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Issues Involved: Seizure and confiscation of zip fasteners, sewing machine needles, and pant hooks of foreign origin; application of Section 123 of the Customs Act; burden of proof regarding the origin of goods; legality of confiscation under Section 111(d) and Section 111(p) of the Customs Act.
Issue-wise Detailed Analysis: 1. Confiscation of Zip Fasteners: The appellant contended that the YKK Zip Fasteners were of Indian origin, supported by a receipt from Modi Enterprises. The department argued that the appellant failed to prove the Indian origin of the goods and that the bulk zip fasteners found in the appellant's premises were not recorded in the notified registers, violating Section 123 of the Customs Act. The Tribunal held that the zip fasteners were indeed a notified item under Section 123, shifting the burden of proof to the appellant. Despite the appellant producing a receipt, no investigation was conducted by the department to verify its authenticity. The Tribunal concluded that the confiscation under Section 111(d) was not justified but confirmed the confiscation under Section 111(p) due to the appellant's failure to record the 500 pcs. of zip fasteners in the notified registers, thus violating Section 11(e) of the Customs Act. 2. Confiscation of Sewing Machine Needles: The appellant produced an invoice from M/s. Devidayal Sales Private Limited, indicating the purchase of industrial sewing machine needles. The department contended that the invoice showed an ex-factory price, suggesting Indian origin, while the seized needles were foreign. The Tribunal noted that the invoice from M/s. Devidayal Sales Pvt. Ltd. indicated the import of needles from a foreign company, and no inquiry was made by the authorities to disprove this claim. Given the lack of investigation and the possibility that the needles were indeed imported by M/s. Devidayal, the Tribunal extended the benefit of doubt to the appellant and set aside the confiscation of the sewing machine needles. 3. Confiscation of Pant Hooks: The appellant did not dispute the foreign origin of the pant hooks but produced a challan from Prasaran Enterprises. The department argued that the mere foreign origin of the goods justified their seizure. The Tribunal, referring to the Supreme Court's decision in D. Bhoormull, emphasized that circumstantial evidence could justify the inference that goods were smuggled. However, the Tribunal found that the circumstances in the present case did not support such an inference. The mere fact that the goods were foreign did not suffice to prove they were smuggled. The Tribunal cited previous decisions stating that foreign origin alone was insufficient for confiscation without clear evidence of smuggling. Consequently, the confiscation of the pant hooks was set aside. Conclusion: The Tribunal set aside the confiscation of the sewing machine needles and pant hooks but confirmed the confiscation of the zip fasteners under Section 111(p) of the Customs Act. The penalty imposed on the appellant was also confirmed. The sewing machine needles and pant hooks were ordered to be returned to the appellant.
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