TaxTMI 
TaxTMI 
1986 (4) TMI 57
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....items including Items No. G-116, G-117, G-28, G-77, G-151 and G-10. The notice was duly replied and the same resulted into adjudication by the Assistant Collector of Customs. By a short order dated 8-8-1966, the Assistant Collector of Customs imposed a penalty of Rs.92,307.26 under Section 116 of the Customs Act, 1962 for short landing of the goods covered by the items mentioned above. 3. Dissatisfied with the aforesaid order, the petitioner-company preferred an appeal before the Central Board of Excise and Customs, New Delhi. Before the hearing of the appeal, the petitioner-company has been able to clarify with the Commandant regarding the clearance of certain items for which the penalty was imposed. As a consequence outturn report prepared by the Bombay Port Trust had also been amended. Considering the Amended outturn report, the Central Board of Excise & Customs partly allowed the appeal and reduced the penalty from Rs. 92,307.26 to Rs.45007/- and remitted the balance. The petitioner-company preferred a further revision petition to the Central Government. The Central Government kept the revision petition pending for a sufficient time in order to enable the petitioner-company ....
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.... have been chargeable on the goods unloaded or the deficient goods as the case may be had such goods been imported. (b) in the case of coastal goods, to a penalty not exceeding twice the amount of export duty that would have been chargeable on the goods not unloaded or the deficient goods as the case may be, had such goods been exported." 5. Various meetings of high level took place between the shippers, the Collector of Customs, the Embarkation Commandant and the trustees of the Bombay Port Trust wherein efforts were made to resolve the matter. It is not necessary to reproduce the minutes of those meetings and in my opinion it would be sufficient to reproduce the relevant minutes of the last meeting, held on 19th November, 1971 in the Board room of the Bombay Port Trust. After recording the full facts in the minute, it was mentioned:- "The Embarkation Commandant say that they have no documents to confirm or deny the receipt of the packages. The Customs are calling upon lines to prove the negative especially something which the other parties involved are unable to prove what they in fact......" "The Embarkation Commandant did his best to link the unconnected packages bu....
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....rs and various opportunities were given to respondents to file their counter affidavit. Respondents No.5 i.e. the Port Trust have filed their counter affidavit. In the said counter affidavit, it has specifically been admitted that the goods were allowed to be cleared without proper documentation and without preparing the tally reports. It is, however, stated that the Port Trust had no option in the matter inasmuch as orders have been issued by the government under rule 6 of the Defence of India Rules to allow the Embarkation Commandant to remove the cargo the moment it arrives. In view of that order it was neither possible for the Port Trust nor for the petitioner to resist the removal of cargo by the embarkation Commandant. From the various meetings mentioned above, it is also clear that no proper documentation was done and the packages were removed immediately on their landing and without there being any tally report. In fact it transpires from the minutes reproduced above that in that 1717 packages initially were not accounted for. Later 650 packages were connected with various vessels and 963 packages out of the same lot are available with the Commandant but the Commandant is u....
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....for in the outturn report of the Port Authority it was obligatory under Section 116 of the Act to impose penalty on the carrier. This has been done in spite of the fact that the Commandant had informed that he had been able to tally certain goods but no benefit of the same was given to the carrier in the absence of the amendment of the outturn report which, according to the Port Authority could not be done unless the proper documents were received from the Commandant. The Commandant was unable to supply the documents as he stated that he did not have any such document. This approach, in my opinion, is legally incorrect. In M/s. Hindustan Steel Ltd. v. State of Orissa, 1978 E.L.T. (J159) (S.C.)=A.I.R. 1970 Supreme Court 243, the Supreme Court was dealing with the question of penalty to be imposed for failure to register as a dealer under the Sales Tax Act. It was observed in paragraph 7 of the report :- "But the liability to pay penalty does not arise merely upon proof of default in registering as a dealer. An order imposing penalty for failure to carryout a statutory obligation is the result of a quasi-criminal proceeding, and penalty will not ordinarily be imposed unless the pa....