2018 (3) TMI 122 - AT - Customs

Confiscation - Gold Bars - contraband item - Baggage Rules - Held that - the appellant vide his statement under Section 108 of Customs Act, 1962 has conceded that he brought the gold bars for one Mr. Habeeb who has paid him ₹ 25,000/- in addition to his travel expenses - the appellant was searched in the presence of the Gazetted officers and he was found concealed this gold bars in his socks which he was wearing and was trying to exit from the green channel without any declaration. Further, the statement made under Section 108 of Customs Act, 1962 by the appellant has not been retracted till now. Further, the appellant has failed to discharge the burden of proof that the gold is licit. In the customs declaration, the appellant has stated as nil which means that he had nothing to declare. In view of the cogent and convincing evidences against the appellant regarding the smuggling of the gold bars, there is no infirmity in the impugned order which is upheld by dismissing the appeal of the appellant. Penalty - Held that - Keeping in view the acts and omission on the part of appellant, the quantum of penalty is reduced. Appeal allowed in part.

Summary

Issues: Smuggling of gold bars, absolute confiscation, imposition of penalty under Customs Act, 1962.

Smuggling of Gold Bars:
The appellant arrived at the airport carrying gold bars concealed in his socks, which were discovered during a search by Customs officers. The appellant admitted to smuggling the gold for another individual in exchange for financial gain. The Customs authorities found the gold bars to be pure gold and valued them accordingly. The appellant failed to provide documentation proving the lawful import of the gold, leading to suspicions of smuggling.

Absolute Confiscation:
The Customs authorities ordered the absolute confiscation of the gold bars under various sections of the Customs Act, including 111(d), 111(i), and 111(m). The appellant argued that the gold did not fall under prohibited goods and should not be subject to absolute confiscation. Citing legal precedents, the appellant contended that the gold could be redeemed upon payment of a fine rather than being confiscated outright.

Imposition of Penalty:
The appellant challenged the imposition of a penalty of ?1,50,000 under Sections 112(a) and 112(b) of the Customs Act. The appellant's counsel argued that the penalty was excessive and should be reduced. The Customs authorities defended the penalty, citing the appellant's admission of smuggling and attempting to exit without declaration. The Tribunal upheld the penalty but reduced it to ?50,000, considering the circumstances.

The Tribunal, after considering submissions from both parties and the evidence on record, found the appellant's admission of smuggling the gold bars to be credible. The appellant's failure to prove the legitimacy of the gold import, coupled with the concealment of gold in socks and attempts to exit without declaration, supported the Customs authorities' decision of absolute confiscation. Legal precedents and the appellant's own statements under Section 108 of the Customs Act further strengthened the case for confiscation. The Tribunal upheld the decision of absolute confiscation but reduced the penalty imposed on the appellant. The appeal was dismissed, affirming the confiscation of the gold bars and the revised penalty amount.