TMI Blog1981 (8) TMI 76X X X X Extracts X X X X X X X X Extracts X X X X ..... merchants dealing in rough diamonds. The petitioner also produced the bill issued by Arunkumar Co. for 555.67 carats of diamonds. The Officers thereupon weighed the diamonds in the packet and noticed that the weight of the diamonds was 625.57 cts. According to the Department, further statement of the petitioner was recorded and in which the petitioner accepted that he had purchased the diamonds from an unknown Muslim in Zaveri Bazar for a small amount. The Department claims that in the two subsequent statements recorded on June 16, 1966, the petitioner admitted that the bill issued by Arunkumar Co. was not genuine. 2. The petitioner was put under arrest and produced before the Judicial Magistrate, but was released on bail on June 17, 1966. On the next day, i.e. June 18, 1966, the petitioner wrote to the Customs Authorities complaining that his two subsequent statements recorded on June 16, 1966, were untrue and were secured from him under coercion and threats. The complaint made by the petitioner was denied by the Customs Authorities by their reply dated June 25, 1966, wherein it was claimed that the statements were voluntary and the complaint of the petitioner was an after-t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... titioner to show cause as to why the diamonds seized from the petitioner should not be confiscated and a personal penalty should be imposed as per the provisions of the Customs Act. In answer to this show cause notice the petitioner filed his reply, but the Collector of Customs, Preventive, Bombay, did not accept the defence of the petitioner and passed the order dated September 7, 1970 confiscating the diamonds, in exercise of the powers under Section 11 1(d) of the Customs Act. The Collector also imposed a penalty of Rs. 5,000/- on the petitioners in pursuance of the powers under Section 112 of the Customs Act. The order passed by the Collector was confirmed in appeal by the Central Board of Excise and Customs on May 23, 1974. The revision application preferred by the petitioner to the Government of India ended in dismissal by an order dated August 16, 1977. The petitioner thereafter filed the present petition under Article 226 of the Constitution of lndia to challenge the legality of the order of confiscation and imposition of personal penalty. 5. Shri Mehta, the leaned Counsel appearing in support of the petition, has raised three or four contentions to challenge the legality ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, the goods shall be returned to the person from whose possession they were seized." This sub-section clearly provides that the goods seized under sub-section (1) must be returned to the person from whom possession was taken in case notice as contemplated under clause (a) of Section 124 is not served within a period of six months. Section 124(a) reads as under: "No order confiscating any goods or imposing any penalty on any person shall be made under this Chapter unless the owner of the goods or such person- (a) is given a notice in writing informing him of the grounds on which it is proposed to confiscate the goods or to impose a penalty;" Shri Mehta submits that the diamonds were seized from the petitioner on June 16, 1966, while the show cause notice contemplated under Section 124(a) of the Act was served only on January 12, 1967. It is not in dispute that the show-cause notice was served after the expiry of six months from the date of seizure. Shri Sethna urges that though the notice was served after the expiry of six months, the proviso to sub-section (2) of Section 110 enables the Collector of Customs to extend the time on sufficient cause being shown. The learned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... confiscation no period of limitation is provided. The submission is totally misconceived. In cases where the goods are seized under sub-section (1) of Section 110 the power to confiscate must be exercised within a period of six months and on failure the authorities are bound to return the goods. It is futile to claim that the Department could exercise the power of confiscation even in respect of seized goods beyond a period of six months. Shri Sethna's submission that the goods can be confiscated if they are brought in India in contravention of provisions of Section 111 of the Act at any time, cannot be entertained in respect of the goods which were seized under sub-Section (1) of Section 110 of the Act. The power of confiscation cannot remain available for all time to come in respect of goods seized under Section 110 of the Act. The submission of the learned Counsel, therefore, deserves to be repelled. The result of this conclusion is that the proceedings adopted by the show cause notice issued after the expiry of six months are illegal and without jurisdiction. The petitioner is entitled to succeed on this count. 9. The second submission of Shri Mehta that the authorities bel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Customs had decided not to launch the prosecution. On this statement being made before the Chief Presidency Magistrate, the petitioner was discharged by an order dated September 8, 1970. Shri Mehta is right in his submission that in case the statements were voluntary, then the Collector would have never permitted withdrawal of the prosecution on the ground that the evidence was not sufficient. Can there be any better evidence than the voluntary statement of the accused? Shri Mehta is right that in case the prosecution would have proceeded, the officer recording the statement would have been required to step into the witness box to sustain the claim that the statements were voluntary and to avoid that the prosecution was not proceeded with. In my judgment, it is obvious that the failure of the Department to tender the officer for cross-examination and the failure to examine the officer in a confiscation proceedings to establish that the subsequent statements of the petitioner were voluntary in nature, is fatal and it was improper on the part of the authorities below to direct confiscation and impose penalty on the basis of such doubtful statements. The proceedings are required to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it is impossible to conclude on the material on record that the bill produced by the petitioner was bogus. The proceedings adopted by the Department are quasi-criminal in nature and it is not necessary for the petitioner to establish beyond doubt that he has purchased the diamonds under the bill from Arunkumar and Company on June 13, 1966. In case the claim made by the petitioner is probable on the facts and circumstances of the case, then it is not open for the authorities to confiscate the diamonds in question. In my judgment, the authorities below overlooked that the fact that the petitioner made statement immediately and also produced the bill is sufficient to warrant a conclusion that the acquisition of 555.67 cts. of diamonds was legal. 11. Shri Sethna very vehemently urged that the Assistant Collector has taken into account five factors to record the conclusion that the claim of the petitioner could not be accepted and that being the finding of fact should not be disturbed in exercise of the writ jurisdiction. The grounds which appealed to the Collector are (i) that the petitioner did not produce his account books on the date of the raid itself. This ground could not be s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f confiscation and personal penalty is required to be set aside. 12. It is necessary to make a reference to the submission made by Shri Sethna in regard to the nature of the statements of the petitioner. Shri Sethna argued that the subsequent statements of the petitioner were voluntary in natural and the principles of nature! justice are not violated. The learned Counsel urged that though the petitioner had demanded that the officer who seized the diamonds should be tendered for cross-examination, that request was not pressed before the Collector or in appeal before the Board. The learned Counsel also submitted that the point about the failure to examine the witness to establish the voluntary nature of statements was also not raised before any of the lower Tribunals. It was also claimed that the panchas were present at the time of recording the first statement but they were not called for the purpose of recording the statement but for the purpose of seizure. The learned Counsel desired that I should peruse the statements and hold that there is intrinsic evidence to establish that they were voluntary in nature. I declined to do so because it is not proper to enter into that arena ..... X X X X Extracts X X X X X X X X Extracts X X X X
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