2018 (3) TMI 1725 - CGOVT - Customs

Re-export of confiscated goods on payment of redemption fine and penalty - smuggling - Gold Items - case of Revenue is that the gold items were brought in India in gross violation of the provisions of Customs Act and such re-export is not permissible under Section 80 of the Customs Act - Held that - Under Section 80 re-export of the detained imported goods can be permitted only at the request of the passenger while he or she is returning from India to the foreign country and thereby it is explicit that returning of the PAX to the foreign country after a short visit to India as a tourist or otherwise is a crucial condition for re-export of such goods - But in the instant case, the respondent had gone to New York only for a short visit and there is no clue that he was either a U.S. citizen or working there on long term basis. On the contrary the respondent is an Indian citizen and resided permanently in Delhi. Therefore, no statutory backing for re-exporting the gold to New York is forthcoming from the O-I-A. Otherwise also the re-export of the goods does not sound to be rational in this case as the respondent had brought the gold items with intention to evade customs duty and on being caught he requested for re-export of goods again to avoid payment of customs duty only. The Government agrees with the Revenue s contention that the Commissioner (Appeals) has committed an error by allowing the re-export of the confiscated gold. Accordingly, the Government set aside the OIA and allows the respondent, Mr. Ranmeet Bhatia, to redeem the confiscated gold on payment of Customs duties, payment of fine of ₹ 1,85,000/- and penalty of ₹ 25,000/- - Revision application allowed.

Summary

Issues:
- Revision of allowing re-export of confiscated gold
- Interpretation of Section 80 of the Customs Act

Analysis:
1. The case involves a revision application filed against an Order-in-Appeal allowing re-export of confiscated gold. The applicant, intercepted at the airport with gold bars, admitted to purchasing them in New York. The Commissioner (Appeals) allowed re-export on payment of fines and duties, leading to the Revenue filing a revision application.

2. The main ground for the revision application was that re-export of the gold violated Customs Act provisions, specifically Section 80. The Government held that the gold was brought with intent to evade duties, making it liable for confiscation. While the Commissioner (Appeals) upheld confiscation, the re-export was deemed unsupported by legal provisions, as the passenger was not returning to the foreign country as required by Section 80.

3. The Government found no statutory basis for re-exporting the gold, as the passenger was an Indian citizen residing in Delhi, not meeting the conditions for re-export under Section 80. Allowing re-export in this case was seen as enabling duty evasion, as the passenger's intent was to avoid paying customs duties. Consequently, the Commissioner (Appeals) was deemed to have erred in permitting re-export, leading to the Government setting aside the Order-in-Appeal.

4. The Government concluded that the Commissioner (Appeals) allowing re-export of the confiscated gold was not justified under the Customs Act. As a result, the revision application filed by the Revenue was allowed, and the respondent was directed to redeem the gold by paying Customs duties, a reduced fine, and a penalty, in accordance with the decision.