2012 (9) TMI 607 - AT - Customs

Confiscation of seized betel nuts and to impose penalty - goods are of foreign origin and have been smuggled into the country - Held that - As betel nuts are not notified items under section 123 of the Customs Act as such, the onus to prove that the same are of foreign origin and were smuggled into the country lies solely on the Revenue. It is the matter of common knowledge that betul nuts grow in west part of the country and are available in abundance, hence there is no affirmative evidence to show that the said betel nuts are of foreign origin apart from the statement of Shri Deepak Kumar, expert of trade opinion which have not been accepted by the Tribunal in various precedent decisions - no reason to uphold the confiscation of the goods - in favour of assessee.

Summary

Issues:
1. Ownership of the seized betel nuts
2. Confiscation of the betel nuts based on foreign origin claim

Ownership of the seized betel nuts:
The case involved the ownership dispute of 15 bags of betel nuts seized by Customs officials. The betel nuts were found to be of foreign origin, leading to a show cause notice for confiscation and penalty. The appellant claimed ownership through a letter and subsequent appearance before the Superintendent, providing details of the consignment. The original adjudicating authority rejected the claim, citing discrepancies in documents and concluding the goods were smuggled.

Confiscation based on foreign origin claim:
The Revenue relied on a trade opinion to assert the betel nuts were of foreign origin, justifying confiscation. However, the Tribunal questioned the expertise of the opinion giver and highlighted the lack of conclusive evidence supporting foreign origin. Noting that betel nuts were not notified items under the Customs Act, the Tribunal emphasized the Revenue's burden to prove foreign origin. Citing precedents, the Tribunal overturned the confiscation, as the evidence provided was deemed insufficient.

The Tribunal ultimately allowed the appeal, setting aside the confiscation order and providing consequential relief to the appellants. The judgment highlighted the importance of conclusive evidence in cases involving the seizure and confiscation of goods, especially when claims of foreign origin are contested.