1. As common question of law and fact is involved in Appeal Nos. CD (SB) (T) 1/56, 2/56 and 3/56, they will, therefore, be disposed of by this one common judgment.
2. M/s. Bharat Marble Company, M/s. Bharat Mineral Industries and M/s.
Gopal Dass Saksaria, three different firms filed three shipping bills No. 457, 458 and 459 for exporting Sesame Cake (Gingelly Cake) and the weight of each consignment was 99 tons odd. The No. of bags in each shipment was 1426 and the weight of each bag as indicated therein was 160 Lbs. gross. The Customs authorities had reasons to believe that the declarations in the shipping bills concerning the above mentioned consignment were not correct and that the samples were drawn from the goods sought to be exported and were found to be of groundnut oil cakes which were assessable at a much higher rate of duty than that given in the case as declared in the shipping bills. It was further found that each bag weighed 200 Lbs. It was thus found that there was misdeclaration of the description and weight of the goods in the shipping bills and this was done to save higher duty. It was further found that export of groundnut oil cakes was not covered by a valid Export Trade (Control) Licence, as was required to be taken at the given period. It was further found by the Customs authorities that the goods sought to be exported belonged to M/s. Palriwala Brothers Limited, M/s. Shree Shew Sakti Oil Mills Ltd. and M/s. Lakshmi Produce Co. Ltd. of 14, Netaji Subhas Road, Calcutta.
3. Three separate show cause notices were, therefore, issued to these three firms by Assistant Collector of Customs and Superintendent, Preventive Service, Calcutta on 22-11-1955 requiring them to explain the allegations recorded in the notices connecting them with the attempted export and to show cause as to why action should not be taken for confiscating the goods and taking penal action under Section 167(8) and Section 167(37) of the erstwhile Sea Customs Act, 1878.
4. The appellants sent an interim reply that they had no connection whatsoever with all these exports nor they had any interest in the goods which were sought to be exported. The appellants, however, demanded the supply of certain copies of the documents. There was exchange of correspondence between the appellants and the Customs authorities. The appellants insisted on the supply of the copies of the documents which the customs authorities could not supply and ultimately a stipulated date was given by the Additional Collector requiring the appellants to send a reply by the specific date failing which the case will be decided. As the copies of the documents were not supplied, the appellants did not appear for the hearing. The result was that the Additional Collector passed the impugned three ex-parte orders on 14-6-1956. Those orders were challenged in appeal before the Central Board of Excise. & Customs. The appeals have since been transferred to this Tribunal and have been argued by both the sides.
5. Although the appeals were filed in 1956, they could not be decided by the Board for one reason or the other. The main ground was that criminal proceedings had also been initiated against Shri G.S.Palriwala, Shri G.N. Palriwala, Shri S.N. Palriwala and Shri C.T.Joseph and others. All these persons were convicted by the trial Court but the Calcutta High Court accepted all the appeals and acquitted the appellants of the various charges.
6. Shri M.C. Bhandare, learned counsel for the appellants vehemently x argued that his clients have absolutely no connection with the three exporting firms or the goods in question and, therefore, the imposition of penalty on them was not justified. We notice that the export licences were issued in the name of M/s. Bharat Marble Company, M/s.
Bharat Mineral Industries and M/s. Gopal Dass Saksaria. Shree Shew Sakti Oil Mills Ltd. or the other appellants had not obtained any licence to export the goods in question. The main circumstance against the appellants as alleged in the notice is that some space for the goods to be exported had been booked in advance by Shree Shew Sakti Oil Mills Ltd. and the same was to be utilised by the exporting firms. Shri Bhandare has submitted that there is absolutely no evidence that the space which was used by the exporters was the same which had been booked by the appellants. In this connection, Shri Bhandare has drawn our pointed attention to the statement of Shri Vaish, a partner of M/s.
Bharat Marble Company and also to that of Shri Gopal Dass. These persons have categorically stated that the space booked by the appellants was not to be used by the exporting firms.
7. In this connection we asked Shri Nair, the learned representative of the respondent to show us from the record how the allegation that the space booked by the appellants in the ships was to be used by the three exporting firms. He has not been able to lay his hands on any evidence.
He submits that circumstances existed in record which go to show that the said space was to be utilised by the exporting firms to send out the disputed goods. He could not produce any evidence, oral or documentary, whether any authority had been given to the exporters to utilise the reserved space of the appellants. We thus find force in the contention of Shri Bhandare that the mere fact that some space in the ship had been booked by the appellants does not ipso facto prove that the same was to be used by the exporting firms. There is absolutely no evidence to substantiate the allegation of the respondent as mentioned in the notice. Before we proceed further we find that the Additional Collector had only copied out the body of the show cause notice in his order and has not discussed any evidence collected by the Customs authorities, only because the appellants had not appeared, an ex-parte order was passed and the penalty was imposed. Even in an ex-parte order it is incumbent on the authority passing the order that it should appraise the evidence on each count and give a finding on the particular points involved by referring to the relevant evidence. This has not been done in these cases. So, for all practical purposes, the Additional Collector adopted the grounds set out in the show cause notice which were only in the form of allegations and passed the final order. Mere allegations cannot take the place of proof and for proving a particular fact, the evidence was required to be assessed as appeared on the record. Unfortunately this has not been done by the Additional Collector.
8. The six grounds listed against the appellants in the show cause notices were as under : 1. That the freight for effecting shipment of the above consignment was booked by M/s. Shree Shew Sakti Oil Mills Ltd. on or about 11-8-55 through M/s. Sinclair & Co. of Royal Exchange and 5 Commercial Buildings, Calcutta.
2. That the job of having the Shipping Bill passed through the Customs for the above consignment was entrusted to M/s. S.R. Bux & Bros. the authorised clearing agents by one S.N. Mondal, who is ascertained to have been a shipping assistant in the office of M/s.
Palriwala Bros. Ltd. 3. That the duplicate copy of the shipping bill has been endorsed by Shri C.T. Joseph, the Licenced Sircar No. J. 36 of the Custom House, who can only attend the work connected with the goods imported and exported by the said M/s. Palriwala Bros. Ltd. and their associate firms viz., M/s. Shree Shew Sakti Oil Mills Ltd., M/s Kedarnath Madanlall etc.
4. That the boats for the carriage of the goods from the Baza Ghat to the docks were arranged through the Boat Contractor Fahad Khan by one Shri Ram Pratap Singh, an authorised representative of the said M/s. Shree Shew Sakti Oil Mills Ltd. and M/s Palriwala Bros. Ltd. 5. That M/s. Lakshmi Produce Co. are one of the associate firms whose affairs are looked after by and in the office of M/s.
Palriwala Bros. Ltd. and the address of Shri Gopal Dass Saksaria, an Agra Party as given in the shipping bills viz., as C/o Lakshmi Produce Co. Ltd., 14, Netaji Subhas Road, Calcutta, further connects the three firms viz., M/s. Palriwala Bros. Ltd., M/s. Shree Shew Sakti Oil Mills Ltd. and M/s. Lakshmi Produce Co. Ltd., with the attempted unauthorised shipment of this consignment.
6. That in spite of the fact that Shri Gopal Das Saksaria is well-known to the Directors of M/s. Lakshmi Produce Co., M/s.
Palriwala Bros. Ltd. and M/s. Shree Shew Sakti Oil Mills Ltd. who appear to have utilised the name of Shri Saksaria for effecting shipment of the consignment in the aforementioned prima-facie illegal manner, a registered letter addressed to the said Sri Saksaria, C/o M/s. Lakshmi Produce Co. Ltd., 14, Netaji Subhas Road, Calcutta, was returned with the remarks of the Post Office 'not known'.
We asked Shri Nair to link the appellants with the above grounds. He has not been able to do so with any cogent evidence to our satisfaction. He has, however, referred to a letter dated 27-9-55 sent by M/s. Shree Shew Sakti Oil Mills Ltd. to their Bankers requesting them to issue one Manager's cheque in favour of Collector of Customs, Calcutta for a total sum of Rs. 15,351-12-0 towards payment of export duty allegedly on behalf of the following three accounts.
Shri Nair has contended that these are the three exporting firms on whose behalf the payment was to be made to the Customs authorities and that these amounts are reflected in the duties payment in the 3 shipping bills filed by the three parties. This is the only evidence on which Shri Nair has tried to rely. When it was put to the learned representative of the respondent as to whether this evidence i.e.
letter to the above mentioned bank had been mentioned in the Show cause notice or in the subsequent communication to the appellants or were they ever confronted with this piece of evidence for any explanation, the reply is in the negative. So, at no stage this piece of evidence had been asked to be explained. Shri Nair submits that the case be remanded and an opportunity be afforded to the respondent to be confronted with this evidence, which was left out earlier, and the matter be looked into afresh and, if need be, the case be further investigated in the light of this additional evidence i.e. the letter dated 27-9-55, written to the bank. There is no doubt that, prima facie, this constitutes an important piece of evidence but after the lapse of 3 decades we do no think it feasible to relegate the parties to a stage as it was in 1956. For non-feasance or mis-feasance, the respondent must bear the legal consequences. We do not express our opinion about the authenticity or the value of the letter sent by Shree Shew Sakti Oil Mills Ltd. to the bankers as the explanation of the other party has not come on record. It can be possible that some plausible explanation might be given by the parties concerned but in the circumstances of the case we do not think that it would be just and proper to remand the case on this score.
9. From the above discussion we find that the impugned order of the Additional Collector of Customs in which proper finding has not been given after due appreciation of the evidence on record, is not sustainable. We, therefore, accept this appeal and set aside the order of the Additional Collector. The appellants would, therefore, be entitled to consequential relief.