2024 (12) TMI 1100 - AT - Customs

Confiscation of the seized goods and vehicles - smuggling - failure to consider the fact that the appellant had purchased the said goods from the farmers of Jaitiya Panchayat, which is located within the territory of India and transportation was made within the permissible limit in the country - HELD THAT - On 04.04.2018, the officers of SSB intercepted two Vehicles within the territory of India and handed over the vehicles carrying the goods to officers of the Customs Circle at Bettiah on 05.04.2018. The appellant has made the submission that the goods available in the two vehicles were of Indian origin and have also submitted cash receipts duly signed by the farmers evidencing purchase of the goods within the territory of India. It is observed that the investigation has not brought in any evidence to counter the claims made by the appellant that the goods were of Indian origin. It is observed that these goods are not notified goods under Section 123 of the Customs Act, 1962, and hence the onus is on the Department to prove that the goods are smuggled in nature. The Department has failed to produce any evidence to establish the smuggled nature of the goods. Accordingly, the goods are not liable for confiscation under Sections 111(b) (d) of the Customs Act, 1962. As the goods are not liable for confiscation, the penalty imposed on the appellant under section 112 of the Customs Act, 1962 is also not sustainable and hence the same is set aside. The confiscation of the goods viz. Rahar Dal (8500 kgs.) and Urad (8500 kgs.) collectively valued at Rs.7,65,000/- and the penalty imposed on the appellant are set aside - appeal allowed.

Summary

Issues:
1. Confiscation of seized goods and vehicles under the Customs Act, 1962.
2. Imposition of penalty on the appellant and co-noticees.
3. Appeal against the Order-in-Appeal No. 03/Pat/Cus/Appeal/2020-21 dated 29.04.2020.

Analysis:
The case involved an appeal against the Order-in-Appeal No. 03/Pat/Cus/Appeal/2020-21 dated 29.04.2020, passed by the Commissioner (Appeals) of Customs, Central G.S.T. & Central Excise, Patna. The appellant, a proprietor of a trading firm, claimed ownership of goods seized by Customs officers, contending that the goods were of Indian origin and purchased from local farmers. The appellant submitted evidence, including cash receipts signed by farmers, to support the claim that the goods were legally purchased within India. The Customs authorities had seized the goods and vehicles on suspicion of smuggling from Nepal into India. A Show Cause Notice was issued proposing confiscation of the goods and vehicles under relevant sections of the Customs Act, 1962, along with the imposition of penalties on the appellant and co-noticees.

The adjudicating authority had confiscated the goods but allowed redemption on payment of a fine and imposed a penalty on the appellant. On appeal, the Commissioner (Appeals) upheld the confiscation and penalties. The appellant challenged this decision, arguing that the goods were of Indian origin and legally transported within the country. The appellate tribunal observed that the appellant had provided substantial evidence to establish the Indian origin of the goods, including cash receipts and details of the purchase from local farmers. The tribunal noted the lack of evidence from the Department to prove that the goods were smuggled or of foreign origin.

The tribunal held that since the goods were not notified goods under the Customs Act, 1962, the burden was on the Department to prove that the goods were smuggled, which they failed to do. Consequently, the tribunal set aside the confiscation of the goods and vehicles, as well as the penalty imposed on the appellant under section 112 of the Customs Act, 1962. The appeal filed by the appellant was allowed, and the confiscation and penalties were revoked. The tribunal's decision was based on the lack of evidence supporting the allegations of smuggling and the appellant's documentation proving the legal purchase and transportation of the goods within India.