2026-VIL-693-CESTAT-ALH-CU
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CUSTOMS CESTAT Cases

Customs - Reasonable Belief for Confiscation of Smuggled Goods - Department seized gold and silver from appellant no.1 while he was transporting it in a car. The Department alleged that the goods were smuggled and therefore liable for confiscation. The appellants claimed that the goods were legally purchased - Whether the Department had reasonable belief to confiscate the seized gold and silver as smuggled goods - HELD - The Department could not establish any valid reasons to believe that the impugned goods were smuggled and liable for confiscation. The seizure was made in a town and not at the international border or a Customs notified area, which is a strong ground to entertain a reasonable belief that the goods are smuggled. The follow-up searches at the premises of the respondents did not yield any incriminating evidence to corroborate the initial statement of the seized person, which was later retracted - The reasonable belief must exist at the time of seizure and not at a subsequent stage. The Department did not make any efforts to verify the claims of the respondents regarding the licit purchase of the goods, despite the production of invoices. The Department failed to discharge its responsibility of forming a reasonable belief under Section 123 of the Customs Act, without which the burden of proof cannot shift to the person from whom the goods were seized - The order of the Commissioner (Appeals) setting aside the confiscation of the seized gold and silver is upheld and the Revenue appeals are dismissed
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