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Issues:
1. Whether the onus under Section 123 of the Customs Act, 1962, to prove goods are not smuggled is discharged when documents do not match with seized goods? 2. Whether the responsibility for goods notified under Section 123 can be shifted to the department? Analysis: 1. The case involved an appeal challenging a Customs, Excise and Service Tax Appellate Tribunal order. The appellant, a 100% Export-oriented Unit manufacturing Polyester Grey Fabrics, had 100 bales of foreign-made fabrics discovered unaccounted in their warehouse during a search by Revenue officers. The Managing Director claimed the goods belonged to another concern, M/s. Fashion World International. A show cause notice for confiscation and penalties was issued to the appellant. 2. The adjudicating authority found the goods were duly entered in M/s. Fashion World International's statutory record and dropped the proceedings. The Tribunal upheld this finding, noting the lack of evidence to support the claim that the goods were not related to those in the statutory record. As M/s. Fashion World International was not a party to the proceedings and no show cause notice was issued to them, the appeal by the Revenue was deemed meritless and dismissed. 3. The Tribunal's order highlighted the absence of evidence linking the seized goods to those in M/s. Fashion World International's records. The goods' presence at the appellant's premises was explained, confirming their ownership by M/s. Fashion World International. Since the firm was not involved in the proceedings and no notice was served to them, the appeal lacked substance and was dismissed for failing to raise any legal question. 4. In conclusion, the High Court upheld the Tribunal's decision, emphasizing the lack of evidence linking the seized goods to the records of M/s. Fashion World International. The failure to involve the actual owner in the proceedings and serve them a notice rendered the Revenue's appeal baseless, resulting in its dismissal.
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