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Shri Umeshwar Prasad, Shri Krishna Prasasd Sarraf, Shri Sanjay Kr. Patel, Shri Vijay Kr. Bajaj And Shri Manish Kumar Versus Commissioner of Central Excise & S. Tax, Patna

2016 (5) TMI 601 - CESTAT KOLKATA

Confiscation of goods under section 113(c) and imposition of penalty under Sec 114 of the Customs Act 1962 - Paddy/Rice stored by the appellants in two godowns situated close to the Indo-Nepal border - Appellant contended that goods seized from the godowns situated in India can at best be a preparation but can not be said to be an act indicating attempt to export the same out of India. - Held that:- there are two statements of Sh. Vijay Kumar Bajaj & Smt Soni Jaiswal that the seized goods w .....

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ons whose statements were implicating them. There is no reason to brush aside the statement of Smt Soni Jaiswal, wife of Sh. Umeshwar Prasad Jaiswal to the effect that the seized goods were meant for export to Nepal. - Further the words dutiable or prohibited existing in Sec-113 (c) have been deleted with effect from 14.05.2003, making the provision applicable to any goods brought near to the land fromties for the purpose of being exported. Therefore, on the basis of the existing evidences .....

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spondent : Shri S. Nath, AC, (AR) ORDER PER SHRI H.K.THAKUR These appeals have been filed by the appellants against OIA No. 177-181/PAT/CUS/Appeal/2010 dt 16/12/2010 passed by Commissioner of Customs & Central Excise (Appeals), Patna as first appellate authority. 2. Sh. N.K. Choudhary (Advocate) appearing on behalf of the appellant argued that on 5/9/2008 a quantity of 2458 bags (86030 Kgs) of paddy & 287 bags (14150 Kgs) of rice of India origin were found by the department stored in a g .....

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Mills situated in Nepal. That in his statement Sh. Vijay Kumar Bajaj stated that these goods stored in the godown were meant to be taken to Nepal as was being done in the past. That Sh. Vijay Kumar Bajaj in his subsequent statement made it clear that his first statement was made on the basis of hearsay. 2.1 That on 7/9/08 another godown, 100 meters away from the above godown, was found from the scrutiny of documents & DRI officers on 21/9/2008 seized 2510 bags from this second godown belongi .....

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seized from godowns situated in India and were not on move towards the International borders and can not be confiscated under Sec 113 of the Customs Act 1962 in view of the following case laws. (i) Abdus Selam Biswas Vs CC (P), West Bengal, Kolkata [2004 (176) ELT 258 (Tri.-Kolkata)] (ii) CCP (Prev) Kolkata Vs Md. Abdus Selam [2005 (186) ELT 293 (Tri.-Kolkata)] (iii) Ajay Gurdamal Rahra Vs CC (P), Mumbai [2002 (147) ELT 943 (Tri.-Mumbai)] (iv) Asif Hossain Vs I.G. BSF West Bengal [1997 (2) CLJ] .....

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ed the case of other appellants under OIO No. 5-CUS/CC/MTH/2009 dt 18/5/2009. 3. Sh. S. Nath AC (AR) on the other hand relied upon the following case laws in support of the argument that intention/preparation to export paddy/Rice in the present proceedings is sufficient to confiscate the goods and impose penalties upon the appellant. (i) Manilal Bhanabha Patel Vs UOI [1992 (60) ELT 99 (Guj)] (ii) Zenith Drugs & Alled Agencies Vs CC, Shillong [2003 (160) ELT 600 (Tri.-Kolkata)] 3.1 Learned AR .....

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retrieved from the Godowns indicated that on earlier accessions also similar goods were sent to Nepal through tractor trolleys to certain Rice Mills of Nepal. That wife of Sh. Umeshwar Prasad Jaiswal, Smt Soni Jaiswal, who provided the keys of the godown during investigations, also stated that the seized goods were meant to be exported to Nepal. That the words dutiable or prohibited existing in Sec 113 (c) of the Customs Act 1962 have been deleted w.e.f-14.05.2003,..therefore, any goods brought .....

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113 (c) of the Customs Act 1962 is thus very relevant and is reproduced below:- SECTION 113. Confiscation of goods attempted to be improperly exported, etc.- The following export goods shall be liable to confiscation :- (a).... (b).... (c). any goods brought near the land frontier or the coast of India or near any bay, gulf, creek or tidal river for the purpose of being exported from a place other than a land customs station of or a customs port appointed for the loading of such goods; 4.1 It i .....

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upra) 4.2 At the same time this bench in the case of Zenith Drugs & Allied Agencies Vs CC, Shillong (Supra), relying upon Gujarat High Courts order in the case of Manilal Bhanabhai Patel Vs UOI (Supra) held as follows in Para-15 :- 15.To invoke the provisions of Section 113, it must be shown that there was an attempt on the part of the noticee to export the prohibited goods through un-authorised manner. Such an attempt implies an act beyond any stage of preparation and towards the commissio .....

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vitable conclusion that the consignment in question was brought near the border area with an intention to export the same. In terms of provisions of Section 113(c), any dutiable or prohibited goods brought near the land frontier for the purposes of being transported from a place other than land Customs station is liable to confiscation. The use of the words near in the said Section has to be interpreted keeping in view the peculiar facts and circumstances of each case. The Commissioner in his .....

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the coastal area or land frontier.......... . Inasmuch as the goods have been brought to Agartala which is only within 5-6 kms. to Bangladesh and read with the evidences on record, I uphold the views of the adjudicating authority that the goods were meant for illegal export to Bangladesh, the same have been rightly confiscated by the adjudicating authority. 4.3 In view of the above judicial pronouncements each and every case has to be seen separately in the light of the evidences available on r .....

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wn has been hired for the purpose of storing the paddy for a limited period. The claimant of the goods is also found to be not a regular business man of the area and his identity as the owner of the goods is also doubtful. It is a common practice of many persons in that area who smuggle paddy after harvest season from India to Nepal. The people of Champaran district have no requirement of paddy as they all grow the crop themselves to meet their requirement. The small town of Bhelahi Where the go .....

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goods also shows that they were hesitant to cooperate with the investigating officers, they also gave some contradictory statements which go to prove that their statements were after thought. The documents produced in support of their claim to the seized goods are also fabricated and none appears genuine. 4.5 In the present proceedings there are two statements of Sh. Vijay Kumar Bajaj & Smt Soni Jaiswal that the seized goods were meant for illegal export to Nepal. It is also observed that th .....

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rsons whose statements were implicating them. There is no reason to brush aside the statement of Smt Soni Jaiswal, wife of Sh. Umeshwar Prasad Jaiswal to the effect that the seized goods were meant for export to Nepal. 4.6 Honable High Court in the case of Manilal Bhanabhai Patel Vs Union of India (Supra) on the issue of attempt to export under Sec 113 (c) of the Customs Act 1962 held as follows in Paras 15,16, & 18 to 20:- 15. In our view this submission has no force. As per Section 113(c) .....

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attempts to export Section 113(c) is added with a specific object that if the goods were brought near the land frontier or the coast of India for the purpose of being exported from a place other than a customs station the goods shall be liable to confiscation. This provision was added to overcome the difficulty that even if the large quantity of prohibited goods were brought to a small village near the border for the purpose of export, yet it was not possible to hold that there was an attempt t .....

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new provision is being made because an attempt to export cannot be said to have been made even if large amount of currency is taken to a small village near the border for the purpose of export in payment of smuggled goods. Further considering the provision of sub-section 113(b) and (d) it is apparent that it deals with any goods attempted to be exported while sub-section 113(c) provides for bringing of goods near the land frontier or the coast of India for the purpose of being exported. Hence u .....

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cumstances of the case. 18. Further in these type of cases of smuggling of goods the activity is done in a clandestine or stealthy manner. Therefore, it would be difficult or rather impossible to have direct evidence to establish that goods were brought for the purpose of being illegally exported. Still however, when there is no direct evidence, from the circumstantial evidence a reasonable and probable inference can be drawn from the facts which may emerge on the record. If the inference drawn .....

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n of proof is always on the department and also the jurisdiction of the court under Article 226 of the Constitution of India. The court held that the burden of proving that the goods are smuggled goods, is on the Department. As it is a fundamental rule relating to proof in all criminal proceedings, where there is no statutory provision to the contrary. The court further held that one of the kindred principles is that the prosecution or department is not required to prove its case with mathematic .....

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le 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. If he fails to establish or explain those facts, an adverse inference of facts may arise against him. The relevant discussion is as under : 30. It cannot be disputed that in proceedings for imposing penalties under Clause (8) of Section 167, to which Section 178A does not apply, the burden of proving that th .....

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egree; for, in all human affairs absolute certainty is a myth, and as Prof. Brett felicitously puts it - all exactness is a fake . El Dorado of absolute proof being unattainable, the law, accepts for it, probability as a working substitute in this work-a-day world. The law does not require the prosecution to prove the impossible. All that it requires is the establishment of such a degree of probability that a prudent man may, on its basis, believe in the existence of the fact in issue. Thus leg .....

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cted. 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 part of its primary burden. 32. Smuggling is clandestine conveying of goods to avoid illegal 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 .....

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pointed out by Best in Law of Evidence (12th Edn. Article 320, page 291), the presumption of innocence is, no doubt presumption juris: but every day 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 .....

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e or contrary to rules of natural justice there would be no warrant for disturbing his finding under Article 226. 20. In the present case, as stated above applying the aforesaid tests laid down by the Supreme Court, in our view, it cannot be said that from the circumstances which are narrated above, a prudent man may not on its basis, believe in existence of the facts in issue. Broadly the main circumstances are : (1) the conduct of the petitioner of not claiming the possession of the huge quant .....

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