1975 (8) TMI 50 - SC - Customs

Whether the presumption contained in Section 123 of the Act corresponding to Section 178A of the Sea Customs Act 1878 or any other provision of law would place the onus of proving innocent possession of these goods upon the appellant? Held that - The very appearance of the goods and the manner in which they were packed indicated that they were newly manufactured and brought into this country very recently from another country. The inscriptions on them and writing on the boxes were part of the state in which the goods in unopened boxes were found from which inferences about their origin and recent import could arise. The appellant s conduct including his untruthful denial of their possession indicated consciousness of their smuggled character or mens rea. In any case there was some evidence to enable the Courts to come to the conclusion that the goods must have been known to the appellant to be smuggled even if he was not a party to a fraudulent evasion of duty. Consequently the appellant had been convicted only under Section 135(1)(ii) of the Act. We do not find sufficient reason to interfere with this finding of fact or the sentence imposed. It would also follow that the goods were rightly confiscated. Appeal dismissed.

Summary

Issues:
1. Conviction under Section 135(b)(ii) of the Customs Act, 1962.
2. Allegations of importing goods without a license and evading customs duty.
3. Application of burden of proof under Section 123 of the Act.
4. Presumption of guilty knowledge under Section 106 and Section 114 of the Evidence Act.

Detailed Analysis:
1. The appellant was convicted under Section 135(b)(ii) of the Customs Act, 1962, for possessing cigarette lighters and flints without an import license. The appellant was sentenced to rigorous imprisonment and fined, with the confiscated goods handed over to the Inspector of Central Excise and Customs.

2. The complaint alleged that the goods were imported without a license, contravening import control orders, and evading customs duty. The appellant denied possession, claiming the goods belonged to sub-tenants, but his explanation was disbelieved by the lower courts. The prosecution argued the appellant was aware of the incriminating nature of the goods, as evidenced by his initial refusal to produce the keys.

3. The key issue was the application of the burden of proof under Section 123 of the Act, which places the onus on the possessor of seized goods to prove they are not smuggled. The prosecution contended that the appellant failed to prove legal importation, relying on precedents to support the presumption of guilty knowledge.

4. The prosecution invoked Section 106 and Section 114 of the Evidence Act to argue that the appellant's possession of the goods created a presumption of guilty knowledge. The defense challenged this, emphasizing the lack of evidence proving smuggling or illegal importation. The court upheld the conviction under Section 135(1)(ii) based on the appellant's conduct and the nature of the goods, affirming the confiscation and dismissing the appeal.