1995 (11) TMI 193 - AT - Customs

Issues Involved:
1. Confiscation of seized silver under Sections 111(b), 111(d), 111(k) of the Customs Act, 1962.
2. Confiscation of the truck under Section 115 of the Customs Act, 1962.
3. Imposition of penalties under Section 112 of the Customs Act, 1962.
4. Validity and credibility of the statements recorded under Sections 107 and 108 of the Customs Act, 1962.
5. Burden of proof regarding the smuggled nature of the silver.
6. Legitimacy of the redemption fines and penalties imposed.

Detailed Analysis:

1. Confiscation of Seized Silver:
The Deputy Collector ordered the absolute confiscation of the seized silver under Sections 111(b), 111(d), and 111(k) of the Customs Act, 1962, which was confirmed by the Collector (Appeals). The appellant argued that the silver was of Indian origin and legally purchased in 1979, supported by Bill No. 740 from Kamal Enterprises. The appellant contended that the silver did not bear any foreign markings and that the burden of proving its smuggled nature was on the Department, as silver was not notified under Section 123 of the Customs Act, 1962 at the relevant time. However, the Tribunal found that the silver was concealed in a cavity of the truck near the international border and that the cloth covering it was of Pakistani origin. Furthermore, the silver did not match the markings described by Kamal Enterprises, casting doubt on the appellant's claim. Citing the Supreme Court's decision in the case of Collector of Customs, Madras & Others v. D. Bhoormull, the Tribunal upheld the confiscation, concluding that the circumstantial evidence and the appellant's conduct reasonably indicated that the silver was smuggled.

2. Confiscation of the Truck:
The truck used for transporting the seized silver was ordered for absolute confiscation under Section 115 of the Customs Act, 1962. The appellant argued that the truck was used without the owners' knowledge. However, the Tribunal found that the truck driver, Kana Ram, was acting in his capacity as the driver and was responsible for the concealed silver. The Tribunal upheld the confiscation of the truck, noting that the driver was in charge and the truck was used for smuggling activities.

3. Imposition of Penalties:
Penalties were imposed on Madan Lal, Ashok Kumar, Kishan Lal, and Kana Ram under Section 112 of the Customs Act, 1962. The penalties on Ashok Kumar and Kishan Lal were reduced by the Collector (Appeals). The Tribunal found that Madan Lal knowingly dealt with the smuggled silver and arranged for its clandestine transportation. Therefore, the penalties on Madan Lal and Kana Ram were upheld. However, due to lack of evidence corroborating Kana Ram's statement that the truck owners were involved, the penalties on Ashok Kumar and Kishan Lal were remitted.

4. Validity and Credibility of Statements:
The statements recorded under Sections 107 and 108 of the Customs Act, 1962 were challenged by the appellants, claiming they were made under duress and coercion. The Tribunal found no substantial evidence to support this claim and relied on the statements as part of the circumstantial evidence supporting the smuggling charge.

5. Burden of Proof:
The Tribunal addressed the appellant's argument that the burden of proving the smuggled nature of the silver was on the Department. The Tribunal concluded that the Department had sufficiently discharged this burden through circumstantial evidence, including the location of the seizure, the concealment method, and the inconsistencies in the appellant's claims.

6. Legitimacy of Redemption Fines and Penalties:
The Tribunal modified the impugned order regarding the redemption fines. The confiscated silver was ordered to be released to the owner on payment of a redemption fine of Rs. 20,000, and the truck was to be released on payment of a redemption fine of Rs. 15,000. The penalties on Kishan Lal and Ashok Kumar were remitted, while the penalties on Madan Lal and Kana Ram were upheld.

Conclusion:
The Tribunal confirmed the confiscation of the seized silver and the truck, upheld the penalties on Madan Lal and Kana Ram, and remitted the penalties on Kishan Lal and Ashok Kumar. The redemption fines for the silver and the truck were also modified.

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