2026-VIL-694-CESTAT-ALH-CU
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CUSTOMS CESTAT Cases

Customs - Foreign origin of seized gold – The gold bars and piece of gold was seized under Section 110 of the Customs Act on reasonable belief that the same are smuggled into India and therefore liable to confiscation - Whether gold seized from the appellant was of foreign origin and smuggled into India – HELD - In the absence of any foreign markings on the gold and the statement of the appellant being hearsay evidence without any corroborative evidence, the revenue has failed to establish that the gold was of foreign origin and smuggled into India. Apart from the statement of the appellant, there is no corroborative evidence on record to suggest that the subject gold was of foreign origin and was smuggled into India - The mere fact that the appellant was found carrying the gold at a public place does not constitute reasonable belief to seize the goods under Section 123 of the Customs Act. The benefit of doubt has to be extended to the appellant as there is no conclusive proof of the gold being of foreign origin and smuggled. Therefore, the confiscation of the gold and imposition of penalty on the appellant cannot be sustained - Since the seizure and confiscation of the gold has been found to be bad in law, the principle of restitution applies, and the appellant is required to be placed in the same position as he was prior to the seizure. Accordingly, the appellant is entitled to the release of the seized gold from whose possession it was seized, as the owner of the gold has not come forward to claim ownership. The Customs Act also does not prohibit release of goods to the person from whose possession the same were seized where the owner is not known or does not come forward - The appellant is entitled to release of subject gold. Accordingly, the appeal is allowed
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