Suketu J. Mody Vs Commissioner of Customs (Bombay High Court)
Bombay HC holds penalty under Section 112(a) of Customs Act, abates on death of noticee and is not recoverable from legal heirs
Shri. Jiten P. Mody, was one of the Directors of the JPM Group of Companies. A penalty was imposed on him under Section 112(a) of the Customs Act for alleged mis-declaration of imported parts of ATM machines. The penalty was challenged in appeal before CESTAT, Mumbai. During the pendency of appeal; he passed away. However; his appeal came to be dismissed. The said order was challenged; in writ; by the legal heir claiming that penalty proceedings abate.
The Hon’ble Bombay High Court allowed the writ petition. It held: (i) personal penalty proceedings initiated against the deceased abate; (ii) Late Jiten P. Mody had abated upon his death; (ii) as per Supreme Court decisions in Shabina Abraham and Madras High Court in S. Hidayatullah, the recovery could not be made from the of penalty could not made from the legal heirs as penalty abates; (iii) the Revenue also agreed with the proposition; in law.
Argued by Adv. Bharat Raichandani i/b UBR Legal.
List of Cases Discussed / Relied Upon
- Shabina Abraham & Ors. Vs. Collector of Central Excise & Customs, (2015) 10 SCC 770.
- S. Hidayathulla @ Mannady Bharakath (Deceased) & Ors. Vs. The Commissioner of Customs, CMA Nos.3581 and 3582 of 2014 and MP Nos.1 and 1 of 2014.
FULL TEXT OF THE JUDGMENT/ORDER OF BOMBAY HIGH COURT
1. It is submitted by the Petitioner’s Counsel that the personal penalty imposed upon Jiten P. Mody, i.e. the father of the Petitioner, who was one of the Directors of JPM Group of Companies, has been assailed in the present Writ Petition. However, Jiten P. Mody has already expired. Therefore, in view of the decision of the Hon’ble Supreme Court rendered in Shabina Abraham & Ors. Vs. Collector of Central Excise & Customs1, as well as the decision rendered by the Madras High Court in S. Hidayathulla @ Mannady Bharakath (Deceased) & Ors. Vs. The Commissioner of Customs2, the proceeding initiated against the deceased father of thePetitioner, viz. Jiten P. Mody imposing penalty has abated under the law.
2. Mr Vijay Kantharia, the learned Counsel for the Department has not disputed the above submission. He has also confirmed that the penalty proceeding has abated due to the death of the proceedee i.e. Late Jiten P. Mody.
3. It appears that Jiten P. Mody has expired on 16th March 2016.
4. In view of the above, the proceedings initiated against Jiten P. Mody (since deceased), in his capacity as a Director of the Company, has abated and is accordingly declared so.
5. In the above terms, the Writ Petition stands disposed of.
Notes:
1 (2015)10 SCC 770
2 CMA Nos.3581 and 3582 of 2014 and MP Nos.1 and 1 of 2014
