Judgment :- Petitioner is before this Court seeking for quashing the orders passed by the 3rd respondent at Annexures, C, C1 to C5 and also the order of the 2nd respondent at Annexures D, D1 to D5 and also the orders on the revision applications filed by the petitioner before the 1st respondent at Annexures M, M1 to M5 and also to quash the letters dated 15.6.2004 at Annexure ‘G’ and 28.6.2004 at Annexure ‘H’ of respondents 4 and 5 demanding penalty and also to issue a writ directing the respondents to refund the amount of penalty paid with interest thereon and for such other relief. Petitioner is a company incorporated under the Companies Act of 1956 and entered into an agreement with the Indian Oil Corporation Ltd., during the year 1993 and 1994 for assisting the Oil Corporation on arrival of its vessels at New Mangalore Port in filing cargo declarations, shifting of vessels etc. According to the petitioner, he is not liable to pay any duty and it is the principal of the petitioner who is the owner of the vessel, liable to pay the duty, if any and, he is only an agent. During the years 1994 and 1995, on six occasions, Indian Oil Corporation had imported oil from Marmagoa Port to New Mangalore Port. As per the ullage survey, the quantity of the cargo was found to be less than the quantity mentioned in the cargo declaration. As such, petitioner sought for amendment of the declaration. Based on the same, duty was calculated and levied on the amended quantities and vessels were permitted to depart. Subsequently, after lapse of 5-6 years, petitioner was issued with a notice proposing to levy penalty under Section 116 of the Customs Act of 1962 for the short landing of the cargo during the years 1994 and 1995. The petitioner contested the matter. However, penalty was confirmed at various levels. According to the petitioner, levy of penalty is wholly illegal and arbitrary and such a belated claim is without jurisdiction. Hence, he is before this Court on various grounds. In the statement of objections filed on behalf of the Revenue it is contended, there is no question of limitation. As per Section 116 of the Customs Act, no time limit is prescribed for initiating penal action. Hence, he is before this Court on various grounds. In the statement of objections filed on behalf of the Revenue it is contended, there is no question of limitation. As per Section 116 of the Customs Act, no time limit is prescribed for initiating penal action. Section 28 of the Customs Act covers only demands in respect of duties and customs and related interests and it cannot be interpreted for defining the provisions of Section 116 since both are distinct and separate. The time limit prescribed under Section 28 of the Act cannot be construed as time limit prescribed under Section 116 of the Act. It is for the petitioner to account for the deficiency in quantity of the imported cargo and the case has been adjudicated and penalty equal to the duty involved has been imposed. It is also stated, the Apex Court in the case of CCE Jaipur Vs. Raghuvar (India) Ltd – 2000 (118) ELT 311 (SC), has held that, it is not for the Courts to import any specific period of limitation by implication where there is really none. As per Section 30 of the Customs Act of 1962, the person incharge of the conveyance has to deliver the import manifest of the vessel at a customs station and as per proviso 2 of Section 30, a person while delivering the import manifest shall at the foot thereof, make and subscribe to a declaration as to the truth of its contents. Further it is stated, the petitioner had filed an import manifest as required under Section 30 of the Customs Act as an agent on behalf of the principal i.e., the master of the vessels, as such, the petitioner who acted as an agent of the person in-charge of the subject vessels becomes liable for accounting the cargo shortage and as per Section 148 of the Act, he cannot escape from the responsibility. If the quantity unloaded is short of the quantity to be unloaded at a destination and, if the failure to unload or the deficiency is not accounted for to the satisfaction of the proper officer, the person incharge of conveyance or his agent shall be liable to pay the penalty and the petitioner could not justify for short landed cargo. If the quantity unloaded is short of the quantity to be unloaded at a destination and, if the failure to unload or the deficiency is not accounted for to the satisfaction of the proper officer, the person incharge of conveyance or his agent shall be liable to pay the penalty and the petitioner could not justify for short landed cargo. It is further stated, when the impugned orders are passed after affording sufficient opportunity and after due application of mind, it does not call for interference much less the question of delay also does not arise. Heard the counsel representing the parties. The learned Counsel appearing for the petitioner has relied upon the following decisions: 1 CCE, Jaipur Vs Rahuvar (India) Ltd – 2000(118) ELT 311 (SC) 2 E.C.Bose & Co. Pvt. Ltd. Vs. Union of India – 1992 (58) ELT 432 3 Parekh Shipping Corpn. Vs. AC of Customs -1995(80) ELT 781 4 Wilco & company Vs Union of India – 2003(151) ELT 49 (Mad). 5 Akbar Badruddin Jiwani Vs Collr. of Customs – 1990 (47) ELT 161 (SC) 6 Reckitt & Colman of India Ltd. Vs CCE – 1996(88) ELT 641 7 Saci Allied Products Ltd. U.P. Vs CCE, Meerut – (2005) 7 SCC 159 8 Khemka and Co. (Agencies) Pvt. Ltd., Vs State of Maharashtra – AIR 1975 SC 148 9 CIT Vs Mcdowell and Company Ltd. – (2009) 10 SCC 755 . 10 Mohinder Singh Gill Vs Chief Election Commissioner, New Delhi – AIR 1978 SC 851 . 11 Singapore Airlines Vs Union of India – 2000(121) ELT 289 (Del). to contend that, no reasons have been assigned in invoking the proceedings after lapse of seven years much less, the action initiated after five years as provided under the law is barred by limitation and action for imposing penalty should not have been against the petitioner who has only undertaken the contract, but on the principal i.e., Indian Oil Corporation for accounting short delivery. Without invoking Section 48 of the Customs Act, the authorities could not have imposed penalty. Accordingly, learned counsel submitted that the impugned order passed by the authorities needs interference. It is further submitted, revised cargo declaration has also been filed showing the actual quantity of cargo discharge. Without invoking Section 48 of the Customs Act, the authorities could not have imposed penalty. Accordingly, learned counsel submitted that the impugned order passed by the authorities needs interference. It is further submitted, revised cargo declaration has also been filed showing the actual quantity of cargo discharge. Learned Counsel appearing for the respondent-authority has submitted, the Tribunal in similar circumstances, in the decision reported in 1986 (25) ELT 741 regarding short landing of goods has held, show cause notice proposing penalty issued after ten years of unloading and delivery of goods is not a duty and hence, is not governed by Section 28 of the Customs Act, 1962, but Section 116 applies. Further, he has also relied upon the decision of the Apex Court in the case of British Airways Pvt. Ltd., Co. Vs. Union of India – (2002) 2 SCC 95 and other cases to contend that, as per Section 116 of the Act, for shortage in the goods unloaded from conveyance can be fastened even on persons representing the person incharge of the conveyance. As such, action initiated against the petitioner/agent is maintainable being a representative of the person incharge of the conveyance. In the case on hand, as noted, petitioner has acted as an agent of the principal viz., Indian Oil Corporation. It is also not in dispute that there is a short delivery of the goods declared at the delivery point and also declaration form has been filed by the petitioner himself. The question is whether the demand or imposition of penalty belatedly after seven years would be maintainable and such imposition of penalty not being accounted for seven years could be recovered at the hands of the respondent-authority belatedly. In the decision relied upon by the petitioner’s counsel in the case of E C Bose & Company Pvt Ltd Vs Union of India – 1992 (58) ELT 432, the Calcutta High Court has held, with reference to short landing of goods and imposition of penalty wherein mishandling of the cargo during unloading resulted in torn bags and a large quantity of sugar spilling over in holds of vessel that, unexplained delay of seven years in issuing show cause notice proposing to impose penalty was not proper. In the case of Parekh Shipping Corporation Vs Asst. In the case of Parekh Shipping Corporation Vs Asst. Collector of Customs, Bombay – 1995 (80) ELT 781 (Bombay), the issuance of show cause notice for short landing was after twelve years after date of vessel leaving the port held and the Division Bench of the Bombay High Court has held, as per S.116 of the Customs Act, 1962, power has to be exercised within a reasonable time. It has also observed, the Bond executed should also be for a duration of five years time which is reasonable and action should be taken within that period. In the case of Collector of Central Excise, Jaipur Vs Raghuvar (India) Ltd – 2000 (118) ELT 311 (SC), the Apex Court has held that it is not for the courts to import any specific period of limitation by implication, where there is really none in law, so as to prescribing a period of limitation to do or not to do a thing after the expiry of the period so stipulated as the consequence of creation and destruction of rights and therefore, must be specifically enacted and prescribed. Petitioner has also relied upon the decision in WILCO & Co. Vs Union of India – 2003 (151) ELT 49 (Madras) wherein the Madras High Court has dealt with S.116 of the Customs Act and held, delay in initiation of proceedings for imposition of penalty is not explained by Customs and reasonable punishment for violation of the Act is imposable though no loss of revenue was caused to the State. At this juncture, it is relevant to extract S.28 and S.116 of the Customs Act which reads- S.28: Notice for payment of duties, interest, etc. At this juncture, it is relevant to extract S.28 and S.116 of the Customs Act which reads- S.28: Notice for payment of duties, interest, etc. 1 When any duty has not been levied or has been short levied or erroneously refunded, or when any interest payable has not been paid, part paid or erroneously refunded, the proper officer may- (a) In the case of any import made by any individual for his personal use or by government or by any educational, research or charitable institution or hospital, within one year; (b) In any other case, within six months, From the relevant date, serve notice on the person chargeable with the duty or interest which has not been levied or charged or which has been short-levied or part paid or to whom the refund has erroneously been made, requiring him to show cause why he should not pay the amount specified in the notice. Provided that where any duty has not been levied or has been short-levied or the interest has not been charged or has been part paid or the duty or interest has been erroneously refunded by reason of collusion or any willful mis-statement or suppression of facts, by the importer or the exporter or the agent or employee of the importer or exporter, the provisions of this sub-section shall have effect as if for the words ‘one year’ and ‘six months’, the words ‘five years’ were substituted. Explanation: Where the service of notice is stayed by an order of a court, the period of such stay shall be excluded in computing the aforesaid period of one year or six months or five years, as the case may be. (1A)…. (2) The proper officer, after considering the representation, if any, made by the person on whom notice is served under sub-section (1), shall determine the amount of duty or interest due from such person (not being in excess of the amount specified in the notice) and thereupon such person shall pay the amount so determined. (2A)…. (2B)….. (2C)…. (1A)…. (2) The proper officer, after considering the representation, if any, made by the person on whom notice is served under sub-section (1), shall determine the amount of duty or interest due from such person (not being in excess of the amount specified in the notice) and thereupon such person shall pay the amount so determined. (2A)…. (2B)….. (2C)…. S.116: Penalty for not accounting for goods: If any goods loaded in a conveyance for importation into India, or any goods transshipped under the provisions of this Act or coastal goods carried in a conveyance, are not unloaded at their place of destination in India, or if the quantity unloaded is short of the quantity to be unloaded at that destination, and if the failure to unload or the deficiency is not accounted for to the satisfaction of the Assistant Commissioner of Customs or Deputy Commissioner of Customs, the person-in-charge of the conveyance shall be liable- (a) in thecase of goods loaded in a conveyance for importation into India or goods transshipped under the provisions of this Act, to a penalty not exceeding twice the amount of duty that would have been chargeable on the goods not unloaded or the deficient goods, as the case may be, had such goods been imported; (b) in the case of coastal goods, to a penalty not exceeding twice the amount of export duty that would have been chargeable on the goods not unloaded or the deficient goods, as the case may be, had such goods been exported. In the case on hand, the impugned orders have been passed at various levels imposing penalty, acting under S.116 of the Act. The 4th respondent by his letter dated 15.6.2004 – annexure G, directed the petitioner to pay penalty amounting to Rs.34,12,105/-. It is see, the 5th respondent – Superintendent of Customs, at the first instance, directed the petitioner to pay an amount of Rs.9,66,382/- towards penalty. The petitioner paid an amount of Rs.5 lakhs during the 1st week of April 2004. For the period from 1994-95, on six occasions the Corporation imported high speed diesel, kerosene and furnace oil and transhipped it from Marmagoa port to New Mangalore port. On ullage survey, it was found that quantity of cargo unloaded was less than the quantity mentioned in the cargo declaration and the same was also informed by the petitioner to the Customs Authorities. On ullage survey, it was found that quantity of cargo unloaded was less than the quantity mentioned in the cargo declaration and the same was also informed by the petitioner to the Customs Authorities. What is south to be imposed is not the customs duty rather penalty, according to the respondent, as per S.116 of the Act. Of course, nothing has been stated in particular explaining the delay in initiating proceedings after a lapse of nearly 6 to 7 years. The notice purporting to impose penalty is issued immediately after 5-6 years i.e., for the transaction of 1994-95, the notice was issued during 2000. What is to be decided in the context is, whether the initiation of proceedings for recovery after 5-6 years is bad in law or whether such delayed recovery is permissible. It is to be noted, limitation has been imposed under the Statute for the recovery of customs duty. However, so far as S.116 of the Act is concerned, no such limitation has been provided. Nonetheless, as is held by the Apex Court and various other courts, in the absence of any such limitation being prescribed, the exercise of discretion/power shall be within a reasonable period. There is short landing of 490.90 metric tons at the instance of the petitioner who was acting as an agent. Petitioner was also given an opportunity to dispute the aspect before the Commissioner of Customs as also the proposed penalty. At the first instance, penalty proposed to be imposed is Rs.22,705/-. On such challenge to the order, after setting aside, the matter was once again reconsidered for denovo adjudication. In that process, there was delay also. However, the initial delay of six years has been properly explained. Ultimately, the order has been confirmed at the government level. The amount of Rs.34,12,105/- is towards short landing of the cargo under six Bills of Entry. The penalty proposed to be imposed appears to be in the context, equivalent to the amount of short landing, according to the petitioner’s counsel. By various orders, the Revenue has enforced and collected an amount of Rs.18,55,597/- (annexures J, K 1 to K3). Ultimately, in the process, order of the Assessing Authority has been confirmed nearly after three years by the Appellate Authority and the Tribunal. By various orders, the Revenue has enforced and collected an amount of Rs.18,55,597/- (annexures J, K 1 to K3). Ultimately, in the process, order of the Assessing Authority has been confirmed nearly after three years by the Appellate Authority and the Tribunal. In the case on hand, whether the penalty imposed to the tune of Rs.34,12,105/- needs to be interfered with on the ground there is no reasonableness in the initiation of proceedings, is to be considered. What is not in dispute is the short landing of the cargo since there is a Form/Declaration filed by the petitioner himself. Subsequently, a revised certificate is also issued regarding short landing. In the statement of objections, Revenue also has clarified as to the cargo declaration. It has noted in the order dated 29.12.2000, as to the discharge quantity i.e., in stead of 3,200 metric tons in one of the case, the unloaded quantity is 3085.543 metric tons; in the order dated 29.1.2002, as against the cargo declared at 11,000 metric tons, the discharge quantity is 10,414.715; in the order dated 29.01.2002 as against 10,000 metric tons declared, the discharge quantity is 9432.620 metric tons. In yet another case, the declared quantity is 3500 metric tons and discharge quantity is about 3009.910 metric tons. Of course, a revised statement is also filed. Substantial quantity though loaded, the discharge quantity appears to be, in almost 5 to 6 occasions, lesser than the declared quantity. Petitioner also has not furnished the details and explanation as to what is the basis on which such short landing has taken place. The contention of the petitioner’s counsel is, at the time of loading and filing declaration there might be some entries but what quantity is loaded is subsequently noted and there is no foul play. The Revenue has exercised its power acting under S.116 of the Act proposing to impose penalty and after hearing, the impugned orders have been passed. In the absence of time limitation for initiation of proceedings for the recovery of penalty amount, although the court cannot import time limitation, to say that it is within a particular prescribed period, proceedings ought to have been initiated within a reasonable time and the Revenue also should have taken sufficient care to initiate proceedings at the earliest. In the absence of time limitation for initiation of proceedings for the recovery of penalty amount, although the court cannot import time limitation, to say that it is within a particular prescribed period, proceedings ought to have been initiated within a reasonable time and the Revenue also should have taken sufficient care to initiate proceedings at the earliest. As per the facts of the present case, there is loss of revenue to the State in not initiating action at the inception. How prejudice has been caused to the petitioner in the context, has also remained unexplained but for the delay in initiating proceedings to recover penalty. The settled principle in such cases is, the test of reasonableness to be adopted. However, on that score alone the case of the Revenue cannot be easily turned down. Further, hardship explained by the petitioner is, there should have been direct charge on the Corporation and not on the petitioner/Agent and the second issue is limitation. In the declaration/agreement entered into between the principal and the agent, the liability is undertaken by the petitioner himself. The petitioner has undertaken under clause (7) of the Agreement that for any contravention of the provisions of the Customs Act, petitioner is responsible. The right of the petitioner if any, under the Agreement, is he can have recourse to settle the issue with the Corporation i.e., the principal. It is seen, not in one case such short landing has taken place but, in almost six occasions. In the facts and circumstances of the case, out of the total amount of penalty proposed to be collected, since already Rs.18,55,597/-has been remitted, an amount of Rs.5 lakhs has been reduced from the total amount. Petitioner to pay the balance amount within three months. Petition is disposed of accordingly.