TMI Blog2014 (9) TMI 376X X X X Extracts X X X X X X X X Extracts X X X X ..... e question is whether that burden of proof shifts to the opposite party, if so, at what stage. It is in this context, Section 106 is attracted as the smuggling being a 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. It is here the underlying principle of Section 106 is attracted and once prima facie evidence is adduced to show that the goods seized are smuggled goods, the burden of showing that it is not the smuggled goods shifts to the person from whose possession these goods are seized. There is a presumption of innocence, but it may be successfully encountered by the presumption of guilt arising from the unexplained lawful possession of the property. It is unfortunate that a Tribunal which is a specialised body, instead of applying its mind to the facts of this case, to the statutory provisions and the principles evolved for more than four decades, and decide the case has followed judgment which cannot be approved and cannot be treated as a judgment which is rendered after referring to those judgments to which a reference is made. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the hotel indicated that one Shri Sameer M.P., Fathima Bhavan, Edapal, Mallapuram had checked into Room No. 113 of the said hotel at 2.00 a.m. on 10-6-2003. Thereafter the Officers proceeded to Room No. 113 of the said hotel where two persons who introduced themselves as Shafiq and Sameer were present. Shri Shafiq acknowledged that the car belonged to him and that he had left from Edapal in Mallapuram, Kerala along with Shri Sameer on 9-6-2003 and reached Bangalore in the early hours of 10-6-2003 and checked into the hotel. On enquiry, they informed that they had carried computer parts in the said car from Edapal in Mallapuram in Kerala to Bangalore for sale in Bangalore on the directions of one Shri Mohammed of Edapal, Kerala. Examination of the Mitsubushi Lancer car was carried out. Nineteen cartons containing 99 sets of Intel Pentium 4 Processors and cooling fan of foreign origin valued at ₹ 7,92,000/- were found. M.P. Sameer and Anwar Shafiq were asked to produce documents for possessing and transporting these goods. They were unable to produce any documents for these goods. Those goods were seized under a mahazar dated 10-6-2003 on the reasonable belief that the said ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stated that they had not smuggled the goods, but they had purchased the same from open market i.e., Burma Bazaar, Chennai. In those circumstances, the goods cannot be seized and confiscated. The judgment in the case of N.A. Khan clearly applies to the facts of the case, accordingly it set aside the impugned orders. Aggrieved by the said order, the Revenue is in appeal. 6. The learned Counsel for the appellant-Revenue assailing the impugned order of the Tribunal contends that as the goods involved in this appeal do not fall within Section 123 of the Customs Act, in the first instance, the burden of proving the confiscated goods are smuggled goods is on the department. The said burden is discharged by them by showing that the goods seized all had foreign markings. They were seized from the car which was parked in the Hotel. The statement recorded under Section 108 of the Act shows that these goods were purchased from Burma Bazaar, Chennai, but there were no receipts evidencing the same. Admittedly, it had been transported from Chennai to Mallapuram and then to Bangalore for the purpose of sale at Bangalore. Therefore, the initial burden which was on the department has been duly d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... person, claims to be the owner thereof, such person, and anything other than the goods, the owner of the goods. This Section 123 is an exception to the law relating to the burden of proof, which imposes an obligation on the owner or the person from whose possession the goods are seized to prove that it is not a smuggled goods. In other words, statutorily the negative is expected to be proved by the owner or the person from whose possession the goods are seized. This presumption is that in respect of the goods covered under the said Section, if it is found in the possession of the owner or the person in possession, it is a smuggled goods. However, this Section has no application to the goods which do not fall within the said Section. In respect of those goods, the burden of proving that the goods seized or smuggled goods is on the person who has asserted it to be a smuggled goods. Here the general law of evidence is attracted. 11. Section 101 of the Indian Evidence Act, 1872 provides that - whoever desires any Court to give judgment as to any legal right or liability dependent on the existence of facts which he asserts, must prove that those facts exist. When a person is bound to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y perfect proof often it is nothing more than a prudent man s estimate as to the probabilities of the case. The other cardinal principle having an important bearing on the incidence of burden of proof is that sufficiency and weight of the evidence is to be considered to use the words of Lord Mansfield in Blatch v. Archar - (1774) 1 Cwop. 63 at p. 65 According to the Proof which it was in the power of one side to prove and in the power of the other to have contradicted . Since it is exceedingly difficult, if not absolutely impossible for the prosecution to prove facts which are especially within the knowledge of the opponent or the accused, it is not obliged to prove them as a part of its primary burden. 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, of the Evidence Act, the burden to establish those facts is cast on the person concerned: and if he fails to establish or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... circumstances, it changes, but in discharge of that burden, once the department adduces evidence, the question is whether that burden of proof shifts to the opposite party, if so, at what stage. It is in this context, Section 106 is attracted as the smuggling being a 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. 14. It is here the underlying principle of Section 106 is attracted and once prima facie evidence is adduced to show that the goods seized are smuggled goods, the burden of showing that it is not the smuggled goods shifts to the person from whose possession these goods are seized. There is a presumption of innocence, but it may be successfully encountered by the presumption of guilt arising from the unexplained lawful possession of the property. Therefore, the question whether the department has discharged the burden of proof in a given case and the principle underlying Section 106 is attracted to the facts of the case depends on the facts of each and every case. There cannot be any hard and fast rule and it cannot be defined in a st ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o show that they purchased those goods from Burma Bazaar, Chennai. It is admitted that they are in the business of selling these electronic items which is for the purpose of selling them. These items were brought from Chennai to Bangalore through Mallapuram. If their statement is to be ignored, there is nothing on record to show that these goods were readily available in plenty in the open market. The goods which were seized were not meant for their personal use. It was meant for sale. If any person is carrying on a lawful business, he should have possessed the documents showing title to the said property. If he has purchased it from a dealer or a wholesaler, there should be some documents evidencing such purchase. It is not forthcoming. Therefore, the initial presumption of innocence cannot be extended to the respondents. As the said goods are all having foreign markings, in the absence of any material to show that it is purchased from a registered dealer dealing with those goods and in the light of what they have stated in the statement under Section 108, burden of proving that they were acquired lawfully shifts on the respondents. They have miserably failed to substantiate their ..... X X X X Extracts X X X X X X X X Extracts X X X X
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