ORDER
1. M/s H.A. Abdul Mustafa & Co. have filed a Revision Petition to the Government of India dated 12-3-1980 under old Section 131. of the Customs Act and this has been transferred to the Tribunal under Section 131 B ibid and this is to be treated as an appeal before us.
2. The appeal was posted for hearing and argued by the Advocate Shri J.R. Gagrat. He explained that the appellants owned a vessel named “M.S.V. Faizi Husaini” registered in January, 1975 under No. BDI 542. The appellants were a partnership concern having the business of plying mechanised sailing vessels. The Hussaini arrived in Bomaby Port on 13-4-78 with a cargo of 4400 gunny bags containing wet dates belonging to M/s National Co-operative Consumers’ Federation Ltd. The appellants “had entrusted the vessel to the Tindel Shri Dawood Ismail and they had taken an undertaking to ensure that he will take all precautions in compliance with law. This was a safeguard for the appellants. The Tindel was authorised to appoint the crew members on the, voyage in question which commenced with the sailing of the vessel on 26-2-1978 from India and the vessel reached Basra and loaded wet dates for Bombay, as per the agreement between the appellants and the importers of the dates. On arrival in Bombay on 13-4-1978 the vessel anchored at dutiable anchorage and on 14-4-1978 a search was carried out in the vessel by the Customs’ Officers which resulted in the seizure of eight gynny bags and two cartons containing various types of goods of foreign origin collectively valued at Rs. 86,412/-at the market rate. These ten packages were recovered from the hatch of the vessel. The packages were not declared in the Private Property list of the crew members or in the manifest of the vessel. These goods were claimed by the Tindel and the remaining crew numbering sixteen persons. The Advocate submitted that the crew members had used their savings for purchase of the various consumer goods possibly with a view to making some business and earning profit. For these reasons they presumably did not declare the same in the private property list of the crew. But the Customs’ authorities seized the vessel and the Addl.Collector confiscated it under Section 115(2) of the Customs Act and allowed the same to be redeemed on payment of fine of Rs. 80,000/-. In addition, the Addl. Collector also confiscated 240 bags of wet dates valued at Rs. 9,600/- cif and Rs. 28,800/- at the market value, which were allegedly used for concealing the 10 bags of contraband. The 240 bags were allowed redemption on payment of a fine of Rs. 10,000/-. In addition, he imposed a penalty of Rs. 2,000/- on the Tindel Shri Dawood Ismail and Rs; 1,500/-each on the remaining 16 crew members. The Advocate submitted that the appellants had filed their appeal only with regard to the Addl.Collector’s order of confiscation of the vessel and the order of confiscation of the part of the cargo of wet dates. The appellants did not have any interest in the un-manifested goods.
3. The Advocate argued that Section 119 was not applicable to the facts dof the case as the 10 baqs of contraband were stored in the hatch along with other goods. The hatch was open and was exposed to the Customs Officer. The presence of the manifested cargo along with the presence of the un-declared goods did not tantamount to concealment. At the time of discharge of the cargo and empting the hatch, the 10 bags in question would have been exposed in any event. Concealment would imply efforts to discover the concealed items. In the present case, the 8 gunny bags and 2 cartons were found in the hatch along with 240 bags of wet dates. The 8 gunny bags containing the contraband could easily be distinguished from the gunny bags containing the dates. It was only by way of storing that the 8 bags and 2 cartons were at the bottom and the gunny bags of dates on top. Hence the Advocate submitted that Section 119 was not applicable. As regards the confiscation of the vessel under Section 115(2), the Advocate read out the Section and he stated that no rules have been framed by the Customs department laying down the precautions to be taken by the master or ‘the owners of the vessel against their use as a means of transport in smuggling of goods. However, he conceded that the Tindel was the person in charge of the vessel and the smuggling of the contraband goods was with his knowledge and connivance. He, therefore, did not urge this point further. He added that he would rely on the two decisions of the Tribunal vide 1985 (21) ELT 936 and 1985 (21) ELT 776. Relying on the ratio of these decisions, he stated that the discovery of contraband goods would not amount to use of the vessel in smuggling and that the quantum of fine in lieu of the confiscation of the vessel was disproportionate in the circumstances of the case. The value of the vessel was Rs. 3,20,000/- and the market value of the contraband goods was Rs. 86,412/-. The Addl.Collector had confiscated these contraband goods and also levied penalty of Rs. 2,000/- on the Tindel andRs. 1,500/-each on the remaining crew members. Since the culprits had been punished, the punishment on the appellants was quite severe. Shri Gagrat also relied on the judgment of the Bombay High Court vide 1976 Bombay Law Reporter page 675 to show that confiscation of a vehicle was not mandatory under Section 115(2) of the Customs Act. He, further, relied on the judgment of the Calcutta High Court AIR 1959 p. 237 in the case of Everest Orient Lines to show that the mitigating facts should be (taken into account while confiscating a vessel. Coming to the facts of the present case, the Advocate argued that the owner of the Vessel was not present at Basra when the cargo of wet dates was loaded. He had no knowledge about the import of the contraband goods and he had no connivance in this matter. The vessel was of standard construction and not of special construction for concealing any contraband goods. The vessel was on charter voyage to the National Co-operative Consumers’ Federation Ltd. and was carrying charter party goods when it arrived in Bombay on 13-4-78. This was only a case of the individual crew members bringing their shopping with them and they desired to avoid paying duty on the same. The said contention was acknowledged by the Addl. Collector in his order. He had not taken any action under Section 112 against the owner of the vessel and there was no previous record of mis-use of the vessel by the owner. In the aforesaid circumstances, the Advocate submitted that the fine in lieu of confiscation of the vessel and the cargo be waived or in the alternative reduced substantially.
4. The learned Sr. Deptl. Representative Shri G.D. Pal submitted that the appellants did not agitate before the Board or before the Tribunal that the manifested cargo was used in concealing the smuggled goods. It was, therefore, not open for the appellants to challenge the confiscation of 240 baskets of wet dates under Section 119 of the Customs Act. The learned S.D.R. relied on the judgment of the Supreme Court, vide AIR 1972 S.C. p. 2091 and read out para 7 of the judgment. He also referred to the Board’s order-in-appeal dated 28-9-1979 and argued that the appellants did not take up the plea erf non-application of Section 119 before the Board. Referring to the panchnama dated 14-4-1978 relating to the seizure of the contraband goods, the S.D.R. argued that the Customs’ Officers had to shift about 200 bags of wet dates to recover the 8 gunny bags and 2 cartons concealed beneath the cargo of the wet dates. It was, therefore, evident that this portion of the cargo was used in concealing the 10 packages of contraband goods. The Sr. Departmental Representative also referred to the Tindel Shri Dawood Ismail’s statement as incorporated at p. 4 of the show cause notice and submitted that the concealment of the contraband goods had. been admitted in this statement. Similarly, the statements of other crew members also confirmed the aforesaid concealment of the, contraband goods. Regarding the Addl. Collector’s order of confiscation of the vessel under Section 115(2) of the Customs Act and giving an option for redeeming it on payment of fine of Rs. 80,000/-, the S.D.R. stated that this action was quite legal as smuggled goods were recovered from this vessel. He read out the interpretation of Section 115(2) of the Customs Act from Shri T.P. Mukherjee’s Commentaries on Customs Act, Third Edition p.345 in support of his submission. The S.D.R. submitted that the imported goods in the 10 packages were smuggled and hence the order of confiscation of the vessel was correct. Accordingly, he prayed that the appeal should be dismissed.
5. We have examined the submissions on both sides. Though the owner of M.S.V. Faizi Husaini had taken precautions by way of bond from the Tindel Shri Dawood Ismail, it is apparent that the vessel had been used in smuggling of the contraband goods. It is also accepted that these goods were not declared in the private property list of the crew members. There is, therefore,’ no dispute regarding the confiscation of the contraband contained in 8 gunny bags and 2 cartons. The learned Advocate conceded that the smuggling was done with the collusion of the person incharge of. the vessel who is the Tindel. However, he has relied on the two decisions of the Tribunal. He has submitted that the vessel cannot be treated as having been used in smuggling of the contraband goods. The two decisions of the Tribunal cited by the Advocate did not help him in saving the vessel from confiscation under Section 115(2) of the Customs Act. The case cited vide 1985 (21) ELT 936 decided by this Tribunal relates to the confiscation of a vessel under Section 115(2), where smuggling was done without the knowledge of the owner of the conveyance or the master.. In the present case under appeal, the Advocate has acknowledged the fact that the Tindel of the vessel was in collusion and in full knowledge of the fact of smuggling. In fact, he himself had smuggled certain contraband goods in the vessel. Therefore, the reliance on this Tribunal’s judgment in that case does not help the appellants in the present case. As regards the second decision of the Tribunal cited by the Advocate vide 1985 (21) ELT 776, the same related to quantum of fine in lieu of confiscation of the vessel. For a vessel valued at Rs. 34,000/-, the fine in lieu, of confiscation was reduced to Rs. 20,000/-. In the present case, the value of Faizi Husaini is Rs. 3,20,000/-, and the redemption fine is Rs. 80,000/-. Hence both these judgments of the Tribunal are of no avail to the advocate in his arguments in the above cited case. The Advocate has further relied on the judgment of the Calcutta High Court in the case of Everest Orient Lines. This judgment is also notattracted to the facts of the present appeal as the Faizi Husaini has not been alleged to have been constructed, altered or fitted for the purpose, of concealing smuggled goods. The confiscation had been ordered by the Additional Collector under Section 115(2) of the Customs Act as a conveyance used as a means of transport in the smuggling of the goods etc. The Addl. Collector had not invoked the provisions of Section 115(1). Therefore, the judgment of the Calcutta High Court is also of no avail to the appellants. As regards the judgment of the Bombay High. Court, 1978 ECR 675, it is the decision of tie High Court that Section 115(2) is only an enabling provision and not a mandatory one. It can be resorted to only if the circumstances justify the same. In the present case the adjudicating authority has thought it fit to invoke this provision and to confiscate the vessel thereunder. The order of confiscation is, therefore, correct. As regards the Advocate’s submission that considering the value of the vessel and the value of the contraband goods, the redemption fine is high and, therefore, some relief should be given, this is the only surviving plea left with us in this behalf. The Addl. Collector fixed the redemption fine in lieu of confiscation of the vessel to approximately 100% of the value of the contraband goods carried in the vessel. Considering the fact that the owner is not to be blamed for the aforesaid act of smuggling and that, he had taken precautions against the misuse of the vessel as also the fact that crew members have lost the goods sought to be smuggled, besides being levied with penalties, we are inclined to accept the Advocate’s request for leniency. The redemption fine for the vessel is, accordingly, reduced from Rs. 80,000/- to Rs. 10,ODD/- (Rupees ten thousand) only.
6. As regards the appellants’ submission that 240 bags of wet dates are not liable to confiscation under Section 119 of the Customs Act, we observe that the same were used for secreting the contraband contained in 8 gunny bags and 2 cartons. The normal place for storing of personal property of the crew is in their quarters and not in the hatch of the vessel. In the present case, the 10 bags of contraband containing the private property of the crew members were recovered hidden from the hatch of the vessel. The panchnama of the search of the vessel dated 14-4-1978 shows that the craft was fully laden with cargo of gunny bags of wet dates and 200 bags had to be shifted to discover the 8 bags of different shape than the cargo of wet dates. It appears that the Addl. Collector of Customs had been very fair in confiscating only those bags of dates which were used for the purpose of hiding the contraband goods and not the remaining portion of the cargo of the Faizi Husaini. There is, therefore, no substance in the argument of the Advocate that Section 119 is not attracted to the facts of the case. However, we find a significant omission in the order of the Additional Collector. The Faizi Husaini was on charter to National Co-operative Consumers’ Federation Ltd., and was carrying wet dates consigned to it. Therefore, the owner of the cargo of wet date contained in the Faizi Husaini was well within the knowledge of the Addtional Collector of Customs, Bombay. As per Section 124 of the Customs Act, the owner of the cargo should have been given, notice before confiscating the same. No such notice was given to the owner of the wet dates in the present case. Accordingly we find that the Additional Collector’s ; order of confiscation of 240 bags of wet dates under Section 119 of the Customs Act is bad in law. Accordingly, we set aside the same and direct that the fine of Rs. 10,000/- paid by the appellant be to. them.
7. Except for the modifications mentioned above, the order of the Additional Collector of Customs, Bombay is confirmed and the appeal is otherwise rejected.