2016 (8) TMI 1280 - AT - Customs

Absolute confiscation of Currency u/s 113 of Customs Act, 1962 - penalty u/s 114 of Customs Act, 1962 - Held that - the adjudicating Commissioner has proceeded on the assumption that option to redeem is a discretion afforded to the adjudicating authority and for release only to the owner of the goods. This is an erroneous interpretation. An adjudicating authority is vested with that discretion only in relation to prohibited goods; indeed, it is moot whether currency is goods. Currency is not prohibited goods and, therefore, the adjudicating authority is bound to allow redemption to the person from whom it was seized - the appellant is merely a carrier, it was also not consistent with the finding to impose such a harsh penalty on the appellant. The option to redeem the confiscated goods is allowed on payment of ₹ 5,00,000/- - Penalty is reduced to ₹ 1,00,000/- - decided partly in favor of appellant.

Summary

Issues: Seizure of currency, Confiscation under Customs Act, 1962, Imposition of penalty, Interpretation of option to redeem, Penalty reduction.

Seizure of Currency: The judgment revolves around the seizure of Indian currency amounting to ?49,73,000 from the appellant, who was bound for Dubai. The currency was seized from the check-in baggage of the appellant.

Confiscation under Customs Act, 1962: The impugned order confiscated the currency under section 113 of the Customs Act, 1962 without the option to redeem and imposed a penalty of ?5,00,000 on the appellant under section 114 of the Customs Act, 1962.

Imposition of Penalty: The adjudicating Commissioner held that the currency did not belong to the appellant but to another individual who had requested him to carry the contraband, leading to the confiscation of the currency and imposition of the penalty.

Interpretation of Option to Redeem: The judgment highlights an erroneous interpretation by the adjudicating Commissioner regarding the option to redeem. It clarifies that the adjudicating authority is bound to allow redemption to the person from whom the currency was seized, especially since currency is not considered prohibited goods.

Penalty Reduction: The judgment notes that the appellant was merely a carrier and, therefore, imposing a harsh penalty was inconsistent with this finding. Consequently, the penalty was reduced to ?1,00,000, and the option to redeem the confiscated goods was allowed on payment of ?5,00,000 within four weeks.

In conclusion, the judgment modifies the impugned order, allowing the redemption of the confiscated goods and reducing the penalty imposed on the appellant. The decision emphasizes the correct interpretation of the option to redeem and considers the appellant's role as a carrier in the incident.