2026-VIL-1740-CESTAT-KOL-CU
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CUSTOMS CESTAT Cases

Customs – Absolute confiscation of gold seized in a town seizure under Sections 111(b), 111(d) and 111(p) of the Customs Act, 1962 - Gold bars were recovered from a person intercepted at a railway station, who stated that he was acting on the directions of the Appellant and that the gold was smuggled, while the Appellant claimed ownership and produced the purchase invoice reflected in the GSTR-2A of the Appellant, with the gold being sent for manufacture of jewellery, and the Respondent ordered absolute confiscation and imposed penalties, which were set aside by the Commissioner (Appeals) in view of the demise of the Appellant - Whether the gold seized is liable to confiscation as smuggled goods, and whether penalty is imposable on the Appellant - HELD - The documents produced by the Appellant, being the invoice and the corresponding GSTR-2A reflecting the transaction in the relevant GSTIN, sufficiently show the licit means of procurement of the gold. It is a case of town seizure and the purity of the gold was admittedly below 99.9%, being 99.7%, and in these circumstances there cannot be reasons to believe that the gold was of foreign origin for seizing it. The obligation under Section 123 of the Customs Act has been discharged by the Appellant, and the onus shifts to the Respondent to prove that the gold is smuggled in nature, which the Respondent failed to do - The gold is not liable for confiscation, the order of absolute confiscation is set aside and the authorities are directed to release the gold to the Appellant within thirty days - No penalty is imposable on the Appellant and the Commissioner (Appeals) has rightly dropped the penalty, and the appeal is disposed of accordingly
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