TMI Blog2013 (1) TMI 727X X X X Extracts X X X X X X X X Extracts X X X X ..... ished their case. Therefore, we do not find any reason to find fault with the findings that the goods in question are smuggled into the country and consequently they are liable to confiscation under Section 111(d) of the Customs Act. It is not necessary that the goods should be prohibited from import under FTDR Act for them to be confiscated under Section 111(d). In this case the allegation is that the goods have been removed without payment of customs duty and therefore, they are liable to confiscation under Section 111(d) of the said Customs Act. Commissioner has imposed various penalties on the persons from whose possession the goods had been seized under Section 112(b) of the Customs Act. It is now well established that mens rea is an important ingredient for imposing a penalty on the persons enumerated in Section 112(b) of the Customs Act. The goods may be liable to confiscation for contravention of the provisions of the Customs Act but the person who is in possession of the goods need not necessarily have anything to do with either smuggling or dealing with them knowingly. The evidence brought out by the department nowhere suggests that the appellants were aware that the g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... additional evidence, if necessary. (1A) The Appellate Tribunal may, if sufficient cause is shown, at any stage of hearing of an appeal, grant time to the parties or any of them and adjourn the hearing of the appeal for reasons to be recorded in writing : Provided that no such adjournment shall be granted more than three times to a party during hearing of the appeal. (Emphasis supplied) Since sufficient opportunities as envisaged under the law have been given to the appellants which they failed to avail and since the appeals are more than a decade old, we take up the appeals for consideration and disposal. 3. These four appeals are taken up together for disposal as the subject matter and the legal issues involved are identical. These appeals arose out of four different orders passed by the Commissioner of Customs (Imports), Mumbai, on various dates. The Commissioner in the impugned orders confiscated the goods, imposed redemption fines and also imposed penalty on the person from whose possession the goods were seized. Hence these appeals. 4. The details of the appeals are summarised in the Table below : Appeal No. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct that these goods are of foreign origin is not denied by anyone. The owners explained that they received the goods after they purchased them from various stockists/importers in Mumbai. The department thereupon contacted the stockists/importers and enquired with them whether they have sold the goods found in the appellants premises. They, in their statements, recorded under Section 108, denied having sold the goods in question to the appellants. The Commissioner in the impugned orders mainly relied on the fact that the appellants could not explain the possession of the imported goods nor were they in a position to explain as to where they got the goods from nor were they in a position to say whether duty had been paid on the goods or not. To come to the conclusion that the goods are smuggled and therefore were liable to confiscation, the Commissioner relied on the above evidence even though the goods in question were not notified under Section 123 of the Customs Act. He mainly relied on the decision of the Supreme Court in D. Bhoormull s case and of Kanungo Co. s case [1983 (13) E.L.T. 1546 and 1983 (13) E.L.T. 1486 respectively]. Quoting from the decision of the Apex Court in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... led; that the goods had foreign markings on them does not imply that they are smuggled because they could have been legally imported into the country as well; that these goods are freely available in the market as there is no prohibition against their import at the relevant time; that the Commissioner s reliance on the D. Bhoormull s and Kanungo s cases is misplaced as no presumption is raised against the appellants by the department that the goods are of smuggled nature; that the appellants are under no obligation to retain Bills of Entry and other import documents permanently in respect of imported goods; that the department was trying to throw the burden cast on it on the appellants who were innocent traders in the impugned goods; that there is abundance of case law that in respect of non-notified goods to say that the burden to prove that the goods are smuggled is on the department; that if the case of the department is that the goods in question were imported under DEEC and were diverted to local market, the proper authority to adjudicate the case would be the Commissioner in charge of the port through which the goods were imported and not the Commissioner, Mumbai; and that in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssession, storage and sale of goods be maintained. Similar views have been held in Khulbhushan Jain v. Commissioner - 1999 (111) E.L.T. 906, Lakhpatrai Sons v. Commissioner - 2004 (177) E.L.T. 934 and a host of other judgments. (d) The Tribunal failed to consider the aforesaid settled law on the subject as cited above and it was not open to the Tribunal to come to a different conclusion in the present matter. 7. The ld. Addl. Commissioner (AR) appearing for the Revenue reiterates the findings given in the adjudicating authority s order and the grounds averred in the reply to the writ petition which are summarized briefly as below :- (i) As regards the jurisdiction of the Customs Department at Mumbai, to adjudicate the case, since the goods were seized at Mumbai, they have jurisdiction to adjudicate the case. They rely on the decision of the Hon ble Apex Court in the case of Shashank Foods Pvt. Ltd. [1996 (88) E.L.T. 626 (S.C.)] and of the Tribunal in the case of Engee Industrial Services Pvt. Ltd. [1996 (87) E.L.T. 152], (ii) The appellants have admitted that goods under seizure are of foreign origin and ownership of the goods are claimed by them and they h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a fiscal legislation are to be liberally construed so as to effectuate the purpose behind the said machinery. Therefore, when the cause of action arises within the territorial jurisdiction of a particular officer, he is competent to have the matter investigated even in an area outside his jurisdiction. It is not a case of stretching the jurisdiction beyond his territory at all . The appellant has relied on the decision of the Tribunal in the case of Vikram Jain to argue that the Customs Officers in Bombay does not have jurisdiction to adjudicate the present case. However the said decision of the Tribunal was overruled by the Hon ble Karnataka High Court in the same case reported in 2009 (244) E.L.T. 504 (Kar.) and it was held that the jurisdictional authorities in whose jurisdiction the seizure of the goods took place has authority to adjudicate the case. An identical issue was considered by this Tribunal in the case of Engee Industrial Services P. Ltd. (supra) and the Tribunal held that the cause of action which commenced at the place of clandestine import continues, and removal or transfer of such goods is part of the continuing cause of action. A part of the cause of action is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... but the onus of proof shifts. Onus means the duty of adducing evidence. In the present case the foreign origin of the goods is evident on the markings found on the packages of the goods and the appellants themselves have admitted that the goods are of foreign origin in the statements recorded under Section 108 of the Customs Act. The appellants were asked about the source of procurement of the goods. The appellants gave details in this regard and when the same were verified, it was found that the said suppliers had not supplied the impugned goods. When the appellants were confronted with these facts, they were unable to give any satisfactory explanation nor any evidence by way of bills/challans indicating the licit procurement of the goods. Thus the onus of proof shifted from the Revenue to the appellants which they have not discharged. 8.3 A similar issue came up before the Hon ble High Court of Bombay in the case of Sailash Amulakh Jogani v. UOI [2009 (241) E.L.T. 348 (Bom.)] and the Hon ble High Court held as follows in para 17 of the judgment. 17. None of the persons present at the office premises could satisfactorily explain from whom the diamonds were purchased. They ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the initial presumption of innocence in favour of that person, and in the result prove him guilty. As pointed out by Best in Law of Evidence [12th Edn. Article 320, page 291], the presumption of innocence is, no doubt, presumptio juris : but everyday s practice shows that it may be successfully encountered by the presumption of guilt arising from the recent (unexplained) possession of stolen property, though the latter is only a presumption of fact. Thus the burden on the prosecution or the Department may be considerably lightened even by such presumption of fact arising in their favour. However, this does not mean that the special or peculiar knowledge of the person proceeded against will relieve the prosecution of the Department altogether of the burden of producing some evidence in respect of that fact in issue. It will only alleviate that burden to discharge which very slight evidence may suffice. 8.5 The circumstances prevailing in the present appeals suggest that the department is able to raise a presumption in its favour with regard to the existence of the fact sought to be proved when the owners of the goods refused to divulge correctly as to where they got the good ..... X X X X Extracts X X X X X X X X Extracts X X X X
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