2021 (8) TMI 296 - AT - Customs

Smuggling - gold biscuits - gold biscuits were concealed inside the inner garment worn by the appellant - undeclared goods - petitioner proved ownership of goods - Absolute Confiscation - penalty - HELD THAT - As per N/N.12/2012-Cus dt. 17/03/2012, appellant was not entitled to bring the gold from abroad as his stay in foreign country was only 35 days. Though in the impugned order, Commissioner(Appeals) has noted that appellant has not been able to prove his ownership on the impugned goods as the appellant has produced a photocopy of the bill as proof of his purchase which is not sufficient. Before this Tribunal, appellant has produced the original copy of the invoice issued by Malabar Gold and Diamonds and the said bill shows that the appellant is the owner of the gold which was purchased by him only 2-3 days before the start of the journey from Bahrain. But since he was not eligible to bring gold in terms of Notification No.12/2012 and the same was not declared, the impugned goods have rightly been confiscated. Penalty - Section 112(a) and (b) of the Customs Act - HELD THAT - Considering the facts and circumstances of the case specifically when the appellant has proved his ownership, the imposition of penalty is not justified - penalty set aside. Appeal allowed in part.

Summary

Issues:
- Confiscation of gold biscuits under Customs Act, 1962
- Imposition of penalty under Customs Act, 1962

Confiscation of gold biscuits under Customs Act, 1962:
The case involved the seizure of two gold biscuits weighing 120 grams valued at ?3,55,680 from the appellant at the airport. The original authority confiscated the gold under Sections 111(d), (i), (l), and (m) of the Customs Act, 1962, and imposed a penalty of ?10,000 under Section 112(a) and (b). The appellant appealed against this decision, arguing ignorance of the law regarding reporting gold brought from abroad and passing through the green channel instead of the red channel. The appellant claimed the gold was purchased for making ornaments for his family and not for sale. The Commissioner(Appeals) rejected the appeal, leading to the present appeal.

Upon hearing both sides and examining the evidence, the Tribunal found that the appellant concealed the gold, did not declare it, and passed through the green channel to avoid customs duty. It was noted that the appellant was not eligible to bring gold from abroad as his stay was only 35 days, violating Notification No.12/2012-Cus. The Commissioner(Appeals) mentioned the appellant's failure to prove ownership of the gold, but the appellant later provided the original invoice from the seller. Despite proving ownership, the gold was rightfully confiscated due to non-declaration and ineligibility under the notification. However, the Tribunal set aside the penalty of ?10,000 considering the circumstances and the appellant's proof of ownership.

Imposition of penalty under Customs Act, 1962:
The Tribunal, after considering the arguments and evidence, upheld the confiscation of the gold biscuits under the Customs Act, 1962, based on non-declaration and ineligibility of the appellant to bring gold from abroad. However, the penalty of ?10,000 imposed on the appellant under Section 112(a) and (b) was deemed unjustified. The Tribunal acknowledged the appellant's proof of ownership and set aside the penalty, partially allowing the appeal in favor of the appellant.