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Issues:
1. Seizure and confiscation of raw silk yarn by Customs. 2. Burden of proof on Revenue to establish smuggling of goods. 3. Discrepancy in documents and mis-declaration of goods. Analysis: Issue 1: Seizure and confiscation of raw silk yarn by Customs The appellant, a proprietor of a textile company, purchased silk yarn from a supplier and faced seizure of the goods by Customs officials during transportation. The appellant argued that the seizure was unwarranted as the goods were not specified under the Customs Act, and there was no evidence of illegal importation. The appellant contended that the goods were covered by Open General License (OGL) and were freely available in the country without restrictions. The appellant relied on various legal precedents to support the claim that the seizure and confiscation were unjustified. Issue 2: Burden of proof on Revenue to establish smuggling of goods The JDR representing the Revenue argued that the goods were rightly confiscated due to discrepancies in documents, mis-declaration, and lack of proper proof of payment. However, the burden of proof that the goods were smuggled rested on the Revenue. The judgment cited legal cases emphasizing that even in the case of goods of foreign origin, Customs authorities must prove smuggling. In this case, the Revenue failed to provide evidence that the goods were clandestinely imported, while the appellant submitted documents showing legal importation through proper channels. Issue 3: Discrepancy in documents and mis-declaration of goods The JDR highlighted discrepancies in documents such as improper challans and mis-declaration on the Railway Receipt. However, the judgment emphasized that such discrepancies did not conclusively prove smuggling. The appellant's submission of documents showing legal acquisition of the goods countered the Revenue's argument. Legal precedents were cited to support the view that failure to demonstrate illegal importation would not support confiscation. The judgment concluded that the Revenue failed to establish the smuggled nature of the goods, leading to the appeal being allowed and the impugned order set aside. In conclusion, the judgment ruled in favor of the appellant, setting aside the confiscation of the raw silk yarn by Customs and allowing the appeal with consequential benefits.
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