the Government in attaching the cheroot tobacco pledged to the plaintiff bank for the amount due on the beedi tobacco, is illegal and mala fide; and thirdly, whether by reason of any act or omission on the part of the Government servants negativing good faith, after the disposal of the claim petition preferred by the State in favour of the plaintiff bank, the defendant would be liable in damages. In all these points I have come to the same conclusion as both the Courts below and here are my reasons. 27. Point 1: Both the Courts have found that the defendant or its servants did not break open the godown of Rahamatullah and remove the goods to Sundaram Pillai's godown and that what happened was that on the application of the surety Sundaram Pillai the Excise authorities permitted the transfer of the excisable goods which were slowly purloined from the godown of Rahamatullah, to the well-protected godown of Sundaram Pillai. Point I raised by the....