TMI Blog1983 (12) TMI 69X X X X Extracts X X X X X X X X Extracts X X X X ..... s search and seizure was not in consonance with any law and more particularly sections 105 and 110 of the Customs Act, 1962 (for short, the Act) under which provisions the respondents claim to have acted. The material part of these two sections, i.e., 105 and 110 of the Act, lays down that the officers specified therein may, on the basis of "reason to believe" that any goods liable to confiscation or any documents or things which in their opinion may be useful or relevant to any proceeding under the Act, search for the goods, documents or things and may also seize them. This is what has been pleaded by the respondents in support of their impugned action :- "An Intelligence indicating the names of firms reported to be engaged in importing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d duty free Raw Material can be recovered, the respondent No. 2 issued the search warrants under section 105 of the Customs Act, 1962 duly authorising respondent No. 3 to search the residential premises of Sh. Gurmukh Singh and Sudesh Kumar Khanna. As a result of the search of the residential premises of Shri Gurmukh Singh petitioner, Advance Import Licences of the above two bogus firms and of M/s. Krishna Woollen Mills, Amritsar could not be recovered, however blank writing pads bearing the names of M/s. Cee International, Amritsar and M/s. O.S. Textiles, Amritsar, were recovered from the residence of Shri Gurmukh Singh alongwith other documents and Indian Currency Rs. 4,08,500/- of which Shri Gurmukh Singh could not furnish any evidence d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ber, 1982, he does not mention anything about the petitioner Gurmukh Singh and with regard to M/s. Krishna Woollen Mills, all that he says is that he is an employee of that firm. In other words, he does not say a word as to whether Krishna Woollen Mills has been importing any material or has been selling anything in the market as suggested vide letter dated 24th November, 1982. Mr. Brar also makes a reference to a note prepared by the Superintendent in the office of respondent No. 2 wherein it is recorded that Gurmukh Singh petitioner is a partner in Krishna Woollen Mills and it is just possible that he might also be the shareholder in Sudesh business for arranging Advance Import Licences in fake name and fake addresses." On this note, resp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 17th December, 1982. By now it is well-settled that mere suspicion cannot be the basis of any search or seizure in terms of the above-noted provisions of the Act. It has been observed by their Lordships of the Supreme Court in Sheo Nath Singh v. The Appellate Assistant Commissioner of Income Tax (Central), Calcutta and others - AIR 1971 S.C. 2451 : "The words 'reason to believe' suggest that the belief must be that of an honest and reasonable person based upon reasonable grounds and that the Income Tax Officer may act on direct or circumstantial evidence but not on mere suspicion, gossip or rumour. He will be acting without jurisdiction if the reason for his belief that the conditions are satisfied does not exist or is not material or ..... X X X X Extracts X X X X X X X X Extracts X X X X
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