TMI Blog2021 (12) TMI 918X X X X Extracts X X X X X X X X Extracts X X X X ..... reign origin of the said goods and the smuggled nature by the adjudicating authority is based on surmises and conjectures. The goods were seized far away from the international border in the interior of North Bengal from trucks/warehouses. It is an undisputed fact that betel nuts are sold in the adjoining State of Assam, Monipur as well as the said North District of West Bengal and their adjacent area. In such circumstances, in the absence of any evidence to the contrary disclosed it has to be concluded that the Revenue has been unable to establish the smuggled nature of the seized goods and thus discharged the burden of proof cast upon the Revenue in this respect. In the instant case, it is found that documents on record show that the said goods were purchased from the local markets and/or haat and/or mandi located in Jalpaiguri district of West Bengal; the sale/purchase of agricultural produce, such as Betel Nuts, are regulated by the respective District Regulated Market Committees and their sub-Divisional Offices in terms of the West Bengal Agricultural Produce Marketing (Regulation) Act, 1972 - In the instant case from copies of the receipts on record evidencing the market f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he learned Commissioner also confiscated the four carrier trucks under Section 115(2) of the Act, but allowed redemption of the vehicles upon payment of redemption fines of ₹ 6,70,000/-, ₹ 5,25,000/-, ₹ 6,50,000/- and ₹ 1,80,000/- respectively. He also directed adjustment of the said redemption fines from the Security Deposits of ₹ 10,60,000/-, ₹ 5,25,000/-, ₹ 6,50,000/- and ₹ 2,88,152/- respectively made by the respective truck owners at the time of provisional release of the seized trucks. The learned Commissioner further imposed the following penalties upon, inter alia, the appellants herein under Section 112(a) and/or Section 112(b) of the Act: (i) Shri Subodh Kumar Das : ₹ 1,00,000/-. (ii) Md.Tashin Shah : ₹ 10,00,000/- (iii) Shri Anil Kr. Jain : ₹ 5,00,000/- (iv) Shri Barun Saha : ₹ 1,00,000/- (v) Shri Surojit Ghosh : ₹ 1,00,000/- (vi) Shri Binod Kumar Pandey : ₹ 10,00,000/- Penalties have also been imposed under other 14 show cause noticees of amounts varying between ₹ 5,00,000/- and ₹ 10,000/-. However, the records reveal that no appeals have been preferred b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to having realised the smuggled nature of the said goods and having witnessed at the time of loading the said goods on to the trucks, the transfer of the said goods from packages bearing foreign marks to those without; (ii) The said goods had no verifiable ownership, source of procurement and no verifiable destination and that the records produced by the appellants in this regard were found to be fictitious and not genuine. 6. We have heard the learned Counsel for the Appellants and Shri A.K. Singh, learned Authorized Representative for the Department. 7. Shri Arijit Chakraborty, learned Advocate on behalf of the Appellant in Customs Appeal No.75638 of 2017 (Subodh Das Vs. CC) submitted as under: (i) The Appellant Shri Subodh Kumar Das was shown the photographs of his residential house. During recording of the Statement he categorically stated that there is no incidence of storing any Betel Nuts or loading of the same from his residential premises on or about 01/02.03.2013. Regarding photographs shown to him the same are of white colored two storied building which is his residential premises. There is some vacant land of another owner which is used for keeping his ve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r pointed out that no photographs have been relied upon in the Show Cause Notice and there are no charges brought against Shri Asit Pal. Cross examination as prayed for in his reply to Show Cause Notice has been denied. (vii) The Impugned Order imposing penalty upon the Appellant Subodh Kr. Das under Section 112(a) (b) of the Act is illegal and bad in law and the Appeal is prayed to be allowed. 8. It has been contended on behalf of the other Appellants as under: (i) The Appellant, Md. Tashin Shah carries on business as a merchant trader dealing in purchase and sale of diverse varieties of Betel Nuts, an agricultural produce grown in abundance in Jalpaiguri and Cooch Bihar districts of West Bengal and in Assam, Arunachal Pradesh, Tripura and Meghalaya. Md.Tashin Shah carries on the business as sole proprietor of two firms, in the name and style of Shree Sai Trading Co., Vivekananda Para, Dhupguri and HAMD Enterprise, Bairatinagar, Dhupguri. Both the firms are in Dhupguri, District: Jalpaiguri, West Bengal. Both the firms are duly registered with concerned VAT/Central Sales Tax authorities. Md.Tashin Shah is also assessed to Income Tax and holds Income Tax PAN NO: BBUPS688 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ignment Note No: 18 dated 01.03.2016 Lorry No : NL01L8734 02. M/s Yash Chirag Brothers Shop No. 16, CorporationBuildingMaskasath, Itwari Nagpur (Maharashtra) TIN No. 27440738943 200 Bags of Betel Nuts Net Weight 15800 kgs @ ₹ 65/- per kg. Tax Invoice SI. No: 88/Falakata dated 01.03.2016 Total Amt. ₹ 10,27,000/- Add CST ₹ 20,540/-. Grand Total Rs. 10,47,540/-. Regulated market Committee Receipt No: 0262408 Book No: 145249 Levy Fee Rs. 10270/- Transporter Tirupati Cargo 2nd Mile Sevak Road, Siliguri, Consignment Note No:21 dated 01.03.2016 Consigned from Falakata to Nagpur Lorry No: CG04JA/2966. 03. M/s. Shree Ambica Trading Co. Vishwash Complex, Raval Petrol Pump Unjha (Gujarat) TIN No: 24540302728 248 Bags of Betel Nuts (Betel Nuts Dust) Net weight 19780 kg.@ ₹ 81/- per kg. Tax Invoice SI. No: 87/Dhupguri dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... their bail prayers were rejected. (vii) Thereafter, in course of follow up enquiry by DRI officers, statements of various other persons were recorded, including the truck owners/ occupants and the Show Cause Noticees, including Md. Tashin Shah, under Section 108 of the Act. (viii) Thereafter the Show Cause Notice dated September 8, 2016 was issued, which was duly replied to in the form of Written Notes of Submissions and submitted at the time of personal hearing. The prayer for cross-examination of several persons whose statements were relied upon was also requested but however was denied. The impugned order was thereafter passed. 9. It is further contended by Shri Arnab Chakraborty, learned Advocate that the impugned order has erred both in law and on facts in confiscating the said goods under Section 111(b) of the Act and imposing penalties upon the five Appellants (Appellant Nos. 1 to 5) under Section 112(a) and/or (b) of the Act on the following grounds: (i) Foreign origin of the said goods not established (a) The said goods were locally sourced and was being sold for indigenous consumption only. They are not of foreign origin and that they were instead purchas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ugned order. The purported statements, all dated 2.3.2016, of the said 9 occupants of the seized trucks, are almost identical. A substantial portion of the words used as well as the sentences incorporated, and the overall layout, format and length, as well as the purported observations in the said statements are almost verbatim reproductions of each other. For instance, an identically worded sentence about the said goods being purportedly smuggled, appears in exactly the second paragraph in all 9 statements of the said 9 occupants of the seized trucks carrying the said goods. Apart from such observation, there are numerous other portions of the said witness statements of the said 9 occupants that are identically constructed and/or worded. It is coincidental that allegedly independent and voluntary statements given by 9 different individuals, who all claim to be not very literate, all bear so many similarities. Since none of the said 9 occupants knew how to write properly, and required the concerned DRI officer to type their narrations, it is likely that the independence, uniqueness and veracity of the statements have been compromised by the process of such transcription. It is also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onsistent and wholly unreliable statements of such witnesses for passing the said impugned order. (iii) Burden of proof on Department not discharged. (a) The said goods are not notified goods under Section 123 of the Act. Therefore the burden of proving the foreign origin of the said goods lies heavily on the Department, which it has failed to discharge. Reliance in this regard was placed on the decision of the Tribunal in Laxmi Narayan Sharma v. CC, Patna, 2002 (142) ELT 74 (Tri-Kolkata) and the decision of the Hon ble Calcutta High Court in Commissioner of Customs (Preventive), WB, Calcutta v. DungarmalMohata, 2006 (200) ELT 522 (Cal.). (iv) Goods having indeterminate source cannot lead to a presumption of smuggling (a) It is not disputed in the said impugned order that the said goods were loaded onto the seized trucks in North Bengal, well inside the international border with Myanmar. It is also not disputed that the said goods were being transported to locations inside the country, particularly in Delhi, Gujarat and Maharashtra. In such circumstances even presuming though denying that the ownership of the said goods, their procurement source and destination for onw ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed at the time of loading the said goods on to the trucks, the transfer of the said goods from packages bearing foreign marks to those without. (c) The said goods had no verifiable ownership, source of procurement, and no verifiable destination and that the records produced by the Appellants in this regard were found to be fictitious and not genuine. 11. We have heard the parties through video conferencing and have carefully perused the appeal records. 12. Section 2(39) of the Act defines smuggling in relation to goods to mean any act or omission which will render such goods liable to confiscation under Section 111 or Section 113 . 13. Section 111 of the Act, as sought to be invoked by the said impugned order provides that The following goods brought from a place outside India shall be liable to confiscation: (b) any goods imported by land or inland water through any route other than a route specified in a notification issued under clause (c) of section 7 for the import of such goods. 14. Hence, for any smuggling to occur, the goods in question must enter India from a place outside India. The foreign origin of the said goods is thus imperative in order for Sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Monipur as well as the said North District of West Bengal and their adjacent area. In such circumstances, in the absence of any evidence to the contrary disclosed it has to be concluded that the Revenue has been unable to establish the smuggled nature of the seized goods and thus discharged the burden of proof cast upon the Revenue in this respect. In this respect reliance is placed upon the decision of this Bench of the Tribunal in the case of Kukil Das Vs. Commissioner of Customs, 2004 (177) ELT 345 (T). In this respect reliance is also placed upon the decision of the Principal Bench of the Tribunal at New Delhi in the case of MaqsoodAlam Vs. Commissioner of Customs, 2015 (324) ELT 162 (T). 15.2 In the case of Smt. Laltanpuii Vs. Commissioner of Customs (Prev.), 2020 (12) TMI 377 CESTAT KOLKATA, in para 10 of the order, this Bench of the Tribunal has observed and held as under: 10. The issue for consideration in the instant case is to see whether Revenue has established the allegation that the seized betel nuts are of foreign origin and are smuggled. Ongoing through the records of the case, it is seen that Revenue bases its case on the certificate issued by Arecanut Rese ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ountry lies heavily upon the Revenue. The adjudicating authority has referred to certain circumstantial evidences which are also in the nature of doubts being expressed by him. The Tribunal in a number of cases assailed that the opinion of the local traders is not sufficient to hold the goods to be of foreign origin. The Spices Board and Central Plantation Crops Research Institute who are approached for ascertaining the country of origin of the betel nuts, have also shown their inability to find out the same. In these circumstances, we agree with the learned Consultant's contention that the Revenue has failed to prove the foreign origin of the nuts at the first instance. We further note that the circumstantial evidences referred to by the adjudicating authority also does not prove beyond doubt that the goods were smuggled into the country, though the same may raise certain doubts about the smuggling character of the same, However, they cannot be given the place of evidence, especially when the goods are non-notified and the Revenue is duty-bound to produce sufficient positive and tangible evidence to reflect upon the smuggled character of the betel nuts. Accordingly, taking all ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n them. The place of seizure was also within the country, at the Ghoshpukur Toll Plaza near Siliguri in the North of West Bengal. During the course of the investigation undertaken by the DRI, no other incriminatory material was obtained, either from the raids conducted or in course of interrogating witnesses, that would indicate that the said goods were sourced from outside India. No specimen packet/bag with any foreign markings, or any import document or any invoice or other record that would establish that the said goods had a foreign origin, was recovered from the appellants or any other party. 16.2 It is not disputed in the said impugned order that the said goods were loaded onto the seized trucks in North Bengal, well inside the international border with Myanmar. It is also not disputed that the said goods were being transported to locations inside the country, particularly in Delhi, Gujarat and Maharashtra. 16.3 In the impugned order the Commissioner observes that there may be a possibility that the subject Betel Nuts too are of foreign origin and were smuggled to India . This finding is based entirely on a presumption for which there is no legal or factual basis discl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Hon ble High Court, inter alia, relying upon the decision of the Hon ble Supreme Court in Vinod Solanki Vs. Union of India, 2009 (233) ELT 157 (SC), observed as follows: 12. In Vinod Solanki V. Union of India (supra), the Supreme Court explained that where the confessional statement made by accused was retracted, the Court has to be conscious about the manner in which retraction has been made and other relevant factors. It was observed that a retracted confession could be used as a corroborative piece of evidence but cannot form the sole basis for returning a finding of guilt. In Union of India Vs. Bal Mukund (supra), in the context of confessional statement under Section 67 of the NDPS Act, the Supreme Court noticed that there can be conviction only if there is an independent corroboration of the retracted statement. In Noor Aga Vs. State of Punjab (supra), the said position was reiterated. The Court held that where the confessional statement was retracted, the burden shifted on the prosecution to prove that it was made voluntarily. It was pointed out that the confessional statement made by the accused while in custody was weak in nature. There being no such independent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted that cross-examination of the said dealers could not have brought out any material which would not be in possession of the appellant themselves to explain as to why their ex-factory prices remain static. It was not for the Tribunal to have guess work as to for what purposes the appellant wanted to cross-examine those dealers and what extraction the appellant wanted from them. This decision of Hon ble Supreme Court is fully applicable to the facts of the instant case. 16.10 In view of the factual analysis above and respectfully following the principles laid down in the aforesaid decisions of the Hon ble Supreme Court, High Court and the Tribunal and applying the principles laid down therein, we are of the view that the Department has failed to establish that the said goods are smuggled goods. 17. Once the conclusion that the said goods are smuggled goods is held to be unsustainable, confiscation of the said goods under Section 111(b) of the Customs Act and imposition of penalties upon the Appellants are also unsustainable. 18. We find that the Appellant, Md. Tashin Shah, in Customs Appeal No.75662 of 2017, has claimed ownership of the seized goods and has prayed fo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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