TMI Blog2001 (6) TMI 150X X X X Extracts X X X X X X X X Extracts X X X X ..... Commissioner culminated in the Order passed on 5-1-1993 and revised on 7-1-1993. Shri Mitra died in 1976. Hence his widow, Smt. Nirmala Mitra was to inherit the properties including the foreign gold bars. 1.3Before the case was finally decided by the Judicial Commissioner, the Assistant Commissioner of Customs Central Excise filed a Writ Petition [Cr. W.J.C. No. 69 of 1990 (R)] before the Patna High Court (Ranchi Branch) for possession of the foreign gold bars and the primary gold to proceed under the Customs Act, 1962 and the Gold Control Act, 1968. The Hon'ble Judicial Commissioner gave the liberty to the Central Excise Customs Authority to initiate action under the Customs Act, 1962 in respect of the foreign gold bars. 1.4As per Orders of the Hon'ble Judicial Commissioner, the appellant had to file an affidavit that she would not take the gold, but would keep the gold in the State Bank of India for initiating action by the Customs Authority. On 18-1-1993 at the time of delivery of the gold, gold ornaments, jewelleries etc., the representatives of the Police and the Assistant Commissioner of Customs Central Excise were present. The inventory of the foreign gold bars wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... berty to the Customs Authority to initiate action under the Customs Act, 1962, the segregation of the foreign gold bars vis-a-vis making of inventory and signature of the inventory of the foreign gold bars on 18-1-1993 by the Assistant Commissioner of Customs, subsequent upon detention and seizure of the same will prove conclusively that the gold had been seized by the Customs Authority from the Police Authority. 2.2"Seizure" under the authority of law does involve a deprivation of "possession" and not merely of custody and so when the Police Officer seized the gold, the accused lost possession which vested in the Police. When that possession is transferred to the Customs, there is no fresh seizure under the Customs Act. Since no seizure is involved under the Customs Act, the provisions of Section 178A of the Sea Customs Act, 1978 (now Section 123 of the Customs Act, 1962) cannot be availed of to throw the burden of proving that the gold had not been smuggled on the accused [Gian Chand Others reported in 1983 (13) E.L.T. 1365 (S.C.). In the case of Collector of Customs Central Excise, W.B. Others v. Hindustan Motors Others Anr. reported in 1979 (4) E.L.T. J 313 it has b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... submitted that it is a settled law that when the goods are seized from the Police, the provisions of Section 178A of the Sea Customs Act, 1978 or Section 123 of the Customs Act, 1962 is not applicable and the burden to prove is on the Customs Authority that the goods are smuggled into India. Following decisions are cited : (i) 1983 (13) E.L.T. 1365 (S.C.) Gian Chand Others v. State of Punjab; (ii) 1992 (58) E.L.T. 54 (P H) Asstt. Collector v. Daljit Singh Others; (iii) 1987 (29) E.L.T. 128 (T) = 1987 (11) ECR 333 (CEGAT) Shri K. Beeman v. Collector of Customs, Madras; (iv) 1987 (27) E.L.T. 675 (T) = 1987 (10) ECR 614 (CEGAT) Shri R. Ramesh, Madras v. Collector of Customs, Madras; (v) 1986 (26) E.L.T. 10 (S.C.) Commissioner of Income Tax Others v. Tarsem Kumar Another. Commissioner of Income Tax Others v. Tarsem Kumar Another. 2.4In the present case, the Assistant Collector of Customs filed Writ Petition to the Hon'ble Court and as per the Orders of the Judicial Commissioner, Ranchi liberty was given to the Customs Authorities to initiate action on the said gold. By the said order of the Hon'ble Court, the gold was virtually transferred to the C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eizure by the Customs Officials. The goods were merely transferred from the Police to the Customs Authorities as per the Orders placed. 2.7From the extracts of the verdict given by the Judicial Commissioner, Ranchi, it appears that Late Shri Santo Kumar Mitra acquired the gold by the defaulcated money during the period from 1941 to 1949. It further appears that as per the statement of Late Shri Mitra the gold had been acquired from the Reserve Bank of India through brokers. Further, certain cash memos of the gold were also found. These are all exhibits in the case of defaulcation. 2.8It is also respectfully submitted that when the gold had been seized by the Police in 1950 the provisions of Section 178A was not in existence. The provisions of Section 178A were incorporated in Sea Customs Act, 1978 in 1955. In the case of Ambalal v. Union of India Others reported in 1983 (13) E.L.T. 1321 (S.C.) it has been held by the Honourable Apex Court that since the Section 178 of Sea Customs Act was not invoked and was inserted in that Act by Act No. 21 of 1955 and whereas the order of confiscation of the goods in question was made in January, 1952, the Section was not applicable at that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been illegally imported into the country. 2.12In the Adjudication Order it has been mentioned by the Commissioner that 19831.805 gms. of foreign-marked gold were seized by the Officers under a reasonable belief that the same were smuggled into India contrary to the provisions of Section 3 of Imports Exports (Control) Act, 1947 read with Section 19 of the Sea Customs Act, 1878 which was subsequently re-enacted as Section 11 of the Customs Act, 1962. The Commissioner observed that Smt. Nirmala Mitra has not been in a position to discharge the burden of proof cast on her regarding lawful import of the impugned gold into India. Smt. Nirmala Mitra is bound to discharge this burden as she is claiming the ownership of the impugned gold. The Commissioner mentioned that he had no option except to conclude that the foreign-marked gold weighing 19831.805 gms. seized in this case have been smuggled into India during the year, 1950 as the appellant could not produce document of licit importation of the gold. He went on saying that this is the year in which the same were initially seized by the Police for contravention of the provisions of Section 3 of the Import Export Control Act, 1947 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions of Section 123 of the Customs Act, 1962 and secondly that even if the seizure is held to be by the Customs authorities, the provisions of the said two sections will not apply inasmuch as they were not in existence at the time of original seizure by the police. 6.As regards the first question, it is admitted that the gold was seized by the Police in the year 1950 from Late Shri Santo Kr. Mitra on the ground of defaulcation of Govt. money. It was subsequently on finalisation of the prosecution proceedings in the said case of defaulcation of Govt. money that the gold in question was ordered to be handed over to the Customs authorities and to be deposited in the bank and permission was granted to the Customs authorities to proceed under the provisions of Customs Act, 1962. The gold in question has been confiscated by the adjudicating authority on the ground that the same was smuggled gold. The question which arises is as to whether the onus to prove that the gold was acquired legally rests upon the appellant or the Department is required to produce positive evidence as regards the smuggled nature of the same. The appellants have strongly contended that the possession obtained by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stody of the goods. The suggestion that the goods continued to be, at that stage, in the possession of the accused does not embody a correct appreciation of the law as regards possession. A 'seizure' under the authority of law does involve a deprivation of possession and not merely of custody and so when the Police Officer seized the goods, the accused lost possession which vested in the police. When that possession is transferred, by virtue of the provisions contained in S. 180 to the Customs authorities, there is no fresh seizure under the Customs Act. It would, therefore, follow that, having regard to the circumstances in which the gold came into the possession of the Customs authorities, the terms of S. 178A which requires a seizure under the Act were not satisfied and consequently that provision cannot be availed of to throw the burden of proving that the gold was not smuggled, on the accused." 7.By applying the ratio of the above decision of the Hon'ble Supreme Court which is more or less akin to the facts and circumstances of the present case we hold that there was no seizure by the Customs authorities under the Customs Act so as to invoke the provisions of Section 178A of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evidence on record to show that the gold found from the possession of Shri Santo Kr. Mitra was illegally smuggled into country. He has merely observed that as the appellant could not produce any evidence as regards the legal character of the gold in question, the same has to be presumed to be smuggled one. Having already held that the onus was not upon the appellant, the same is required to be discharged by the Revenue by production of positive and tangible evidence, which they have failed to discharge. It is also on record that Shri Santo Kr. Mitra in his statements recorded at the time of seizure by the Police and during investigations thereafter has deposed that the gold in question was purchased by him from the Reserve Bank of India through brokers. Certain cash memos of the gold were also found, as is evident from the exhibits in the case of defaulcation. Even the prosecution's case before the Judicial Magistrate was that the gold was acquired by Shri Mitra by defaulcation money during the period from 1941 to 1949. As against the above evidences there is no evidence produced by the Revenue to show that the gold was smuggled and acquired illegally in the year 1950 by Shri Sant ..... X X X X Extracts X X X X X X X X Extracts X X X X
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