2002 (1) TMI 512 - AT - Central Excise

Summary

Issues:
1. Seizure of gold biscuits and car by Central Excise Officers.
2. Imposition of penalties under Gold (Control) Act, 1968 on individuals involved.
3. Appeal against the Commissioner's order.
4. Legal challenge to composite penalties under different statutes.
5. Validity of statements recorded during the investigation.

Seizure of Gold Biscuits and Car:
The case involved the interception of a car containing 52 foreign marked gold biscuits valued at Rs. 18,20,000. Statements revealed that the gold biscuits were collected by individuals involved in the case, leading to the seizure of the gold and the car by Central Excise Officers. Further investigations uncovered additional silver cubes and documents from the residence of one of the individuals implicated.

Imposition of Penalties:
The Commissioner of Central Excise, Indore imposed penalties under Section 112 and Section 74 of the Gold (Control) Act, 1968. A penalty of Rs. 10 lakhs was levied on one individual and Rs. 5 lakhs on another for their involvement in the possession and transfer of the gold biscuits. The appeals filed against these penalties were heard by the Appellate Tribunal.

Appeal Against Commissioner's Order:
The appellants challenged the Commissioner's order, arguing against the legality and sustainability of the composite penalties imposed under the Customs Act, 1962 and the Gold (Control) Act, 1968. They contended that the penalties should be set aside based on a previous Tribunal decision and the involuntary nature of statements recorded during the investigation.

Legal Challenge to Composite Penalties:
The Tribunal considered the legal proposition raised by the appellants and referred to a Supreme Court judgment regarding the imposition of composite penalties. The Tribunal clarified that the imposition of a composite penalty under different statutes was not inherently unlawful. It directed the appellants to make pre-deposits towards the penalties imposed, indicating that the penalty amounts could be re-determined separately under each statute.

Validity of Statements Recorded:
The validity of statements recorded during the investigation was also raised, with claims of coercion and retraction made by one of the individuals involved. However, the Tribunal found that the facts of the case, including the recovery of the gold biscuits and the statements made, would be further examined during the final hearing. The Tribunal concluded that the appellants had not established a prima facie case in their favor, requiring one of the individuals to make a pre-deposit of the penalty amount.

This detailed analysis of the judgment outlines the key issues involved in the case and the Tribunal's considerations and decisions regarding the seizure of gold, imposition of penalties, legal challenges, and the validity of statements recorded during the investigation.