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2008 (4) TMI 432 - HC - CustomsProhibited goods vis-avis Dutiable goods vis-à-vis Exempted goods - violation of the provisions of the Customs Act - Section 111 that the Act deals with “prohibited goods” and “dutiable goods” as two identifiable and separate categories. Goods which are dutiable but which are exempted from duty subject to conditions cannot become prohibited if these conditions are violated; they only become dutiable. Therefore, when it is accepted by both parties that the goods were imported as per Notification No. 20 of 1999, we are unable to see anything in the relevant clause in the said Notification which persuades us to come to the conclusion that the goods were prohibited – the goods in question are exempt from duty wholly or partially subject to certain conditions – The fact that subsequently a decision was taken because of the policy of the Government, which rendered the fertilizer plant unviable, would not justify a conclusion that the condition subject to which exemption from duty was granted had been violated - As per Section 125 of the Customs Act, if the goods are not prohibited, then the adjudicating officer shall give to the owner of the goods an option to pay in lieu of confiscation, such fine as the officer thinks it fit. It is only when it is a prohibited goods that the officer has the discretion and it is open to him not to give the option to pay fine in lieu of confiscation. Therefore, the finding of the learned Judge that the goods are prohibited is not correct - We only hold that the question whether there was suppression and fraud must be proved by one who alleges fraud; the question of collusion and conspiracy must also be proved by the one who alleges it. These are questions which have to be proved by adducing evidence.
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