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Shri Babul Roy And Shri Swadesh Ch. Paul Versus Commissioner of Customs & Central Excise, Shillong

Denial of ownership claim and imposition of penalty - Section 112(b) of the Customs Act, 1962 - Seizure of 7 gold bars concealed in the rectum - No foreign markings found on the seized gold bars - Appellant contended that the seized gold bars were made from the gold ornaments belonging to his family - Held that:- none of the seized gold bars bear any foreign markings. The method of concealment of the seized gold bars in the rectum of appellant is no doubt very suspicious, but that does not estab .....

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llary to refute the claim of the appellant Shri Swadesh Ch. Paul. In the absence of any such investigation claimant Shri Swadesh Ch.Paul has discharged his burden that 7(seven) gold bars seized from Shri Babul Roy belonged to him and are not of foreign origin. The only evidence in the form of first statement of Shri Babul Roy, which was also subsequently retracted, cannot be made as the sole basis to hold that the seized gold bars are of foreign origin and smuggled. - Decided in favour of appell .....

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on behalf of the Appellants argued that on the basis of a specific information the officers of Customs, Agartala apprehended Shri Babul Roy at Mathchowmuhani on Assam Agartala Road on 12.03.2004 and with the help of metal detectors observed that Shri Babul Roy was carrying certain metal concealed in his rectum. That Appellant Shri Babul Roy was brought to the Customs Office, Agartala where he released two rubber balloon packets containing 7(seven) gold bars. That Shri Babul Roy in his voluntary .....

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lier statement and stated that the seized goods belonged to one Shri Swadesh Ch. Paul. That Appellant Shri Swadesh Ch. Paul vide letter dated 04.10.2004 claimed the ownership of seized gold bars and also produced a certificate from one Shri Nantu Banik, Pinky Jewellary, Municipal Road to the effect that his gold ornaments were converted into gold bars. That Adjudicating authority in the first round of litigation under Order-in-Original dated 01.03.2005 did not pass any order against the ownershi .....

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noticeable fact that the confession and retraction of Shri Babul Roy was on the same day followed by an affidavit filed on 14.06.04 by Shri Swadesh Chandra Paul before the learned Judicial Magistrate of Agartala. When the important piece of evidence was available, the Departmental enquiry should not have ended by cryptic Orders passed by both the Authorities showing no anxiety what was the real source of gold and who were the owners. It appears from para 19 of the Order of Adjudication that from .....

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rtment did not appear to have given him a fair opportunity with appropriate charge and the basis, if any, for denial. There was neither any nexus nor any collusion between the two Appellants, the fact of which was also brought to record. No material shows that Shri Babul Roy was under any sorts of influence or pressure by Shri Swadesh Roy for retraction of the confessional statement on the very day of detection of gold from him. Further, when there was an allegation by letter dated 04.10.04 that .....

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nce. If both the Appellants are dealt in the manner desired by law granting them a fair opportunity of examination and cross-examination, there may not be any grievance in future about denial of justice. Therefore, the Authorities below are at liberty to come to a very rational conclusion following due process of law. 2.1 That as a result of the remand Order dated 26.09.2007 a Show Cause Notice dated 10.11.2009 was issued to Appellant Shri Swadesh Ch.Paul as to why the ownership of the seized go .....

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ed 16.12.2013 rejected the Appeals filed by the Appellants. Ld.Advocate argued that Order passed by the First Appellate Authority is not legally correct because in para 16 of the Order-in-Appeal dated 13.12.2013 First Appellate Authority has accepted the ownership of Shri Swadesh Ch.Paul when making the observation that the owner of seized gold was not awarded with penalty under Section 112 of the Customs Act, 1962 as proposed in the Show Cause Notice. Ld.Advocate relied upon the case law of Nan .....

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ade the Bench go through para 12.4 of the Order-in-Original dated 04.03.2011 passed by the Adjudicating authority to argue that the claim of Appellant Shri Swadesh Ch.Paul was not justified. It was also argued by the Ld.AR that no other documentary evidence was produced by the claimant Shri Swadesh Ch.Paul after 04.10.2004. Ld.AR relied upon the case law of Kewal Krishan v. State of Punjab [1993 (67) ELT 17(SC)] to argue that in the case of a seizure made under reasonable belief of goods being s .....

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d that the seized gold bars were of Bangladesh origin. No foreign markings were found on the seized gold bars. It is also observed that by a subsequent statement on the date of seizure Shri Babul Roy retracted his first statement and stated that the seized goods belonged to Shri Swadesh Ch.Paul. Departmental investigation tried to locate the whereabouts of Shri Swadesh Ch.Paul, but he could not be traced. A Show Cause Notice dated 03.09.2004 was issued to Appellant Shri Babul Roy, but no Show Ca .....

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y. The matter reached this Bench where the case was remanded to the Adjudicating authority on the Appeals filed by Appellant Shri Babul Roy and Shri Swadesh Ch.Paul. As a result of remand proceedings ordered by Order dated 26.09.2007 by this Bench a Show Cause Notice dated 10.11.2009 was issued to Appellant Shri Swadesh Ch.Paul as to why his ownership claim should not be denied and as to why penalty should not be imposed upon him under Section 112(b) of the Customs Act, 1962. Adjudicating author .....

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e that Shri Swadesh Chandra Paul has neither contested this observation of Commissioner (Appeals) nor has he produced any further document in support of his claim. Also I find that Shri Swadesh Chandra Paul, despite been given a fair opportunity to do so on 01.02.2008, has not produced any evidence in support of his assertion that he is the owner of the seized gold bars, which according to him were converted from gold belonging to his family. In the absence of any such evidence or documents plac .....

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ellant that he is indeed the owner of the seized gold. The Order-in-Appeal dated 08.09.2005 passed by the First Appellate Authority was agitated by the Appellant before this Bench when the case was remanded for de novo adjudication as per Order dated 26.09.2007. Once an order passed by the First Appellate Authority has been set aside then the same cannot be considered to be the final word to be relied upon. Though the claim by the Appellant Shri Swadesh Ch. Paul was made after the issue of first .....

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l Roy was retracted. Ld.AR also argued that a local gold-smith certified the seized gold bars to be of foreign origin. Bench is not able to appreciate as to how a gold-smith can certify a gold to be of foreign origin without any foreign markings thereon. The case law of Kewel Krishan v. State of Punjab (supra) relied upon by the Revenue is not applicable to the facts of the present case. In this relied upon case law the gold bars seized from the Appellant bore foreign made stamps of Johnson Math .....

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oy is no doubt very suspicious, but that does not establish that seized gold bars are of foreign origin. Secondly the seizure of gold bars has also not been effected in a Customs area to shift the onus on Appellants. 6. Ld.Advocate appearing on behalf of the Appellants relied upon the case law Nand Kishore Modi v. CC(Prev.), West Bengal (supra) to argue that once Appellants produce the Bills then the burden stands discharged. It is observed that in the relied upon case this Bench passed followin .....

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imported gold as baggage. In the instant case the foreign marked gold was not seized from a customs area or a person coming from an international border. Accordingly, it is held that in the present appeals, Revenue has failed to establish that seized gold was of smuggled nature. 5. Appellant Shri Rajendra Kumar Damani has brought on record two bills suggesting the purchase of the seized gold biscuits from M/s. Anand Sales Pvt. Ltd. On investigation by the Customs officer Shri Nand Kishore Modi o .....

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