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2019 (3) TMI 1529 - AT - CustomsSmuggling - Prohibited item - Gold Bars - demonetized notes - skoda car - case of Revenue is that since the seized gold cannot be identified with any legitimate purchases, hence the same has been rightly confiscated being of prohibited and smuggled nature - Held that - The documents produced by the Appellant clearly show that the gold was legally procured by the Appellant. M/s Diamond India Ltd. has confirmed the goods to be sold by them. The revenue has not adduced any evidence nor it came during the entire investigation that the gold was procured from elsewhere i.e. other than M/s Diamond India Ltd. When once the nominated agency has certified and it is apparent from the records that the goods were procured legally, the burden lies upon the revenue to show that the gold was procured from elsewhere or to show that the documents/ records produced before them are false/ fabricated. It is also a fact that the Appellant had procured gold after discharging their export obligation and therefore the confiscation of gold on the ground that the Appellant has not discharge their burden of showing legal acquisition of gold is not sustainable. The adjudicating authority has contended that the travelling voucher shows that the travelling was to be made by bus whereas the gold was carried in car. We found that it is not such an anomaly which could lead to otherwise inference of gold being smuggled can be drawn. The gold was exported at the NRC rate which was agreed at the time of export and even the gold was procured by the Appellant at same rate as NRC. The final invoice of M/s Diamond (India) Ltd and the invoice of appellant were matching in all details except the conversion rate which clearly shows that the seized gold was against the export invoice of Appellant. Confiscation of 1000.009 gms of gold bearing serial no. scratched, the ownership of which has been claimed by Shri Satish Mehta and seized from possession of Smt. Seema Mehta - Held that - Shri Mukesh menon is employee of the Appellant and Smt. Seema Mehta is relative of Shri Nitin. Further all the purchase documents were produced before the investigating authority but the same were nor alleged to be false/ fabricated. No investigation was conducted at M/s Kaka Gold to show otherwise. Therefore, there is no reason to confiscate the said gold bar. Confiscation of 100.001 gms of gold serial no. AG 190942 owned by Appellant Shri Satish Mehta and seized from M/s PGP Joyeria - Held that - That the invoice was issued by M/s Raksha Bullion on 20.10.2016 whereas the gold was seized on 13.11.2016 and it would not be possible for jeweller to hold goods for so long period. We find that the above instance cannot be reason to hold that the goods are of smuggled nature. The Appellant has produced the invoice No. 1995 dated 20.10.2016 of M/S Raksha Bullion. Out of this part quantity was handed over to Shri Prakash Duggar under Transfer voucher dated 12.11.2016 for giving delivery to M/s PGP, Ahmedabad for manufacture of jewellery. There is no contrary evidence to this fact. Also the one month gap between the purchase of gold and sending it for manufacture of jewellery cannot be held to be basis of confiscation of gold on the ground of same being illegally procured - there is no reason to confiscate the seized gold. Confiscation of quantity of 190.002 gms of gold said to be owned by Appellant Shri Satish Mehta and seized from PGP Joyeria - Held that - The purchase invoice of gold issued by TBZ was addressed to Alma Jewels which is brand of PGP. Even if there is a meagre difference of some milligrams it cannot be said that the gold was procured illegally. Also the revenue has not shown otherwise procurement of goods from the statement of any persons. Thus the above grounds taken by the adjudicating authority cannot be ground for confiscation. A quantity of 4 half cut pieces weighing 505 grams recovered from possession of Smt. Seema devi and said to be owned by Shri Satish Jain has been ordered to be confiscated on ground that the purchase invoice no. 19110964 dated 11.11 2016 issued by M/s TBZ is not fool proof evidence of legitimacy and the travel voucher shows the weight of gold pieces as 505.470 gms whereas the seized gold pieces 505 gms - The travelling documents i.e. Travelling Voucher and transfer note were issued for such transfer which shows that the gold was legally acquired. There is no statement of any person that the gold is of smuggled nature and hence there is no reason to confiscate the same. The confiscation of seized gold and the skoda car in which some of the gold was carried is not correct - confiscation set aside - penalty also set aside - appeal allowed - decided in favor of appellant.
Issues Involved:
1. Legitimacy of the seized gold. 2. Confiscation of the Skoda car. 3. Imposition of penalties on the appellants. Issue-wise Detailed Analysis: 1. Legitimacy of the Seized Gold: The case revolves around the interception of a Skoda car carrying 2.5 kg of gold and ?15 lakhs of demonetized notes. The gold was claimed to be legally procured by M/s Dhanishta Gold from M/s Diamond India Ltd. under a duty-free import scheme for export purposes. The appellants produced various documents, including import invoices, shipping bills, and delivery challans, to prove the legal acquisition of the gold. The adjudicating authority, however, questioned the legitimacy of the gold due to discrepancies in the documents and the mode of transport used. The Tribunal found that the appellants had followed all the prescribed procedures under the Foreign Trade Policy (FTP) and Customs Notification No. 57/2000-Cus. The documents provided by the appellants, including the Notional Rate Certificate, export invoices, and delivery challans, were deemed sufficient to establish the legal procurement of the gold. The Tribunal noted that minor discrepancies, such as the mode of transport mentioned in the travelling voucher, were not substantial enough to infer smuggling. Regarding the 1000.009 grams gold bar with a scratched serial number, the Tribunal held that a minor weight difference of 0.009 grams is normal and does not indicate illegal procurement. The approval challan being in the name of an employee instead of the person carrying the gold was also not considered significant, as they were travelling together. For the 100.001 grams gold bar and the 190.002 grams gold piece, the Tribunal found that the appellants had provided valid purchase invoices from M/s Raksha Bullion and M/s Tribhovandas Bhimji Zaveri, respectively. The lack of serial numbers on the invoices and the time gap between purchase and seizure were not deemed sufficient grounds for confiscation. 2. Confiscation of the Skoda Car: The Skoda car used to transport the gold was ordered for absolute confiscation by the adjudicating authority. The Tribunal, however, found that the car's use in transporting legally procured gold does not justify its confiscation. The Tribunal set aside the order for confiscation of the car, noting that the gold was legally acquired and transported for legitimate purposes. 3. Imposition of Penalties on the Appellants: Penalties were imposed on the appellants under Sections 112(a) and 112(b) of the Customs Act, 1962. The Tribunal found that since the gold was legally procured and there was no evidence of smuggling, the penalties were not sustainable. The Tribunal set aside the penalties imposed on all appellants. Conclusion: The Tribunal concluded that the seized gold was legally procured and the appellants had followed all necessary procedures under the FTP and Customs regulations. The confiscation of the gold and the Skoda car was set aside, and the penalties imposed on the appellants were annulled. The appeals were allowed with consequential reliefs in accordance with the law.
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