2024 (5) TMI 474 - AT - Customs

Smuggling of the gold bars - bona fide baggage - Absolute confiscation of the seized gold of foreign marking - Prohibited item or not - Confiscation - Penalty - HELD THAT - The phrase prohibited goods has been defined in sub-section (33) of Section 2 in the Act of 1962 to mean any goods, the import or export of which is subject to any prohibition under this Act or other law in force. Sub-section (39) of Section 2 has conveyed the meaning of smuggling in relation to any goods as any act or omission, which will render such goods liable for confiscation u/s 111. The law is well settled that violation of any condition or restriction in respect of the imported goods makes those as prohibited goods. In the case of Shri Shankar Lal Goyal vs. Commissioner of Customs 2023 (12) TMI 1156 - CESTAT NEW DELHI , has held that since the conditions of import of gold as per the notification issued by the DGFT and the restrictions imposed by the RBI have been violated, then in such case, the offending gold has to be treated as prohibited goods u/s 2 (33) of the Act of 1962 and consequently, it would fall within the definition of smuggling u/s 2 (39) and would rendered such goods liable for confiscation u/s 111. Therefore, the observations made by both the authorities below that the imported gold bars in this case are liable for absolute confiscation u/s 111(d) of the Act. The records in this case have transpires that the appellant had knowingly concerned himself with goods, which he knew were liable to confiscation and accordingly, he rendered himself liable for penal action provided u/s 112(b) of the Act of 1962. Further by not declaring the gold in the prescribed declaration form before the Customs authorities, he had rendered himself liable to penal action provided u/s 114AA of the Act. Thus, No infirmity in the impugned order dated 11.02.2022 passed by the learned Commissioner of Customs (Appeals). Therefore, the appeal filed by the appellant is dismissed.

Summary

Issues involved: Smuggling of gold bars, confiscation under Customs Act, imposition of penalties, appeal against adjudication order.

Smuggling of Gold Bars:
- Appellant admitted smuggling 5kg gold bars from Dubai.
- Gold bars seized under Section 110 of the Customs Act, 1962.
- Statements recorded under Section 108 of the Customs Act confirmed smuggling.
- Show cause proceedings initiated against various persons, including the appellant.
- Confiscation and penalties imposed under Sections 111 and 112 of the Act.
- Adjudication order upheld by Commissioner of Customs (Appeals).
- Appeal filed by the appellant before the Tribunal challenging the impugned order.

Confiscation and Penalties:
- Lower authorities' reliance on statements and material evidence.
- Appellant's involvement in smuggling confirmed by statements and evidence.
- Modus operandi of smuggling gold bars without legal sanction.
- Appellant's contention for redemption of gold rejected.
- Violation of customs statutes and regulations by not declaring gold.
- Tribunal's precedent in similar cases supporting absolute confiscation.
- Appellant held liable for penal action under Sections 112(b) and 114AA of the Act.

Decision:
- Tribunal examined case records and submissions.
- Found no infirmity in the impugned order of the Commissioner of Customs (Appeals).
- Dismissed the appeal filed by the appellant.
- Upheld the confiscation of gold bars and imposition of penalties under the Customs Act, 1962.