JUDGMENT - DEVADHAR J.P., J.:---Short point that arises for consideration in this writ petition is, whether the adjudicating authority is justified in confiscating the vessel in question, even after holding that neither the owner of the vessel nor the master of vessel, are liable for any penal action?

2.The facts in brief are that the petitioners are owners of vessel "m.v. MAERSK CLEMENTINE". On 7-2-1989 the said vessel was searched by the officers of the Directorate of Revenue Intelligence (D.R.I.). On search, it was found that 1895 pieces of gold biscuits valued at Rs. 7,22,83,922/- were kept concealed in the ceiling of one of the unoccupied cabin (Engineer A on B Deck). The said 1895 gold biscuits were seized under a panchanama for action under the provisions of the Customs Act, 1962. During the course of investigation, a number of crew members on board the vessel were interrogated and their statements were recorded. In this statement recorded under section 108 of the Customs Act, 1962 Mr. Leonardo Vilarico, the chief cook of the vessel, stated that during the ships stay at Dubai, he met one Mr. Agha and Mr. Eric Pinto, representatives of the shipping agents and at their instance, he smuggled the gold to India on the vessels voyage to India. In his statement recorded under section 108 of the Customs Act on 11-2-1989 and 14-2-1989, the captain of the vessel stated that before the vessel arrived in Bombay, he had conducted inspection of the entire vessel for contraband on 6-2-1988 along with Chief Engineer and Chief Officer and that the investigation did not reveal anything to show that the contraband gold was stored in the vessel. On completion of the investigation, a show cause notice was issued and by the impugned order dated 28-9-1990 the seized gold was confiscated and a penalty of Rs. 1,00,000/- was imposed on Leonardo Villarico, Chief cook under section 112(b)(i) of the Customs Act. By the said order, the Collector of Customs (Preventive) ordered the confiscation of the vessel under section 115 of the Customs Act with the option to the owners to redeem it on payment of fine of Rs. 10,00,000/-. Challenging the said order in so far as it pertains to the confiscation of the vessel and redemption fine is concerned, the present petition is filed.

3.Mr. Ramabhadran, learned Advocate appearing on behalf of the petitioners submitted that once it is held that the owner of the vessel or the master of the vessel is not involved in the smuggling, it was not open to the Adjudicating authority to confiscate the vessel. He submitted that in the absence of any finding that he negligence on the part of the master of the vessel in not replacing the keys of a cabin even after the knowledge that one of the master keys of that cabin is misplaced has direct nexus with the smuggling of gold, the vessel in question could not be confiscated. Mr. Ramabhadran relying upon the judgment of this Court in the case of (Additional Collector of Customs v. Mogul Lines Ltd.)1, reported in 1990(48) E.L.T. 349(Bom.) submitted that once the adjudicating authority has found that the owner/master of the vessel are not involved in the act of smuggling and has not levied any personal penalty on the Master of the ship or the owner of the vessel, then, there was not ground on which the vessel could be confiscated under section 115(2) of the Customs Act. Accordingly, he submitted that the order confiscating the vessel he quashed and set aside.

4.Mr. R.V. Desai, learned Senior Advocate appearing on behalf of the respondents, on the other submitted that the findings recorded by the adjudicating authority is that the lapse on the part of the company or the master of the vessel in not taking immediate steps to change the lock, even after noticing that a duplicate key to the cabin is misplaced is totally condemnable and, therefore, the adjudicating authority was justified in confiscating the vessel. According to Mr. Desai, as soon as it was noticed that the duplicate key

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