P AND O NEDLLOYD (INDIA) LTD. Vs. CC

JUDGEMENT

(1.) This appeal filed by M/s. P and O Nedlloyd (India) Ltd. is directed against the order in original No. S8/C(A)/A4 -28/99 dated 11.8.1999 passed by the Commissioner of Customs, Madras by which the Commissioner has imposed a penalty of Rs. 70,78,408/ - on appellant viz. M/s. P and O Nedloyd (India) Ltd. who are the Steamer Agents, under Section 116(a) of the Customs Act, 1962. He has also imposed penalty of Rs. 1,00,000/ - each on various other persons involved in the case. He has also ordered confiscation of vehicle TMV 2510 under Section 115(1) of the Act with option to redeem the same on payment of fine of Rs. 1,00,000/ - and also ordered release of the seized goods. In the present appeal, we are concerned with the appeal filed by M/s. P and O Nedlloyd (India) Pvt. Ltd., the Steamer Agents.

(2.) The brief facts of the case are that on gathering information that goods contained in container No. ICSU 5060556 was removed illegally while in transit from Chennai Port Trust to CFS, Virugambakkm without payment of duty, the officers of the DRI, detained the said container at CFS Virugambakkam on 12.9.1988. On enquiry, it was noticed that the goods stuffed in the said container was imported by the Chennai Branch of ITDC, DFT division, Jeevan Vihar, Sansad Marg, New Delhi, vide Bill of Entry (BE) No. 51211 dated 9.9.1988. As per the BE and the invoice, the consignment consisted of 999 cartons of assorted brands of liquor of foreign origin. The container was found locked with one time lock No. 011213 and the container was transported from Chennai Harbour to CFS Virugambakkam by Trailer No. TMV 2510 belonging to the Transport Company viz. M/s. AKTP. On examination of the container in presence of the independent witnesses and Shri Gopalakrishnan, driver of the Trailer, Shri E. Vijayakumar, Senior Manager of ITDC who are the importers, Shri Rupam Jaikumar, Clearance Supervisor of M/s. ITDC and Shri P. Raghuraman, Clerk of the CHA viz. Alankar Shipping and Trading Co. Pvt. Ltd. it was found to contain only 652 cartons of foreign liquor and the same were listed. Since the goods listed did not correspond to the declaration found in the BE, the same were seized under a mahazar dated 12.9.1998. Statement was obtained from the driver of the Trailer wherein he inter alia stated that the container was opened en -route to CFS, Virugambakkam without tampering with the Customs bottle seal by two persons by name viz. Murugesan, a friend of his, working with M/s. GVS Transports, and another person viz. Raju and they took away sizable quantity of goods from the container and he was also offered some commission. As the involvement of the Driver Gopalakrishnan was beyond doubt in the illicit removal of dutiable goods from the import container, he was arrested on 12.9.1998 and remanded to the judicial custody. Statement was also recorded from Murugesan, Clearing Clerk of M/s. AKPT on 12.9.1998 wherein he has stated inter alia that his job was to supervise the transport of the containers from Chennai Harbour to the place to the destination and for that purposes he obtained the necessary document from the Steamer Agent viz. the appellants herein for the transport of the container and he made arrangements for the five trailers and around 11.30 PM he loaded the container in trailer No. TMV 2510 and went to supervise the loading of containers in other trailers and he requested Gopalakrishnan, the driver of Trailer No. 2510 to be available till he came back since there was no cleaner available in the vehicle, but when he came back after supervising the loading of other trailers, he found Trailer No. 2510 was not there at the site and he came to know on the following day that the said trailer had reached the CFS Virugambakkam. Statements were also recorded from the owner and employees of the Transport Company, such as G. Nagarajan, Shri Satyanarayanan and Shri S.K. Ganapathi, Eiankovan of the Transporter and all of them denied any knowledge about the pilferage. Statement was also obtained from L. Gopikrishnan, Officer (Operations) of the appellants Company on 14.9.1998 wherein he stated inter alia that normally the containers are allotted by him on equal ratio basis and that the Company on routine transport all the containers only to Concor CFS but in this particular case there was a letter from the importer M/s. ITDC Chennai vide their letter dated 24.8.1998 requesting them to transport the container to CWC Virugambakkam and a container was allotted on a routine equal basis and on 14.9.1998 one Shri Satyanarayana of the Transport Company informed him that the container was detained by the DRI officers. He had denied any knowledge about the discrepancy in the quantity of the goods. Statement was also recorded from Shri S. Edwin, Executive, Customer Service of the appellants Company, wherein he stated inter alia that transporters normally hand over container to the CFS authorities with seal intact and produce all the documents for verification and endorsement which would be recorded by them and as and when the consignee come for delivery order, they hand over the copy of the -same to the consignee for inspection and clearance from the CFS. He has also stated that in this case they have received instructions from M/s. ITDC who are the importers stating that the importers have got permission from the Customs for bonding the cargo and the documents were prepared accordingly and contacted the Transport Company for conveyance of the goods. Statement was also recorded from Maran Nallaiah, Director of CHA M/s. Alankar Shipping and Trading Co. Pvt. Ltd. Chennai on 14.9.1998 wherein he stated inter alia that the transportation of the consignment was done by the appellant herein. Statement was also recorded from E. Vijayakumar, Senior Manager of the importer on 15.9.1998 wherein he stated about the placement of orders for import of 900 cartons of foreign liquor from M/s. United Distilleries and Vinters UK and they had engaged M/s. Alankar Shipping and Trading Company. He has also stated that in this particular case, the DRI officers asked him to be present at CFS Virugambakkam for examination of the container and on examination it was found that the goods were not tallying with the quantity mentioned in the BE. He also stated that they had written to the Steamer Agents about the discrepancy and they also asked the CHA why the container arrival was not informed to them. In the circumstances proceedings were initiated by issue of show cause notice dated 5.3.1999 and the proceedings culminated in the order impugned which is challenged by the appellants, who are the Steamer Agents, who have been visited with a penalty of Rs. 70,78,408/ - under Section 116(a) of the Customs Act, 1962. Aggrieved by the said order, the appellants have come in appeal on the following grounds:

(3.) Shri Ranganathan, learned Advocate accompanied by Miss Shya mala, learned Advocate appeared for the appellants and argued the case for a considerable length of time and submitted that in this case the Steamer Agents (Appellants) cannot be held responsible for the pilferage of the goods en route from the Chennai Port to CFS Virugambakkam. Shri Ranganathan, learned Counsel submitted that when the container was unloaded from the Vessel, the seal of the container was intact and this fact is not disputed. He submitted that the responsibility for the pilferage is on the transporter and not on the Steamer agents who are the appellants in this case.