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2014 (9) TMI 376 - HC - CustomsSmuggling of goods - onus to prove - notified goods u/s 123 - confiscation and imposition of penalty - 99 sets of Intel Pentium four processors and cooling fan of foreign origin valued at ₹ 7,92,000/- were found in the Mitsubishi Lancer Car which was parked in Hotel - Tribunal observed that, these goods were freely available in the open market. The Revenue has not discharged their burden to prove that the goods were smuggled ones. - Held that:- the cases to which Section 123 is not attracted, the adjudicating authorities and the Courts have to bear in mind whether they are proceeding against the goods or against the person. If they are proceeding against the goods, the standard of proof that is required is far less when compared to a proceedings in which they are proceeding against that person. Similarly, in all cases to which Section 123 is not attracted, the initial burden of proving that the goods are smuggled goods is on the Department. Under no circumstances, it changes, but in discharge of that burden, once the department adduces evidence, the question is whether that burden of proof shifts to the opposite party, if so, at what stage. It is in this context, Section 106 is attracted as the smuggling being a clandestine conveying of goods to avoid legal duties. Secrecy and stealth being its covering guards, it is impossible for the Preventive Department to unravel every link of the process. It is here the underlying principle of Section 106 is attracted and once prima facie evidence is adduced to show that the goods seized are smuggled goods, the burden of showing that it is not the smuggled goods shifts to the person from whose possession these goods are seized. There is a presumption of innocence, but it may be successfully encountered by the presumption of guilt arising from the unexplained lawful possession of the property. It is unfortunate that a Tribunal which is a specialised body, instead of applying its mind to the facts of this case, to the statutory provisions and the principles evolved for more than four decades, and decide the case has followed judgment which cannot be approved and cannot be treated as a judgment which is rendered after referring to those judgments to which a reference is made. It is the case of the respondents that the goods were purchased by them in Burma Bazaar, Chennai. Admittedly, they were not in possession of any documents to show that they purchased those goods from Burma Bazaar, Chennai. It is admitted that they are in the business of selling these electronic items which is for the purpose of selling them. These items were brought from Chennai to Bangalore through Mallapuram. If their statement is to be ignored, there is nothing on record to show that these goods were readily available in plenty in the open market. The initial presumption of innocence cannot be extended to the respondents. As the said goods are all having foreign markings, in the absence of any material to show that it is purchased from a registered dealer dealing with those goods and in the light of what they have stated in the statement under Section 108, burden of proving that they were acquired lawfully shifts on the respondents. They have miserably failed to substantiate their case. - The respondents are in the business of sale of smuggled goods and as no duty is paid on these goods, they are liable for confiscation under the Act. - Decided in favor of revenue.
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