2006 (10) TMI 299 - AT - Customs

Adjudication and criminal prosecution - Acquittal by criminal court - Investigation - Non-cooperation - Smuggling - Foreign marked gold biscuits and currency

Summary

Issues Involved:

1. Absolute confiscation of foreign gold biscuits.
2. Confiscation of Indian currency under Section 121 of the Customs Act, 1962.
3. Imposition of penalties on the appellants.
4. Impact of acquittal in criminal prosecution on adjudication proceedings.

Detailed Analysis:

1. Absolute Confiscation of Foreign Gold Biscuits:

The Customs authorities intercepted a jeep on the night of 22/23-10-1997 and recovered five foreign marked gold biscuits and Indian currency from appellant No. 2. The appellant could not produce any evidence of licit possession of the gold. The authorities seized the gold and currency, and appellant No. 2 admitted in his statement that the gold was smuggled. The adjudicating authority and the Commissioner (Appeal) upheld the absolute confiscation of the gold biscuits.

The appellants contested this, arguing that appellant No. 2 had retracted his statement and produced a bill dated 17-10-97 from M/s. Dhan Cholia Sons, Delhi, as evidence of legal purchase. However, the authorities noted that this bill was produced much later and did not match the unique markings on the seized gold biscuits. The tribunal found that the delayed production of the bill and the failure to present it during the initial summons indicated a cover-up. Thus, the absolute confiscation of the gold biscuits was upheld.

2. Confiscation of Indian Currency under Section 121 of the Customs Act, 1962:

The Indian currency was seized as it was alleged to be the sale proceeds of smuggled silver. Appellant No. 2 admitted this in his statement, which was not retracted. The appellants argued that the currency was for the purchase of agricultural land, but failed to provide immediate documentary evidence. The tribunal found that the delayed production of documents and the non-cooperation of appellant No. 4 with the investigation suggested an attempt to legitimize the currency. Therefore, the confiscation of the Indian currency was upheld.

3. Imposition of Penalties on the Appellants:

Penalties were imposed on all the appellants based on their involvement in the smuggling operation. The tribunal found that appellant No. 2's statements were consistent and not made under duress, and that appellant No. 4's actions indicated a cover-up. The penalties imposed by the lower authorities were deemed appropriate and were upheld.

4. Impact of Acquittal in Criminal Prosecution on Adjudication Proceedings:

The appellants argued that their acquittal in the criminal prosecution should lead to the dismissal of the adjudication proceedings. However, the tribunal cited the Supreme Court's decision in the case of Standard Chartered Bank, which established that adjudication and prosecution are independent proceedings, and the outcome of one does not bind the other. Therefore, the acquittal in the criminal case did not affect the adjudication proceedings, and the tribunal dismissed this contention.

Conclusion:

The tribunal upheld the absolute confiscation of the foreign marked gold biscuits and the Indian currency, and the imposition of penalties on the appellants. The appeals filed by the appellants were dismissed, and the impugned order was confirmed.