The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Kolkata Bench, has set aside penalties totaling Rs. 40 lakh imposed on IRS officer Vikash Kumar citing that the department failed to substantiate its allegations with legally admissible evidence, particularly relying on a broken DVD and a retracted statement.
The bench of Ashok Jindal (Judicial Member) and K. Anpazhakan (Technical Member) has observed that the department failed to comply with Section 138C of the Customs Act, which governs admissibility of electronic records. No certificate—similar to the requirement under Section 65B of the Evidence Act—was obtained to validate the computer-generated material.
The appeals arose from orders that upheld penalties of ₹10 lakh each under Section 114AA of the Customs Act, 1962, against the appellant.
The case stemmed from a Directorate of Revenue Intelligence (DRI) investigation into fraudulent exports carried out through the Petrapole Land Customs Station using Import Export Codes (IECs) of two firms.
According to the Revenue, exporters allegedly misdeclared goods in terms of quality, quantity, and value—or exported junk—to claim undue duty drawback benefits.
During searches, a DVD was seized from the premises of M/s Spak Enterprises Pvt. Ltd., which purportedly contained data relating to exports and was linked to the alleged conspiracy involving departmental officers, including Vikash Kumar.
The case against the officer was further supported by the statement of a private individual, Jyoti Biswas, who allegedly admitted involvement in fabricating export documents and sharing drawback proceeds.
The department argued that the appeals were not maintainable because they involved duty drawback claims. However, the Tribunal rejected this contention, noting that the appellant was not claiming drawback but was only challenging the penalty imposed on him.
It clarified that the statutory exclusion applies to orders relating to payment of drawback and does not bar appeals concerning penal liability.
The Tribunal framed two central questions. Firstly, whether the DVD could be treated as admissible electronic evidence without verifying its genuineness from the original device. Secondly, whether a retracted statement recorded during investigation could be relied upon to implicate the appellant.
The bench noted that the primary evidence used to implicate the officer was the information contained in the seized DVD. However, the appellant challenged its authenticity, asserting that the original DVD had been destroyed and was unavailable for verification.
The Tribunal observed that electronic records are susceptible to tampering and must be authenticated before being relied upon. Significantly, it found that the original DVD was not available from the beginning of the proceedings and that the computer device used to create it was also not produced.
It further held that without verifying the original electronic source, information from a reconstructed DVD could not be relied upon, especially when no corroborative evidence was presented.
As a result, computer printouts taken from the disputed DVD could not be treated as evidence for imposing a penalty.
The Tribunal reiterated that safeguards ensuring the source and authenticity of electronic records are essential to prevent miscarriage of justice.
The bench also questioned reliance on the statement of the co-accused, which had been retracted before a court on the very day it was recorded.
Without independent corroboration, such statements could not form the sole basis for penal action.
In the absence of the original DVD, the recording device, and statutory certification, the Tribunal concluded that allegations of forging export documents and participating in a conspiracy were unsubstantiated.
Accordingly, it held that the requirements for imposing penalty under Section 114AA were not satisfied.
Case Details
Case Title: Vikash Kumar versus Commissioner of Customs (Preventive)
Case No.: Customs Appeal No. 75368 of 2025
Date: 06.02.2026
Counsel For Appellant: A.K. Pattanayak, Advocate
Counsel For Respondent: Tariq Sulaiman, Authorized Representative
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