ORDER
V.K. Agrawal, Member (T)
1. As these three appeals have arisen out of a common order dated 30-6-1998 passed by the Commissioner of Customs, these are being disposed of by a common order.
2. Briefly stated the facts are that the officers of the Directorate of Revenue Intelligence recovered 360 kgs. of raw silk yarn valued at Rs. 5,76,000/- in 9 packages from a Truck No. WB-03/9011 on 26-9-1996, which was detained at the Naubatpur Trade Tax Check post by the Trade Tax Authorities. The goods were booked, as per consignment notes, as Rebooking Readymade goods by one M/s. Gopal Bhai from Calcutta to self at Seroli (Surat). The officers seized the said goods under customs Act alongwith Miscellaneous Indian Goods valued at Rs. 2,79,561 /- and the Truck under the reasonable belief that silk yarn was smuggled into the country; Indian goods were used for concealing the same and truck was used as means of transportation. The Commissioner of Customs, under the impugned order confiscated absolutely the raw silk yarn of Chinese origin; confiscated Indian goods with an option to redeem the same on payment of fine of Rs. 50,000/-; confiscated the truck with an option to redeem the same on payment of fine of Rs. 2,00,000/- and imposed penalty as under:
(i) M/s. Rajdoot Road Carriers P. Ltd. Rs. 1,00,000/- (ii) Krishna Gopal Keserdev Rs. 50,000/- (iii) Jayanti Lal Heera Lal Rs. 20,000/- (iv) Ishwar Chand Thakur, Driver Rs. 2,000/-
The Commissioner held that, after examination two silk Traders of Varanasi opined that recovered raw silk yarn was of Chinese origin, the import of which is prohibited in India under Notification No. 9/96-Cus., dated 22-1-1996; that no one had claimed the ownership of the raw silk yarn; that running away of the driver Ishwar Chand Thakur from the spot lends support to the belief that the goods were illegally imported into India; that the Indian goods were used for concealment of the smuggled goods that the Truck had transported the smuggled goods from Calcutta to Varanasi; that running away of the Driver suggested that he was aware about the smuggled nature of the goods and for this reason penalty under Section 112(b) of the Customs Act is imposable on him; that it is the responsibility of the carriers that unauthorised or smuggled goods are not transported or booked from their Transport Company and no Transport company would book the consignment without actually examining the contents thereof; that circumstantial evidences clearly establish the connivance on the part of transport company; that Krishna Gopal is liable to penalty as he is concerned in the sale of smuggled silk yarn at Surat in full knowledge; Jayantilal Heera Lal Jariwala had gone to collect the goods in full knowledge and awareness.
3. Shri K.M. Makwana, ld. Consultant, submitted on behalf of M/s. Rajdoot Road Carriers and Rajdoot Road Carriers Pvt. Ltd. that they are engaged in business of transportation of goods; that the consignment received by them for transportation are not opened by them; that it is also not possible to open the packages; that nowhere such practice prevails and as such the Commissioner has wrongly held about their involvement in the case; that the normal trade practice is to accept the goods for transport on the basis of the declaration given by the consignor. He further submitted that on receipt of the message from the driver, an employee was sent to the spot and they came to know about the reality when contrabands were found from the cartons; that the transporter is not required to know the name of the persons who came for booking the consignment; that it is also not required to identify the name of the person on whose name, consignment is booked; that neither the transporter nor driver are responsible for misdeclaration of goods by the consignors; that the truck driver is only responsible for the number of packages which are loaded in the truck; that the Department has failed to prove that the owner of the truck, transporter or the driver had knowledge of the contents of the cartons. He also mentioned that the miscelleneous Indian goods were not used for concealing the smuggled goods as these goods were pertaining to other customers and were destined for different places. The similar submissions were made by the ld. Consultant on behalf of the third Appellant Shri Ishwar Singh, Driver. He relied upon the decision in the case of Nepal Singh v. Commissioner of Customs -1998 (104) E.L.T. 336 (T) wherein it was held that for confiscation of the truck under Section 115(2) of Customs Act, knowledge of the owner or the person in charge of the truck about the smuggled nature of the goods is a pre-requisite. Reliance was also placed on the decision in the case of ABC India Ltd. v. Commissioner of Customs, -1999 (107) E.L.T. 503 (T) wherein it was held that where the nexus was not established between the owner of the contraband and the owner of the goods used for concealment, there was no cause for confiscation of the latter under Section 119 of the Customs Act.
4. Countering the arguments Shri Y.R. Kilania, ld. D.R. reiterated the findings of the Commissioner as contained in the impugned order and emphasised the fact that driver of the truck ran away from the scene which shows his knowledge about the contraband goods being carried on in the truck.
5. I have gone through the submissions of both the sides. The Commissioner has imposed penalty and ordered confiscation of Indian goods as driver of the truck fled away from the spot of deduction of smuggled goods and according to him, it was the responsibility of the Transporter to properly examine the actual contents of the packets brought to them for the purpose of transportation. The reasoning adopted by the Commissioner is not correct in law. A carrier of goods is not required to check and verify the contents of the packages and to ensure that the goods are not of smuggled nature. The Appellate Tribunal in Harbans Singh Narula v. Commissioner of Customs – 1998 (100) E.L.T. 282 held that persons running a transport company “could not be expected to know or be aware of, the contents of each of the hundreds of packages which must have passed through their office; that there is no specific evidence to show that the appellants knew or had reason to believe that the packages in question contained contraband; there is no legal requirement for names and addresses of consignees and consignors to be mentioned and insistence of this requirement, in practice would mean refusing to accept large number of packages for carriage.” No evidence has been adduced by the Department to prove that the Transporter was aware of the smuggled nature of the goods. The penalty under Section 112(b) of the Customs Act can be imposed only if a person is concerned in carrying any goods which he knows or has reason to believe are liable to confiscation under Section 111 of the Act. The Revenue has not been able to prove such knowledge of the Transporter. Accordingly I set aside the penalty imposed on M/s. Rajdoot Road Carrier Pvt. Ltd.
6. As per the provisions of Section 115(2) of the Customs Act any conveyance used as a means for the transporting smuggled goods is liable for confiscation unless the owner of the conveyance proves that the conveyance was used as a means of transport in the smuggling of any goods without his knowledge or connivance or knowledge or connivance of his agent and the person in charge of the conveyance. The mere fact that the driver had run away from the place of interception of the truck will not be sufficient to come to a conclusion that he had the knowledge about the contraband goods being carried in the truck. He had also deposed, in his statement 13-11-1996, that he ran away from the spot as he was told by some people that many persons had been arrested in the past with raw silk. There is nothing on record to attribute knowledge about the smuggled nature of the goods to driver and for want of such knowledge neither the Truck can be confiscated nor penalty can be imposed on the driver under the Customs Act. As far as the Indian goods are concerned, the Department has not proved that these goods were used for concealing the smuggled goods. The Appellants have claimed that these goods were booked for transport to different destinations. The Appellate Tribunal in the case of United States Lines Agency v. Commissioner of Customs -1998 (101) E.L.T. 602, relied upon by the Appellants, has held that charge of concealment of goods cannot be sustained when the packages were not concealed so as to obscure from view or where there was no attempt to hide the packages containing contraband goods. The Tribunal also distinguished between the words “concealment” and “covering” in Mazda Chemicals v. Commissioner of Customs (Preventive) -1996 (98) E.L.T. 767 for the purpose of Section 119 of the Customs Act. Following the ratio of these decisions, I hold that the miscellaneous goods of Indian origin are not liable for confiscation under Section 119 of the Act. Accordingly appeals are allowed.