1. This is an application filed under Section 130 of the Customs Act, 1962 for making a reference to the High Court on certain points said to be of law arising out of the Tribunal's order dated 28.12.1983 in appeal No. CD(MAS) 522/83. The points raised are- (1) Whether any penalty can be imposed under Section 116 of the Customs Act, 1962 on shortlanded goods when such goods are not chargeable to duty on their import? (2) Whether on the facts and circumstances of the case, the customs authorities are justified in levying penalty on shortlanded goods which are not subject to any customs duty? (3) Does not Marine Note of Protest lodged by the Master of the vessel before the Consul, at the earliest opportunity after the calamity encountered by the vessel exonerate the carrier from liabilities for the loss or damage to the cargo? (4) Will not the declaration of general average by the shipping company indicate that the goods were lost and that the losses have to be borne by all the interested parties in the voyage? (5) Whether the construction of the "Marine Note of Protest" by the Appellate Tribunal is proper and valid in law? (6) Whether the levy of penalty is justified in the absence of any finding that the unaccounted goods had been smuggled into the country or had been sold in India or elsewhere? (7) Whether on the facts and circumstances of the case, the imposition of penalty is warranted? 2. In respect of the questions (1) and (2) Shri Shanmugasundaram, Advocate, appearing for the applicant, explained that at the time of submission of the written memorandum of appeal, a point had been taken that other goods covered by the same Bill of Entry had been assessed free of duty the goods being CARE consignments, for distribution free of duty after clearance through Customs. Hence, the shortlanded goods should also be treated as non-dutiable. This aspect, unfortunately, had not been canvassed at the time of oral hearing, though a point was made that Buljar Wheat is not dutiable and we had responded that Bulgar Wheat per se is a dutiable item being different from wheat. However, neither of these points finds a place in the order of the Tribunal.
This by itself would not raise this point as one of law for reference to the High Court at this juncture, the order being worded as it is.
3. Questions (3) to (5) deal with the status of a Marine Note of Protest lodged by the Master and its effect in deciding a case of shortlanding under Section 116 of the Customs Act. In our order of 28.12.1983, we have dealt with this aspect in detail and found that in the factual circumstances of the case, the Note of Protest is of no avail in explaining the shortlanding of the bags. This is a finding on facts relating to the circumstances of importation and hence no question of law is involved to merit a reference to the High Court.
4. Question (6): It is nobody's case that the shortlanded goods have been "smuggled into the country." Section 116 required that the goods which are found short are required to be accounted for to the satisfaction of the proper officer. This has not been done in the instant case. What could have happened to the missing goods is not relevant to an adjudication under Section 116; nor has this been attempted in the order of the Tribunal. This question is therefore, without any foundation.
5. Question (7): Once it is found that there is non-accountal to the satisfaction of the proper officer, imposition of penalty follows.
6. Question (8): The quantum of penalty to be imposed is a matter of judicial discretion subject to an upper limit of twice the amount of duty payable on the goods. In the absence of any claim or even allegation that the imposition of penalty or determination of its quantum is mala fide on for collateral purposes, the mere exercise of discretion is not an issue involving any point of law to merit a reference to the High Court. As none of the questions raised by the applicant involves any point of law, the application is rejected.