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TMI Blog1989 (11) TMI 178X X X X Extracts X X X X X X X X Extracts X X X X ..... der. 3. The goods, confiscation of which is challenged in these appeals, had been seized by the Customs officers of Dinhata Customs, Preventive Unit and the Police officers of Cooch Behar from a godown belonging to one Shri Rewatmal Gunecha at Station Road, Dinhata, after a search of the said premises. The search was on 11-6-1984 and the seizure was effected on 13-6-1984. The present appellants submitted individual petitions on 9-7-1984 claiming ownership of the seized goods. In the statements recorded by the Customs officers on 13-7-1984 they reiterated their claim of ownership of the seized goods and stated that they had purchased the goods from different Hats of Gitaldah and Dinhata with a view to selling them at different places of Cooch Behar, Jalpaiguri and Darjeeling. They could not, however, produce any evidence showing the legal importation of the goods or their legal acquisition or possession of the seized goods. The goods were seized under Section 110 of Customs Act, 1962 on reasonable belief that they had been imported illegally from a foreign territory in violation of Section 3(2) of the Import/Export (Control) Act, 1947 read with Section 11 of the Customs Act, 1962 a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eign marks; (iii) No trade restriction in dealing with the subject goods in border areas; (iv) Selling old garments is a primitive trade for the use of poor persons; (v) Subject goods abundantly available everywhere in the State; (vi) No evidence of importation from Bangladesh furnished with the Show Cause Notice; (vii) Goods not covered under Section 123 of the Customs Act. Burden of proof is on the Department. Reliance placed on CEGAT decision in S.N. Sarkar v. Collector of Central Excise, New Delhi 1985 (22) E.L.T. 186 (Tri.) = 1984 ECR 2296; (viii)Suspicion is not evidence - CEGAT's decision M. Abdul Aziz & Sons v. Collector of Central Excise, New Delhi 19S3 ECR 1727 Relied upon; (ix) Even in the case of goods where the burden of proof is on the person concerned to prove that the goods seized are not smuggled [vide Section 178A of the Sea Customs Act, 1878], the Madras High Court had held that the prosecution should prove that the articles brought are smuggled articles (AIR 1961, Madras 368: Public Prosecutor v. M.L. Modi); (x) The proposal to impose penalty was made in the Show Ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gifts for distribution among poor persons. Such old and used garments are also sold by the Customs department; (v) Foreign made garments are neither notified goods nor covered under Section 123 of the Customs Act, 1962; (vi) The Collector had not given his reasons why he did not accept the pleadings before him, particularly the preliminary points. 9. Arguing on behalf of the appellants, Shri Prantosh Mukherjee, learned Advocate, reiterated the contentions contained in the appeal memorandum, which have been referred to supra. He stressed the following points: The charge of unauthorised importation from Bangladesh had not been spelt out with the evidence pointing to such a fact. The charge has also not been established by the Collector's finding in the adjudication order. There is reference to markings which point to the goods being of third country origin, but the nature of markings had not been spelt out. Further, the Show Cause Notice referring to the claim of the appellants that they purchased the goods from the different Hats of Gitaldah and Dinhata, proceeds to make the observation that this version could not be accepted as correct "in view of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cross-examination of seizing officers and the Panch-witnesses." (iv) 1989 (41) E.L.T. 69 (Tribunal) = 1989 (20) ECR 364 Cegat B.M. Auto India v. Collector of Central Excise "Cross-examination of the witnesses should have been afforded to the appellants as requested." (v) 1966 A.C. 367 (369) Privy Council - Controller of Customs v. Western Electric Company Ltd. - "Mere markings could not be taken as proof of the fact of foreign origin of the goods as such marking and labels would be hearsay evidence" (vi) 1983 (12) E.L.T. 322 - B Lakshmichand v. Govt. of India "Where it was not held as to which of the clauses of Section 112 of the Customs Act was relevant and would be attracted it can be said that there was a failure to apply one's mind." 11. Replying to the arguments of the learned Counsel for the appellants, Shri D.N. Bhowmik, the learned JDR strongly urged that in quasi-judicial proceedings, cross-examination of witnesses is not a must and refusal of the said facility does not constitute denial of natural justice. He relied upon the decision in Manindranath v. Collector of Central Excise -1977 Tax L.R. 1754 referred to in the judgement of Madras High Court in K. Balan v. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the accused it is not obliged to prove them as part of its primary burden. 32. Smuggling is clandestine conveying of goods to avoid legal duties. Secrecy and stealth being its covering guards it is impossible for the preventive department to unravel every link of the process. Many facts relating to this illicit business remain in the special or peculiar knowledge of the person concerned in it. On the principle underlying Section 106, Evidence Act, the burden to establish these facts is cast on the person concerned; and if he fails to establish or explain those facts an adverse inference of facts may arise against him which coupled with the presumptive evidence adduced by the prosecution or the department would rebut the initial presumption of innocence in favour of that person and in the result prove him guilty .... this does not mean that the special or peculiar knowledge of the person proceeded against will relieve the prosecution or the department altogether of the burden of producing some evidence in respect of the fact in issue. It will only alleviate that burden to discharge which by slight evidence may suffice. 44......The broad effect of the application of the basic princ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en in respect of a case where the goods were confiscated even after producing the documents by the appellant evidencing the legal possession of the goods whereas in the case before him the persons who claimed ownership of the seized goods had not been able to produce evidence showing their legal importation/acquisition/possession. He has held that the smuggled character of the goods is proved by the marks of foreign origin and that the ratio of the earlier Tribunal decision cannot be said to be relevant to the instant case. It was this aspect of the Collector's order that was stressed by the learned JDR while stressing the point that as laid down in the D. Bhourmul case by the Supreme Court it is not necessary to establish in a smuggling case every link in the chain of the clandestine activity. In that case the Supreme Court had, while conceding that no direct evidence of the illicit importation of the goods was adduced by the department, it had made available to the Collector several circumstances of a determinative character which coupled with the inferences arising from the dubious conduct of Baboothmull and Bhourmull could reasonably lead to the conclusion drawn by the Collecto ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts were confiscated was the marks of foreign origin it would not be in order to confiscate all the garments as if all of them were of foreign origin, when admittedly such marks were found in only some of them. Further, the thrust of the judgements cited by the learned JDR regarding the effect of the marks of foreign origin is only that they were of foreign origin or that they had been imported. That does not mean that these goods had been smuggled into the country rendering them liable to confiscation. 16. The appellants had explained how they had acquired the goods. There is no mention in the Collector's order that this had been disbelieved and that we found contentions untenable and hence rejected the same. The only reason given is that they did not produce only evidence regarding their legal importation/acquisition and possession. Examining the appellants' contentions the Collector has observed in his adjudication order that the seizure list did not indicate the marks of foreign origin and that on a reference to the seizing unit it had been ascertained that the goods under seizure bore marks of foreign origin, viz. Japan, Taiwan, Korea etc. and this information was communicated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the Tribunal holding that such a conclusion was unjustified. The goods were neither notified under Section 123 of the Customs Act, 1962 nor covered by Chapter IVA of the Act. Hence, placing the burden on the appellants to prove the lawful origin of the goods in India was not justified. The ratio of this case squarely applies to the present appeal. 17. The contention of the appellants that mere suspicion cannot amount to evidence and in absence of reliable evidence penalty is not sustainable, is based upon the decision of the Tribunal in Abdul Aziz & Sons v. Collector of Customs, New Delhi [1983 ECR 1747 CEGAT]. This has been rejected by the Collector with the observation that as in the above case the appellants were accused of smuggling Hashish in wooden furniture etc. misdeclared to Customs, the facts of that case are distinctly different from the instant one, the ratio of the decision cited was not relevant to the case before him. This is a palpably wrong conclusion by the Collector. The stand that suspicion cannot amount to evidence is an unexceptionable generalisation which is truly applicable to any case irrespective of the difference in the nature of case, or the commod ..... X X X X Extracts X X X X X X X X Extracts X X X X
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