2006 (11) TMI 512 - AT - Customs

Issues Involved:
1. Maintainability of the appeal by Smt. Anju Devi.
2. Determination of the foreign origin of the seized silver bullion.
3. Legitimacy of the seizure conducted by the Superintendent of Central Excise.
4. Compliance with CBEC Circular No. 334/233/88 Cus(AS) dated 11-6-99.
5. Burden of proof under Section 123 of the Customs Act, 1962.

Issue-wise Detailed Analysis:

1. Maintainability of the appeal by Smt. Anju Devi:
The Department raised a preliminary objection regarding the locus standi of Smt. Anju Devi, questioning her right to file the appeal without a succession certificate. However, the Tribunal found that Smt. Anju Devi had filed an affidavit and obtained a favorable order from the Allahabad High Court, which acknowledged her as the wife of late Shri D.K. Agarwal. Therefore, the Department's preliminary objection was dismissed, and the appeal was considered maintainable.

2. Determination of the foreign origin of the seized silver bullion:
The main issue was whether the silver bullion seized from Shri Subhash Chand's premises was of foreign origin. The panchnama recorded markings on only three out of 37 silver bullions, stating "DEGUSSA-999-1981" and "DEGUSSA-999-1982". The adjudicating authority concluded these were foreign based on these markings. However, the Tribunal noted discrepancies in the recorded markings and the adjudicating authority's findings. The Tribunal highlighted the lack of evidence linking the markings to a foreign company and considered the possibility that the markings could be related to a local firm named "M/s. Degussa," registered by the appellant's late husband.

3. Legitimacy of the seizure conducted by the Superintendent of Central Excise:
The Tribunal found that the seizure of the silver bullion was conducted by the Superintendent of Central Excise, which contravened CBEC Circular No. 334/233/88 Cus(AS) dated 11-6-99. This Circular specified that seizures should be conducted by an officer not lower in rank than an Assistant Commissioner of Customs. Since the seizure was not conducted by an authorized officer, the Tribunal deemed the seizure invalid and not in accordance with the law.

4. Compliance with CBEC Circular No. 334/233/88 Cus(AS) dated 11-6-99:
The Tribunal emphasized the CBEC Circular's intent to prevent undue harassment and specified that seizures should be conducted by an Assistant Commissioner of Customs for quantities less than 100 kgs or for bullions with foreign markings. The Tribunal found that the seizure was conducted by unauthorized personnel and noted that the majority of the seized bullions did not have any foreign markings, further invalidating the seizure.

5. Burden of proof under Section 123 of the Customs Act, 1962:
The Tribunal concluded that the Revenue did not discharge its burden of proving that the seized silver bullions were of foreign origin. The Tribunal referred to previous judgments, including the Division Bench decision in Kirit Parekh v CCE, which established that purity alone does not indicate foreign origin. The Tribunal found that the Revenue failed to provide evidence of foreign markings or licit possession, thus failing to shift the burden of proof to the appellants.

Conclusion:
The Tribunal set aside the impugned order of confiscation, directed the release of the seized silver bullions to the appellant, and allowed the appeal. The judgment emphasized the importance of adhering to procedural requirements and the necessity for the Revenue to provide concrete evidence when alleging foreign origin and smuggling.

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