TMI Blog2022 (4) TMI 269X X X X Extracts X X X X X X X X Extracts X X X X ..... habad to Jaipur or their persons in Jaipur during the material time and that during the material time they were around Calcutta only. To this extent, the submission by Shri Jitendra Kumar Mishra could he held to be inconsistent if not totally wrong as held by the Department. The Department could have made enquiries with the said Indian Art Gallery regarding the licit purchase of the impugned gold, if any. Not having done so, the Department has lost an opportunity tofalsify the claim of Shri Jitendra Kumar Mishra, in a comprehensive manner. However, for that reason it cannot be said that the burden of proof has been discharged entirely by either side. However, smuggling of the gold being very sensitive issue, in the absence of definitive discharge of the burden of proof by the claimant along with documentary evidence, the benefit of doubt should go to the Revenue, therefore, not withstanding the claims of the Appellants, we find that the impugned gold has been rendered liable for confiscation on the merits of the case. Whether the penalties imposed on different persons are justified in the facts and circumstances of the case? - HELD THAT:- The retracted statement, that too t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e barred in terms of Section 110 of the Customs Act, 1962. There are no evidence is put forth to show any appeal has been filed against the order of the Hon ble High Court and if so, whether any stay is granted. Under the circumstances, following the principles of Judicial Discipline, we hold that the goods are required to be returned in terms of Section 110 of the Customs Act, 1962. Levy of penalty on Shri Jitendra Kumar Mishra u/s 112(a) of the Customs Act, 1962 - HELD THAT:- The imposition of penalty can be sustained despite the seizure being vacated. As Shri Jitendra Kumar Mishra, having rendered impugned goods liable for confiscation under Section 111 of the Customs Act, 1962, has rendered himself liable for penalty under Section 112 ibid - it is found that under the facts and circumstances of the case, penalty can be reduced as it is found that the penalty should be commensurate with the role played by the individual and the pecuniary gain if any that would of have accrued to the individual as a result of such acts of omission and commission in rendering the goods liable to confiscation - Penalty imposed on Shri Jitendra Kumar Sharma is reduced to 2,00,000/-. Appeal a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der seizure was manufactured in India (ii) Valcambi Suisse, the manufacturing company does not manufacture gold bar of 1 kg of purity 99.50%. Summonses were issued to Shri Baikunth but he did not turn up. Vide a SCN dated 04.08.2015, it was proposed to extend the time limit for issuing a SCN confiscating the seized gold by six more months and the same was confirmed vide order dated 13.08.2015. The test reports of the seized gold confirmed that the sample was of purity 99.50%. Therefore, a SCN dated 11.02.2016 was issued to (1) Mr. Jitendra Kumar Mishra, (2) Mr. Anurag Jalan, (3) Mr. Balram alias Mr. Santosh Kumar (staff of Anurag Jalan), (4) Mr. Ram Chandra Verma (5) Mr. Mohit Verma (6) Mr. Sonu Verma are requiring them to show cause before the Commissioner of Customs (Preventive), W.B., Kolkata, having office at Customs House, (3rd floor), 15/1, Strand Road, Kolkata-700001 within 30 (thirty) days from the date of receipt of this notice as to why; (i) The seized gold as per inventory dated 19.02.2015, which appears to be illegally imported into India through unauthorized route and manner should not be confiscated under Section 1119(b) (d) of the Customs Act, 1962. (ii) Pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed. He relies upon the following: (i). Purushottam Jajodia Vs DRI, New Delhi reported in 2014 (307) ELT 837 (Del.) (ii). Sewing Systems (P) Ltd. Vs Collector of Customs reported in 1992 (62) ELT 725 (Tribunal) (iii). Deepak Natvarlal Soni Vs UOI reported in 2019 (368) ELT 27 (Guj.) (iv). Harbans Lal Vs Collector of Central Excise Customs reported in 1993 (67) ELT 20 (SC). (v). UOI Vs Kamlakshmi Finance Corporation Ltd. [1991 (55) ELT 433 (SC)]. (vi). Shanti Lal Mehta Vs UOI, 1983 (14) ELT 1715 (Del.) 4. Learned counsel for the Appellants also submits that the criteria for applicability of Section 123 of the Customs Act is formation of reasonable belief which is elaborately delivered into landmark decisions (i) Ramesh Kumar Baid and Sons vs. UOI in a latter s patent appeal No.1302 of 2019 in Civil Writ Case No.6563 of 2019 (Patna High Court) and (ii) Jai Mataji Enterprises and Others Vs UOI in Writ Tax No.573 of 2020 (Allahabad High Court). Learned counsel for the Appellants submits that in the light of above decisions, the impugned proceedings are due to a flawed investigation and lack legal tenability as no cogent reasons for forming any reasonable belief is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... play and the provisions of law have been misinterpreted and misconstrued; the Appellant is bona fide dealer in gold and silver bullion; Appellants is not concerned with the subject gold, i.e. 3 pieces seized from Jitendra Kumar Mishra; the department relied solely upon the statement of Shri Jitendra Kumar Mishra, who is alleged to have stated that the said yellow metal was handed over to him without any document or bill by two unknown persons Baikunth Nath and Balram, who have been shown to be worker at their shop at Sona Patti, Kolkata; his statement too was too retracted; request was made for cross examination of Mr. Jitendra Kumar Mishra under the provisions of Section 138B of the Customs Act, 1962 was not given; alleged confessional statement of Appellant was also re-cordedin Hindi Language; but was not made a relied upon document to the impugned Show Cause Notice; Appellants requested the department vide various letters that original statement of Shri Anurag Jalan recorded in Hindi Language be provided; only a doctored / translated copy, unsigned statements dated 19.02.2015 29.06.2015 of the Appellant was provided; cross examination of Shri Jitendra Kumar Mishra was not perm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... kg. each of 995.0 purity and that they manufacture only 100 gm. Bar, the photographs of which were submitted. We find that the Appellants Shri Jitendra Kumar Mishra changed his version in his two statements. Initially he stated that the gold was handed over to him at Calcutta by two persons namely Baikunth Nath and Balram working for Jalan at Calcutta and in his later statement he submits that the gold was purchased from Jaipur on 14.02.2015 in the account of Shri Sonu Verma. Though the Department has come to the conclusion that the changed version of Shri Jitendra Kumar Mishra cannot be agreed as his movements, as per call records of Shri Jitendra Kumar Mishra or Sonu Verma do not indicate their movement from Allahabad to Jaipur or their persons in Jaipur during the material time and that during the material time they were around Calcutta only. To this extent, the submission by Shri Jitendra Kumar Mishra could he held to be inconsistent if not totally wrong as held by the Department. The Department could have made enquiries with the said Indian Art Gallery regarding the licit purchase of the impugned gold, if any. Not having done so, the Department has lost an opportunity tofalsi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mishra nobody has taken the names of either Shri Ram Chander Verma or his sons Sonu Verma and Rahul Verma. On the basis of the ownership of mobile number Mohit Verma son of Ram Chander Verma was also made noticee. However, as submitted by the Appellants, particularly, Shri Anurag Jalan, we find that the entire case is majorly based on one statement of Shri Jitendra Kumar Mishra on 19.02.2015 which was later retracted. No other statement or document point out to their respective roles. In view of the case laws cited by the appellants, we find that retracted statement, that too the only evidence, cannot be a basis for imposing penalty on various persons, as above. Inclusion of various names in the investigation and seeking imposition of penalty, without adducing sufficient evidence, would not help the cause of the case and in fact would go to dilute the case. We find that the roles of different persons, other than Shri Jitendra Kumar Mishra, have not brought out clearly by the investigation so as to render them liable for penalty under Section 112(a) of the Customs Act, 1962. We find that Shri Jitendra Kumar Sharma has rendered himself liable for penalty as he has rendered the seize ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stand of the Department that under the statute, there was no necessity of giving opportunity of hearing on further matter notice to the person from whom goods have been seized for extension of time for issue of show cause notice. Notice was given in this case. The same was a superfluous exercise and not a legal necessity accepting the reliance placed by the Counsel for Shri Jitendra Kumar Mishra. Hon ble High Court at Calcutta relying on the judgment of Hon ble Supreme Court in the case of I.J. Rao, Assistant Collector of Customs and others versus Bibhuti Bhushan Bagh and another (AIR 1989 SC 1884) observed that: This being the position of law laid down by a Constitution Bench of the Hon ble Supreme Court, we do not find any reason to interfere with the judgment under appeal. There is no material before us on the basis of which we can come to a conclusion that the noticee had indulged any evasive tactics which would justify post-decisional hearing. No other cogent reason has been cited for which the notice was not sent within time. In this judgment that question is not in lis before us. Mr. Ganguli had also argued that the proceeding under Sections 110 and 124 play on mutually ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oms Act, 1962. However, the Show Cause Notice stands as far as the imposition of penalties is concerned. As per our discussion as above, we find that Shri Jitendra Kumar Mishra has rendered himself liable to pay penalty in terms of Section 112(a) of the Customs Act, 1962. We hold that imposition of penalty can be sustained despite the seizure being vacated. We find the as Shri Jitendra Kumar Mishra, having rendered impugned goods liable for confiscation under Section 111 of the Customs Act, 1962, has rendered himself liable for penalty under Section 112 ibid. However, we find that under the facts and circumstances of the case, penalty can be reduced as we find that the penalty should be commensurate with the role played by the individual and the pecuniary gain if any that would of have accrued to the individual as a result of such acts of omission and commission in rendering the goods liable to confiscation. 15. In the result, we pass the following order (i). Confiscation of impugned Gold is set aside (ii). Penalty imposed on Shri Jitendra Kumar Sharma is reduced to 2,00,000(Rupees Two Lakhs only); thus, appeal No. Customs Appeal No.77007 of 2018 is partly allowed. (iii ..... X X X X Extracts X X X X X X X X Extracts X X X X
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