2006 (2) TMI 408 - AT - Customs

Summary

Issues Involved:
1. Legality of detention and arrest.
2. Burden of proof regarding the origin of the gold.
3. Evidentiary value of statements obtained under detention.
4. Applicability of Section 123 of the Customs Act, 1962.

Issue-wise Detailed Analysis:

1. Legality of Detention and Arrest:
The primary issue is whether Shri Amar Kishore Prosad of Ramgarwa was detained legally. It was contended that he was arrested on 22-4-1996 and produced before the Chief Judicial Magistrate on 24-4-1996, exceeding the 24-hour limit mandated by law. The judgment noted that various courts have held that a person must be produced before a magistrate within 24 hours of arrest. The argument by the learned J.D.R. that the arrest was made on 23-4-1996 and thus within the 24-hour limit was not supported by any authority and was rejected. The court found that the detention exceeded 24 hours, making it illegal.

2. Burden of Proof Regarding the Origin of the Gold:
The next issue was whether the burden of proof was on the appellants or the Department to prove the origin of the gold. The purity of the gold bars was found to be 984.2, 992.200, and 995.5, with no marks or numbers indicating foreign origin. The court held that mere purity levels do not prove foreign origin and cited the case of Akule Sheshagir Rao & Sons v. Commissioner of Central Excise, Kanpur, where ingots without clear markings were not considered foreign. The court concluded that Section 123 of the Customs Act, 1962, which shifts the burden of proof to the accused, was not applicable as the Department failed to prove the gold was of foreign origin.

3. Evidentiary Value of Statements Obtained Under Detention:
The court examined the evidentiary value of the statements obtained from Shri Amar Kishore Prosad of Ramgarwa. It was argued that the statement was taken after prolonged detention and thus lacked evidentiary value. The court cited several cases, including Union of India v. Abdulkadar Abdulgani Hasmani, which held that statements recorded after prolonged detention might not be voluntary. The court found that the statement of the carrier, obtained after more than 24 hours of detention, could not be considered voluntary and lacked corroborative evidence.

4. Applicability of Section 123 of the Customs Act, 1962:
The final issue was the applicability of Section 123 of the Customs Act, 1962. The court noted that for Section 123 to apply, the Department must first prove that the goods are smuggled. Since the Department failed to prove the gold bars were of foreign origin, Section 123 was not applicable. The court emphasized that the burden of proof lies with the Department to establish the applicability of Section 123 before it can shift to the appellants.

Conclusion:
The court concluded that the detention of Shri Amar Kishore Prosad of Ramgarwa was illegal, the Department failed to prove the gold was of foreign origin, and the statements obtained under prolonged detention lacked evidentiary value. Consequently, the order passed by the Commissioner (Appeals) was set aside, and the appeals were allowed.