2017 (6) TMI 307 - AT - Customs

Smuggling of gold - 18 gold bar of 1 kg. each with foreign mark was recovered - penalty - Held that - the appellant cannot disassociate himself from the recovered gold stating that he was an innocent bystander and was a curious lookers. Chander Parkash Verma was the readymade recipient of the smuggled gold - Being an employee it cannot be said that Sh. Verma was not helping to his master i.e. appellant. In these circumstances, we are of the view that the appellant has committed the crime of smuggling. The crime of justice never dwells together as per the maxim FRAUS ET JUS NUNQUAM COHAMBITANI - In the instance case, the facts and circumstances speaks itself as per the maxim RES IPSA TAX QUITER - penalty on appellant justified - appeal dismissed - decided against appellant.

Summary

Issues:
Smuggling of gold, imposition of penalty, retraction of statements, involvement of appellant, legal grounds for penalty imposition.

Analysis:

Smuggling of Gold:
The case involves the recovery of 18 kg of gold from a vehicle, indicating smuggling activity. The gold was concealed in the driver side door, and the individuals involved confessed to purchasing it in Nepal and smuggling it into India. The appellant was associated with a proprietorship firm dealing in gold, and one of the accused was a relative of the appellant. The circumstances point towards the appellant's involvement in the smuggling operation.

Imposition of Penalty:
A penalty of ?50 lakhs was imposed on the appellant for his role in the alleged smuggling. The appellant's counsel argued that the penalty was based solely on retracted statements without corroborative evidence. However, the Revenue supported the penalty, emphasizing the confession made under Section 108 of the Customs Act, 1962. The Tribunal upheld the penalty, considering the recovery of smuggled gold and the appellant's active participation in the crime.

Retraction of Statements:
The accused, including the appellant, initially confessed to their involvement in the smuggling operation but later retracted their statements. The appellant's counsel argued that the retracted statements were the basis for the penalty imposition and no opportunity for cross-examination was provided. However, the Tribunal found the retraction to be a natural consequence of legal advice and upheld the penalty based on the initial confessions.

Involvement of Appellant:
The appellant claimed to be a curious bystander due to physical limitations, but evidence suggested his active participation in the smuggling operation. The Tribunal noted that the appellant, despite his disability, managed a jewelry business and was well-acquainted with the area where the gold was recovered. The appellant's presence during the smuggling activity and his relationship with one of the accused indicated his complicity in the crime.

Legal Grounds for Penalty Imposition:
The Tribunal considered the maxim "FRAUS ET JUS NUNQUAM COHAMBITANI" and highlighted that smuggling undermines the nation's economy. Referring to the principle of "RES IPSA TAX QUITER," the Tribunal found the appellant's case distinct from the cited legal precedents. Ultimately, the Tribunal upheld the penalty of ?50 lakhs, stating that it was justified and even considered lenient, given the gravity of the offense.

In conclusion, the Tribunal dismissed the appeal, affirming the imposition of the penalty on the appellant for his involvement in the smuggling of gold based on the evidence and circumstances presented during the case proceedings.