2003 (3) TMI 374 - AT - Customs

Summary

Issues:
1. Confiscation of foreign exchange under Customs Act.
2. Confiscation of scooter and penalty imposition.
3. Retracted statements and admissibility as evidence.
4. Burden of proof regarding smuggled goods and sale proceeds.

Analysis:

Issue 1: Confiscation of foreign exchange under Customs Act
The appellant was apprehended with a significant amount of foreign exchange without permission from RBI. The show cause notice alleged confiscation under Section 111(d) of the Customs Act and as sale proceeds of smuggled gold under Section 121. The Commissioner confiscated the currency absolutely and imposed a penalty. The appellant argued that the currency was freely allowed for import by passengers, and without evidence of smuggling, confiscation was not justified.

Issue 2: Confiscation of scooter and penalty imposition
The Commissioner confiscated the scooter but allowed redemption on a fine and imposed a penalty on the appellant. The appellant challenged the penalty, citing retracted statements and lack of evidence linking the currency to smuggled goods. The Tribunal found no evidence of smuggling or sale of smuggled goods, thus setting aside the confiscation of the scooter and the penalty.

Issue 3: Retracted statements and admissibility as evidence
The appellant's statements were retracted multiple times, raising concerns about their admissibility as evidence. The appellant argued that uncorroborated retracted statements should not be considered. The Tribunal emphasized the need for corroborative evidence to support retracted statements, which was lacking in this case.

Issue 4: Burden of proof regarding smuggled goods and sale proceeds
The Tribunal analyzed the burden of proof in cases involving smuggled goods and sale proceeds. It was noted that the law requires specific evidence to establish smuggling allegations. The Commissioner's observations about the appellant's privileged information were deemed insufficient to prove smuggling charges. Without establishing the smuggled nature of the currency, the confiscation orders were set aside, along with the penalty imposed on the appellant.

In conclusion, the Tribunal allowed the appeal, setting aside the confiscation of the currency and the scooter, as well as the penalty imposed on the appellant. The judgment highlighted the importance of evidence and burden of proof in cases involving confiscation under the Customs Act, emphasizing the need for corroborative evidence to support allegations of smuggling and sale proceeds.