1961 (11) TMI 60 - SC - Customs

onus to prove on the department that the gold was of foreign origin, and this foreign gold had been imported after restrictions had been imposed in March 1947. extremely improbable that the gold would remain in the same shape of bars and with the same fineness as when imported after the passage of this length of time

Summary

Issues:
1. Legality of order of confiscation by Customs Authorities.
2. Applicability of Section 178(A) of the Sea Customs Act.
3. Constitutionality of Section 178(A).
4. Validity of the order of the Collector of Customs.
5. Evidence supporting the finding of the Collector.

Analysis:
The case involves an appeal challenging the judgment of the Punjab High Court that summarily dismissed a Writ Petition filed under Art. 226 of the Constitution, questioning the legality of the Customs Authorities' order of confiscation of gold belonging to the appellants on grounds of smuggling. The appellants, partners of a Joint Hindu Family firm in Bombay, had sent gold for melting to a refinery, which was seized by Customs Officers on suspicion of being smuggled. The Collector of Customs issued a notice for confiscation under s. 167(8) of the Sea Customs Act, which was upheld through appeals and revisions. The central issue revolves around the Collector's finding that the gold was of foreign origin and imported in contravention of regulations, justifying confiscation.

The primary contention raised was the applicability of Section 178(A) of the Sea Customs Act, which was not relevant as the seizure and proceedings predated its enactment. The focus shifted to whether the Collector's order was erroneous under Art. 226 of the Constitution. The Collector's finding was based on two aspects: foreign origin of the gold and contravention of regulations. The appellants argued that there was no evidence of post-1947 importation after restrictions, challenging the sustainability of the smuggling claim. However, the Court rejected this argument, noting the improbability of gold remaining unchanged if imported earlier and emphasizing the evidence considered by the Collector, including purchase details and refining attempts, supporting the smuggling inference.

The judgment highlighted the significance of evidence presented before the Collector, refuting the appellant's claim of insufficient material to justify the finding of smuggling. The Court upheld the dismissal of the Writ Petition by the High Court, emphasizing the relevance of the evidence considered and the Collector's reasoning. Ultimately, the appeal was dismissed, affirming the Collector's order of confiscation and holding the appellants liable for smuggling, with costs imposed on the appellants.

In conclusion, the judgment delves into the intricacies of Customs law, evidentiary standards, and the burden of proof in cases of suspected smuggling. It underscores the importance of factual findings and the reasoning behind administrative decisions, ultimately upholding the Collector's order in this particular case.