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2019 (12) TMI 1380 - GOVERNMENT OF INDIA, MINISTRY OF FINANCESmuggling - Gold Bars - Forex and Indian currency - packaging materials and other miscellaneous goods - absolute confiscation - penalty - cross-examination of the customs officers manning x-ray machine and red channel counter as well as the witnesses present on the date of seizure in the case - HELD THAT:- From the evidence on record it is evident that Indian currency as well as huge amount of forex Dirham 1,05,410 was recovered from the PAX on 23-9-2012. The impugned currency was also not declared to the customs officers at the red channel under Section 77 of Customs Act, 1962 by the PAX - It is observed that the PAX did not make the statutory declaration on his arrival to the customs authorities since the Forex (UAE Dirham 1,05,410) carried by him was much higher than the prescribed limit under the FEMA, 1999 read with Foreign Exchange Management (Export and Import of Currency) Regulations, 2000. The legal provisions of FEMA, 1999, the Foreign Exchange Management (Export and Import of Currency) Regulations, 2000, Section 2(33) of the Customs Act, 1962 read with Section 11 clearly stipulate that an attempt to smuggle foreign currency and Indian currency is ‘prohibited’ and merits confiscation under provisions of Customs Act, 1962. In the case of Ram Kumar v. Commissioner of Customs [2015 (1) TMI 1126 - DELHI HIGH COURT] Hon’ble High Court of Delhi while dismissing the writ petition of the petitioner disallowed release of confiscated forex to be redeemed under Section 125 of Customs Act, 1962. The ratio of judgment squarely applies to the present case - Therefore the impugned Indian and foreign currency seized from the PAX in violation of the provisions of FEMA, 1999, Foreign Exchange Management (Export and Import of Currency) Regulations, 2000 read with Sections 2(33) and 11 of Customs Act, 1962 falling into the category of ‘prohibited goods’ has been correctly confiscated under Section 111(d), (m) & (o) of Customs Act, 1962 by the adjudicating authority which has been upheld by the impugned order-in-appeal. Penalty under Section 112 and Section 114AA of Customs Act, 1962 - HELD THAT:- Keeping in view the gravity of the offence the order of Commissioner (Appeals) in reducing the penalty from ₹ 30 lacs to ₹ 5 lacs is erroneous and is set aside - It is observed that this is not a case for imposition of penalty under Section 114AA of the Customs Act, 1962. Therefore the order of Commissioner (Appeals) in waiving the penalty under Section 114AA of Customs Act, 1962 is legally sustainable and is upheld - In view of the seriousness of the offence wherein 70 (Seventy) gold biscuits weighing 8164.80 grams and valued at ₹ 2,51,89, 735/- and forex 1,05,410 UAE Dirham have been smuggled by the PAX, Government imposes a penalty of ₹ 40 lacs on the PAX under Section 112(a) of the Customs Act, 1962. Appeal allowed in part.
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