IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HON'BLE THE CHIEF JUSTICE MR.H.L.DATTU & THE HONOURABLE MR. JUSTICE K.M.JOSEPH WEDNESDAY, THE 9TH JANUARY 2008 / 19TH POUSHA 1929 Cus.Appeal.No. 1 of 2008 -------------------------- AGAINST THE ORDER DATED 28/06/2007 IN ORDER.710/2007 of CUSTOMS,EXCISE&SERVICE TAX APP.TRIBUNAL,BANGALORE .................... APPELLANT/APPELLANT: ------------------------------------ ABDUL BASHEER, VANIYA PEETIKAYIL, SAFIYA MANZIL, PADAMOT, MUNDERY PO, KANNUR DIST. BY ADV. SRI.P.A.AUGUSTIAN RESPONDENT/RESPONDENT: ----------------------------------------- THE COMMISSIONER OF CUSTOMS, CUSTOM HOUSE, COCHIN-9. BY ASST. SOLICITOR GENERAL SRI. P. PARAMESWARAN NAIR. THIS CUSTOMS APPEAL HAVING COME UP FOR ADMISSION ON 09/01/2008, THE COURT ON THE SAME DAY PASSED THE FOLLOWING: H.L. DATTU, CJ. & K.M. JOSEPH, J. - - - - - - - - - - - - - - - - - - - - - - - - - - - - - CUSTOMS APPEAL No. 1 of 2008 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Dated this the 9th day of January, 2008. JUDGMENT K.M.JOSEPH,J, The appellant calls in question Annexure N final order passed by the Customs, Excise and Service Tax Appellate Tribunal, South Zonal Bench. The Tribunal disposed of two appeals filed by the appellant. One appeal was directed against the order confiscating the vehicle. The other appeal related to the imposition of penalty. The appeal relating to the confiscation came to be dismissed by Annexure N order. The appeal relating to the imposition of penalty however was partly allowed and the amount of penalty was reduced to Rs.10,000/-. It is feeling aggrieved by the same that the appellant has filed this appeal purporting to be an appeal under Section 130 of the Customs Act. 2. The appellant, who was abroad, brought a car under Annexure A bill of lading. The car came to be seized vide Annexure D Mahazar dated 24.1.2006. The case of the respondent was that on examination there was indication to show that the model of the vehicle is of the year 2003, though the model purported to be of 2002. It is the further case of the respondent that Government of India had imposed a restriction on import of car by individuals stipulating a condition of possession of vehicle for atleast an year prior to the individual's return to India for permanent settlement. Sections 111 (d) and (m) are invoked to justify the confiscation of the vehicle. It is the case of the respondent that the appellant was only a carrier and lent his passport for the import of the car. A statement was taken from him. Thereafter Annexure E show cause notice was issued on 26.5.2006 to the effect that the imported car is confiscated. He was also Cus. Appeal.1/2008. 2 called upon to reply as to why penalty under Section 112 should not be imposed. The appellant approached this court with W.P.(C) No. 17445 of 2006. Counter affidavit was filed producing the statements recorded from the appellant. He came to know that the confiscation was effected by order dated 15.5.2006 and it was disposed of on public auction on 30.6.2006. The writ petition came to be disposed of by the learned Single Judge with a direction to furnish the copy of the order to the appellant and he was directed to file appeal vide Annexure G judgment. As the vehicle was released to the auction purchaser, appellant preferred appeal before the Division Bench. By Anenxure H order the Division Bench dismissed the appeal filed by the appellant and thereafter proceeded to observe as follows: “Before, however, we may part with this order, we would like to mention that Mr.V.Giri, learned counsel appearing for the appellant, argued on the basis of the proviso to Section 23(2) of the Customs Act, 1962 that the owner of any such imported goods shall not be allowed to relinquish his title to such goods regarding which an offence appears to have been committed and, therefore, even if the appellant had denied title over the vehicle and stated that it did not belong to him, it ought to have been offered to him on the price offered by him. All that we comment on the aforesaid contention of the learned counsel is that if the said point is raised before the appellate authority, the said authority would deal with and decide the same or any other points that may be urged. The appellate authority would decide the appeal as expeditiously as possible and preferably within a period of two months from the date of receipt of a copy of this order. Mr.K.P.Dandapani, learned counsel appearing for the purchaser of the vehicle, who is present, states that the vehicle shall not be further sold till the disposal of the appeal.” 3. While the writ appeal was pending in proceedings pursuant to the show cause notice, the appellant was afforded an opportunity to cross-examine the Cus. Appeal.1/2008. 3 Investigating Officer and witnesses (Annexure K). He filed Annexure L argument notice. However, Anenxure M order was passed dated 28.11.2006 imposing penalty of Rs.2,50,000/-. It was after considering the appeals filed against the order of confiscation and the order imposing penalty as aforesaid, Annexure N came to be passed. 4. The complaint of the learned counsel appearing on behalf of the appellant is essentially two fold. He would contend that by virtue of the provisions contained in Section 23 of the Customs Act, an owner is prohibited from relinquishing his right over the vehicle. Section 23 reads as follows: “23. Remission of duty on lost, destroyed or abandoned goods.- (1) Without prejudice to the provisions of Section 13, where it is shown to the satisfaction of the Assistant Commissioner of Customs or Deputy Commissioner of Customs that any imported goods have been lost (otherwise than as a result of pilferage) or destroyed, at any time before clearance for home consumption, the Assistant Commissioner of Customs or Deputy Commissioner of Customs shall remit the duty on such goods. (2) The owner of any imported goods may, at any time before an order for clearance of goods for home consumption under Section 47 or an order for permitting the deposit of goods in a warehouse under Section 60 has been made, relinquish his title to the goods and thereupon he shall not be liable to pay the duty thereon: Provided that the owner of any such imported goods shall not be allowed to relinquish his title to such goods regarding which an offence appears to have been committed under this Act or any other law for the time being in force.” He would further contend that confiscation can be ordered only with notice to the owner Cus. Appeal.1/2008. 4 of the vehicle under Section 124 of the Customs Act. Section 124 of the Customs Act reads as follows: “124. Issue of show cause notice before confiscation of goods, etc.- No order confiscating any goods or imposing any penalty on any person shall be made under this Chapter unless the owner of the goods or such person- (a) is given a notice in writing with the prior approval of the officer of Customs not below the rank of a Deputy Commissioner of Customs, informing him of the grounds on which it is proposed to confiscate the goods or to impose a penalty; (b) is given an opportunity of making a representation in writing within such reasonable time as may be specified in the notice against the grounds of confiscation or imposition of penalty mentioned therein; and (c) is given a reasonable opportunity of being heard in the matter: Provided that the notice referred to in clause (a) and the representation referred to in clause (b) may, at the request of the person concerned, be oral.” He would further contend that the Tribunal has not considered the question relating to the effect of the proviso to Section 23 of the Customs Act. Even though this contention was raised before the Division Bench in writ appeal, this court had specifically directed that when this contention is raised in the appeal, it must be addressed, he points out. He also contended that as the appellant has filed bill of entry, he must be treated as the owner. 5. We have perused Annexure N order. We notice that the Tribunal has taken note of the statement given by the appellant on 22.11.2005 followed by letter given by the appellant on 10.12.2005. The statement in its material particular is extracted hereunder: “My name and address is as stated above. For the last 10 years I have been working in UAE. For the last 3 years I was working in Cus. Appeal.1/2008. 5 Albhadha in a Motor Cycle Company. I have studied upto 10th class. I can read and write English as well as Malayalam. In my house, I am staying with my father, mother, 4 sisters and brother. Out of this, 3 sisters are married. In June 2005 I cancelled my visa and came back to my native place. Within 10 days of that my friend called me and demanded my passport. He told that it is required for sending some cargo in my name. I had handed over the passport to him due to the reason that he was my friend. Since my friend had helped me a lot earlier, I have not mentioned about the cash. After few days Affeel called me in my phone and told that a letter will come. As per that I got a letter from a shipping company in Kochi in September first. Immediately zfter getting the letter I called Affeel on Affeel's phone No.08272237658 at Kudaku. That time Affeel told that I will have to go to Cochin as and when he will inform the same to me. Approximately after 2 months Affeel call me and inform that I should go to an agent named Ajay which is opposite to Fire Station in Island in Cochin. As per that I came to Cochin in November 1st week and met the agent. I had signed in few papers and went to advocate office and signed stamp paper there. I got a copy of bill of lading from the agent's office. I have no knowledge about the import of this car. I was not knowing that Affeel has taken passport for importing car. I have not spent money for this car. I have not purchased the car. I understood that after my arrival in native place, the car was imported using my passport.” The letter of the appellant dated 10.12.2005 reads as follows: “I had stated that I had no relation with the Range Rover Car imported in my name under B/E 168777/8.11.05, in my statement before the Superintendent of Customs on 22.11.2005. I had also stated that I shall produce the person to whom I had given my Passport, Afeel before Customs Authorities. I could not find him inspite of my efforts. Therefore, I am abandoning the car and that he would not stake any claim on the car.” Cus. Appeal.1/2008. 6 Thereafter the Tribunal has proceeded to enter the following finding: “The appellant is referring to proviso to Section 23(2) of the Customs Act, which has been extracted in para 3(x). In our view, that proviso will not at all be applicable to the appellant who has nothing to do with the car. First of all, the appellant who has nothing to do with the car, gave a letter saying that he was abandoning the car. Even that letter has no meaning. Abandoning implies originally the ownership rests with the person. Here, even by the own admission of the appellant, he has nothing to do with the car.” In the teeth of this finding, the appellant cannot contend that the Tribunal has not considered the effect of the proviso to Section 23(2) of the Customs Act. 6. The further question is whether there is merit in the contention of the appellant that even if the appellant has given a letter dated 10.12.2005, it cannot take away the effect of the proviso. We fail to see that there is any merit in the said contention. The proviso which has been incorporated in Section 23(2) is only to interdict the owner of a vehicle from giving up his claim over the vehicle. Going by the statement, and the letter given by the appellant, we are of the view that this is a clear case where the appellant did not set up title in himself as the owner. In such circumstances, he cannot be treated as the owner of the vehicle under the proviso to Section 23(2) of the Customs Act. It is only a person, who is the owner within the meaning of the proviso to Section 23(2) of the Customs Act who is interdicted from giving up his right. We would think that the finding rendered by the Tribunal on this aspect is perfectly justified and no other view is possible. 7. We also do not think that there is any merit in the complaint of the appellant that the appellant was not served with any notice before the vehicle was confiscated. Having regard to the fact that the appellant was not the owner of the vehicle as noticed by us, the appellant cannot be permitted to invoke Section 124 of the Cus. Appeal.1/2008. 7 Customs Act. Going by the statement and letter, it is clear that the appellant did not have anything to do with the vehicle as found by the Tribunal. 8. Even though learned counsel for the appellant referred to Bill of Lading Act in support of his contention that he is the owner of the vehicle, going by the Bill of Lading filed by him, in the facts of this case, we do not think that it is open to the appellant to raise such a contention in the teeth of the statement and the letter we have already referred to. The appellant did not chose to retract the statement, which he made on 22.11.2005. As correctly found by the Tribunal, in the light of the admissions made by the appellant in the statement and in the letter, we are not at all impressed by the argument based on the claim based on the bill of entry having been filed by the appellant. 9. Even though the appellant did make an attempt to contend that the statement was obtained by coercion, having regard to the facts present in this case and in particular the fact that he did not retract the statement given by him on 22.11.2005, even though he did take a contention in his reply to the show cause notice in 2006, we are of the view that the Tribunal was right in drawing support from the statement of the appellant as also the letter issued by him. Even in letter dated 10.12.2005, he stands by his statement dated 22.11.2005. We therefore think that the appeal deserves to be dismissed, and it is dismissed. H.L. DATTU, CHIEF JUSTICE K.M. JOSEPH, JUDGE Cus. Appeal.1/2008. 8 sb.