2024-VIL-288-CESTAT-KOL-CU
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CUSTOMS CESTAT Cases

Customs – Sections 111(b) and 123 of Customs Act, 1962 – Seizure of gold bars – Order of absolute confiscation – Sustainability – Customs Officers intercepted Appellant Nos.1 to 4 and recovered gold bars from them – Officers seized said gold on a reasonable belief that gold bars had been smuggled into India through an unauthorized channel and is liable for confiscation – Department issued show-cause notice to Appellants for confiscation of seized gold – Adjudicating authority ordered for absolute confiscation of seized gold bars under Section 111(b) of the Act – HELD – Per: Ashok Jindal, Member (Judicial) – At time of pre-trial notice for disposal of seized gold, Appellant Nos.1 to 4 claimed that impugned gold pertains to Appellant No.5 – Appellant No.5 has produced invoices of seized gold purchased from Appellant No.6 – Appellant No.6 produced all records for verification of impugned transactions with regard to possession of seized gold of Appellant No.5 – Said documents have not been rejected by adjudicating authority – Appellant No.5 has discharged his onus in terms of Section 123 of the Act, therefore, seized gold is not liable for confiscation – Impugned order passed by Adjudicating authority is set aside – Appeals allowed - Per: Rajeev Tandon, Member (Technical) – Appellant No.5 did not produce any evidence of licit purchase within a reasonable time after seizure – Prepared invoices/bills submitted to department by Appellant No.5 in support of his claim to licit acquisition of foreign marked gold are grossly incomplete in details – Purported invoices submitted do not even indicate brand of gold or marks and number of gold bars – Appellants have failed to discharge onus cast upon them under Section 123 of the Act and consequently, seized gold is liable for confiscation – Order passed by adjudicating authority is upheld – Appeals dismissed - Difference of opinion – In view of difference in viewpoints of two members, matter referred to a third member for resolution of conflict and difference of opinion – Whether Appellants have discharged their burden under Section 123 of the Act and hence goods are not liable for confiscation as held by Member (Judicial) or Appellants have failed to discharge their burden under Section 123 of the Act and hence goods are liable for confiscation as held by Member (Technical) – HELD – Section 123 of the Act clearly states that burden of proving that seized goods are not smuggled goods shall be on person who claims to be owner thereof – Appellant Nos.1 to 4 uniformly state that gold in question was procured for Appellant No.5 – It cannot be denied that Appellant No.5 is the owner of gold – Only person responsible to discharge burden of proof could be only Appellant No.5 – Show Cause Notice has proceeded on an erroneous notion that burden of proof is required to be jointly discharged by Appellant Nos.1 to 4 along with Appellant No.5 – Framing of charges on Appellant Nos.1 to 4 is erroneous – Appellant No.5 has claimed that he has purchased gold in a licit way through invoices issued by Snehal Gems Pvt Ltd. – Appellant No.5 had duly produced original copies of such purchase invoices before investigating authority at time of investigation – Snehal Gems have confirmed transactions in respect of invoices – Onus under Section 123 of the Act stands discharged by Appellant No.5 – It is proper to agree with Member Judicial that burden of proof stands discharged under Section 123 of the Act and seized goods are not liable for confiscation – Reference is answered and difference of opinion stands resolved on above terms.
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