2003 (12) TMI 162 - AT - Customs

Summary

Issues:
1. Seizure and confiscation of smuggled gold
2. Claim of licit acquisition and redemption fine under Section 125 of the Customs Act, 1962
3. Validity of the duty paid baggage receipt
4. Exercise of discretion under Section 125 for redemption fine
5. Penalty under Section 112 of the Customs Act, 1962

Analysis:

1. The case involved the seizure of 15 foreign marked gold biscuits from the appellant, leading to the belief that it was smuggled due to lack of evidence regarding its duty, nature, and legal acquisition. The gold was confiscated, and no redemption fine was offered. The Commissioner (Appeals) confirmed the confiscation and penalty, which led to an appeal to CEGAT. The High Court set aside the absolute confiscation, directing a re-examination of the case.

2. During re-adjudication, the appellant claimed licit acquisition of the gold through a duty paid baggage receipt produced after the seizure. However, the retraction letter and timing of the receipt's submission raised doubts. The tribunal found the appellant failed to discharge the burden of proving the seized gold was not smuggled, upholding the confiscation and denying redemption fine under Section 125.

3. The tribunal rejected the duty paid receipt as an afterthought, indicating it was not in possession of the appellant during the interception or immediately after. The delayed submission and circumstances cast doubt on the authenticity of the receipt, leading to the conclusion that it was an attempt to cover smuggled gold with a legitimate appearance.

4. Refusal to grant redemption fine under Section 125 was deemed appropriate given the finding of smuggled gold liable for confiscation. The tribunal upheld the lower authorities' decision on exercising discretion in this regard, emphasizing the need for the appellant to prove the gold's licit nature convincingly.

5. As the appellant was transporting smuggled gold, the penalty under Section 112 of the Customs Act, 1962 was deemed applicable. The tribunal upheld the lower authority's order, stating that the grounds raised in the appeal lacked merit. Consequently, the appeal was dismissed based on the findings of the tribunal.