ORDER
S. Kalyanam, Member (J)
1. This appeal is directed against the order of the Collector of Customs, Cochin dated 1-9-1988 imposing a penalty of Rs. 5,000/- on the appellant under Section 114 of the Customs Act, 1962 (‘the Act’ for short). The appellant is a Custom House Clearing Agent at Cochin under the name and style “M/s. Anit Marine Agencies, Cochin”. The appellant filed a shipping bill No.992 dt. 15-6-1987 for export of 240 bales of grey knitted fabrics (polyester) on behalf of exporters M/s. Indian Fibre Trading Co. and the goods were for shipment to Dar-Es-Salam. The appellant in the shipping bill had subscribed to the declaration that the goods sought to be exported were grey knitted fabrics (polyester) as per the Rules. The Customs authorities examined the goods under Section 17 of the Act and thereafter passed the cargo for shipment on 22-6-1987 as evidenced by the endorsement made in the shipping bill. The S.I.B. Officers on some information later on re-examined the packages and found the goods to be jute gunny rags and not grey knitted polyester fabrics as declared in the shipping bill. The appellant, the clearing agent, informed that one Shri T.K. Subramaniam who had signed all the export documents as partner of the export-firm was staying at Hotel Casino, Cochin and the authorities traced the said Subramaniam for interrogation. The appellant also handed over certain documents in his possession to the officers. The said Subramaniam was examined by the Customs authorities on 23-6-1987,23-6-1987,4-7-1987 and 6-7-1987; two statements were recorded from the said Subramaniam on 23-6-1987 and two further statements were recorded on the other two dates referred to above. Subramaniam gave an inculpatory statement confessing to misdeclaration of the goods but did not in any way implicate the appellant and exculpated him. The authorities took the appellant to custody on 22-6-1987 at midnight and recorded a statement from him on 23-6-1987 which was exculpatory. Thereafter on 25-6-1987 at 1 p.m. they recorded a second statement of the appellant which is inculpatory in nature and again another statement on 8-7-1987 which is also inculpatory. The appellant retracted the statements on 9-7-1987 stating that it was brought about under circumstances of threat and coercion when he was in a state of detention. It is in these circumstances, after further investigation, proceedings were instituted resulting in the impugned order. In the present appeal I am concerned only with the appellant herein on whom a penalty of Rs. 5000 has been levied under the Act.
2. Shri Sunny Varghese, Learned Counsel for the appellant submitted that the appellant is a Clearing Agent and the firm has been in existence for the past three generations absolutely without any adverse notice and the exporter was introduced to the appellant even as per his first statement and also as per the statement of the partner of the exporting firm (Shri Subramaniam); by Shri Kumar, Deputy Chief Controller of Imports and Exports, Shri Dinesh Customs Prev. Officer of Cochin and another one Shri Mani a friend at Bombay. The Ld. Counsel urged that the appellant merely played the role of a Custom House Clearing Agent. The Ld. Counsel further contended that the earliest statement of the appellant is exculpatory in nature and there was absolutely no justification for the Department to record a second statement on 25-6-1987. The Ld. Counsel further urged that the Custom House Control Room Diary would prove that the appellant was in a state of de facto del ention from 22-6-1987 to 26-6-1987 and inculpatory statements recorded, when the appellant was kept in duress, are not voluntary and true and would not be admissible as evidence in law. The Ld. Counsel further submitted that the partner of the exporting firm Shri Subramaniam, though has given as many as four statements implicating himself and given elaborate details about misdeclaration of the cargo etc., but has not implicated the appellant in anyway. The Ld. Counsel further urged that the adjudicating authority has dealt with the appellant’s case in para 60 of the impugned order and has merely highlighted only a kind of negligence on the part of the appellant stating that the appellant had discharged his duties in a very casual manner. The Ld. Counsel, therefore, urged that when the original statement is exculpatory and subsequent inculpatory statements were extracted by keeping the appellant in duress, they would not be admissible in law. Those statements also were retracted on 9-7-1987 and except the retracted statement, there is absolutely no evidence at all on record to connect the appellant with the commission of any offence as an abettor in regard to the goods in question. The Ld. Counsel also placed reliance on the ratio of the ruling of the Bench of this Tribunal in the case of K.I. Pavunni v. Collr. of Cus. and C. Ex., Cochin’ dated 27-5-1985 reported in 1985 (22) ELT 913 (Tri.), and also to the ratio of the ruling of the Supreme Court in the case of ‘Shankaraiah v. Slate of Rajasthan’, (reported in AIR 1978 Supreme Court Cases page 435) which ruling has been referred to by the Bench of the Tribunal in the case cited supra. The Ld. Counsel further urged that the proceedings being penal in nature the appellant would at any rate be entitled to the benefit of doubt arising in the facts and circumstances of the case and pleaded that the appellant may be exonerated of the charge. Finally the Ld. Counsel made a fervent plea that even the Custom House Clearing Agent licence of the appellant was suspended on 30-6-1987 and the appellant has been out of business for the past about 3 /2 years.
3. Shri Namasivayam, Ld. Deptl. Representative submitted that the Custom House Clearing Agents have certain statutory responsibilities and cannot be negligent in the discharge of their duties. The Ld. D.R. urged that even though the earliest statement of the appellant was exculpatory in nature, it is open to the authorities to record statements later and if those statements are inculpatory, they could be relied upon. Regarding the endorsements in the C.H. Control Room Diary about “detention of the appellant” and “guarding the appellant”, the Ld. D.R. urged that the Tribunal should not attach the meaning normally ascribable to those expressions and those words have been loosely used by the Prev. Officers without knowing their significance. The Ld. D.R. referred to the finding in the impugned order about the typing of the purchase order in the office typewriter of the appellant and urged the appellant should have atleast entertained a suspicion at this stage and scrutinised the matter with more care.
4. I have carefully considered the submissions made before me. In the present appeal proceedings were instituted against various persons in the impugned order connected with the export-firm and in the present appeal I am concerned only with the appellant, a Custom House Clearing Agent to find out as to whether the evidence on record brings home a charge of abetment against him warranting imposition of a penalty under Section 114 of the Act in regard to the goods attempted to be exported. It is not disputed before me that there was clear misdeclaration of the goods in the shipping bill and the goods that were sought to be exported were not grey knitted polyester fabrics but only jute gunny rags. The exporters have been penalised for the same in the impugned order by the Learned Collector. Shri Subramaniam, Partner of the export-firm has given as many as four statements on 23-6-1987, 4-7-1987 and 6-7-1987.1 have gone through the statements and they contain elaborate and comprehensive factual details about the exporters and their representative’s misdeclaring the goods and how they sought to export the goods abroad in contravention of law. In none of these statements the appellant has been implicated in any way as one who either had any knowledge about the clandestine and illegal acts of the exporters or was in any way privy to the commission of any offence by those persons. This is a very important point because if really the appellant had been an abettor, Shri Subramaniam should have implicated him atleast in one of the four statements recorded by the authorities on different dates. Coming to the appellant at the outset I should like to take note of the fact that it is he who informed the Customs authorities about the place where Shri Subramaniam, the partner of the exporter-firm, was residing. Apart from it, the appellant also handed over all the documents available with him to the Customs. I should also take note of the fact that the goods were initially examined before export as per law by the Customs Officers themselves and after due examination they gave ‘let export order’ as evidenced by the endorsement in the shipping bill. The endorsement of the authorities before clearing the goods for export on 22-6-1987 reads as under :-
“Opened, Inspd. and C/weighed S/3 Bales Inspd. Marks Goods : Grey knitted polyester fabrics in each.
C/W Average - As (certained) Gr.weight of
3 bales 376.00
Declared weight (of three bales)
378.00
Diffce( + )2.00
Excess weight within 1%
Sd. x x x x (examiner)
countersigned: x x x x"
This endorsement is signed by the Examining Officer and countersigned by the Appraiser and duly dated. The appellant was taken into custody on 22-6-1987 at midnight and was interrogated and a statement has been recorded from him on 23-6-1987 at 4 a.m. This statement runs to about seven pages in the appellant’s own hands giving all the details and in no part of the statement is there anything to indicate that the appellant either had knowledge or was privy to the commission of an offence by exporters. I have gone through the statements of the appellant recorded on 25-6-1987 and 8-7-1987. Even in those two statements there is nothing to indicate that the appellant was privy to the commission of any offence by the exporter and the inculpatory aspect in the above statements excluding the exculpatory one would only point to a negligence on the part of the appellant. As per the Custom House Control Room Diary which was made available before me by the Ld. D.R., I find an entry at 12 midnight on 22-6-1987 which reads that the appellant, and Mr. Subramaniam etc. were brought for interrogation and an entry at 2 a.m. reads as under :-
"2 A.M. - Guarding Mr. Bhatt, Mr. Subramaniam is being interrogated by Mr.
Abraham and Mr. Gopikumar, Examiner.
4 P.M. - Guarding Mr. Bhat and remained alert.
6 P.M.- Broke off duty on relief from Srivastav, S.K."
I further find an entry on date 25-6-1987 as follows :
"12 MN. - ... At 1.15 A.M. SIB Officers brought Mr. Bhatt to Control Room for cus-
tody. Sepoy N.S.C. Nair guarded him at visitors' room..."
"6 A.M. - Charge handed over to Shri Srivasthav along with Shri Bhatt, Anith Agen-
cies,..."
The further inculpatory statements of the appellant on 25-6-1987 and 8-7-1987 have to be viewed in the above factual background as to whether they could have been voluntary and true meriting acceptance in the facts and circumstances of the case. After the elaborate statement recorded from the appellant on 23-6-19871 find no justification at all for detaining the appellant in the Custom House and moreso, interrogate him far into the night and even into the early hours of the morning as evidenced the endorsements in the Control Room Diary. On going through the various endorsements in the Control Room Diary and in the facts and circumstances of the case I find it difficult to persuade myself that the subsequent statements of ,the appellant were voluntary. I should confess I find it difficult to disabuse my mind of a conviction that the subsequent statements could not have been voluntary and should have come into existencirwhen the appellant was in the continued custody of the authorities. It is a well-established proposition of law that a confessional statement, before becoming admissible, should satisfy two tests namely, it should be voluntary and true; if it is not voluntary, even if it is true, the same will have to be rejected in entirety. The Bench of this Tribunal in the case of ‘K.I. Pavunni’ referred to above has had occasion to refer to the rulings of the Supreme Court before considering the acceptability of a confessional statement. The Tribunal has observed in the said railing as under :-
“But one should remind oneself of the exiomatic proposition of law that even if truth were to be extracted by blandishment, coax, coercion, threat or inducement by a person in authority, the same would be hit by Section 24 of the Evidence Act and would cease to be voluntary and in such a situation there is no alternative to a court of law except to reject the same brew menu. References may usefully be made in this connection to the ratio decidendi in the rulings of the Supreme Court reported in :
1. AIR 1960 SC 1125 (1128 to 1131) in the case of State of Uttar Pradesh v. Deoman Upadhyaye
2. 1978 (3) SCC 435 – Sankaraiah v. State of Rajasthan.
The circumstances under which the appellant was kept though unofficially, in the Custom House for a long spell of time and an inculpatory statement emerging after such a detention do not inspire any confidence in our mind about the voluntary nature of the same.”
Therefore, if the inculpatory statements recorded from the appellant subsequently are not voluntary, as I have held them to be since they do not inspire confidence in me, the statements cannot be relied upon. Be that as it may, the fact remains that the appellant has also retracted the statement on 9-7-1987 itself and it is a well-settled proposition of law that retracted statement requires some degree of corroboration in evidence since the proceedings are penal in nature. In the present case in order to sustain a charge of abetment against the appellant even the retracted statement of the appellant does not have any corroboration. The Division Bench of the Madras High Court in Writ Appeal No. 454/1978 in the case of ‘R.S. Kalyanaraman v. Collr. of Customs, Cochin and C.B.E.C., New Delhi’ has observed as under :-
“It is well established that such retracted statements of accomplice cannot form the sole basis for finding a person guilty without any further corroboration. In this case both the original as well as the appellate authority have found the appellant guilty of abetting the import of contraband gold only on the basis of the retracted statement which have not got corroboration from other materials. Hence, we cannot agree with the conclusion arrived at by the authorities that the guilty as against the appellant has been duly established.”
I should also like to take note of the fact that even the Customs Authorities themselves, entrusted with the task of scrutinising the documents, examining the cargo before permitting clearance of the same for export have cleared the goods. Mere passing of the goods for clearance by a Custom House Clearing Agent or for that matter clearance of the goods by the authorities by random examination cannot ipso facto lead to the conclusion that they must have been privy to the commission of an offence by the exporter unless there is clear evidence, either direct or circumstantial, to warrant such conclusion. Mere negligence or want of diligence on the part of the Custom House Clearing Agent or the Customs Officers in clearing the goods would not ipso facto render their act culpable inviting penal consequences in law. The fact that the purchase orders of the importer were typed in the office of the appellant, though might engender a suspicion, would not conclusively prove that the appellant was on that score privy to the commission of an offence because the order placed by the supplier would only indicate the requirements of the importer. Therefore, on consideration of the entire evidence on record and having regard to the facts and circumstances of the case I am inclined to think that in the interest of justice the appellant would at least be entitled to the benefit of doubt inasmuch as the proceedings are penal in nature and by giving the appellant the benefit of doubt I exonerate him of the charge, set aside the penalty and allow the appeal. I also take note of the fact that the appellant has never been involved in any offence of any kind under the Act in the past and the family has been in the business of Custom House Clearing Agent for nearly three generations without any blemish. The Custom House Clearing Agent licence to the appellant was also suspended as early as on 30-6-1987 and continues to be under suspension for the past about 3 /2 years and this has been more than an adequate punishment for the negligence on the part of the appellant in the discharge of his duties as Custom House Clearing Agent. In the result the impugned order is set aside and the appeal is allowed.