TMI Blog2019 (12) TMI 1380X X X X Extracts X X X X X X X X Extracts X X X X ..... 962 read with Section 11 clearly stipulate that an attempt to smuggle foreign currency and Indian currency is prohibited and merits confiscation under provisions of Customs Act, 1962. In the case of Ram Kumar v. Commissioner of Customs [ 2015 (1) TMI 1126 - DELHI HIGH COURT ] Hon ble High Court of Delhi while dismissing the writ petition of the petitioner disallowed release of confiscated forex to be redeemed under Section 125 of Customs Act, 1962. The ratio of judgment squarely applies to the present case - Therefore the impugned Indian and foreign currency seized from the PAX in violation of the provisions of FEMA, 1999, Foreign Exchange Management (Export and Import of Currency) Regulations, 2000 read with Sections 2(33) and 11 of Customs Act, 1962 falling into the category of prohibited goods has been correctly confiscated under Section 111(d), (m) (o) of Customs Act, 1962 by the adjudicating authority which has been upheld by the impugned order-in-appeal. Penalty under Section 112 and Section 114AA of Customs Act, 1962 - HELD THAT:- Keeping in view the gravity of the offence the order of Commissioner (Appeals) in reducing the penalty from ₹ 30 lacs to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... STAT, New Delhi (Tribunal). As the appeal did not lie before the Hon ble Tribunal, the PAX applied for its withdrawal on 3-10-2017 when the matter came up for final hearing. The Tribunal vide Final Order No. 57034/2017, dated 3-10-2017 dismissed the appeal of the PAX as withdrawn. Subsequently the PAX filed the above Revision Application which is currently pending with the Government. In the instant case the Additional Commissioner of Customs, Jodhpur vide adjudication Order Bearing No. 17/2013, dated 11-12-2013 ordered for absolute confiscation of the seventy gold biscuits weighing 8164.80 grams valued at ₹ 2,51,89,735/-, UAE Dirham AED 1,05,410, INR ₹ 20,000/-, an amount of ₹ 12 lacs received by the PAX in lieu of demand draft issued by Al Fardan Exchange along with concealment material valued at ₹ 2,200/-. She also imposed a penalty of ₹ 30 lacs (Rupees Thirty Lacs) under Section 112 and ₹ 10 lacs (Rupees Ten Lacs) under Section 114AA of the Customs Act, 1962 on the PAX. The PAX preferred an appeal against the impugned adjudication order before Commissioner of Central Excise (Appeals), Jaipur. The Commissioner (Appeals) vide the aforesai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ought the impugned gold bars to India to earn profit and did not declare the impugned gold bars and other things viz. Forex, Demand draft, Indian currency, etc. in the customs declaration form submitted to the customs authorities at the airport. The PAX was arrested under Section 104 of the Customs Act, 1962 on 23-9-2012 and subsequently released on bail on 24-9-2012 on furnishing a security of ₹ 84 Lacs by way of fixed deposit and two surety bonds for ₹ 20 lacs each by two guarantors. The PAX sent a retraction letter dated 27-9-2012 to the Commissioner of Customs, Jaipur and retracted from his statement dated 23-9-2012 recorded under Section 108 of the Customs Act, 1962 stating that he was forced to sign the said statement. Two opportunities were given to the PAX subsequently on 11-10-2012 and 29-1-2013 and statements under Section 108 of the Customs Act, 1962 were duly recorded on both these dates. Another retraction letter dated 30-1-2013 was sent to the Commissioner of Customs, Jaipur by the PAX regarding his statement tendered on 29-1-2013 under Section 108 of Customs Act, 1962. The PAX did not challenge the statement dated 11-10-2012. Regarding the statement re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lute confiscation of the seventy gold biscuits weighing 8164.80 grams valued at ₹ 2,51,89,735/- (Rupees Two Crore Fifty One Lacs Eighty Nine Thousand Seven Hundred and Thirty Five) and UAE Dirham AED 1,05,410 (Dirham One Lac Five Thousand Four Hundred and Ten). The revision applications have been filed by the Commissioner of Customs (P) Jodhpur (HQ Jaipur) and the PAX on 19-5-2015 and 3-11-2017 respectively with this office. The PAX initially filed an Appeal Bearing No. C/51960/2015-CU (DB) along with stay application on 25-2-2015 before the Hon ble CESTAT, New Delhi against the impugned order-in-appeal. As the appeal did not lie before the Hon ble Tribunal, the PAX applied for its withdrawal on 3-10-2017 when the matter came up for final hearing. The Tribunal vide Final Order No. 57034/2017, dated 3-10-2017 dismissed the appeal of the PAX as withdrawn. Subsequently the PAX filed the instant Revision Application dated 3-11-2017. Revision Application has been filed by the Commissioner of Customs (P), Jodhpur (HQ Jaipur) on two grounds. He has challenged the reduction in penalty imposed on the PAX under Section 112 of the Customs Act, 1962 as per Order-in- Appeal on the g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sequently submitted another customs declaration form dated 23-9-2012 which does not mention the impugned goods or their value. His initial statement under Section 108 of Customs Act, 1962 was recorded on 23-9-2012. However he retracted from this statement on 27-9-2012. Subsequently the customs authorities recorded the second and third statement on 11-10-2012 and 29-1-2013 under Section 108 of Customs Act, 1962 on his request wherein all facts were stated regarding the bona fide purchase of the impugned goods. It has been contended that since gold is not a prohibited item the same should be released on redemption. In case it is not allowed to be released on redemption, he should be given an option for re-export. The absolutely confiscated foreign currency amounting to UAE Dirham 1,05,410 should also be released to him. It is pertinent to mention that the PAX decided to withdraw the request of cross-examination of witnesses and the customs officers at the time of personal hearing before the Government on 22-11-2019. However the PAX vide his subsequent letter dated 26-11-2019 addressed to Government has retracted and requested that he would want to cross-examine the concern ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 962 signed by the PAX. Hence the allegation of the PAX that the customs authorities had intentionally misplaced the customs declaration form is baseless and remains unsubstantiated. Therefore this contention of the PAX merits no consideration. 8. Section 123 of Customs Act, 1962 reads as follows : 123. Burden of proof in certain cases. - (1) Where any goods to which this section applies are seized under this Act in the reasonable belief that they are smuggled goods, the burden of proving that they are not smuggled goods shall be - (a) in a case where such seizure is made from the possession of any person, - (i) on the person from whose possession the 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 and manufactures thereof watches, and any other class of goods which the Central Government may by notification in the Official Gazette, specify. As per Section 123 of Customs Act, 1962 th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erned, a passenger returning to India after six months can bring gold up to 1 kg in the form of bars provided he duly informs the customs authorities at the airport and pays the duty leviable thereon under the said notification, which is not the case here. The PAX brought 8 kgs gold, eight times the quantity permitted under Notification No. 12/2012-Customs, dated 17-3-2012. The plea of the PAX that he was eligible to carry 10 kg of gold wherein he was carrying only 8 kg gold as per Condition No. 35 of Notification No. 12/2012- Customs, dated 17-3-2012 is incorrect, since the benefit of Notification No. 12/2012-Customs, dated 17-3-2012 is not available to the PAX. Hon ble High Court of Calcutta in the case of Provash Kumar Dey v. Inspector of Central Excise and Others [1987 (31) E.L.T. 13 (Cal.)] has held that ignorance of law is no excuse and accordingly the petitioner was rightly found guilty for contravention of Rule 32(2) [1993 (64) E.L.T. 23 (Del.)]. It was duty of the PAX to ascertain the correct position of law before smuggling 8 kg of gold in bar form. The PAX is a NRI and residing in Dubai for the last 15 years. He cannot take an alibi that he was not aware of prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e same. It is evident that the PAX smuggled the impugned gold bars and did not declare them at red channel counter with an intention to evade customs duty. The PAX s alibi that he was carrying 1,05,410 Dirham for payment of duty in convertible foreign currency on the impugned goods is baseless and merits no credence. The PAX had made out a case of ignorance of law and vindication on part of the Customs authorities, Jaipur. However the facts of the case belie the baseless allegations of the PAX and his innocence. It is observed that C.B.I. C. had issued instruction vide letter F. No. 495/5/ 92-Cus.-VI, dated 10-5-1993 wherein it has been instructed that in respect of gold seized for non-declaration, no option to redeem the same on redemption fine under Section 125 of the Customs Act, 1962 should be given except in very trivial cases where the adjudication authority is satisfied that there was no concealment of the gold in question . Andhra Pradesh High Court in its order in the case of Shaikh Jamal Basha v. G.O.I. [1997 (91) E.L.T. 277 (A.P.)] has held as follows : Attempt to import gold unauthorisedly will thus come under the second part of Section 125(1) of the Act wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (a) vessels, aircrafts and vehicles; (b) stores; (c) baggage; (d) currency and negotiable instruments; and (e) any other kind of movable property. Rule 7 of the Baggage Rules, 2016 stipulates as under : Currency. - The import and export of currency under these rules shall be governed in accordance with the provisions of the Foreign Exchange Management (Export and Import of Currency) Regulations, 2015, and the notifications issued thereunder. Section 11(2)(c) of Customs Act, 1962 prohibits import or export of goods for the purpose of prevention of smuggling. From the evidence on record it is evident that Indian currency as well as huge amount of forex Dirham 1,05,410 was recovered from the PAX on 23-9-2012. The impugned currency was also not declared to the customs officers at the red channel under Section 77 of Customs Act, 1962 by the PAX. 15. Regulations 3, 5 and 6 of the Foreign Exchange Management (Export and Import of Currency) Regulations, 2000, states that no foreign currency can be sent out of India or brought into the country without the permission of the Reserve Bank of India. The relevant provisions read as follows :- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the Forex (UAE Dirham 1,05,410) carried by him was much higher than the prescribed limit under the FEMA, 1999 read with Foreign Exchange Management (Export and Import of Currency) Regulations, 2000. 16. The legal provisions of FEMA, 1999, the Foreign Exchange Management (Export and Import of Currency) Regulations, 2000, Section 2(33) of the Customs Act, 1962 read with Section 11 clearly stipulate that an attempt to smuggle foreign currency and Indian currency is prohibited and merits confiscation under provisions of Customs Act, 1962. In the case of Ram Kumar v. Commissioner of Customs [2015 (320) E.L.T. 368 (Del.)] Hon ble High Court of Delhi while dismissing the writ petition of the petitioner disallowed release of confiscated forex to be redeemed under Section 125 of Customs Act, 1962. The ratio of judgment squarely applies to the present case. Therefore the impugned Indian and foreign currency seized from the PAX in violation of the provisions of FEMA, 1999, Foreign Exchange Management (Export and Import of Currency) Regulations, 2000 read with Sections 2(33) and 11 of Customs Act, 1962 falling into the category of prohibited goods has been correctly confiscated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t and that of confiscated Indian currency amounting to ₹ 12,500/- (out of ₹ 20,000/- beyond ₹ 7,500). The impugned order-in-appeal is upheld on this aspect as per law. 20. Accordingly Government passes the following orders :- (i) The absolute confiscation of impugned seventy gold biscuits weighing 8164.80 grams valued at ₹ 2,51,89,735/-, Forex (UAE Dirham AED 1,05,410) and concealment material vide Order-in-Original No. 17/2013, dated 11-12-2013 and Order-in-Appeal No. 5 (SLM)/Cus/JPR/2015, dated 27-2-2015 is upheld under Section 111 of Customs Act, 1962. (ii) A penalty of ₹ 40 lacs (Rupees Forty Lacs) is imposed under Section 112(a) of Customs Act, 1962. (iii) Penalty under Section 114AA of Customs Act, 1962 is set aside and the order-in-appeal on this aspect is upheld. (iv) Order-in-Appeal in releasing DD amounting to ₹ 12 lac (Rupees Twelve Lacs) meant for deposit in NRE Account and Indian currency amounting to ₹ 12,500/- (Rupees Twelve Thousand and Five Hundred) is upheld. Accordingly both the Revision Applications Bearing No. 375/37/B/2017-RA, dated 3-11-2017 filed by the PAX and Revision Application No. 3 ..... 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