1991 (2) TMI 295 - AT - Customs

Summary

Issues:
1. Whether the confiscation of Indian currency of Rs. 1.20 lakhs under Section 121 of the Customs Act, 1962 is in accordance with law.
2. Whether the confiscation of US $ 8,600 is in accordance with law.
3. Whether the imposition of penalty against the appellants is in accordance with law.

Analysis:

Issue 1: Confiscation of Indian Currency
The case involved the confiscation of Rs. 1.20 lakhs under Section 121 of the Customs Act, 1962. The Tribunal emphasized that the burden of proof lies with the department to establish that the seized amount is the proceeds of smuggled goods. The Tribunal cited several precedents to support its decision, highlighting that mere suspicion or lack of satisfactory explanation from the appellant cannot warrant confiscation. The Tribunal concluded that there was no evidence to prove that the seized amount was from the sale of smuggled gold. Therefore, the confiscation of Rs. 1.20 lakhs was deemed unlawful, and the amount was directed to be returned to the appellant.

Issue 2: Confiscation of US $ 8,600
The Tribunal confirmed the confiscation of US $ 8,600 as the appellants did not claim ownership of the currency. Since there was no challenge to the confiscation of this amount, the decision was upheld.

Issue 3: Imposition of Penalty
Regarding the imposition of penalties under Section 112 of the Customs Act, the Tribunal scrutinized the evidence and statements provided. It was highlighted that the statement of the appellant, taken under duress and retracted promptly, could not be deemed voluntary. The Tribunal emphasized the necessity of independent evidence to corroborate accusations, especially when dealing with smuggled goods. As the gold in question was not seized, and the statements were retracted, the penalties imposed on both appellants were deemed unjustified and not in accordance with the law. Therefore, the penalties were set aside for both appellants.

In conclusion, the Tribunal allowed both appeals, ruling in favor of the appellants and granting them consequential reliefs.