1. This is an application for stay filed by M/S. National Harbour Launch Service in connection with their appeal against the order of the Additional Collector of Customs No. S-14-4-1097/80 PINT, dt. 1-9-82 confiscating inter alia the appellants launch valued at Rs. 40,000/-under Section 115(2) of the Customs Act and giving them option to redeem the same on payment of fine of Rs. 30,000/-in lieu of confiscation. Since the launch was released before the issue of the order of confiscation the appellants executed the bond with bank guarantee for Rs. 30,000/-. The Customs authorities have initiated action to recover Rs. 30,000/- from the guarantor. In the aforesaid circumstances, M/s. National Harbour Launch Service have filed the present application for stay of the recovery. During the course of oral,arguments, Shri Faizullabhoy has submitted that the recovery of the amount would cause undue hardship to the appellants and that the appellants can give an undertaking not to dispose of the motor launch and to deposit its registration certificate with the Tribunal or the Bombay Customs authorities as the surety against such transfer. The appellants are also prepared to execute an indemnity bond or undertake to keep the sum of Rs. 30,000/- with M/s. Oil & Natural Gas Commission who owes sums in excess of the amount to the appellant. On being pointed out the provisions of Section 129-E of the Customs Act under which stay can be applied only against payment of duty of Customs or penalty. The learned Advocate has referred to the provisions of Section 129-C (6) and (7) to say that the Tribunal has inherent powers to grant stay against the recovery of fine and he has cited 71 ITR p. 815 relating to ITO, Cannanore v. M.K. Mohammed Kunny and 98 I.T.R.relating to Puranmal Kauntia v. ITO and Ors.. In the aforesaid cases the Law courts had the occasion to examine the provisions of Section 254 of the Income-tax Act and decided that the Income-tax Appellate Tribunal had the inherent right of granting stay against the recoveries under the Income-tax Act, Shri Faizullabhoy therefore submitted that this Tribunal has the legal authority to grant the stay prayed for by him.
2. The departmental representative has opposed the stay on the grounds that when explicitly Section 129-E of the Customs Act does not provide for any stay of the fine levied, the rules cannot do so as the rules have to be in conformity with the Act. In any case the rules had already been framed and the rules did not provide for grant of stay of fine levied in lieu of confiscation of the launch.
3. We have examined the case. We find that the department's contention is correct. The adjudicating authority has confiscated the launch under Section 115 (2) of the Customs Act and given appellants an option to redeem it on payment of fine of Rs. 30,000/-. It was not necessary for the adjudicating authority to allow provisional release of the seized launch on execution of the bond with bank surety by the owners. The appellants cannot make capital out of the forbearance shown by the adjudicating officer in releasing the seized launch. As pointed out by the departmental representative, Section 129-E does not cover fine. The rules cannot override the Act and hence the judgments narrated above by Shri Faizullabhoy are of no consequence to the present case where the Act specifically provides for stay of penalty or duty and not fine in lieu of confiscation which is the case under consideration. Under Section 126 of the Customs Act, the property in the confiscated launch vest in the Central Government and the Addl. Collector of Customs is required after issue of this order, to take and hold possession of the confiscated launch. la such circumstances the Tribunal cannot allow any stay against the recovery of redemption fine. In the aforesaid circumstances we find that there are no provisions under the Customs Act which would permit the Tribunal to grant stay. Accordingly, the appellants' request for stay is hereby rejected.