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2015 (2) TMI 176 - AT - CustomsConfiscation of goods - Imposition of penalty - abatement of the illegal export of foreign currency - Held that:- Three passengers, namely, S/Shri Fayaz Gulam Godil, Mukhtar Gulam, Farhan Shekhani, proceeded to Hong Kong on 22-5-2010 carrying foreign currency amounting to US $ 1,24,100 without declaring the same before Customs authorities. However, they were not allowed entry into Hong Kong and were deported back and they arrived in India on 24-5-2010; therefore, it was not a case of successful export of foreign currency but an attempt to take out the foreign currency from India, which failed. It is also on record that the currency was concealed and was never declared to the Customs authorities. As per the provisions of Foreign Exchange Management Act, 1999 read with Foreign Exchange Management (Current Account Transaction) Rules, 2000, “no person shall draw foreign exchange (a) exceeding US $ 10,000 or its equivalent in one calendar year for one or more private visits to any country (Except Nepal and Bhutan) (b) exceeding US $ 25,000 for business travel”. Currency seized is in excess of these limits and therefore, the foreign currency seized are prohibited goods in terms of Section 2(33) of the Customs Act which define prohibited goods as “any goods, the import or export of which is subject to any prohibition under this Act or any other law”. In the case of prohibited goods, as per Section 125, it is the discretion of the adjudicating authority to allow redemption or to resort to absolute confiscation. Therefore, there is no right of redemption provided in respect of prohibited goods. A Larger Bench of this Tribunal had examined the issue at length in Peringatil Hamza case (2014 (8) TMI 247 - CESTAT MUMBAI (LB)) and after examining the various provisions of the Foreign Management Act and Rules made thereunder and the decisions of the Hon’ble Apex Court in the case of Sheikh Mohd. Omer v. CC, Calcutta & Others - [1970 (9) TMI 36 - SUPREME COURT OF INDIA] came to the conclusion that in the case of prohibited goods, the same can be absolutely confiscated and it is the discretion of the proper officer to allow redemption on payment of fine. It is an admitted position that the currency was illegally exported from India by concealing it in the baggage and considering the substantial quantum of currency seized, the adjudicating authority has come to the conclusion that this is not a case where discretion has to be exercised by allowing redemption of confiscated currency. The penalty of ₹ 5 lakhs imposed on Shri Fayaz Gulam Godil under Section 114 is justified. As regards the imposition of penalty, on Shri Mustafa Kantawala, from the statements of Shri Fayaz Gulam Godil and the SMS message received by Shri Farhan Shekhani, it is clear that he had directed Shri Fayaz Gulam Godil to smuggle out the currency from India. Therefore, his abetment in smuggling out of foreign currency is clearly established. Therefore, imposition of penalty on him under Section 114 is justified. The penalty imposed of ₹ 10 lakhs cannot be said to be excessive when the total value of the currency sought to be illegally exported is of the order of ₹ 56 lakhs and the penalty imposed is less than 20% of the value of the currency. - Decided against assessee.
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