2025 (2) TMI 887 - HC - Customs

Correctness of order of release of gold when the respondent has failed to establish their ownership of the said gold and has failed to substantiate that the gold bars are not smuggled one - proper appreciation of provisions of Section 110A of the Customs Act 1962 at the time of passing the order for release of gold - burden of proof in terms of Section 123 of the Customs Act - HELD THAT - It is found from the impugned order that the learned Tribunal has endeavoured to verify the genuineness of the challans submitted by the respondent and the respondent was directed to produce copies of the preceding and succeeding challans issued and accordingly the respondent produced challans in respect of serial numbers 220 221 222 and 223 at the time of personal hearing before the Tribunal. The learned Tribunal on facts found that the challans were serial in number and the signatures of the authorized signatory available in challan nos. 220 221 and 222 were tallying. Therefore the learned Tribunal came to the conclusion that the respondent had prima facie established that they have issued the challans bearing Gate Pass No. RM/2023-24/KOL/222 dated 11.10.2023 for the purpose of job work of the 4 gold bars of 1 kg. each through M/s. Kalyan Jewellers. Further the learned Tribunal verified the challans and found that the gold bars having mark/numbers as 4400493-96 were issued for job work by the respondent. Further the same marks and numbers were also found to be available in the packing list issued by M/s. Brinks India Pvt. Ltd. at the time of release of the 14 kgs. of gold bars to the respondent. Therefore the learned Tribunal came to the prima facie conclusion of correlation between the 4 kgs. of gold bars purchased by them from HDFC Bank Ltd. and the gold seized by the officers on 11.10.2023. Taking note of the prayer made by the respondent being one for provisional release of the seized goods and noting that the respondent has prima facie established correlation between the 4 kgs. of gold bars purchased by them from M/s. HDFC Bank Ltd. and the 4 gold bars seized by the officers the Tribunal came to the conclusion that the goods can be provisionally released subject to certain conditions to safeguard the interest of revenue. Conclusion - The Tribunal had appropriately considered the evidence and made a reasoned decision based on the facts presented. Appeal dismissed.

Summary

The Calcutta High Court considered an appeal filed by the revenue under Section 130 of the Customs Act, 1962, against an order passed by the Customs, Central Excise and Service Tax Appellant Tribunal. The revenue raised several substantial questions of law for consideration, including issues related to the ownership and provenance of seized gold bars, the application of relevant provisions of the Customs Act, and the sufficiency of evidence presented by the respondent to establish ownership and compliance with customs regulations.The Court noted that a previous appeal had been filed challenging an order directing the provisional release of the seized gold bars. In that appeal, the Court had remanded the matter back to the Tribunal for further consideration, as it was found that certain aspects of the case had not been adequately addressed. Upon remand, the Tribunal reviewed the challans submitted by the respondent and found that they appeared genuine, with serial numbers matching and signatures tallying. The Tribunal also verified the markings on the gold bars and found a correlation between the bars purchased by the respondent and those seized by customs officers.Based on these findings, the Tribunal concluded that the respondent had prima facie established ownership of the gold bars and their lawful acquisition. The Tribunal ordered the provisional release of the seized goods, subject to certain conditions to safeguard the revenue's interests. This included the requirement for the respondent to provide a bond for the full value of the seized gold bars supported by a bank guarantee.The Court, upon reviewing the Tribunal's decision, found that the Tribunal had appropriately considered the evidence and made a reasoned decision based on the facts presented. The Court concluded that no substantial questions of law arose from the Tribunal's decision and, therefore, dismissed the revenue's appeal. The Court ordered the provisional release of the seized gold bars to the respondent within three weeks, in accordance with the conditions set by the Tribunal.In summary, the Court upheld the Tribunal's decision to provisionally release the seized gold bars to the respondent based on the evidence presented and the findings of correlation between the purchased gold bars and the seized goods. The Court found no legal errors in the Tribunal's decision and dismissed the revenue's appeal, allowing for the release of the gold bars subject to specified conditions.