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Sri Nand Kishore Sumani, Sri Rakesh Somani, Shri Krishna Roy And Shri Manoj Gattani Versus Commr. of Customs, Central Excise & Service Tax-Siliguri

2015 (10) TMI 2329 - CESTAT KOLKATA

Confiscation of goods and vehicle under Section 111 (b) and (d)- Gold Bars - Appellant contends that seized goods are not having any foreign markings and have purity of less than 99.99% - Gold bars were not of smuggled nature thus case is not covered under Section 123 and once bills are produced by appellant such gold and vehicle are not liable to confiscation - Revenue contends that no document showing licit acquisition of gold bars was produced by appellant at the time of interception and seiz .....

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rigin.

seized gold bars do not have uniform weight/purity and appellant has shown purchase bills covering gold bars having assorted size, weight and purity and person who sold seized goods has also confirmed to have supplied them to appellant - Minor mismatching of difference in weight will not make bills as an after thought - Appeal allowed - Decided in favour of Appellant. - Customs Appeal Nos. C/75327,75516,75642 & 75643/2014 - ORDER NO : FO/A/75521-75524/2015 - Dated:- 21-8-2015 - .....

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gms., under Section 111 (b) and (d) and allowed redemption of the same under Section 125(1) of the Customs Act, 1962 by an option of ₹ 40 Lakh fine to the claimant. Carrier vehicle TATA Indica Car WB-74M-5809 used by the appellants was also confiscated under Section 115 (2) of the Customs Act, 1962 and allowed redemption to the owner Shri Rakesh Kumar Somani on payment of ₹ 70,000/- as redemption fine. Under this order penalties of ₹ 5.00 Lakh on Shri Nand Kishore Somani, ͅ .....

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as believed to be from Bangladesh and that the same was subjected to some re-treatment for selling to different Jewellery Shops in and around Cooch Behar. On the basis of the above information the said vehicle was intercepted on 2/2/2012 by the officers of Cooch Behar Customs P.O. near Ghoogomali Area and two occupants (including a driver) were found in the vehicle. Both the occupants alongwith the vehicle were brought to Cooch Behar Customs office premises. When the said vehicle was being check .....

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out any markings or inscription. The name of the person who tried to run away was ascertained to be Shri Nand Kishore Somani. He could not produce any licit document in support of legal acquisitionof the gold bars and his health deteriorated and was admitted to a hospital in Cooch Behar. 2.1 The driver of the said vehicle identified himself as Shri Krishna Kumar Roy of Cooch Behar. He stated in his statement dated 2/2/2012 that the vehicle belonged to Shri Rakesh Somani of Dinhata and he gets &# .....

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123 of the Customs Act, 1962. Driver Shri Krishna Roy was arrested on 3/2/2014 and was granted bail on the same day by Chief Judicial Magistrate, Cooch Behar. In a statement dated 6/2/2012, Shri Nand Kishore Somani (recorded in the Hospital/Nursing Home) stated, inter alia, that the documents pertaining to the purchase of the gold from Kolkata were lying with him in some pocket and he was searching for the same in the Customs office on 2/2/12. That when he saw more officers coming the same creat .....

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llers, Kolkata in his statement confirmed the supply of gold bars to Shri Nand Kishore Somani under Bill No. 97 dated-3/1/2012, 105 dated-9/1/2012, 110 dated-17/1/2012, 112 dated-19/1/2012 & 116 dated-24/1/2012. He also submitted certain photo copies of Purchase Bills of Jewellery & bank statements. 2.3 Shri Nand Kishore Sumani in his further statement dated-27/2/2012 inter alia, accepted the ownership of the seized goods believed to be gold and that the same were purchased on different .....

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relation of Shri Manoj Gathani of Kolkata (his son in law) with M/s. Shroff Jewellers . That the amount of ₹ 10.00 Lakhs in his ICICI account was due to ₹ 4.00 Lakh and 3 .00 Lakh loans respectively taken from his son Prakash Kumar Somani and his daughter-in-law Smt. Pinki Damani. Both these persons confirmed to have given such loan to Shri Nand Kishore Somani. 2.4 Chemical Examine under his report dated 13/3/12 confirmed the seized goods to be gold having gold content by weight as .....

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of the foreign marked gold is always 99.99% and above . That as the purity of all the gold bars tested in this case was less than 99.99%, therefore, the same cannot be of foreign origin. Secondly, it was also argued that weight of all the ten gold bars seized is not standard which is found in gold bars of foreign origin. It was strongly argued by the Learned Advocates that seized gold bars were not of smuggled nature and that present case is not covered by the provisions of Section 123 of the Cu .....

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ce bills are produced by the claimant , then such gold and vehicles are not liable to confiscation. It was also submitted that Shri Ajay Kr. Saraff has also stated to have received ₹ 39,15,982/- and only ₹ 9,30,292/- are remaining payment. 4. Shri S.P. Pal, Appraiser(AR) appearing on behalf of the Revenue argued that no document showing licit acquisition of gold bars was produced by Shri Nand Kishore Somani at the time of interception and seizure. That the bills of M/s. Saraff Jewell .....

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ods cannot be produced from the Jewellery, purchased by M/s. Saraff Jewellers, Kolkata . Learned A.R., therefore, strongly defended the order passed by the Adjudicating authority. 5. Heard both sides and perused the case records. The first issue required to be decided in these proceedings is whether 10 gold bars (1746.580 gms.) seized by the officers on 2/2/12 are of foreign origin. The said 10 gold bars of different size and weight were seized on a reasonable belief of being smuggled as per the .....

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nformation that some retreatment on the said gold bars could have been done but no documentary evidence exist on record that any defacing of the foreign markings was done by the appellants on the seized gold bars. The weight of foreign origin gold bars is standard which is not the case in the gold bars seized. It is the argument of the Revenue that report of chemical examine will prevail over the oral statements made. However, it is observed that a chemical examiner can only give the percentage .....

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eign origin when there are no foreign markings on them and there is no oral evidence also conveying the same of foreign origin. An information received in this case is only a hearsay not corroborated by any other documentary evidence. The seizure of gold bars was also not made in a Custom area or a vehicle coming from the side of Border with Bangladesh. In the light of the above factual matrix it has to be held that the seized goods cannot be considered to be of foreign origin. 6. Regarding appl .....

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goods were seized; and (ii) If any person, other than the person from whose possession the goods were seized, claims to be the owner thereof, also on such other person; (b) In any other case, on the person, if any, who claims to be the owner of the goods so seized.] (2) This section shall apply to gold, 2[and manufactures thereof,] watches, and any other class of goods which the Central Government may by notification 3 in the Official Gazette specify. 7. It is true that as per the above provisi .....

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d to be a very sensitive commodity. There was subsequent liberalisation in import policy with respect to gold and even foreign marked gold was allowed to be imported through baggage & through Banks on fulfilling certain conditions. On licit import these foreign marked gold bars can be freely bought & sold in India. However, if any person is found to carry a foreign marked gold in India without a bill then by simply having foreign markings on the gold it cannot be said that the same is of .....

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appellants showing the legal purchase of the same from M/s. Chauhan Zevares Pvt. Ltd. and by referring to certain discrepancy in the said document of the seized gold biscuits. However, I find that the discrepancies referred to by the adjudicating authority are not real inasmuch as he has held that whereas the sale voucher shows the goods to be T.T. Bars, the seized gold is biscuit. He has thus observed that such descriptive variation between the biscuits and the bars raises a reasonable doubt .....

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gold. The standard 10 tola bars weigh 116.640 gms, and as such, the total weight of 16 pieces of biscuits would come to 1866.240 gms, which is reflected in the sale voucher of M/s. Chauhan Zevares. Similarly, it is a matter of common knowledge that the standard purity of gold is 999.00. As such, as rightly contended by the learned consultant, the small variation in the weight or in the purity of gold is attributable to the human error and cannot be made the basis for rejecting the sale voucher o .....

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sixteen pieces of gold were, in any case, purchased by Shri Kapildeo Prasad from the said M/s. Chauhan Zevares Pvt. Ltd. 13.The Tribunal in the case of S.K. Chains v. Commissioner of Customs (Prev.), Mumbai reported in 2001 (127) E.L.T. 415 (Tri. - Mum.) observed as under :- Thus, today there exists a very peculiar situation. On the one hand the Customs Act considers it necessary to ask a person to establish the legality of the origin of the gold seized from him while on the other hand in pursu .....

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alcutta - decided by the Tribunal in Order No. A-475-478/Kolkata/2001, dated 4-7-2001 [2001 (135) E.L.T. 1036 (T)], the Tribunal has considered the effect of liberalised policy as regards the import and dealing in gold and thereafter, concluded that onus as placed under Section 123 was discharged when the appellants produced the sale/purchase vouchers showing the sale of the goods from the gold dealer who has admitted having sold the same. In the absence of any requirement of law requiring the g .....

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s, I am of the view that the onus cast upon the appellants under the provisions of Section 123 stands fully discharged. The confiscation of the gold biscuits is not called for. Accordingly, I set aside the same. 15.In as much as the confiscation of the gold biscuits has been set aside, the confiscation of the truck is not called for. For the similar reasons, there is no warrant for imposition of penalties upon the various persons. The same is, accordingly, set aside. 7.1 In the light of the abov .....

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