SHRI.K.ANANTHAPADMANABHA RAO v. THE COMMISSIONER OF CENTRAL TAXES & Ors.

Learned counsel for the petitioner would also invite my attention to the memo dated 21.04.2026 along with the documents produced with the same in order to point out that subsequent to the impugned order, the Sessions Court/Special Court discharged the petitioner / accused No.2 vide Order dated 14.01.2026 which would have a direct and substantial bearing/impact on the impugned order of dismissal which deserves to be set aside and the matter remitted back to the respondent for reconsideration afresh in accordance with law.

7. It is also pointed out that against the order passed by the Customs Department, the petitioner had filed an appeal which also culminated in an order dated 30.12.2025, which was - 6 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR demanded for de novo adjudication, which circumstance would also have a bearing/impact on the impugned order and against the impugned dismissal order passed against the petitioner. It is therefore submitted that the impugned order deserves to be set aside and the matter remitted back to the respondent for reconsideration afresh in accordance with law.

8. Per contra, learned counsel for the respondent would reiterate the various contentions urged in the statement of objections and submits that there is no merit in the petition and the same is liable to be dismissed especially when the petitioner has an equally efficacious alternative remedy by way of an appeal against the impugned order and as such, there is no merit in the petition and the same is liable to be dismissed.

9. A perusal of the material on record will indicate that it is an undisputed fact and a matter of record that the impugned order came to be passed on 10.11.2025. About 3 days prior to the date of the impugned order, the petitioner submits a representation vide Annexure - F dated 07.11.2025 requesting an opportunity for personal hearing on the ground that an discharge application filed by him in Special CC No.29/2023 in which, he was arrayed as - 7 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR accused No.2 was pending before the Sessions Court/Special Court. The said representation reads as under: "From, K.Ananthapadmanabha Rao Superintendent Northwest Commissionerate Bengaluru To, The Commissioner Disciplinary Authority Northwest Commissionerate, Bengaluru Subject: Charge memorandum issued on 10/10/2023-requesting for an additional opportunity to present the defence in person in the matter-Rg In the above matter, it is submitted that, in the original matter and root cause issue of the Charge memorandum, ie., the show cause notice dated 24-1-2022 issued by the Additional Commissioner of Customs, ACC Bengaluru, the issue has been decided by the adjudicating authority and the gravity of charges levelled against the under signed in the SCN has been reduced substantially, i.e., by over 90%. Further, an appeal has been preferred. against the same and the same is fixed for PH on 12th November 2025. - 8 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR Further in respect of the action initiated by the ACB, Bengaluru in the matter on the request of the department, the undersigned has filed an discharge application and the arguments on the same has completed on 5-11-2025 and the matter is posted for orders. Considering the above factors and more likelihood of decisions in both above mentioned matters will be available very shortly, I request the benign Disciplinary Authority to provide me an opportunity to present the out come of the parallel proceedings in person before taking any further decision in the disciplinary proceedings, please. The undersigned will be grateful to the Commissioner Sir for the above act of kindness. Place:Bengaluru Date: 6/11/2025 Yours faithfully, Superintendent" [K.Ananthapadmanabha Rao]

10. It is also a matter of record and undisputed fact that subsequently, the Sessions Court/Special Court allowed discharge application vide Order dated 14.01.2026 which reads as under: - 9 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR "ORDERS ON APPLICATION U/S 239 OF CR.P.C: The accused No.2 has filed this application under Section 239 of Cr.P.C., seeking discharge for the allegations/ offences punishable under sections 120-B r/w section 420 of IPC and Sections 7 and 8 of Prevention of Corruption Act

2. It is averred in the application that the alleged omissions and commissions attributed to this accused are in fact integral part of his duties done in discharge of duty and any act would entail for dereliction of duty. The accused being public servant there is need for obtaining sanction under section 197 of CRPC and sanction under section 19 of P.C.Act alone is not sufficient. Further under section 155 of Customs act, accused being customs officer has immunity from prosecution. The acts done by this accused are done in good faith and in bonafide discharge of his official duties. It is further averred that only Special court established under Prevention of Corruption Act is having jurisdiction to try the offence if specifically notified. If not notified the trial would be rendered illegal.

3. It is further averred that there is no ingredient forth coming to attract offence under section 120-B of IPC and section 8 of P.C.Act. There is no conspicuous material of meeting of minds amongst the accused persons. The matter with regard to offence of illegal export of red sanders is already investigated by DRI Bengaluru and show cause notice was issued to this accused under customs act. The - 10 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR same is pending for adjudication and Departmental enquiry is also pending. The show cause notice issued by DRI and charge sheet submitted by CBI arise out of same facts, circumstances, documents. The allegation against accused no.2 is far from truth, not factual, and based on assumption and presumption.

4. It is further pleaded that the charge sheet is result of misconstruction of facts and circumstances and failure to understand established procedure under Customs act. The complaint suffers form disjointness, incompleteness, misconstruction and resulting failure of justice. There is lack of documentary evidence, the statements were recorded under threat, coercion. There is no proof of demand and acceptance of money. The other officers who allowed LEO for four shipments were not charge sheeted and the accused no.2 stands on same footing. But the same benefit is not this accused. The details of these grounds elaborately explained in the petition and sought discharge on the above referred grounds.

5. The learned Public Prosecutor has filed statement of objections wherein It is contended that, the petition filed by the petitioner/accused No.2 is devoid of merits and liable to be dismissed in limini. Based on the written complaint dated

08.09.2021 given by the Olo the Principal, Commissioner of Customs, Airport and Air Cargo Complex, Devanahalli, Bengaluru, a preliminary enquiry report dated 21.12.2021 was submitted by Shri. Deviprasad, PSI, CBI, ACB, Bengaluru. On - 11 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR the basis of the said report a case vide RC-15(A)/2021 has been registered on 22.12.2021 against Accused No. 1- Mr.C.Venkatesh, accused No.2-Mr.Anantha Padmanabha, accused No.3-Mr.Ravinder Pawar, accused No.4-Mr.Satish Kumar, accused No.5-Mr.Najeeb.Z and other unknown public servant for commission of offences punishable under sections 120-B of IPC and Section 7 of Prevention of Corruption Act alleging that they conspired for facilitating illicit export of the Red Sandal wooden logs. The Statement of CW-79 is relevant with regard to duties of Superintendent, Central Excise and document no-9 is relevant document with regard the procedure to be followed by Inspectors and Superintendent of Customs while clearing the ICEGATE Portal by using shipping Bills through RMS/Assessment Channels.

6. It is alleged that, the accused No.5-Mr.Najeeb Zianudheen and accused No.4-Satish Kumar conspired with accused No.1-Venkatesh.C, who is the Superintendent of Customs and accused No.4-Sathish Kumar, office of Chief Commissioner's Office Customs, Bengaluru, acted as middlemen between accused No.5 and accused No.1 and agreed to do the documentation and other customs clearance formalities for the illegal export of Red Sandar. In pursuance of such conspiracy, accused No.5-Najeeb Zianudheen procured Red Sandars vide shipping bill No.2190821 D-8 and 10). Further, on the directions of accused No.5-Najeeb Zianudheen, accused No.4-Sathish Kumar mis-declared the for customs clearance. During the process of - 12 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR clearance, the said shipment was selected for physical examination by Risk Management System and accused No.3- Ravinder Pawar had given the examination report (D-10) stating that the goods were Industrial Spares as declared in the invoice even through the consignment was Red Sanders. Further accused No.3-Ravindar Pawar demanded accused No.4- to pay an amount of Rs.5 lakhs to clear the above consignment which was kept aside by the screening staff as they suspected it to contain wood. It is also revealed that accused -Ravinder Pawar told accused No.4-Sathish Kumar.T that the accused No.2-Sri.Anantha Padmanabha Rao, Superintendent had come to know about it.

7. Further, the accused No.3 immediately arranged the amount and gave Rs.2.5 lakhs in cash to accused No.3- Ravinder Pawar and transferred an amount of Rs.25,001/- Rs.99,999/-from ICICI Bank account No.431901500656 (D-13) account No.20015079351 (D-12) at SBI, PBB Branch, Malleswaram, which is in the name of Smt.Jayalakshmi Rao, mother of accused No.2-Sri.Anantha Padmanabha Rao on the same day. The screen shots taken from the Indian Customs EDI system shows that the petitioner/accused No.2 and accused No.3/Ravinder Pawar were on duty at Import Export shed of Air Cargo Complex on 03.06.2021 and facilitated in clearing the shipping bill No.2190821. The fact that, shipping bill No.2190821 was taken up for open examination established through the data available in system and the X- ray image (D-8) taken in respect of the above consignment - 13 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR looked like wood and not industrial spares. Though a false report filed by accused No.3-Ravinder Pawar, petitioner/accused No.2 violating the procedure let Export Order for the said consignment. Thus, the involvement of petitioner/accused No.2 in facilitating the illegal export of Red- Sanders herein primafacie shows that he is particeps in criminis of the conspiracy designed and executed by accused No.1-Venkatesh, accused No.3-Ravindar Pawar, accused No.4-Sathish Kumar and accused No.5-Najeeb Zianudheen to cheat the Customs Department by mis-declaring the goods and exported the consignments and the said accused customs officials obtained undue advantage from accused No.4 until it was intercepted by the DRI.

8. Issuance of the Let Export order by the accused No.2 and crediting of amount in the account of his mother, prima facie shows that in pursuance of such conspiracy, petitioner /accused No.2 aided the other accused facilitating the illegal export of Red-Sanders. The allegations against the accused No.2/petitioner are supported by the statement of witnesses for oral evidence and relevant documentary evidence. As accused No.4 and 5 are willing parties in offering bribe and by not approached any investigating agency to report on the corrupt practices of accused No.1 and 3 and accused No.2. Hence, prays to reject the discharge application.

9. Heard the arguments from both side. - 14 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR

10. The Points that would arise for my consideration are as follows :- 1) Whether accused No.2 has made out grounds to discharge and allow the application filed under Sec. 239 of Cr.P.C.? 2) What Order?

11. My findings on the above points are as follows: Point No.1: In the Affirmative. Point No.2: As per the final order for the following:- :REASONS:

12. POINT NO.1: The accused has application under section 239 of Crpc. The Section 239 of Cr.P.C., reads as under: S. 239: When accused shall be discharged If, upon considering the police report and the documents sent with it under section 173 and making such examination, if any, of the accused as the Magistrate thinks necessary and after giving the prosecution and the accused an opportunity of being heard, the Magistrate considers the charge against the accused to be groundless, he shall - 15 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR discharge the accused, and record his reasons for so doing.

13. So, on understanding the provision it specifies, the obligation to discharge the accused under Section 239 Cr.P.C. arises when the Magistrate/Special Judge considers the charge against the accused to be groundless i.e, there is no legal evidence or when the facts are such that no offence is made out at all.

14. Before adverting to the factual aspects of the case, the well settled principles of law is required to be reiterated wherein itis held that the court at the time of considering the application seeking for discharge need not examine the materials in detail to ascertain whether there are grounds to award conviction. Only aspect the court is required to consider is to, sift and weigh the materials to ascertain whether the materials placed before the court indicate facially the commission of offence and if so the case has to be proceeded, to frame charges.

15. While considering the application under section 227 of Cr.P.C., as per the dictum of Hon'ble Apex Court in the case of State Through Deputy Superintendent Of Police Versus R.Soundirarasu-2022 Live Law (SC) 741 has held as under:.

53. The aforestated Section indicate that the CrPC contemplates discharge of the accused by - 16 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR the Court of Sessions under Section 227 in a case triable by it, cases instituted upon a police report are covered by Section 239 and cases instituted otherwise than on a police report are dealt with in Section 245. The three Sections contain some what different provisions in regard to discharge of the accused. As per Section 227, the trial judge is required to discharge the accused if "the Judge considers that there is not sufficient ground for proceeding against accused". The obligation to discharge accused under Section 239 arises when "the Magistrate considers the charge against the accused to be groundless". The power discharge under Section 245(1) is exercisable when "the Magistrate considers, for reasons to be recorded, that no case against the accused has been made out which, if un-rebutted would warrant his conviction". Sections 227 and 239 resply provide for discharge being made before the recording of evidence and the consideration as to whether the charge has to be framed or not is required to be made on the basis of the record of the case, including the documents and oral hearing of the accused and the prosecution or the police report, the documents sent along with it and examination of the accused and after affording an opportunity to the parties to be heard. On the other hand, the stage for discharge - 17 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR under Section 245 is reached only after the evidence referred to in Section 244 has been taken.

54. Despite the slight variation in the provisions with regard to discharge under the three pairs of Sections referred to above, the settled legal position is that the stage of framing of charge under either of these three situations, is a preliminary one and the test of "prima facie" case has to be applied - if the trial court is satisfied that a prima facie case is made out, charge has to be framed.

16. The judgment of the Hon'ble High Court of Karnataka reported in 2022 (2) KCCR SN 135 (K.Manjunath Vs State and another) wherein it has been held as :- Scope of discharge under Section 239 of Cr.P.C. is very limited. The Court cannot held a mini trial while considering the application and only look into the documents which have been filed along with the charge sheet. The defence cannot be raised in discharge application. Scope of Section 239 of Cr.P.C. is very limited. In a case where material is not collected, then Court can discharge the accused, if allegation made in the charge sheet is groundless, then - 18 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR the Court can exercise power under Section 239 of Cr.PC. Petition dismissed.

17. In the arguments advanced by the learned counsel for accused No.2, has more stressed upon the provision of Section 155 of Customs Act. It is contended that, as per this provision, the accused is having immunity from being prosecuted directly and if has to be prosecuted, notice has to be issued and charge sheet is to be filed within three months of the date of offence. However, in this case, the prosecution has not followed both and it is clear violation of this law which benefits the accused to seek discharge of the alleged offences. The learned counsel the accused has emphasized on the point of following this law being special law barring invoking General Law. It is also highlighted that, the sanction for prosecution is only obtained under section 19 of PC Act, but, the sanction required under section 197 of Cr.P.C., for the offence alleged under IPC is not obtained from competent authority and this also is beneficial to the accused to seek discharge. It goes to the roots of the case and as such, the prosecution cannot be continued.

18. To understand better, the Section 155 of Customs Act is reproduced as under:

155. Protection of action taken under the Act. -(1) No suit, prosecution or other proceedings shall lie against the Central Government or any officer of the Government or - 19 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR a local authority for anything which is done, or intended to be done in good faith, in pursuance of this Act or the rules or regulations. (2) No proceeding other than a suit shall be commenced against the Central Government or any officer of the Government or a authority for anything purporting to be done in pursuance of this Act without giving the Central Government or such officer a month's previous notice in writing of the intended proceeding and of the cause thereof, or after the expiration of three months from the accrual of such cause.

19. The learned counsel for accused argued that, to decide whether sanction is necessary, the judgment in the case of D.Devaraja V/s Owais Sabeer Hussain (2020)7 SCC 695 wherein it is held that, the test whether the act is totally unconnected with the official duty or whether there is reasonable connection with the official duty and in case of act of policeman or any other public servant unconnected with the official duty their can be no question of sanction. However, if the act alleged against the policeman reasonably connected with discharge of his official duty, it does not matter if policeman has exceeded the scope of his powers and acted beyond the four corners of law (Para-70). The learned counsel for accused placed reliance on the judgment of Hon'ble Apex Court in the matter of Jayalalitha V/s Union of India and others (1999)5 SCC 138 on the point of sanction required for prosecution. Another judgment in the - 20 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR case of G.C.Manjunath and others V/s Seetharam, (2025) 5 SCC 390 wherein Hon'ble Apex Court has clarified the essential conditions required to obtain sanction prosecution. More particularly, the learned counsel for the accused relied upon the judgment of Hon'ble High Court of Punjab and Hariyana in the case of Sunilkumar and others V/s CBI and others 2016 SCC Online P and H 613. The learned counsel for accused has pressed upon the fact that, this judgment is aptly applicable to the facts of the case as the Hon'ble High Court of Punjab and Hariyana has discussed about the provision of Section 155 of Customs Act and based on that, has quashed the proceedings. Even, the judgment of Hon'ble High Court of Calcutta in the case of Ashok Kumar Singh V/s State of West Bengal and another 2016 SCC Online Calcutta 1516, wherein the Hon'ble High Court has also discussed the said provision and in the facts of the case, wherein he was examining officer of customs omitted to perform duty in order to assist the principal accused, to export goods improperly from India, applying section 155(2) of Customs Act, 1962 has given the benefit of immunity of prosecution.

20. Further, he has placed reliance on the orders passed by the learned Special Judge sitting in the 32nd Additional City Civil and Sessions Judge for CBI cases dated

03.03.2022 while dealing petition under section 239 read with section 227 of Cr.P.C., for the provisions under Passport Act specifically Section 15 is invoked and has given benefit of the - 21 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR said provision and for non production of sanction order discharged the accused.

21. The counter argument canvassed by the learned Public Prosecutor is on the point that, it is only they are protected if they act in good faith and taking bribe and doing illegal acts is not termed as good faith and hence, this immunity is not attracted to the case on hand. Even the learned public prosecutor who has filed synopsis of arguments, in that has also urged that the sanction as required under section 197 of Crpc is required when there is reasonable connection between act alleged and the duty of officer. But in this case it is totally unconnected and taking bribe for doing illegal act is not covered under good faith or in discharge of duty. Hence the judgment relied by other side is not applicable to case on hand.

22. Considering the rival submissions and after going through the judgment relied upon by the learned counsel for the accused, I am of the opinion that, the section 155 of Customs Act has not been followed by the CBI before prosecuting this accused. As it is admitted that, they have not given notice of one month in writing and the prosecution is launched after three months from accrual of such cause. Thereby it is only left to decide whether it is attracting the facts of the case to invoke provision under section 155 of Customs Act. As per the contents of the provision, it is protecting the Customs officers by any suit, prosecution or other legal proceedings to be initiated against them, if it is - 22 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR done or intended to be done in good faith in pursuance of this act or the rules or regulations. The second sub section speaks about if prosecution is to be launched, one month prior notice to be given to the officer.

23. In this case, it is admitted fact that this accused No.2 is Customs officer and the allegations leveled against him are punishable under section 120-B read with 420 of IPC and Sections 7 and 8 of PC Act. It is the allegation that, this accused No.2 being Superintendent of Customs let export order for the consignment and to be more specific a consignment which was containing load of Red sanders was allowed to pass through for export by suppressing the fact that it is containing such goods and mentioning it as Industrial Spares. Even though it has been brought to the knowledge of this accused No.2, he has aided them to pass through by accepting bribe to the account of his mother. Considering these facts, it is clear on the face of it that the act alleged is not to be said as distinctive, not connected to the the discharge of his official duty. The duty of the accused No.2 was to properly check the goods and if he has omitted to do so either intentionally or not, it is connected with discharge of his duty. In this regard the judgment of Hon'ble Supreme Court in Case of Rizwan Ahmed Javed Shaikh and Ors. V/s Jammal Patel and Ors. 2001 INSC 281_it is held as under: "The real test to be applied to attract the act which is done by a public office and is alleged to constitute an offence was done by the public officer whilst - 23 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR acting in his official capacity though what he did was neither his duty not his right to do as such public officer. The act complained of may be in exercise of the duty or in the absence of such duty or in dereliction of the duty, if the act complained of is done while acting as a public officer and in the course of the same transaction in which the official duty was performed or purported to be performed the public officer would be protected.". Thereby, in my opinion in this case as well the accused no.2 is protected under the umbrella of section 155 of Customs Act from being prosecuted. Hon'ble Apex Court in the case of Costao Fernandes v. State at the instance of D.S.P., CBI, Bombay has held: "wherein a Customs Officer had a scuffle with a person alleged of smuggling gold and caused his death and when the CBI sought prosecute the Customs Officer, came down heavily and held that the protection under Section 155 of the Customs Act was available to the Customs Officer as the killing cannot be divorced from the performance of duty enjoined by Section 106 of the Customs Act, 1962 though the act might be in excess. In the present case also, the petitioners were searching the premises and seizing documents under Section 105 of the Customs Act, 1962 - 24 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR and the said official duty is inseparably linked to the allegation of interpolating two invoices and tampering with records seized under the cover of Panchanama. The allegations relate to the performance of official duties by the petitioners, hence, they were protected against the prosecution under Section 155(1) of the Customs Act, 1962".

24. The Hon'ble Telangana High Court in the case of State Rep By Cbi vs Sri Rajnish Aggarwal And Another, in CRIMINAL REVISION CASE Nos.28 of 2009, 1942, 1947, 1948, 1949 and 1681,1701,1702,1703 and 1704 of 2008, decided on on 25 January, 2024 dealt with more or similar situation. The brief facts of the case are explained that during the period 2000-2001, the accused A1 to A8 entered into criminal conspiracy among themselves to cheat the Customs Department at Inland Container Deport, Sanathnagar, Hyderabad, in the matter if export of cheat and very small garments of uneven size and shape, which are unfit for use by any age group and have negligible value, in the guise of "Dyed/printed night-wears (maxies) various style/size/design/colours made from P/L, Woven Fab valued at Rs.300 per piece under Duty Entitlement Pass Book (DEPB) scheme and attempted to export two consignments to Dubai from ICD, Sanathnagar, Hyderabad on 06.01.2001 in the name of M/s.Ganesh Yarntex Exports Pvt Ltd and M/s Aadee Exports and Imports by way of bogus documents. - 25 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR

25. Applying the case referred supra, contention of learned PP that acting in good faith does not hold good. As the Hon'ble Apex Court has given the benefit of Section 155 of Customs Act in case of Murder committed by Officer of Customs which is in excess to his duty, in this case as well the act of accused in allowing export of goods suppressing the fact that it contains red sanders, is not dislinked to his discharge of duty. The allegations relate to the performance of official duties by the petitioner, hence, he is protected under Section 155 of the Customs Act, 1962.

26. In the present case, the allegations were made against the petitioner about cheating the Customs department, committing the offence of criminal conspiracy, and allowing illegal export of red sanders, attracting offences under section 120-B r/w section 420 of IPC. No doubt the Prosecution has obtained sanction order under section 19 of PC act from competent authority but there is no specific order showing sanction accorded under section 197 of CR. P.C to prosecute the accused for the offfences under IPC. The offences were alleged to have been committed by the petitioner while performing the official duties. Section 197 of the Code of Criminal Procedure if construed too narrowly, it can never be applied, as it is no part of an official's duty to commit an offence and never can be, as observed by the Hon'ble Apex Court in Shreekantiah Ramayya Munipalli and Anr. v. State of Bombay AIR 1955 SC 287. - 26 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR

27. No narrow interpretation can be given to Section 197 Cr.P.C., as the acts alleged against the petitioner is reasonably connected in discharge of official duties. As such, cognizance cannot be taken by the Court without the requisite sanction of the appropriate Government. As such, taking cognizance of the offences by the Court without prior sanction is considered as illegal and void ab initio. The use of the words 'no' and 'shall' under Section 197 Cr.P.C. would make it abundantly clear that the bar on the exercise of power of the court to take cognizance of any offence is absolute and complete and taking of the cognizance is barred under law. Further the judgments relied by accused no.2 are helpful in holding that he is protected under section 155 of Customs Act as well. In the case of G C Manjunath vs Seetharam, Hon'ble Apex Court has held as under: Para 34: The language of both Section 197 of the CrPC and Section 170 of the Police Act is clear that sanction is required not only for acts done in the discharge of official duty as well as for the acts purported to be done in the discharge of official duty and/or acts done "under colour of or in excess of such duty or authority". Sanction becomes mandatory if there is a reasonable connection between the act and the officer's official duties, even if the officer acted improperly or exceeded his authority. - 27 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR

28. Hence, considering the principle explained, in this case as well the act of accused if held as improper, even then he is protected under section 197 of Cr.P.C. Thereby on considering all these points this court is of the opinion that the CBI has not followed the mandate of section 155 of Customs Act and section. 197 of Cr.P.C and entitling the accused discharge. Hence I answer point No.1 in the Affirmative..

29. POINT NO.2 In view of my discussions on point No.1, I, proceed to pass the following:- :ORDER: The application filed by the accused No.2 under section 239 of Cr.P.C., for discharge is hereby allowed. The accused No.2 is discharged of the alleged offences under section 120-B IPC R/w Section 420 IPC and under section 7 and 8 of PC act."

11. So also the Appellate Authority of the Customs Department set aside the order passed by the original authority and remitted the matter back to the original authority for reconsideration afresh at the instance of the petitioner as hereunder: - 28 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR OFFICE OF THE COMMISSIONER OF CUSTOMS (APPEALS) BMTC Building, Above BMTC Bus Stand, Domlur, Bengaluru - 560071 email-id-customs-appeals0037@gov.in Phone: 080-25301983 A.No.415,423,424&445/2025 Cus (B-Air) and 504/2025 Cus (B-Air) (Dept) Date: 30.12.2025 DIN-20251272MR000000E621 Order-in-Appeal No. 939-943/2025 Passed by Dr.Chetan R.C, IRS (C & IT) Commissioner of Customs (Appeals) PREAMBLE This copy is granted free of charge for the private use

1. of the person to whom it is issued.

2. Under Section 129 A (1) of the Customs Act, 1962 (as amended), any person aggrieved by this order can appeal to the South Regional Bench of the Tribunal having its Registry at 1st Floor, WTC Building, FKCCI Complex, K. G. Road, Bangalore 560 009. In case of Draw Back and Baggage the Principal related matters Commissioner & Ex-Officio Additional Secretary to the Government of India, 14, "B" Wing, HUDCO Vishal Building, 6th Floor, Bhikaji Cama Place, New Delhi-110 066. the appeal lies with

3. Appeal must be filed in the prescribed C.A. 3 as required vide Rule 6(1) of Chapter III of the Customs (Appeals) Rules, 1982 within 3 months from the date of communication of this order. In case of Draw Back and Baggage related matters Application must be filed in the prescribed C.A. 8 as required vide Rule 8A & 8B of Chapter - 29 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR III of the Customs (Appeals) Rules, 1982 within 3 months from the date of communication of this order.

4. Appeal must be filed in quadruplicate and must be accompanied by: a) Copy of the order and Order-in-Original, both in quadruplicate (one of which at least should be certified copy). b) i) A Crossed Bank Draft for a sum of Rs.200/- (Rupees Two Hundred only) where the amount of duty demanded and penalty levied by the Customs Officer in the case to which the appeal relates is One Lakh Rupees or less, ii) for a sum of Rs.1000/- (Rupees One Thousand only) where the amount of duty demanded and penalty levied by any Customs Officer in the case to which the appeal relates is more than One Lakh Rupees, to be obtained from a Nationalized Bank drawn in favour of the Assistant Registrar of the Bench of the Tribunal concerned and should be on the Bench of the Bank of the place where Registry of the Bench is situated.

5. An appeal against this order shall lie before the Tribunal on payment of 10% of the duty demanded where duty or duty and penalty are in dispute, or penalty, where penalty alone is in dispute".

6. The documents authorizing the representative to sign and appear on behalf of the appellant, if the appeal by as authorized representative, specified under Rule 9 of Chapter IV of the Customs (Appeals) Rules, 1982 should accompany the appeal. Appellant/Exporter 1 A.No. Shri K Ananthapadmanabha Rao, Superintendent of GST, 14/1,[32], Pooja Power Compound, 17-A Cross, Malleswaram West, Bengaluru-560055 2 423/2025 M/s UDL Logistics Pvt Ltd., Sy.No. 136/9, Site No. 04% 05 Sneha Nagar, Kashi Nagar Main Road, Opp. SBI Bank, Amruthahalli, Sahakarnagar Post, Bangalore-560092 424/2025 Shri K V Dushyanth, Director, M/s UDL 3 - 30 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR Logistics Pvt Ltd., Sy.No. 136/9, Site No. 04& 05 Sneha Nagar, Kashi ashi Nagar Main Road, Opp. Post, Bangalore-560092 SBI Bank. Amruthahalli, Sahakarnagar Post, bangalore-560092 4 445/2025 Shri C. Venkatesh, Superintendent of Respondent Authorized Representative for Appellant Customs and GST (Retd.), Flat No. B-503, Cauvery Serenity, No 10/1-1-46, Raghavendra Extension, Yeshwantpur, Tumkur, Bengaluru – 560022 The Additional Commissioner of Customs, Airport & Air Cargo Complex Commissionerate, Bengaluru-560300 1. Shri K Ananthapadmanabha Rao, Appellant for Sl. No. 1 2. Shri T Sundarnathan, Advocate, AR for Sl. No. 2 & 3 3. Shri C Venkatesh, Appellant for Sl. No. 4 Order in Original No./ Assessment Order ΟΙΟ No. 03/2025-26 dated 15.04.2025 AND Appellant A.No. 1 The Assistant Commissioner of Customs, Export Assessment, Airport & Air Cargo Complex Commissionerate, Bengaluru- 560300 M/s UDL Logistics Pvt. Ltd. and its Managing Director Shri KV Dushyanth; Bangalore No. 411/2, 2nd Floor, 3rd Cross, Thalacauvery Layout, Bytrayanapura, Amruthahalli, Sahakarnagar Post, Bangalore-560092 Respondents 2 Shri Anantha Padmanabha Rao K, then Superintendent of GST and Customs, 14/1,[32], Pooja Power Compound, 17-A Cross, Malleswaram West, Bengaluru-560055 3 Shri Ravinder Pawar, Superintendent of GST and Customs (the then Inspector), No. 104, HC-KAR - 31 - NC: 2026:KHC:23440 WP No. 39444 of 2025 D-Block, Prasanahalli Village, House of Hiranandini, Chancery Building, Devanahalli, Bangalore-562110 (pawarpriya90958@gmail.com priya.khatkar@gmail.com) Authoriized Representative for Appellant/ Respondents

1. Shri T Sundarnathan, Advocate, AR for Respondents Sl. No. 1 2. Shri K Ananthapadmanabha Rao, Respondent for Sl. No. 2 3. Shri K.V. Srinivasa Prasad, AR for Respondent Sl. No. 3 Order-in-Original No./ Assessment Order ΟΙΟ No. 03/2025-26 dated 15.04.2025

1. BRIEF FACTS OF THE CASE

1.1 The instant appeals are filed against OIO No. 03/2025-26 dated 15.04.2025 (hereinafter referred to as 'impugned Order'/'OIO) passed by the Additional Commissioner of Customs, Airport & Air Cargo Complex Commissionerate, Bengaluru-560300 (hereinafter referred to as the lower adjudicating authority/LAA1. Appeals have been filed by the parties as well as by the Department.

1.2 Appeals have been filed by Shri K Anandapadmanabha Rao, Superintendent of GST (hereinafter referred to as 'Appellant No.11, M/s UDL Logistics Pvt Ltd. (hereinafter referred 'Appellant No. 2), Shri K.V.Dushyanth, Director, M/s UDL Logistics Pvt Ltd (hereinafter referred to as 'Appellant No. 3) and Shri C. Venkatesh, Superintendent of Customs & GST (Retd) (hereinafter referred to as 'Appellant No. 4'). to as filed by

1.3 Appeal has also been the Assistant Commissioner of Customs, Export Assessment, Airport & Air Cargo Complex Commissionerate, Bengaluru (hereinafter referred to as 'Appellant Department) being duly authorized by the Commissioner of Customs, Airport & Air Cargo Complex Commissionerate, Bengaluru against the decision in the impugned Order in respect of three noticees namely - 32 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR M/s UDL Logistics Pvt. Ltd. and its Managing Director Shri K V Dushyanth (hereinafter referred to as Respondent No. 1), Shri K Ananthapadmanabha Rao, Superintendent of GST (hereinafter referred to as 'Respondent No. 2) and Shri Ravindra Pawar, Superintendent of GST and Customs the then Inspector) (hereinafter referred to as 'Respondent No. 3)

1.4 The issue in brief is that based on specific intelligence, the Directorate of Revenue Intelligence (DRI) intercepted two export consignments at ACC, Bangalore, booked in the name of M/s TEAC Engineers UT2, under Shipping Bill Nos. 3378541 and 3378546, both dated 26.07.2021. The consignments were declared as "Industrial Ductile Pipes", but, upon examination were found to conceal 106 logs of Red Sanders Wood (Pterocarpus Santalinus) a prohibited item for export under CITES and the Foreign Trade Policy weighing 3.293 MT and valued at approximately Rs. 62.655 lakh. These goods were seized under Mahazar dated 29.07.2021.

1.5 Subsequent investigation revealed that the exporter had earlier fraudulently exported five other consignments, also concealing Red Sanders Wood. These five consignments booked under Shipping Bill Nos. 2577229, 2569607 both dated 21.06.2021, 2878013 dated 03.07.2021, 3158069 dated 15.07.2021 and 2190821 dated 03.06.2021 in the name of M/s TEAC Engineers UT2 or M/s. Gurmehar Impex covered a total of 6.821 MT of Red Sanders wood, valued at about Rs.129.77 lakh, which had already been exported by mis-declaring them an permissible goods. including drivers,

1.6 Investigation further identified around 15 individuals and entities intermediaries, as part of a collusive network facilitating this smuggling activity. Accordingly, SCN No. 155/2021-22 dated 24.01.2022 was issued to the appellant. The LAA after having gone through the facts of the case, the reply received during PH and relevant legal provisions ordered for- operators, logistics i. Absolute confiscation of 106 logs of "Red Sanders' wood totally weighing 3.293 MT valued at Rs.62.655 lakh attempted to be exported vide the Shipping Bill Nos. 3378541 and 3378546 both dated 26.07.2021 which were - 33 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR seized vide Mahazar dated 29.07.2021 in terms of the provisions contained under Section 113(d), 113(e), Section 113(h) and Section 113(i) of the Customs Act, 1962 (hereinafter referred to as 'the Act) ii. Red sanders wood (Pterocarpus Santalinus) totally weighing 6.821 MT (not available physically) valued at Rs. 129.77 lakh which were fraudulently exported vide the Shipping Bill Nos. 2577229 and 2569607 both dated 21.06.2021; No.2878013 dated 03.07.2021; No.3158069 dated 15.07.2021 and No.2190821 dated 03.06.2021 through ACC, Bangalore, was liable for confiscation under Section 113(d), 113(e), Section 113(h) and Section 113(1) of the Act along with imposition of fine in lieu of confiscation in absence of appropriate proposal. iii. Absolute Confiscation of the packing materials seized vide Mahazar dated 29.07.2021 at ACC, Bangalore in terms of provisions contained under Section 118 of the Act. iv. Confiscation of the conveyance bearing number TN-23-CC-8516 seized vide Mahazar dated 29.07.2021 at ACC, Bangalore under Section 115 of the Customs Act, 1962 and in terms of Section 125 of the Act and ordered for payment of Ra 5,00,000 in lieu of said confiscation; Further, penalties were imposed on the individuals and entities the penalties appellants/respondent in the present appeals are as under. imposed on involved, i) Appellant No.1/Respondent No.2: Imposed a penalty of Rs.8,81,461/- on Shri K.Anantha Padmanabha Rao (Noticee No. 13) under Section 114AA of the Act. ii) Appellant No. 2&3/Respondent No.1: Imposed a penalty of Rs. 61,05/900/each on M/s UDL Logistics Private Limited and Shri K. V. Dushyanth, Managing Director (Noticee No.9), under Section 114AA of the Act. iii) Appellant No. 4: Imposed a penalty of Rs. the Act and Rs. 2,86,214/- under Section 114(i) of 14,31,070/- under Section 114AA of the Act on Shri C.Venkatesh (Noticee No. 12). - 34 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR iv) Respondent No. 3: Imposed a penalty of Rs. 8,81,461/ on Shri Ravinder Pawar (Noticee No. 14) under Section 114AA of the Act. Aggrieved by the impugned OIO, the appellants have filed the present appeals on the following grounds.

2. GROUNDS OF APPEAL: In view of the extensive submissions advanced by the appellants, it is neither practicable nor necessary to reproduce in extenso the repetitive or inconsequential grounds urged. Accordingly, only the material and relevant grounds have been succinctly set out herein, without prejudice the appellants' contentions. For the sake of brevity, the entire grounds of appeal are not being reproduced verbatim.

2.1 Appellant No. 1: Shri K Ananthapadmanabha Rao:

2.1.1 The Respondent's logic, inferences, and findings for imposing penalty under Section 114AA of the Customs Act, 1962, are fundamentally flawed and unsupported by credible evidence. The order relies heavily on surmises, presumptions, and depositions from individuals such as Satish Kumar, Suresh, and others who lack statutory license, authority, or locus standi to act on behalf of exporters or customs brokers. Such reliance violates the fundamental principles of natural justice and established legal precedents. The appellant expressly draws on the rulings in Union of India v. Raj Grow Impex, 2021 (377 ELT 145) SC, and Collector of Customs v. Sanjay Chandi Ram, 1995 (77 ELT 162) SC, which hold that penalties for misdeclaration or fraud under Customs Act require concrete and corroborative evidence, not mere suspicion or unauthorized witness statements. The material facts and oral testimony relied upon lack credibility and contradict documentary evidence, making the penalty order arbitrary, unjust, and unsustainable under law.

2.1.2 Despite filing comprehensive and bona fide documentary evidence-which includes shipping bills, air way bills, export invoices, packing lists, air freight receipts, custodial expense receipts, scanned images, CCTV footage, cargo-entry registers, and more the Respondent failed to - 35 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR take these into due consideration Instead, the adjudication rested solely on incomplete investigation and depositions that were not tested through proper cross-examination or supported by documentary proof. This constitutes a gross miscarriage of justice and a fundamental breach of principles laid down in Commissioner of Customs v. Phoenix International Ltd., 2007 (217 ELT 513) SC, which requires that every charge of misdeclaration or fraud must stand on cogent, unimpeachable evidence rather than baseless surmises. The absence of a speaking order addressing each defense point and material evidence deprives the appellant of a fair adjudication. security scanning

2.1.3 The Respondent ignored authenticated custodial the operator AISATS Bengaluru, records provided by including expert testimonies affirming that the consignment under shipping bill no. 2190821 dated 03.06.2021 consisted of lawful industrial pump spares, not prohibited red sanders as alleged. These records included scanned images of consignments, registers, physical examination reports, and other official documentation demonstrating adherence to customs protocols. Reliance placed instead on the testimonies of unauthorized witnesses- who themselves retracted or contradicted their statements betrays a flawed investigative process. In support, the appellant cites MS Exim Services u. Commissioner of Customs, Ludhiana, 2021 SCC OnLine CESTAT 14, reinforcing that penalties cannot be imposed where bona fide exercised due diligence and verifiable documentation exist, negating allegations of false declaration.

2.1.4 The Respondent overlooked the multi-layered and structured customs examination and assessment process mandated by the RMS/ICES system, including oversight by authorized officials like export assessment Superintendents and shed inspectors. The goods were scrutinized thoroughly via physical examination and electronic verification before the issuance of the Let Export Order (LEO). No evidence contradicts the documented procedures, and no basis is shown for allegations of misdeclaration. This is in line with the principle established in UOI v. Ganesh Das Bhoj Raj, 2000 (122 ELT 522) (SC), which affirms the requirement of corroborated evidence directly linking the accused to fraud or misdeclaration. The - 36 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR Respondent's procedural adherence points to an arbitrary and legally unsupportable conclusion. to appreciate or challenge failure

2.1.5 The depositions relied upon by the Respondent emanate from persons lacking statutory authorization or contractual agency to represent either exporters or customs brokers. This includes individuals associated with unrelated entities or merely private individuals with no lawful role in customs documentation or cargo handling. Public Notice No. 14/2011 Customs ACC and the ruling in K Sugumar v. Commissioner of Customs, Madras-HC (2021), clearly establish that unauthorized presence and actions in the customs examination area are impermissible, negating the evidential value of their statements. The Respondent's acceptance and use of such inadmissible evidence violate binding regulations, further undermining the fairness and legality of the penalty proceedings against the appellant.

2.1.6 The material irregularities and defects permeate regarding mahazar investigation, particularly proceedings, which were conducted without the presence of required statutory witnesses such as the exporter, customs house agent, vehicle driver, or the customs shed officer. Moreover, the mahazar fails to record identifying marks and seals on the alleged seized goods, resulting in a vital gap in the evidentiary concrete documentation associating seized goods with the appellant's actions contravenes principles upheld in Sea Queen Shipping Services Pvt. Ltd. v. Commissioner of Customs, Chennai, 2019 (366 ELT 1011) (CESTAT). This infirmity alone undermines legitimacy of penalty imposition and demonstrates the lack of procedural fairness owed to the appellant.* chain. The absence of

2.1.7 The appellant contends that the Respondent erroneously imposed penalty without establishing mens rea- the necessary criminal intent or willful knowledge under Section 114AA of the Customs Act. The appellant acted strictly within the framework of RMS protocols, and there is no material evidence pointing to knowingly issuing false or incorrect documentation while granting the LEO for shipping bill no. 2190821. The importance of mens rea as a condition precedent to penalty imposition is emphasized in Hera Shipping Solutions Pvt. Ltd. v. Commissioner of Customs, - 37 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR Chennai, 2022-VIL-603-CESTAT-MAD, which holds that the intentional element must be proven beyond reasonable doubt. The Respondent's failure to establish this essential element renders the penalty order unsustainable.

2.1.8 The mistrust or resemblance of modus operandi with other shipments cannot replace the need for legally admissible, compelling evidence. As established in UOI v. Raj Grow Impex, 2014 (306 ELT 433) SC. and Collector of Cus Sanjay Chandiram, 1995 (77 ELT 162) SC, suspicion from unrelated cases cannot substantiate penal consequences. The Respondent's assumption that the shipment was red sanders based solely on the modus operandi found in an unrelated consignment intercepted later lacks any evidentiary foundation, rendering the penalty imposition speculative and unlawful. inferred misconduct

2.1.9 The penalties must be directly attributable to proven illegal acts concerning specific goods and transactions involving the appellant. Misattribution or pooling of unrelated consignments to implicate the appellant violates the principle of individual responsibility grounded in UOI v. Ganesh Das Bhoj Raj (2000), Commissioner of Customs v. Phonics Commissioner of Customs v. Sanjay Chandiram (2000). The Respondent's failure to segregate facts and hold the appellant accountable exclusively for actual conduct and consignments breaches fair trial norms and the customs legal framework. International (CESTAT), Ltd.

2.1.10 Section 155 of the Customs Act provides protection to officers acting in good faith and within their official duties, shielding them from punitive action absent malafide conduct. The appellant discharged functionary duties as assigned, following due RMS procedures diligently and with no mal-intent. Case law including Sea Queen Shipping Services Pvt. Ltd. (supra) and Pushpak Lakhani v. Principal Commissioner of Customs, 2022-VIL-528- CESTAT-AHM underscores that penalties under Section 114AA cannot be levied except where intent to evade or defraud fundamental right to cross-examine witnesses relied upon by the department, a critical principle of natural justice violated here, undermining the entire penalty process. is proven. The appellant also stresses - 38 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR

2.2 Appellant No.2: M/s UDL Logistics Pvt Ltd and

2.2.1 The Show Cause Notice is not maintainable both in law and also on facts, as there was no specific allegations against the Noticee No. 9/Appellant and whatever made, were solely based on guesses and surmises. The SCN alleging lack of due diligence and failure to verify the documents, is vague, sweepy and arbitrary as no specific allegations were made the Noticee No.9/Appellant, more so when penal measures were proposed under multiple provisions of law The impugned Order was passed levying penalty against each of them and/thús, both a nullity in law. against

2.2.2 The SCN was also issued in respect of the improper exports to as many as 15 persons including 3 Customs officers. As against the Noticee No.9/Appellant, the said SCN merely alleged that the appellant failed to fulfill Regulations 10(e) and 10(n) of CBLR, 2018. The SCN has not alleged any malafide motive or act as against the appellant which are punishable or liable in any manner under the provisions the Customs Act.

2.2.3 A bare perusal of the Show Cause Notice and the impugned Order would reveal that vague and false allegations are made against the Noticee No.9 by alluding to two different persons KV Dushyanth and UDL Logistics Pvt Ltd- by mentioning and referring them as one person Noticee No.9. As such, no such Noticee No.9 exists or could ever exist. The issue of such a Show Cause Notice is arbitrary and unlawful. Even assuming the issuing of SCN to Noticee No.9 is valid for any reason whatsoever and without admitting to the same, the levy of penalty on each of them separately is arbitrary, without application of mind and unlawful.

2.2.4 The SCN dated 24-01-2022 was issued in respect of the exports for which the shipping bills were filed by the Noticee No.9/Appellant on 21-6-2021 and 3-7-2021, which were also duly cleared by the Customs Authorities, without any adverse observation or objection in respect of any role, act or conduct of the Noticee No.9/Appellant. Thus, - 39 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR the SCN dt 24-01-2022 issued to the Noticee No.9/Appellant was belated and barred by limitation.

2.2.5 The SCN was said to have been issued on the basis of the Investigation conducted by the DRI and it was not stated in the SCN as to any conclusion thereof. From a bare perusal of the SCN or the impugned order, it was also clear that the departmental authorities have examined nor conducted any enquiry on any document or person. The Noticee No.9/Appellant was also denied opportunity of cross examination of the relevant persons. Thus, the entire proceedings as against the Noticee No.9/Appellant, including the issue of SCN and the impugned order were all in violation of principles of natural justice and also contrary to law and for this reason alone, both the SCN and the impugned Order deserve to be set aside as being illegal and arbitrary.

2.2.6 The said SCN was also issued after detailed investigation including the collusion and unlawful conduct of the Customs Officials. It is further submitted that there was no allegation on the appellant as to confiscation of export goods or contravention of any specific provision under the Customs Act, in respect of which the appellant filed Shipping Bills. The above clearly show that the Noticee No.9/Appellant was bonafide in respect of their role and activities in the exports done through them.

2.2.7 A bare reading of the Regulation 10(e) CBLR, 2018 provision show that the authorization from the exporter was not made mandatory. In any case, the KYC documents were duly authenticated and attested by the exporter which were bonafidely relied on by the Noticee No.9/Appellant. The KYC documents were the requirement and the same were duly provided along with the cargo. It is also stated in the impugned Order in para 79.7... ... "Out of the 03 CBs only, M/s UDL Logistics Private Limited (Noticee No.8) is seen to have collected KYC Documents and verified the same to some extent from information available in public domain...." Being so, the invocation of Reg 10(e) is not legal and not proper.

2.2.8 Also, a bare reading of the Regulation 10(n) CBLR, 2018 provision shows that the IEC and GSTIN and - 40 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR the functioning of the exporter at the declared address were to be verified as to the correctness. All KYC documents including the IEC and GSTIN were duly authenticated and attested by thee exporter which were bonafidely relied on by the Noticee No.9/Appellant the correctness of which were not denied nor disputed in any manner. It was also stated that the KYC documents were also verified in a manner known to law. Being so, the invocation of Reg 10(n) is not legal and not proper.

2.2.9 The impugned Order has not made any finding as against the Noticee No.9/Appellant nor dealt with Sec 114AA with respect to any act or any document or statement pertaining to Noticee No.9/appellant. Hence, the section is not applicable.

2.2.10 A bare perusal of the SCN dt 24-01-2022 show that merely alleging lack of diligence on the Noticee No.8/Appellant in respect of CBLR, 2018, the penalty is sought to be leviable under Sections 114 and 114AA. A perusal of the impugned Order reveal that while holding correctly that Section 114(i) penalty is not legable however, without discussing and without giving any finding against the Noticee No.9/Appellant in any specific manner in terms of Section 114AA, the impugned Order levied penalty under Section 114AA and the same is not legal and not proper.

2.2.11 The Noticee No.9/Appellant was bonafide throughout and the Noticee No.9/Appellant promptly filed its objections and also participated in the proceedings. There was no allegation nor any findings in respect of any undue financial gain to the Noticee No.9/Appellant or knowledge or intention and thus both the SCN and the impugned Order are not sustainable both in law and on facts as against the Noticee No.9/Appellant.

2.2.12 A perusal of the impugned Order and the proceedings thereof would reveal that the alleged improper exports have been made with active collusion, cooperation and collaboration between departmental officers. No act or conduct has been alleged against or can be said to be done knowingly or with the knowledge of any such the Noticee No.9/Appellant. The Noticee No.9/Appellant have only filed the exporters and illegal act by - 41 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR the Shipping Bills and performed the consequential activities thereof, all in accordance with law and their role and conduct is bonafide and lawful both in intent and content. In the above facts and circumstances, the impugned proceedings and the Order thereof, as against the Noticee No.9/Appellant are both unlawful, unjust and harsh in all, any and every manner both in law and on facts.

2.2.13 In view of the above submissions and also due to the fact that the obligations of the Noticee No.8/Appellant as a Customs Broker is having been duly fulfilled, the impugned order is liable to be set aside in every and all manner.

2.3 Appellant No.3: Shri K V Dushyanth, Director, M/s UDL Logistics Pvt Ltd

2.3.1 The Appellant No. 3 also submitted identical grounds of Appellant No. 2: M/s UDL Logistics Pvt Ltd, and therefore not submissions, the appellant requested to set aside the impugned order. repeated again. On the basis of

2.4 Appellant No. 4: Shri C. Venkatesh, Superintendent of Customs and GST (Retd.)

2.4.1 The findings against him regarding Shipping Bill No. 3378541 dated 26.07.2021 are without basis, arbitrary, and imposed despite bona fide facts and absence of material evidence. The penalties under Section 114(i) and Section 114AA of the Customs Act, 1962, have been imposed without proper examination of the appellant's defenses or the evidences on record. The Risk Management System (RMS) is a system-driven process configured to prevent arbitrary actions. The appellant acted on the authority of the Duty Roster and at the statutory workplace, following established RMS procedures. Any issuance of Let Export Order (LEO) was post-inspection by a pre-functionary officer, whose report uploaded in the system was devoid of adverse remarks. The appellant refers to CBIC Standing Order No. 22/2015 and CBIC Circular No. 23/2013 that mandate strict adherence instructions and disallow personal discretion beyond these instructions. The appellant relies on Supreme Court rulings, notably M.V. Bijlani vs Union of to RMS - 42 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR ORDER The instant appeals, namely: Appeal No 415/2025 Cus filed by Shri K (B-Air) dated 03.06.2025 Ananthapadmanabha Rao, Bengaluru; Appeal No. 423/2025 Cus (B-Air) dated 11.06.2025 filed by M/s UDL Logistics Pvt. Ltd., Bengaluru; Appeal No. 424/2025 Cus (B-Air) dated 11.06.2025 filed by Shri K.V. Dushyanth, Bengaluru; Appeal No. 445/2025 Cus (B-Air) dated 12.06.2025 filed by Shri C. Venkatesh, Bengaluru; and Appeal No. 504/2025 Cus (B-Air) (Dept) dated 15.07.2025 filed by the Assistant Commissioner of Customs, Airport & Air Cargo Commissionerate, Bengaluru, all arising out of Order-in-Original No. 03/2025-26 dated 15.04.2025 passed by the Additional Commissioner of Customs, Airport & Air Cargo Commissionerate, Bengaluru, are allowed by way of remand in terms of Section 128A(3) of the Customs Act, 1962. The matter is remitted to the Adjudicating Authority for fresh consideration in accordance with law, ensuring adherence to the principles of natural justice. Dr. Chetan R.C) Commissioner of Customs (Appeals)"

12. The aforesaid facts and circumstances including the orders passed by the Sessions/Special Court and the Appellate Authority of Customs will clearly indicate that the respondent was not justified in declining the request of the petitioner for grant of personal hearing despite bringing it to his notice that the petitioner - 69 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR had filed a discharge application and the same was pending consideration before the Special/Sessions Court.

13. In addition there to, the petitioner having sought for an opportunity of personal hearing as late as on 07.11.2025, the respondent did not even advert to the said request nor refer to the same nor provide an opportunity of personal hearing to the petitioner as can be seen from the impugned order which is clearly violative of principles of natural justice warranting interference by this Court in the present petition which deserves to be allowed and the matter remitted back to the respondent for reconsideration afresh and in accordance with law.

14. Insofar as the contention urged by the learned counsel for the respondent that in view of availability of equally efficacious and alternative remedy, the petitioner is not entitled to any relief in the present petition is concerned, in view of the findings recorded by me herein before that the impugned order is violative of principles of natural justice, mere availability of an appeal remedy would not come in the way of this Court exercising its jurisdiction under Articles 226 and 227 of the Constitution of India and as such, - 70 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR the said contention urged by learned counsel respondent cannot be accepted.

15. In the result, I pass the following:- ORDER (i) Petition is hereby allowed. (ii) The copy of order in original No.01/2025 dated

10.11.2025 passed by respondent No.1 vide Annexure A is hereby set aside. (iii) The matter is remitted back to respondent No.1 for reconsideration afresh in accordance with law. (iv) Petitioner shall appear before respondent No.1 on

18.05.2026 without awaiting further notice respondent No.1. (v) Liberty is reserved in favour of the petitioner to submit additional pleadings documents etc., before respondent No.1, who shall consider the same and provide sufficient and reasonable opportunity to the - 71 - NC: 2026:KHC:23440 WP No. 39444 of 2025 HC-KAR petitioner and pass appropriate orders in accordance with law. Sd/- (S.R.KRISHNA KUMAR) JUDGE BH List No.: 1 Sl No.: 3