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2023 (12) TMI 261 - AT - CustomsViolation of principles of judicial discipline - Smuggling - foreign origin betel nuts - foreign origin black pepper - burden to prove - HELD THAT - It is observed that the impugned goods i.e. Betel Nuts and Black Pepper are not the goods specified or notified under Section 123 of the Customs Act, 1962. Thus the burden to prove the smuggled nature of these goods lies on the Custom Authorities as held by the Tribunal in the case of BABOO BANIK VERSUS COMMISSIONER OF C. EX. CUS., LUCKNOW 2004 (7) TMI 482 - CESTAT, KOLKATA . Tribunal in the case of BIJOY KUMAR LOHIA VERSUS COMMISSIONER OF CUSTOMS (PREV.), PATNA 2005 (11) TMI 306 - CESTAT, KOLKATA has held that the local trade opinion cannot take the place of the legal evidence.. No case has been made out for the seizure and confiscation of the Black Pepper or Betel Nuts is made out as no evidence has been placed on record to establish the foreign origin of these goods, or of illegal importation of the same. The Tribunal in the case of COMMISSIONER OF CUSTOMS (PREVENTIVE) , LUCKNOW VERSUS SHRI SHANTI BISWAS 2020 (9) TMI 525 - CESTAT ALLAHABAD given a clear finding to the effect that there was no evidence to establish that the goods which were moved within the country were smuggled in the country and therefore has held that action on the part of the revenue to detain the said goods and not released the same in spite of the order of Commissioner (Appeals) is an action of high handedness. It was directed that the black pepper and Betel nuts being released to the respondent immediately. When there was clear-cut finding of the Tribunal that there existed no evidence that black pepper and betel nuts were smuggled into the country. The entire proceedings subsequently on issuance of show cause notice and adjudication thereof is contrary to the principles of judicial discipline. There are no merits in the impugned order of Commissioner (Appeals) - appeal allowed.
Issues Involved:
1. Ownership and legality of seized goods (Betel Nuts, Black Pepper, and Poppy Seeds). 2. Validity of the testing report from Arecanut Research & Development Foundation (ARDF) regarding the country of origin. 3. Burden of proof on the Customs Authorities to establish the smuggled nature of goods. 4. Imposition of penalties under Section 112(b) of the Customs Act, 1962. Summary: Ownership and Legality of Seized Goods: The appellant, Shri Shanti Biswas, claimed ownership of the seized betel nuts and black pepper but denied any connection with the 1315 kg of poppy seeds. The Commissioner (Appeals) found that the poppy seeds were concealed among the bags of betel nut, indicating a malafide intention to smuggle prohibited goods into India. The appellant's claim that all goods were covered under E-way bills and GST paid was dismissed as the documents were found to be fake. The Commissioner (Appeals) upheld the confiscation of 13125 kg of foreign origin betel nuts, 2250 kg of foreign origin black pepper, and 1315 kg of foreign origin poppy seeds under Section 111(b) of the Customs Act, 1962. Validity of Testing Report from ARDF: The appellant challenged the authenticity of the ARDF report, which concluded that the betel nuts were of Indonesian origin. The Commissioner (Appeals) considered the ARDF report as reliable evidence. However, the Tribunal in previous cases, such as Maa Gauri Traders, held that ARDF's opinion could not be relied upon to establish the smuggled nature of betel nuts. The Tribunal noted that ARDF itself admitted that it is not possible to determine the place of origin of betel nuts through laboratory tests. Burden of Proof on Customs Authorities: The Tribunal emphasized that the burden to prove the smuggled nature of goods lies on the Customs Authorities, as the goods in question are not specified under Section 123 of the Customs Act, 1962. The Tribunal found no evidence to establish that the goods were smuggled into the country. The goods were seized during local transportation within India, and there was no evidence to suggest illegal importation. Imposition of Penalties: The original adjudicating authority imposed penalties on the appellant and others under Section 112(b) of the Customs Act, 1962. The Tribunal, however, found that the entire proceedings, including the show-cause notice and adjudication, were contrary to judicial discipline, given the lack of evidence to prove the smuggled nature of the goods. Conclusion: The Tribunal allowed the appeal, setting aside the impugned order of the Commissioner (Appeals). The Tribunal reiterated that no legal liability could flow from the ARDF report and that the Customs Authorities failed to establish the smuggled nature of the goods. The Tribunal's decision aligns with previous judgments, emphasizing the need for concrete evidence to support claims of smuggling. The appeal was allowed, and the confiscation and penalties imposed were overturned.
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