2002 (12) TMI 521 - AT - Customs

Summary

Issues:
Confiscation of metal scrap and truck, imposition of redemption fine and penalties, burden of proof on Revenue, presence of foreign markings on scrap, proximity to border, evidence of smuggling.

Analysis:
The judgment concerns three appeals arising from the confiscation of 44 gunny bags of metal scrap and a truck by the Commissioner of Customs, Patna, on suspicion of being smuggled. The Commissioner imposed a redemption fine of Rs. 60,000 on the truck and personal penalties on the owner of the scrap and the truck driver. The appellant, owner of the metal scrap, argued that the appearance of foreign markings on some pieces of the scrap did not prove the entire quantity was of foreign origin or smuggled. He contended that the burden to prove smuggling rested on the Revenue, which had not provided sufficient evidence.

The Commissioner's decision was based on the absence of papers in the truck, foreign markings on some scraps, proximity to the Indo-Nepal border, lack of infrastructure for large consignments, and discrepancies in payment methods. However, the Tribunal noted that metal scrap was a non-notified item, placing the burden of proving foreign origin and smuggling on the Revenue. Citing precedents, the Tribunal emphasized that foreign markings on a few pieces did not establish the entire scrap as foreign. Additionally, the circumstances raised doubts but did not conclusively prove smuggling. As the Revenue failed to present evidence of clandestine smuggling, the Tribunal set aside the confiscation of the metal scrap.

Since the scrap confiscation was overturned, the Tribunal ordered the release of the truck without a redemption fine and revoked the penalties imposed on the other two appellants. The judgment highlighted the lack of evidence supporting the smuggled nature of the metal scrap and emphasized the Revenue's failure to meet the burden of proof. Ultimately, all appeals were allowed, providing consequential relief to the appellants, and the stay petitions were disposed of accordingly.