Page 178 - ELT_15th June 2020_VOL 372_Part 6th

856 EXCISE LAW TIMES [ Vol. 372

their inability to offer a credible explanation, considered to be dubious. The ab-
sence of additional particulars in the declarations entered in the bills of entry was
also held to be an impediment to proper valuation of the imported goods. The
goods that were, as yet, pending for clearance by M/s. ABG Shipyard Ltd., or
any other person, were also subject to the same treatment of having the value, as
yet undeclared for the purposes of Section 46 of Customs Act, 1962, rejected and
revised downwards.
12. It is seen that though the confiscation was restricted to the goods
contained in 20 consignments that had, as yet, not been entered for clearance at
Jawahar Custom House, Nhava Sheva and at the Air Cargo Complex, Chatrapati
Shivaji International Airport; the penalty under Section 112 is, however, related
to the detriment visited upon the entirety of the goods. Invoking Section 112(a) of
Customs Act, 1962, the impugned order has imposed penalty of ` 10,00,000 on
S/Shri Dhananjay Datar, S. Muthusamy, D.N. Mathur and N.R. Jayanth. For a
clearer understanding of the justification, it may be worthwhile to recollect the
other provision invoked, viz.,
13. ‘114AA. Penalty for use of false and incorrect material. - If a person
knowingly or intentionally makes, signs or uses, or causes to be made, sign
or used, any declaration, statement or document which is false or incorrect
in any material particular, in the transaction of any business for the purpos-
es of this Act, shall be liable to a penalty not exceeding five times the value
of the goods.’
for imposition of separate penalty of ` 5,00,000 each on S/Shri Dhananjay Datar,
S. Muthusamy, D.N. Mathur and N.R. Jayanth. The latter, doubtlessly, stands on
its own and is applicable to documentation utilised for the business of transact-
ing in relation to customs law. The former, however, cannot be separated from
the provisions for confiscating of imported goods.
14. The facts narrated supra are a summation of the submissions made
by Mr. J.C. Patel and Mr. Vipin Kumar Jain with Mr. Krishna Kumar, Mr. Akshit
Malhotra and Mr. Ramnath Prabhu, appearing for the appellants, and Ms. P.
Vinitha Sekhar, appearing for Revenue, on various days on which the hearings
were held and concluded. The observations therein are our own flagpoles to
guide us through the slalom run that this adjudication order is. We have record-
ed only such of both as, in our opinion, are essential to the task that we set for
ourselves at the very beginning.
15. In our opinion, there are two aspects that should be considered in
every appeal challenging imposition of penalty : whether the pre-requisites of
competence have been fulfilled and whether the penalty itself is disproportionate
with the gravitas. As the penalty imposed under Section 112 of Customs Act, 1962
assailed in these appeals is the consequence of liability to confiscation under Sec-
tion 111 of Customs Act, 1962, it is but natural for the confiscation itself to be
questioned on grounds of competence and circumstances. We are compelled to
deal with the legal arguments posited for and against the confiscation even if the
appellants before us do not have the locus to seek the quashing of confiscation.
16. Learned Counsel contends that the Tribunal, in re Knowledge Infra-
structure Systems Private Limited, had occasion to deal elaborately with an adjudi-
cation order that had been assailed for confiscating imported goods, under Sec-
tion 111(m) of Customs Act, 1962, and for imposing penalties under Section 112
and Section 114AA of Customs Act, 1962, on the premise that, even in the
EXCISE LAW TIMES  15th June 2020  178