Commissioner of Central Excise vs Amin Chandrakant Bhailalbhai

D.A. Mehta, J.—Appellant-Revenue has proposed the following question:

Whether in the facts and circumstances of the case, the Tribunal is justified in setting aside the amount of penalty levied/imposed on the employees of the firm u/s 112(a) of the Customs Act, 1962 being employees of the firm on the ground that they as employees were not aware of the provisions of law?

Learned Counsel for the appellant seeks permission to amend the proposed question so as to refer to the correct provision of law. Permission granted. Accordingly, the amended question now reads as under:

Whether in the facts and circumstances of the case, the Tribunal is justified in setting aside the amount of penalty levied /imposed on the employees of the firm u/s 112(b) of the Customs Act, 1962 being employees of the firm on the ground that they as employees were not aware of the provisions of law?

The respondent is an employee of one M/s. Associate Plastic & Rayon. Action was initiated against the Unit on the basis that certain goods which were found in a vehicle bearing No. GJ-5T-2998 were liable to be confiscated. The Adjudicating Authority passed a consolidated order dated 27-1-2005 against the Unit and certain employees, including the respondent-assessee. Penalty of Rs. 75,000/- came to be imposed u/s 72 read with Section 112(b) and/or Section 114A of the Customs Act, 1962. Respondent-assessee carried the matter in appeal alongwith the appeal filed by the Unit. In case of the respondent. Tribunal deleted the penalty holding that the respondent had no knowledge and hence provisions of Section 112(b) of the Customs Act are not attracted.

The learned Counsel for the appellant has reiterated what has been stated in the order in original made by the Adjudicating Authority.

Considering the submissions made, it is apparent that the question, as proposed originally, does not arise out of impugned order of Tribunal as the order in original also reveals that penalty was never levied under the provisions of Section 112(a) of the Customs Act. However, even if one considers the amended question, it is apparent that provisions of Section 112(b) of the Act permit levy of penalty on a person who acquires possession or is in any way concerned in carrying, removing etc. any goods, which the person knows or has reason to believe are liable to confiscation u/s 111 of the Customs Act. The Tribunal has categorically recorded that the respondent, as an employee, did not have such a knowledge and, therefore, the provision is not attracted. There is no material on record to suggest the contrary, nor has the learned Counsel been able to point out any such material being available on record to ascribe any knowledge or belief to the employee concerned.

In the result, in absence of any legal infirmity in the impugned order of Tribunal deleting the penalty in case of the respondent, no interference is warranted. The appeal is accordingly dismissed in absence of any substantial question of law.