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2015 (9) TMI 1197 - AT - CustomsConfiscation of seized diamonds under Section 111(d), (f), (i) and (m) - imposition of penalties - Smuggling - It is seen that in the context of section 111(d) or 113(d), in several precedents, the definition of 'prohibited goods' as contained in section 2(33) of the Customs Act, 1962 has been applied liberally, including in Om Prakash Bhatia vs. Union of India, [2003 (7) TMI 74 - SUPREME COURT OF INDIA] and Sheikh Mohd. Omer vs. Collector, [1970 (9) TMI 36 - SUPREME COURT OF INDIA]. - Under section 125 of the Customs Act, unless the importation or exportation of goods is expressly 'prohibited', the Adjudication Authority is obliged to offer to the Owner the goods an option to pay fine in lieu of confiscation. Since the import of 'cut and polished diamonds' is not expressly prohibited under Section11 of the Customs Act, 1962 or by any other statutory notification, we find merit in the ground that an option to redeem them on payment of fine in lieu of confiscation was mandatory. However, after conclusion of the hearing, on instructions, advocate for Ms. Kanchna informed that now she will not avail the option of redemption even if granted. Therefore, we are not interfering with the order of absolute confiscation. Since the courier parcel was in the name of his sister, considering the gravity and penal consequences and due to natural love and affection he initially accepted under pressure the ownership and importation of the seized courier parcel. He categorically stated that he was not concerned with the seized goods and as such he was not opposing the confiscation of the seized goods. However, he strongly opposed imposition of any penalty whatsoever on him under the provisions of the Customs Act, 1962. However, adjudication qua him was not completed with five weeks and thereafter he filed application for settlement as co-applicant, which was dismissed. No admission was made by these brothers even before the Settlement Commission. It is seen that his subsequent statements, which were also recorded under section 108, do not incriminate him or Nilesh Patel. These statements cannot be ignored. His explanation therefore seems plausible. The adjudicating authority has recorded that Ms. Kanchana appears to have been pressurized to file an affidavit giving untenable grounds such as non dutiability of the seized diamonds and conflicting reasons for sending concealed diamonds for collection by Jimmy who was not even known to Shri Bhargav Patel or his parents in India. We find that on the contrary she admitted her duty liability not only before Settlement Commission but also during the adjudication proceedings. There is no cogent evidence to show that she was so pressurized and this finding is based only on suspicion. There is no document or material or circumstantial evidence showing that Bhargava Patel had placed any order either verbal or written, or made compensatory payment, for the seized diamonds. In view of the above, we find that role of Mr. Bhargav Patel and Nilesh Patel in the smuggling of the diamonds under seizure is not established even on preponderance of probability and penalties imposed on them are set aside. - Decided partly in favour of appellants.
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