TMI Blog2024 (3) TMI 703X X X X Extracts X X X X X X X X Extracts X X X X ..... Gold, Coimbatore does not inspire confidence, as he stated that he does not transact in gold other than by way of banking channel. Further, he stated that he sometimes facilitates purchase from the open market, if required by customer on payment of cash, for which he charges nominal commission of Rs.2000/- per kg. The statement is self contradictory and evidently, he was under pressure when the statement was recorded as on the said date, his shop was searched and records were examined and there was shortage of gold as per stock register. Further, Smt. A. Varalakshmi, in her very first statement (on summons), has stated the fact that they had negotiated purchase of gold from M/s Aryan Gold, Bangalore and had accordingly, gone there with her son Mr. A. Praveen Kumar who assists her in the family business and they had taken delivery on credit basis. Further, she had stated that the payment for the same has been made through banking channel. From the perusal of the copy of invoice produced, it is evident that M/s Aryan Gold are registered with GST department and have also charged GST on the transaction. Further, Mr. Somanath of M/s Aryan Gold, who was also examined by the officers, has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from one Mr. Somanath. H, proprietor of M/s Aryan Gold, Bengaluru. Later, as he was not well and not in a position to take journey to Bengaluru, Smt. A. Varalakshmi and her son Mr. A. Praveen Kumar went to Bengaluru on 06.03.2020 to take delivery of the gold on credit basis from M/s Aryan Gold, Bengaluru and took delivery under tax invoice No. 38 dt.06.03.2020. As they were in a hurry to reach the bus stand to catch the bus for Smt. Varalakshmi s return journey to Narasaraopet, mistakenly, they left the invoice behind in the shop. From the bus stand, Smt. Varalakshmi proceeded to Narasaraopet, whereas, Mr. A. Praveen Kumar carried the gold to Hyderabad as he had to attend a function there and then proceeded to Coimbatore along with his wife and sister. Smt. Varalakshmi had instructed her son to get the bars converted to gold jewellery through job workers either at Hyderabad or at Coimbatore. As the job workers in Hyderabad asked for higher rate, the Appellant proceeded with the gold to Coimbatore for conversion to jewellery. Mr. A. Praveen Kumar along with his wife and sister reached Coimbatore on 09.03.2020 and there he made enquiries with the local goldsmiths and then informed h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... before the DRI officers on 12.06.2020, 24.06.2020 and 12.11.2020 and deposed, inter alia, clearly stating that the gold was purchased by her from M/s Aryan Gold, Bengaluru on 06.03.2020 and also produced relevant invoice and also gave evidence of payment made for purchase through RTGS transfer on 19.03.2020. The seller Mr. Somanath. H, proprietor of M/s Aryan Gold, in his statement recorded by officers on 08.09.2020 also admitted the sale of the subject gold under tax invoice No. 38 dt.06.03.2020 made to the Appellants. Smt. Varalakshmi also categorically denied the deposition of her son as recorded by the officers at the time of seizure, as to purchase of gold from Coimbatore. 6. It further appears from the SCN dt.25.02.2021, that on interception of the bus on 10.03.2020 at Venkatachalam Toll Plaza being bus No. AR01 J 5225, another person named Mr. V. Kranti Kumar, who was travelling by the same bus, was also intercepted. Mr. V. Kranti Kumar admitted that he was carrying one packet of gold kept in tailor-made cloth belt tied to his waist weighing approximately 1kg and also showed the cloth belt to the officers. Another passenger by the name Mr. T. Prasannanjaneyulu also admitted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g any origin is actually smuggled gold brought into India and remelted to erase the identity of foreign origin/markings, which appeared to have been purchased by these persons without valid bills/documents or vouchers and hence liable to confiscation under the Customs Act. Accordingly, the officers seized the gold, as it appeared to them that the same is liable to confiscation under the provisions of Customs Act along with the packing materials used to wrap and carry gold. 10. In his statement recorded by the officers, immediately on seizure, Mr. A. Praveen Kumar, on 10.03.2020 had, inter alia, stated that he had purchased the gold from M/s Srinidhi Bullion, Coimbatore. His wife and his sister also travelled with him for sightseeing. He had carried cash of Rs.1.40 Crores for purchase of gold with which he purchased gold from M/s Srinidhi Gold Bullion, Raja Street, Coimbatore. He also met Mr. V.B. Vimal, owner of the said firm to whom he paid the cash. Mr. V.B. Vimal delivered him 14 gold bars and two pieces of gold totally weighin 3304.560 gms. On a specific query by officers as to why he carried huge cash, as he could have used the facility of bank transaction, he replied that he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... month. On the apparent shortage of 3488gms of gold as per the stock register, Mr. V.B. Vimal stated that the said shortage is due to nonissuance of sale bill at the time of sale on the same day before the search proceedings. 12. Further, the premises of M/s Varalakshmi Jewellers, Narasaraopet was also searched on 17.03.2020 and no incriminating documents were found. The statement of proprietor of M/s Varalakshmi Jewellers Smt. A. Varalakshmi was recorded. Subsequently, on 12.06.2020, wherein, she, inter alia, stated that she is the proprietor of M/s Varalakshmi Jewellers and Mr. A. Praveen Kumar is her son and he assists her in the family business. They purchased gold in the form of biscuits through bank and get the same coverted into ornaments and thereafter sell the same. Sometimes, they also sell pure gold in small quantities (ranging from 5 to 20 gms) to their customers. Further stated that her husband Mr. A. Srinivasa Rao also assists her in the family business. Whenever they need to purchase gold, her son Mr. A. Praveen Kumar goes to Vijayawada to bring the gold and also travel for getting the gold converted into jewellery. Her son Mr. A. Praveen Kumar looks after the bank t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from Mr. T. Prasannanjaneyulu with further proposal to impose penalty on all these persons. 15. The SCN was adjudicated ordering absolute confiscation of the 14 gold bars and two small pieces of gold totally weighing 3304.56gms valued at Rs.1,40,87,399/- seized from the posession of Mr. A. Praveen Kumar under Sec 111(d) 111(o) of the Act along with absolute confiscation of the packing material. Further penalty of Rs.35 lakhs was imposed on Mr. A. Praveen Kumar under Sec 112(a) and 112(b) of the Act and similarly, penalty of Rs.15 laksh was imposed on Smt. A. Varalakshmi. Penalty of Rs.15 laksh was also imposed on Mr. A. Srinivasa Rao and Mr. V.B. Vimal under Sec 112(a) 112(b) of the Act. Being aggrieved, the Appellants herein filed the Appeals before the learned Commissioner (Appeals) who, vide the impugned orders of even date, was pleased to dismiss the Appeals confirming the OIO. Being aggrieved, the Appellants are before this Tribunal. 16. Assailing the impugned order, learned Counsel for the appellants, inter alia, urges that the whole case is based on the statement dt.10.03.2020 of Mr. A. Praveen Kumar recorded at the time of seizure and the statement dt.12.03.2020 of Mr. V.B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... whether the gold was purchased from Srinidhi Gold or from some unknown persons in the market at Coimbatore. Thus, the SCN is based on vague and contradictory statements which has got no legs to stand. The Revenue has chosen one of the versions of Mr. V.B. Vimal to suit their purpose, although there is no material evidence in support thereof. Further, he urges that the deposition of Mr. A. Praveen Kumar at the time of seizure has been retracted at the first instance in the bail application and thus, the same is no reliable. Further, Revenue failed to examine Mr. A. Praveen Kumar during adjudication proceedings as required under Sec 138B of the Act and thus, the allegation is wholly unsubstantiated and fit to be rejected. 19. Further urges, admittedly, there is no foreign marking and serial numbers on the irregular gold bars seized from the appellant. Further, there is no basis or evidence available to Revenue for alleging the seized gold in question to be of foreign origin, and thus, the same is a wide guess work. The falsity of the statement dt.10.03.2020 of Mr. A. Praveen Kumar is also evidenced from the fact that Revenue did not put him any question regarding the source of the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hreat, etc., if the same is to be relied upon solely for the purpose of securing a conviction. Further, observed with a view to arrive at findings as regards the voluntary nature of statement or otherwise of a confession, which has since been retracted, the Court must bear in mind the attending circumstances which would include the time of retraction, the nature thereof, the manner in which such retraction has been made and other relevant factors. Law does not say that the accused has to prove that retraction of confession made by him was because of threat, coercion, etc., but the requirement is that it may appear to the court as such. 21. Further, he urges that Commissioner (Appeals) has erred in observing that the aforementioned ruling in Vinod Solanki has been distinguished by the Hon ble Madras High Court in the case of J. Shivakumar vs Additional Director General [2015 (316) ELT 382 (Mad.)]. A plain and simple persual of the said judgment of Hon ble Madras High Court indicates that the validity of the retracted statement was not the issue to be decided by the Hon ble High Court. The Hon ble High Court discussed the applicability of the decisions of the Apex Court with regard t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pe of Sec 123 of the Customs Act is concerned, it is urged that the appellants have discharged the onus by submitting the proof of bonafide purchase from M/s Aryan Gold, Bangalore vide tax invoice and the payment for the same, admittedly, made through banking channel. 24. Opposing the Appeals, learned AR for Revenue relies on the impugned order. He further states that as per the appellants, Mr. A. Praveen Kumar with Smt. A. Varalakshmi had gone to Bangalore to purchase gold on credit basis from M/s Aryan Gold on 06.03.2020 and had received the delivery of the gold in question. As this fact was known to Mr. A. Praveen Kumar, he failed to state the same at the time of panchanama proceedings before the officers, and thus, the narration of the facts as to purchase of gold from M/s Aryan Gold, is either of some other gold, or by way of afterthought. He further states that the appellant, in his statement recorded immediately on seizure dt.10.03.2020, had stated that he had purchased gold on payment of cash through M/s Srinidhi Gold, Coimbatore, person concerned Mr. V.B. Vimal, who had facilitated purchase through unknown person. The said fact was corroborated in the statement recorded of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , Mr. Somanath of M/s Aryan Gold, who was also examined by the officers, has supported the transaction of sale of subject gold in question, to the appellants on credit basis and subsequently, received the payment through banking channel and in support thereof, had produced both the copy of invoice as well as copy of his bank statement. 27. From the aforementioned facts and circumstances, I find that there is independent external evidence available in the facts of this case and the genuinity of the transaction is evident from the bank statement, wherein payment has been received by the seller from the buyer in due course within a period of about 15 days from the date of sale. As the transaction is through banking channel, thus, prima facie is evidence of its genuineness. Thus, I find that the appellants have discharged the onus under Sec 123 on them and they have explained the source with certainty. 28. Accordingly, in view of my findings and observations, I allow these appeals and set aside the impugned orders. The appellants Smt. A. Varalakshmi or Mr. A. Praveen Kumar are held entitled to receive back the gold, and if the same is already disposed of by the department, are held ent ..... X X X X Extracts X X X X X X X X Extracts X X X X
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