1989 (7) TMI 260 - AT - Customs

Issues Involved:
1. Confiscation of 2 Kruggrrands of gold.
2. Imposition of penalties under the Customs Act, 1962.
3. Imposition of penalties under the Gold (Control) Act, 1968.
4. Legal import of the two Kruggrrands of gold.
5. Liability of M/s. Lamba Jewellers and its partners.

Issue-wise Detailed Analysis:

1. Confiscation of 2 Kruggrrands of Gold:
The Department seized 2 Kruggrrands of gold from the appellant Sardar Virender Singh Lamba, claiming they were not declared upon import. The Adjudicating Authority ordered their absolute confiscation under Section 111(d) of the Customs Act. The Tribunal upheld this decision, stating there was no evidence of legal import of the Kruggrrands and they were correctly classified as articles of gold, not ornaments.

2. Imposition of Penalties under the Customs Act, 1962:
Penalties were imposed under Section 112 of the Customs Act on M/s. Lamba Jewellers, Virender Singh Lamba, and Manmohan Singh. The Tribunal found no evidence that Virender Singh acquired the Kruggrrands with knowledge of their liability for confiscation. The Show Cause Notice did not allege abetment or possession with such knowledge. Consequently, the penalty on Virender Singh under the Customs Act was set aside. Similarly, the penalty on M/s. Lamba Jewellers was also set aside due to lack of evidence showing their involvement in acquiring the Kruggrrands.

3. Imposition of Penalties under the Gold (Control) Act, 1968:
Penalties were imposed under Section 71 of the Gold (Control) Act on M/s. Lamba Jewellers, Virender Singh Lamba, and Manmohan Singh. The Tribunal upheld the penalties on Virender Singh, finding the documents recovered were not merely rough notes and related to transactions around 1984. However, the penalty on M/s. Lamba Jewellers was set aside due to lack of evidence showing the firm's involvement in the contravention.

4. Legal Import of the Two Kruggrrands of Gold:
Manmohan Singh contended the Kruggrrands were imported by his wife as part of a necklace. The Tribunal rejected this argument, stating the Kruggrrands were articles of gold, not ornaments, as defined under the Gold (Control) Act. The Tribunal found no evidence of legal import and upheld their confiscation.

5. Liability of M/s. Lamba Jewellers and its Partners:
The Tribunal found no evidence linking M/s. Lamba Jewellers or its other partners to the seized Kruggrrands or the documents. The statutory records of the firm were in order, and nothing was recovered from the other partners. The Show Cause Notices did not charge the firm or its partners with abetment. Consequently, the penalties on M/s. Lamba Jewellers were set aside.

Conclusion:
1. Appeals by Manmohan Singh under the Customs Act and Gold (Control) Act were dismissed.
2. Appeal by Virender Singh under the Gold (Control) Act was dismissed, but the penalty under the Customs Act was set aside.
3. Appeals by M/s. Lamba Jewellers under both Acts were allowed, and the penalties were set aside.

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