Penalty u/s 114(iii) of Customs Act Could not impose based on Statement Recorded u/s 108 of Customs...

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has ruled that a penalty under Section 114(iii) of the Customs Act cannot be imposed solely based on a statement recorded under Section 108 of the Act. The tribunal held that while a statement recorded during an investigation is a piece of evidence, it must be corroborated by other independent and credible evidence to form the basis of a penalty. Section 114(iii) provides for a penalty for making a false declaration. The CESTAT observed that a penalty cannot be sustained if the department's entire case is built only on a retracted or uncorroborated statement of the accused or a co-accused. This ruling protects individuals from being penalized based on statements that may have been given under duress and emphasizes the need for a higher standard of proof for imposing penalties.