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High Court of Judicature at Madras
THE HONOURABLE MR. JUSTICE PADMANABHAN
K.R. Ahmed Shah - Appellant
Versus
Additional Collector of Customs, Madras - Respondent
Case No : W.P. No. 3724 of 1977
Decided On : 14 April 1980
CUSTOMS ACT, 1962 - SECTION 77, 80, 111(D), 112 - IMPORT OF GOODS - INTERPRETATION - GOODS NOT CROSSING CUSTOMS BARRIER - NO IMPORT - NO CONFISCATION - NO PENALTY.
Fact of the Case:
The petitioner, an Indian citizen, arrived at Meenambakkam airport from Saigon with four items of jewellery and diamonds. He made a declaration of the items under Section 77 of the Customs Act, 1962, and requested for re-export under Section 80. However, the customs authorities detained the items and initiated confiscation and penalty proceedings against the petitioner under Sections 111(d) and 112 of the Act.
Finding of the Court:
The court held that the petitioner had not imported or attempted to import the goods into the country since they had not crossed the customs barrier. Therefore, the goods were not liable to confiscation, and no personal penalty could be imposed on the petitioner.
Issues: Whether the petitioner had imported or attempted to import the goods into the country contrary to any prohibition imposed by or under the Customs Act, 1962, or any other law for the time being in force.
Ratio Decidendi: The court held that the word "import" in Section 111(d) of the Customs Act, 1962, means bringing goods into India from a place outside India and incorporating them into the mass of goods in the country. The mere landing of an aircraft at an international airport in India does not amount to import of goods. Once a passenger enters the customs area and makes a declaration of the goods brought, irrespective of whether the goods could be passed on payment of duty or not, unless there are circumstances to indicate an intention to smuggle, no offence is committed.
Final Decision: The court quashed the order of confiscation and penalty imposed on the petitioner.
The writ petition has been filed on 25-3-1977 to quash the order passed by the Special Secretary to the Government of India, the third respondent herein, in the revision application filed by the petitioner on 24-8-1973. The third respondent has levied in lieu of confiscation and re-export, a fine of Rs. 5000 and the penalty of Rs. 15000 on the petitioner. The facts leading to the filing of the writ petition may be stated as follows-The petitioner is an Indian citizen, but had been carrying on business in Saigon (South Vietnam) in the year 1970. On 7-2-1970 he arrived at Meenambakkam airport by the Air India flight from Saigon to India. In the customs examination hall, the petitioner made a declaration of his personal effects which included the following items :-
The total value of these four items, according to the petitioner, was Rs. 80, 850. On the basis of the declaration the customs authorities issued a detention receipt. It is the petitioner's case that at the time of giving the declaration, he made an oral request for re-export of the declared jewellery and diamonds as required under Ss. 77 and 80 of the Customs Act, 1962 (hereinafter referred to as the Act). He followed up his oral request for re-export of the declared items by a letter addressed to the Assistant Collector of Customs, Madras airport. Thereafter, he was arrested and produced for remand before the then Chief Presidency Magistrate, Egmore, Madras Subsequently, the first respondent, the Additional Collector of Customs, Madras issued a show cause notice to the petitioner as to why the detained diamonds and jewellery should not be confiscated to the Central Government under Sec. 111 (d) of the Act and that personal penalty should not be imposed on the petitioner under Sec. 112 of the Act. The petitioner submitted his explanation. That was followed by an enquiry as provided under Sec. 122 of the Act. The first respondent passed an order on 29-9-1970 confiscation the jewellery and diamonds to the Central Government and also imposed a personal penalty of Rs. 40, 000 on the petitioner. The petitioner after paying the personal penalty preferred an appeal to the Central Board of Excise and Customs, New Delhi, the second respondent herein, under Sec. 128 of the Act. The second respondent confirmed the order of the first respondent in respect of the personal penalty but modified the order in respect of the confiscation of the goods by giving an option to the petitioner to re-export the said items on payment of another fine of Rs. 40, 000. It is not disputed now that the petitioner paid the fine and re-exported the said items. Against the order of the second respondent, the petitioner preferred a revision application before the third respondent. By his order No. 41-A of 1977, dated 25-3-1977, the third respondent held that the liability of the goods for confiscation under Sec. 111 (d) of the Act and the petitioner's liability for penal action under Sec. 112 of the Act was justified in law. However, having regard to the fact that the petitioner had made a declaration under Sec. 77 of the Act and the further fact that the goods had not gone into home consumption but were allowed to be re-exported, the third respondent reduced the fine in lieu of confiscation for re-export to Rs. 5, 000 and the personal penalty to Rs. 15, 000. It is in these circumstances, the present writ petition has been filed by the petitioner.
2.The Assistant Collector of Customs, Madras has filed counter affidavit. According, to him, on 7-2-1970 a discreet watch was being kept by the Customs officers of Meenambakkam airport to the movements of passengers who arrived from Singapore by Air India flight A-1-115B. The officers noticed that a passenger, whose name was later ascertained to be K.R. Ahmed Shah, was moving around suspiciously with a group of five persons in the health and immigration counter. Thereafter, the petitioner came to the customs examination hall and produced a bunch of p
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