2015 (10) TMI 2394 - AT - Customs

Confiscation of goods Imposition of penalties Revenue contended that pulses carried in trucks was meant for illegal export to Nepal and goods were correctly confiscated under Section 113(d) and vehicle was correctly confiscated under Section 115 Goods were also prohibited as per were also prohibited by DGFT Notification No. 35/2009-2010 Respondent contended that goods were not intended to be exported to Nepal and were being transported to Manjharia Godowns within the territory of India and pulses seized were meant for sale within India. Held That - There is no evidence to rebut the argument of Respondent that pulses were meant for sale only within India Information gained by Department was on mere hearsay of driver and cannot be taken as evidence - Impugned pulses were not liable to confiscation under Section 113 (d) as these were moving within the territory of India - Pulses have not been shown to have been notified as specified goods under Section 111 - No evidence on record that owner of truck had knowledge of smuggled nature of goods Decided against Revenue

Summary

Issues:
1. Confiscation of pulses/cereals and truck for illegal export to Nepal.
2. Imposition of penalties under Customs Act, 1962.
3. Interpretation of Section 113(d) and Section 2(19) of the Customs Act.
4. Evidence required for goods to be considered for export.
5. Confiscation of the vehicle and owner's knowledge.

Analysis:

Issue 1: Confiscation of pulses/cereals and truck for illegal export to Nepal
The Revenue contended that the intercepted truck carrying assorted pulses/cereals was intended for illegal export to Nepal, leading to confiscation under Section 113(d) of the Customs Act, 1962. The Revenue argued that the goods were correctly confiscated, penalties were rightly imposed, and the vehicle was rightfully confiscated under Section 115 of the Act.

Issue 2: Imposition of penalties under Customs Act, 1962
The Revenue emphasized that the goods were prohibited for export to Nepal as per DGFT Notification, justifying the penalties imposed. The argument was supported by Section 114 of the Customs Act, which designates a specified area near the Indo-Nepal border for export restrictions.

Issue 3: Interpretation of Section 113(d) and Section 2(19) of the Customs Act
The Tribunal analyzed Section 113(d) and Section 2(19) to determine that only goods attempted for export are liable for confiscation. Lack of concrete evidence indicating the goods were meant for export to Nepal led to the conclusion that the confiscated goods were moving within India's territory, not for export.

Issue 4: Evidence required for goods to be considered for export
The Respondents argued that the confiscated goods were intended for distribution/sale within India only, citing case laws to support the notion that transportation to a godown within India does not constitute an export attempt. The lack of evidence supporting the export intention to Nepal weakened the Revenue's case.

Issue 5: Confiscation of the vehicle and owner's knowledge
The Tribunal found no evidence implicating the truck owner's knowledge of the smuggled goods, leading to the conclusion that the goods were not liable for confiscation under Section 113(a) of the Customs Act, 1962. The absence of incriminating evidence supported the decision to reject the Revenue's appeals.

In summary, the Tribunal upheld the first appellate authority's decision to set aside the confiscation of pulses/cereals and the truck, as there was insufficient evidence to prove an attempt to export to Nepal. The lack of concrete proof and the interpretation of relevant legal provisions favored the Respondents, resulting in the rejection of the Revenue's appeals.