2014 (5) TMI 88 - AT - Customs

Smuggling of IC - Proceeds of Smuggled silver - No Evidence - Whether Indian currency caught is sale proceeds of smuggled silver - Section 121 of the Customs Act - Held that - There is virtually no evidence on record to establish that the Indian currency in question is sale proceeds of the smuggled silver as alleged by the Revenue - The entire case is based upon the seizure by the police and the initial statement of Shri Hem Raj, which are also contradictory in nature - He has named different person at different points of time as recorded in the impugned order - During adjudication appellants have taken a stand that the money in question was given to him by various persons for the purchase of the agriculture land - The said persons who have given their affidavits do not stand examined by the adjudicating authorities, who have simplicitor rejected the said affidavits by observing that the same is an afterthought. In any case Section 121 stands examined by the various Courts and it is well settled that the onus to prove that the Indian currency and the sale proceeds of smuggled goods is on the Revenue - There is nothing on record to show as to which silver stands sold by the appellant and who are the buyers of the same - Whether the said silver, even if sold, was smuggled or not - In the absence of an answer to all these questions, the confiscation of the Indian currency and the imposition of penalty is on the appellants is not justified - Accordingly, the impugned orders are set aside Decided in favour of appellant.

Summary

Issues involved:
- Confiscation of Indian currency recovered from two individuals during a police interception
- Imposition of penalties on the individuals and co-noticees
- Appeal against the order of confiscation and penalties

Confiscation of Indian Currency:
The case revolved around the recovery of a significant amount of Indian currency from two individuals during a police interception. The police detained the individuals based on a reasonable belief that the money was related to illegal activities. The total amount recovered from the two individuals was substantial. The authorities initiated proceedings for the confiscation of the Indian currency and imposed penalties on the individuals and co-noticees. The lower authorities based their decision on the initial statement of one of the individuals, which was contradictory. The appellants argued that there was no concrete evidence linking the currency to smuggled goods. The Tribunal highlighted the heavy onus on the Revenue to prove that the seized currency was indeed the sale proceeds of smuggled items.

Legal Precedents and Analysis:
The judgment referenced legal precedents to emphasize the necessity for the Revenue to establish beyond doubt that the confiscated currency was derived from smuggled goods. The Hon'ble Punjab & Haryana High Court and the Tribunal's decisions were cited to support the argument that without concrete evidence linking the currency to smuggling activities, confiscation is not justified. The Tribunal stressed that the onus of proof lies with the Revenue to establish the connection between the currency and the alleged smuggled goods. In this case, the lack of evidence regarding the source of the currency and the buyers of any smuggled goods led to the conclusion that the confiscation and penalties imposed were not justified.

Conclusion:
The judgment concluded that there was virtually no evidence to support the claim that the Indian currency in question was the sale proceeds of smuggled silver. The case primarily relied on contradictory statements and lacked substantial proof linking the currency to illegal activities. The appellants' argument that the money was intended for the purchase of agricultural land was dismissed as an afterthought by the lower authorities. Given the absence of concrete evidence and unanswered questions regarding the origin of the currency, the Tribunal set aside the impugned orders, allowing the appeals and providing consequential relief to the appellants.