2021 (1) TMI 768 - AT - Customs

Smuggling - Baggage Rules - concealment of dutiable/contraband goods - 20 yellow metal discs concealed in 10 lids of Tiger Balm - 4 cartons of Gudang Garam International Cigarettes - Gold - N/N. 12/2012-Cus. dated 17 March 2012 - HELD THAT - It is found that the appellant had brought a small quantity of 233.00 gms. of gold in the shape of 20 disc (about 11.66 gm. per disc) for personal use. Further it is found that there is no commercial quantity either of gold or cigarettes. Further it is found that the appellant is an eligible passenger as defined in condition No. 35 of the Notification No. 12/2012-Cus and entitled to import gold up to one kilogram on returning to India on payment of concessional duty. It is further held that the appellant is eligible to pay concessional duty as provided under Notification No. 12/2012-Cus read with the provisions of Customs Tariff Act and there is no case of alleged violation of the provisions of Section 111(d) (i) (j) (l) and (m) so far gold is concerned. Accordingly it is directed that the seized gold is to be released to the appellant on payment of concessional duty under Notification No. 12/2012-Cus. Confiscation of gold is set aside. Cigarettes - HELD THAT - It is not a commercial quantity. However the appellant was entitled to import only 100 sticks (duty free). Accordingly the absolute confiscation of the cigarettes (being 960 sticks in quantity) valued at Rs. 10, 000/- is upheld - Further the penalty under Section 112(a)(i) is reduced to Rs. 10, 000/. The penalty under Section 114AA is set aside as the condition precedent for imposition under the said section are not found under the facts and circumstances of this case. Appeal allowed in part.

Summary

Issues:
1. Alleged smuggling of gold and cigarettes by a passenger returning to India.
2. Interpretation of Baggage Rules and Customs Act provisions regarding import of gold and cigarettes.
3. Assessment of eligibility for concessional duty under Notification No. 12/2012-Cus.
4. Consideration of penalties under Sections 112(a)(i) and 114AA of the Act.

Issue 1: Alleged Smuggling of Gold and Cigarettes
The appellant, a road cleaner in Dubai, was intercepted at Jaipur Airport with 20 gold discs and 4 cartons of cigarettes concealed in his baggage. The Revenue alleged smuggling under Section 111 of the Customs Act due to non-declaration and attempted evasion of duty. The appellant claimed innocence, stating he was unaware of the contents as a friend had given him the items to deliver. The officers conducted a search at his residence but found no incriminating evidence.

Issue 2: Interpretation of Baggage Rules and Customs Act Provisions
The Revenue contended that the appellant, as an Indian returning to India, was not permitted to import gold in any form other than ornaments under Baggage Rules. They argued that the appellant did not qualify as an eligible passenger under Notification No. 12/2012-Cus, thus subjecting him to the basic rate of Customs duty. The Show Cause Notice demanded confiscation of the seized goods and proposed penalties under various sections of the Act.

Issue 3: Assessment of Eligibility for Concessional Duty
The appellant defended his actions, claiming he brought the gold and cigarettes for a family wedding and intended to declare them. He asserted his entitlement to concessional duty under Notification No. 12/2012-Cus, citing personal use and lack of commercial quantity. The appellant emphasized his lack of education and cooperation from Customs officers, seeking release of goods on payment of appropriate duty.

Issue 4: Consideration of Penalties
The adjudication resulted in absolute confiscation of the gold and cigarettes, along with penalties imposed under Sections 112(a)(i) and 114AA of the Act. The appellant appealed, arguing for the release of seized goods, reduction of penalties, and recognition of his eligibility for concessional duty. The Tribunal analyzed the circumstances, finding the appellant eligible for concessional duty on the gold but upholding confiscation of the cigarettes and modifying the penalties.

In conclusion, the Tribunal allowed the appeal in part, setting aside the confiscation of gold and reducing the penalty while upholding the confiscation of cigarettes and adjusting the penalties imposed. The judgment clarified the eligibility of the appellant for concessional duty under Notification No. 12/2012-Cus and addressed the alleged smuggling accusations and penalties under the Customs Act.