TMI Blog2013 (4) TMI 7X X X X Extracts X X X X X X X X Extracts X X X X ..... sufficient to establish the smuggled nature of the goods. Held that :- The argument provided by the appellant is wrong for the reason that subsequent to sub-section (2) of Section 123 clearly provides that the section applies to gold and the manufacturer thereof. Customs authorities did not seize the goods from the appellants; therefore, the provisions of Section 123 which casts the onus on the appellants to prove that the goods are not smuggled is not applicable, inasmuch as no seizure has been made from the appellant by the Customs. Therefore, the burden and onus of proof to establish the fact that the goods are smuggled lies on the Revenue and not on the appellants. In respect of these gold articles, there is no evidence whatsoever in record to show that they are of foreign origin. Tribunal do not find any infringement of the provisions of Customs Act so as to attract confiscation under Section 111(e) and (i) of the said Act and accordingly, and set aside the same. The next issue for consideration is whether the appellants are liable to pay Customs duty demanded under Section 28 of the Customs Act. Invoking the provisions of Section 28 applies to imported goods. Smuggled ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssioner of Customs, Pune about the arrest of the owner and driver of the vehicle and seizure of the gold and silver. The Asst. Commissioner of Customs, Pune, vide letter dated 6-11-2009 requested the Police authorities to hand over the seized goods, cash, vehicle and the same were taken over by the Customs from the Police and were seized under the provisions of the Customs Act. Thereafter, the appellant and his driver were taken over to the Customs Office for interrogation and their statements were recorded on 6/7-11-2009 and they were arrested by the Customs Officers on 8-11-2009 and produced before the JMFC, Pune, who remanded them to judicial custody. The appellant and his driver moved application for bail and submitted various documents to establish the licit possession of the goods seized and pleaded that they were not guilty of any offence; however, their bail application was rejected by the JMFC. Thereafter, on 9-11-2009, another application for bail was moved before the Sessions Court and they were released by the Sessions Court on 18-11-2009. 2.2 In his statement dated 6-11-2009, the appellant, inter alia, admitted that he did not have any document showing the licit impo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he other hand submitted on 16-11-2009 documents from 9 traders (by way of letters) of Narayanpet under which he had procured gold bars/ornaments totally weighing 2085.170 gms and cash of Rs. 2.5 lakhs. 2.4 The department also got the purity of the gold seized from the appellant tested by M/s. Tanishq. The purity of 10 gold bars of 100 gms each and 2 half gold bars of 50 gms each, having foreign markings, varied from 98.7 to 99.9. In respect of primary gold, which were not having any foreign markings, the purity varied from 77.74 to 99.44 and in respect of gold ornaments the purity varied from 81 to 85. The value of the gold under seizure was arrived at Rs. 40,47,158.40 and the customs duty liability was determined at Rs. 9,88,371/- on the value and rate of duty prevailing on 6-11-2009. 2.5 On conclusion of the investigation, a show cause notice dated 3-5-2010 was issued to the appellant, his driver, 9 traders of Narayanpet proposing confiscation of 2455.800 gms of gold under Sections 111(e) and 111(i) read with Sections 119 and 120 of the Customs Act. The notice also proposed confiscation of 74.200 gms of gold ornaments and 313 gms of silver ornaments under Section 119 ibid. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 82) E.L.T. 494] (iv) H. Ismail v. CCE C, Cochin [2001 (133) E.L.T. 191] 4. Mere foreign marking on the gold does not by itself establish the smuggled nature of the goods. It can at best establish the foreign origin of the goods. He relies on the following judgments in support of his contention, namely :- (i) Naved Ahmed Khan v. CC, Bangalore [2005 (182) E.L.T. 494] (ii) Jitendra Pawar v. CC, Raipur [2003 (156) E.L.T. 622] (iii) CC, (Prev) Kolkata v. Monoranjan Banik [2004 (165) E.L.T. 237] 5. Merely because the appellant could not produce the documents to establish the licit nature of the goods is not sufficient to establish the smuggled nature of the goods. Appellant had, in fact produced the challan/certificates to establish the licit possession of the gold at the first available opportunity before JMFC. The ld. adjudicating authority conveniently ignored these documents by merely saying that the said documents do not match with the gold seized from the possession of the appellant. He relies on the following judgments in support of his above contention, namely :- (i) Krishnakumar Dhandhania [2007 (219) E.L.T. 736 (Tri.-Kol.)] (ii) CC v. Golak Chandra Kamila [200 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ame view has held by the Hon ble High Court of Bombay in the case of Prithviraj Pokhraj Jain (cited supra) and by this Tribunal in a number of cases such as Nirmala Mitra [2001 (138) E.L.T. 1037 (Tri.-Kol.)], E. Eshwara Reddy, Naveed Ahmed Khan, etc. Therefore, the burden and onus of proof to establish the fact that the goods are smuggled lies on the Revenue and not on the appellants, in terms of the judgment cited above and we hold accordingly. 7.2 Further, we observe that in the case under consideration only in respect of gold bars weighing 1100 grams, the same bore foreign markings. In respect of gold bars weighing 206 grams it was marked as Laxman Rao in marathi and in respect of six small gold pieces it bore the markings of J. Laxman, Swastik symbol and Shantaram. These markings clearly show that the goods were of Indian origin and not of foreign origin. Therefore, in respect of these gold articles weighing 1206 grams in total, there is no evidence whatsoever in record to show that they are of foreign origin. With respect to the 12 gold bars/biscuits bearing foreign origin, the appellant has produced letters from Sri Ganesh Jewelers of Narayanpet, Sri Balaji Jewellers of Nar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncomprehensible why the appellant who procured the gold from these nine traders was not given the same benefit of doubt. The only evidence which the department has, against the t appellant is the statement which he had given on 6/7-11-2009 wherein the appellant had admitted that the goods under seizure are smuggled. However, the appellant has subsequently produced evidence, by way of letters/bills, to show that he had procured these from traders in Narayanpet licitly. 7.4 The Hon ble Apex Court in the case of Francis Stanly @ Stalin v. Intelligence Officer, Narcotic Control Bureau, Thiruvananthapuram (MANU/SC/8783/ 2006) and Assistant Collector of Central Excise, Rajamundry Duncan Agro Industries Ltd., (MANU/SC/0486/2000) held that Courts must seek corroboration of the purported confession from independent sources . In State (NCT of Delhi) v. Navjot Sandhu @ Afasan Guru [(2005) 11 SCC 600], the Apex Court held that a Court shall not base a conviction on a confession without corroboration. It is not a rule of law, but is only a rule of prudence that under no circumstances can a conviction be made without corroboration. In the facts of the case before us, inasmuch as the appellan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red for home consumption. Smuggled goods are not imported goods as held by the Hon ble Apex Court in the case of Commissioner of Customs v. Ambalal Co. [2010 (260) E.L.T. 487 (S.C.)]. Therefore, the provisions of Section 28 are not attracted in the case of smuggled goods. Duly on smuggled goods can be demanded when the smuggled goods are confiscated and thereafter, released on payment of a redemption fine under Section 125(1) of the Customs Act. Sub-section (2) of Section 125 states that where any fine in lieu of confiscation of goods is imposed under sub-section (1), the owner of such goods or the person referred to in sub-section (1) shall, in addition, be liable to any duty and charges payable in respect of such goods. Therefore, the demand of duty under Section 28 in the instant case is wrong and bad in law. In the instant case, duty has been demanded on the basis of its value and rate of duty prevailing on the date of seizure namely, 6-11-2009 which is wrong. In the case of goods which are confiscated and released on payment of fine, as per the provisions of Section 15 of the Customs Act, the date for determination of rate of duty and value shall be the date on which the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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