2004 (7) TMI 482 - AT - Customs

Smuggling - seizure of betel-nuts - Determination of origin of goods - ownership of goods - Evidence - HELD THAT - It is admitted position that the betel-nuts were booked by the appellants from Dhupguri as certified by C.P.S. Northern Railway BSB. The subordinate authority has come to this conclusion that the betel-nuts are of foreign origin on the basis of the opinion given by two local traders. But such traders opinion is not sufficient to establish that the betel-nuts were of foreign origin as decided by this Tribunal in the case of Sunderlal v. Commr. of Customs (Prev.) 2003 (12) TMI 398 - CESTAT KOLKATA and Laxmi Narayan Somani v. Commr. of Customs 2003 (1) TMI 181 - CEGAT KOLKATA . In the present case there is no iota of evidence that the goods were of foreign origin. The Additional Commissioner as well as the Commissioner (Appeals) has relied upon the opinion of the local traders which is not sufficient to establish that the betel-nuts were of foreign origin. The betel-nuts are grown in Assam and adjoining area and the goods under dispute had come from the same area. Under these circumstances it cannot be said with certainty that the goods were of foreign origin. Betel-nuts are not notified items and as such it is for the Revenue to prove by production of sufficient evidence that the betel-nuts have been smuggled into the country. No such evidence has been produced by the Revenue. In so far as the ownership is concerned in the present case the appellants have produced the receipt of the goods. Further the Railway authorities have verified that the goods were booked by the appellants from Dhupguri to Varanasi. The Civil cases are decided on the basis of preponderance of the evidence. In this case the preponderance of evidence is in favour of the appellants. Thus it is established that the appellants are the owner of the betel-nuts. In view of the above discussions the appeals deserve to be allowed.

Summary

Issues involved: Determination of origin of goods, ownership of goods, validity of seizure under Section 110 of the Customs Act, 1962.

Origin of Goods: The case involved the seizure of betel-nuts suspected to be of foreign origin at a railway station. The Customs officers relied on the opinion of local traders to determine the origin of the goods. However, the Tribunal emphasized that such opinions alone are not sufficient to establish foreign origin, especially when dealing with non-notified items like betel-nuts. Lack of concrete evidence from the Revenue to prove smuggling was highlighted, citing previous judgments where reliance on local traders' opinions was deemed insufficient.

Ownership of Goods: The appellants were able to produce receipts and verification from Railway authorities confirming the booking of the goods. The Tribunal noted that civil cases are decided based on preponderance of evidence, and in this instance, the evidence favored the appellants, establishing their ownership of the betel-nuts.

Validity of Seizure: The Additional Commissioner had confiscated the betel-nuts and imposed penalties based on the belief of foreign origin, a decision upheld by the Commissioner (Appeals). However, the Tribunal found that the Revenue failed to provide substantial evidence to support the claim of smuggling or foreign origin. Consequently, the impugned order and Order-in-Original were set aside, and both appeals were allowed in favor of the appellants, with consequential relief granted.