2009 (12) TMI 280 - AT - Customs

Smuggling- Penalty- In this case a Show cause Notice had been issued to the Appellant for smuggling the gold and jewellary from Singapore to India by misusing the benefits extended to passengers staying abroad for more than six months. The adjudicating Commissioner has absolutely confiscated the seized gold jewellery arid the seized foreign currency. He also imposed penalties of Rs.50, 000/- each on the passengers in addition to pert- ally of Rs.10, 00, 000 on Shri G.V. Ramesh Rs. 2, 00, 000/- on Shri Lakshmi Narayan and Rs.1, 00, 000/- each on S/Shri Parthiban Kathiresan Janaki Raman and Vijay. He has also confiscated 10, 000 Singapore dollars seized from Shri Abirami Jewellery owned by Shri Ramesh and allowed redemption of the same on payment of a fine of Rs.1, 50, 000/-. The Toyota Quails car was also confiscated but allowed redemption on payment of a fine of Rs.1, 00, 000/-. Held that- Considering the fact that they were induced by Shri Ramesh and his associates to carry the impugned gold jewellery and foreign currency for a consideration and the consideration has been stated only to be Rs.2, 000/- in the statements recorded from them as well as from the associates of Shri Ramesh separately the penalty of Rs.50, 000/- each imposed on them appears to be harsh on them. At the same time the amount cannot be reduced to such an extent as to encourage them to commit the same wrongs repeatedly and it should also be deterrent enough to prevent other passengers to act as carriers. Hence keeping both considerations in view reduce the penalty in respect of the 11 passenger-appellants from Rs.50, 000/- each to Rs.10, 000/- (Rupees ten thousand only) each. In the result the appeals filed by S/Shri G.V. Ramesh Lakshmi Narayan Kathiresan Janakiraman and Parthiban are dismissed. The other 11 appeals filed by the 11 passenger-appellants are partly allowed by reducing the penalties imposed on them from Rs.50, 000/- each to Rs.10, 000/- (Rupees ten thousand only) each as indicated above

Issues Involved:
1. Interception and seizure of gold jewellery and foreign currency.
2. Non-declaration of gold and foreign currency by passengers.
3. Smuggling operation and involvement of appellants.
4. Confiscation of seized items and penalties imposed.

Issue-wise Detailed Analysis:

1. Interception and Seizure of Gold Jewellery and Foreign Currency:
The Directorate of Revenue Intelligence (DRI) intercepted a Toyota Quails car at Chennai Airport based on intelligence that gold jewellery was being smuggled from Singapore. The car occupants were found with lists of passengers, their descriptions, and Rs.54,000/- in Indian currency. The DRI officials intercepted 13 passengers arriving from Singapore, seizing gold jewellery and foreign currency. Statements from the passengers confirmed they were carrying the items for monetary consideration, instructed not to declare them to customs.

2. Non-declaration of Gold and Foreign Currency by Passengers:
The adjudicating Commissioner found that the passengers did not declare the gold jewellery and foreign currency in their baggage declaration forms. The passengers had signed disembarkation cards declaring either nil or minimal amounts, which did not cover the value of the gold jewellery seized. The Commissioner concluded that the passengers intended to exit through the Green Channel without declaring the items, supporting the Department's case of smuggling.

3. Smuggling Operation and Involvement of Appellants:
The investigation revealed that Shri G.V. Ramesh masterminded the smuggling operation, using passengers eligible to import gold for personal use. His employees, including Shri Lakshminarayanan, facilitated the operation by identifying passengers and receiving the gold jewellery. The modus operandi involved sending passenger details and photographs via fax or email to ensure smooth handover of the smuggled items. The evidence, including statements and seized documents, indicated that Shri Ramesh and his associates were involved in organized smuggling.

4. Confiscation of Seized Items and Penalties Imposed:
The adjudicating Commissioner ordered the absolute confiscation of the seized gold jewellery and foreign currency. Penalties were imposed on the passengers and the main appellants, including Rs.10,00,000 on Shri G.V. Ramesh and Rs.50,000 each on the passengers. The Toyota Quails car and 10,000 Singapore dollars were also confiscated, with fines imposed for their redemption. The Tribunal upheld the confiscation and penalties, reducing the penalties on the passengers from Rs.50,000 to Rs.10,000 each, considering the inducement by Shri Ramesh and the need for deterrence.

Conclusion:
The Tribunal found sufficient evidence to support the findings of the adjudicating Commissioner regarding the smuggling operation and the involvement of the appellants. The confiscation of the gold jewellery, foreign currency, and the car, along with the imposition of penalties, was upheld, with a reduction in penalties for the passenger-appellants to ensure deterrence while considering their induced role in the smuggling operation.

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