2002 (3) TMI 80 - AT - Customs

Summary

Issues Involved:
1. Legality of the confiscation of goods under Section 111(d) of the Customs Act.
2. Imposition of penalty under Section 112(b) of the Customs Act.
3. Applicability of the burden of proof under Sections 106 and 114 of the Evidence Act.
4. Relevance of cited case laws by the appellants.

Detailed Analysis:

1. Legality of the Confiscation of Goods under Section 111(d) of the Customs Act:
The appellants did not dispute the recovery of 58256 pieces of ball bearings of foreign make and brand valued at Rs. 1,50,11,900/- from their office-cum-godown. They neither claimed ownership nor provided any valid documentation for lawful possession. The consignors and consignees listed in the GRs and invoices were found to be fictitious. The Tribunal inferred that the goods were smuggled as no valid claim or documentation was presented. Consequently, the confiscation under Section 111(d) of the Customs Act was deemed justified.

2. Imposition of Penalty under Section 112(b) of the Customs Act:
The appellants argued that they had no knowledge of the smuggled character of the goods, claiming they merely transported the goods for others. However, the Tribunal found this plea fallacious. The appellants failed to identify the consignors or consignees, who were found to be non-existent. The Tribunal concluded that the appellants had prepared bogus GRs/Invoices to camouflage their possession of the smuggled goods. Thus, the imposition of penalty under Section 112(b) was upheld.

3. Applicability of the Burden of Proof under Sections 106 and 114 of the Evidence Act:
The Tribunal highlighted that the burden of proof lies with the party who asserts a fact within their special knowledge. The appellants had the opportunity to prove lawful acquisition of the goods but failed to do so. The Tribunal cited the Supreme Court's ruling in CC, Madras v. D. Bhoormull, which applied the principle of Section 106 of the Evidence Act to cases under Section 111(d) of the Customs Act. The Tribunal also referenced the case of Shah Guman Mal v. The State of Andhra Pradesh, asserting that presumptions under Sections 106 and 114 of the Evidence Act could be applied when direct evidence is unavailable. Given the appellants' inability to provide valid documentation or identify genuine parties, the Tribunal inferred their knowledge of the smuggled nature of the goods.

4. Relevance of Cited Case Laws by the Appellants:
The appellants cited several cases to argue against the confiscation and penalty. However, the Tribunal found these cases inapplicable. In the cited cases, the evidence was insufficient to prove knowledge of the smuggled character of the goods. In contrast, in the present case, the Tribunal found overwhelming evidence of the appellants' knowledge. Hence, the cited case laws did not aid the appellants' defense.

Conclusion:
The Tribunal upheld the Commissioner's order of confiscating the goods and imposing a penalty on the appellants. The appeal was dismissed as devoid of merit, affirming the legality of the actions taken under the Customs Act and the applicability of the burden of proof principles under the Evidence Act.