1995 (8) TMI 155 - AT - Customs

Issues Involved:
1. Confiscation of foreign ball bearings.
2. Imposition of penalty on the appellant.
3. Validity of the confessional statement and its retraction.
4. Burden of proof regarding the smuggled nature of the goods.
5. Legality of the absolute confiscation and the option for redemption.

Detailed Analysis:

1. Confiscation of Foreign Ball Bearings:
The case involved the seizure of 2554 pieces of ball bearings of foreign origin valued at Rs. 1,01,170. The goods were intercepted at Howrah Railway Station, and the appellant failed to produce any evidence of legal importation or possession. The goods were seized under Section 110 of the Customs Act, 1962, for violating Section 3(1) of the Import/Export Control Act, 1947, and were liable for confiscation under Section 111(d) of the Customs Act, 1962.

2. Imposition of Penalty on the Appellant:
A penalty of Rs. 200 was imposed on the appellant under Section 112(b) of the Customs Act, 1962. The appellant was found to be involved in the conveyance of smuggled goods, justifying the penalty.

3. Validity of the Confessional Statement and Its Retraction:
The appellant had given a confessional statement admitting that the ball bearings were smuggled. However, he retracted this statement before the Magistrate, claiming it was obtained under threat and coercion. The Tribunal noted that the appellant did not mention the retraction in his letter to the Collector of Customs dated 8-8-1988, nor did he specify the nature of the alleged coercion. The Tribunal, citing the Supreme Court's decision in 1992 (40) ECC 352, held that merely retracting a statement does not make it involuntary. The appellant failed to provide evidence of coercion, and there were no circumstances indicating that the statement was extorted. Therefore, the Tribunal deemed the confessional statement voluntary and reliable.

4. Burden of Proof Regarding the Smuggled Nature of the Goods:
The appellant argued that the burden was on the Department to prove that the ball bearings were smuggled. The Tribunal noted that although the ball bearings were not notified items under Section 123 of the Customs Act, the Department had provided substantial evidence, including the voluntary statements of Niyamatullah and the appellant, that the goods were smuggled. The appellant's failure to produce any legal documents or disclose the identity of the person from whom he allegedly purchased the goods further supported the presumption that the goods were smuggled. The Tribunal cited the Supreme Court's decisions in 1983 (13) E.L.T. 1631 (S.C.) and Commissioner of Income Tax, Madras v. Best & Co. (P) Ltd., 1966 (2) SCR-480, to emphasize that the burden shifts to the appellant to prove the legality of the goods once the Department has provided substantial evidence.

5. Legality of the Absolute Confiscation and the Option for Redemption:
The Tribunal acknowledged that under the relevant Import/Export Policy, ball bearings could be imported under REP Licence and were not subject to the 'Actual Users' condition. Therefore, absolute confiscation was not warranted. The Tribunal allowed the appellant to redeem the goods on payment of a redemption fine of Rs. 60,000 within two months from the date of receipt of the order. The penalty of Rs. 200 imposed on the appellant was confirmed.

Conclusion:
The appeal was disposed of with the Tribunal confirming the confiscation of the ball bearings but allowing redemption on payment of a fine. The penalty of Rs. 200 was upheld, and the appellant was given the option to redeem the goods within a specified period. The Tribunal found the confessional statement voluntary and reliable, and the Department had successfully discharged its burden of proving the smuggled nature of the goods.

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