1983 (11) TMI 67 - HC - Customs

Seizure and confiscation of video cassette recorders not valid when there was no material on record nor presumption available for forming the reasonable belief that the goods were smuggled goods

Summary

Issues Involved:
1. Validity of the seizure of video cassettes, V.C.R., and telephone.
2. Compliance with the Customs Act, 1962, and Import and Export Control Act, 1947.
3. Burden of proof regarding the legality of imported goods.
4. Jurisdiction of customs authorities to seize goods.

Issue-Wise Detailed Analysis:

1. Validity of the Seizure of Video Cassettes, V.C.R., and Telephone:
The petitioners, Ashok Kumar and Raj Kumar, challenged the seizure of 115 recorded video cassettes and a telephone instrument by filing a writ petition under Article 226 of the Constitution. They argued that they had lawfully possessed the items and had provided receipts to substantiate their claim. The customs authorities, however, found the receipts inadequate and proceeded with the seizure under Section 110(1) of the Customs Act, 1962, suspecting the items to be smuggled goods.

2. Compliance with the Customs Act, 1962, and Import and Export Control Act, 1947:
The customs authorities contended that the video cassettes and the telephone were liable for confiscation under Section 111(d) of the Customs Act, 1962. According to the respondents, the video cassettes were of foreign origin and restricted items under the Import Control Order, 1955, requiring a valid import license. The petitioners failed to provide satisfactory evidence that the items were imported legally. Furthermore, the import policy for April 1983-March 1984 specified that only actual users could import such items, and the petitioners were using them for business purposes, which was against the policy.

3. Burden of Proof Regarding the Legality of Imported Goods:
The court noted that under Section 123 of the Customs Act, the burden of proving that the seized goods were not smuggled lies on the person from whose possession the goods were seized, but this presumption applies only to specific goods like gold, diamonds, and watches. Video cassettes were not included in this category, and there was no notification making Section 123 applicable to video cassettes. Therefore, the respondents were incorrect in assuming that the burden of proof lay on the petitioners.

4. Jurisdiction of Customs Authorities to Seize Goods:
The court found that there was no positive material before the respondents to reasonably believe that the video cassettes were smuggled goods. The respondents had not demonstrated that the video cassettes were imported without a valid license. The court held that the seizure of the video cassettes was without jurisdiction. However, regarding the telephone, the court found that the customs authorities had sufficient reasons to believe it was imported without payment of duty, making it liable for confiscation.

Conclusion:
The court concluded that the seizure of the 115 video cassettes by the customs authorities was without jurisdiction and ordered their return to the petitioners. However, the seizure of the telephone was deemed within jurisdiction, and the petitioners were not entitled to relief concerning the telephone. The petition was allowed in part, and each party was directed to bear its own costs.