1992 (3) TMI 352

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....cordingly, the bill of entry was assessed to customs duty on 6.8.1991. The petitioner paid the customs duty on 12.8.1991 and thereafter the goods were examined by the inspection staff on 14.8.1991. As per the examination report the consignment consisted of certain non-declared goods besides 12.668 MT of cellulose acetate cuttings and the value of the non-declared goods was determined after making due market enquiries. It was found that as against the declared net weight of 13.800 MTs only 12.668 MTs of cellulose acetate cuttings were found and the said cellulose acetate cuttings were used for concealing the other five non-declared goods mentioned in the adjudication order like new spectacle frames, plastic sheets decorative, plastic granules, plastic floor sweepings and sun glasses. So, the cellulose acetate cuttings were valued at Rs. 93,417/- and it was decided for confiscation under Section 119 of the Customs Act, 1962. The said non-declared goods were valued at Rs. 5,94,950/ having been found concealed among the declared goods and were held to be liable for confiscation under Section 111(m) and (1) of the Customs Act, 1962. After a notice to the petitioner a personal, hearing w....

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.... Customs Act, 1962. However the petitioner was given an option to redeem the goods on payment of fine. When the petitioner's counsel made a request for release of the goods after mutilation, the adjudicating Officer held that under Section 24 of the Customs Act, 1962 he had no powers to order mutilation and Rules for mutilation of the goods concerned have not been framed by the Central Government. Ultimately the order of confiscation of the non-declared mis-described goods was made under Section 111(m) and (1) of the Customs Act and the confiscation order was passed under Section 119 of the Act with regard to 12.668 MTs. of cellulose acetate cuttings. However, an option was given under Section 125 of the Customs Act to redeem the said declared as well as non-declared goods on payment of a fine of Rs. 1,00,000/- apart from the personal penalty of Rs. 50,000/-. It is this order that is challenged in this writ petition. 6. Notice of motion has been ordered by me on 31.1.1992. 7. The petitioner alleges in the affidavit that the order of the Collector is purely arbitrary and is silent as to how the assessable value is arrived at in spite of the order of remand. It is also alle....

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....s are given in the order and the impugned order has to be quashed on the same ground on which the earlier order was struck down and quashed by this Court in the very same case of the petitioner. Further, the learned Senior Counsel contends that the adjudicating authority has got powers under Section 24 of the Customs Act, 1962 for ordering mutilation and that almost all the High Courts and Tribunals in India including this Court have directed mutilation in certain instance, and it cannot be said that no power is vested with the adjudicating Authority. The learned Senior Counsel relies upon Section 24 of the Customs Act which provides for making of rules by the Central Government. According to him, this should be taken as substantive power for ordering mutilation by the adjudicating Authorities. The learned Senior Counsel states that the non-framing of the rules will not take away the power of the Authority if the object of Section 24 is looked into and relies on the decision Collector of Customs v. Gokuldas 1955 I MLJ 422. The learned Senior Counsel also relies upon another decision of a Division Bench of this Court in Madanlal Steel Industries Ltd. v. Union of India for the propos....

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....in the Official Gazette. It is not in dispute that with regard to the denaturing of spirit rules are framed under Sections 24 and 158 of the Customs Act and so far no rules are made for mutilation of goods, by the Central Government. It is the admitted case of both sides. When rules are not framed is it open to the adjudicating Authority to order mutilation, is the question to be considered on the facts and circumstances of this case. It is true that courts have ordered mutilation in certain cases. But I am not able to see in my case the question with regard to the power of the Adjudicating Authority with reference to Section 24 has been raised and decided. Even in the Division Bench Judgment in Madanlal Steel Industries Ltd. v. Union of India 1992 (56) ELT 705 (Mad.) I do not think this question has been raised and decided. There is only a passing observation in the judgment at page 718, which is to the following effect. Section 24 of the Act, in our view, is a provision introduced with the object of removing any chance of abuse of the import by any person for home consumption. Apart from that I do not think I can take it that the question has been raised and decided by the ....