2019 (2) TMI 605 - AT - Customs

Absolute Confiscation - penalties - Smuggling of gold - assorted gold articles and jewelry - Baggage Rules - Held that - This issue is squarely covered by the decision of the Kerala High Court in the case of Vigneswaran Sethuraman 2014 (12) TMI 268 - KERALA HIGH COURT wherein the Hon ble High Court has discussed in detail regarding the declaration to be made by foreign tourist entering into India and the various provisions of the Customs Act relating to seizure of such goods. In the impugned order, the Commissioner of Customs has wrongly observed that the gold ornaments were made of crude gold whereas in the seizure report, it has been observed that the purity is 22 crt. - the impugned orders are not sustainable in law in view of the judgment of Kerala High Court in the said case - the impugned order set aside - Appeal allowed - decided in favor of appellant.

Summary

Issues:
- Appeal against the order of absolute confiscation of gold under Customs Act, 1962.
- Imposition of penalties on the appellants.
- Applicability of declaration requirements for foreign nationals entering India.
- Interpretation of relevant sections of the Customs Act regarding seizure of goods.
- Comparison with judicial precedents and decisions of Kerala High Court.
- Review of impugned orders by the Commissioner of Customs.

Analysis:
1. The appellants filed appeals against the order of absolute confiscation of gold and imposition of penalties under the Customs Act, 1962. The Commissioner of Customs had ordered the confiscation of gold under various sections of the Act and imposed penalties on both appellants.

2. The facts of the case involved Srilankan nationals arriving at Kochi International Airport from Colombo, Srilanka, where they were intercepted by Customs Officers resulting in the recovery of undeclared gold articles and jewelry. The Commissioner of Customs ordered the confiscation of goods and imposed penalties, leading to the appeals being filed.

3. The appellants argued that as foreign nationals, they were not required to declare the jewelry upon arrival in India. They cited a Kerala High Court case where confiscation and penalties were set aside for similar circumstances. The Commissioner's observations regarding the nature of the gold and non-declaration were contested by the appellants.

4. The defense maintained a violation of import procedures due to the appellants not declaring the jewelry to the Customs Department upon entry.

5. The Tribunal analyzed the applicability of declaration requirements for foreign tourists entering India under the Customs Act. Citing the Kerala High Court decision, it was concluded that the provisions regarding baggage declaration did not apply to the situation where the gold was worn by the tourists and not concealed in baggage. The Tribunal highlighted the absence of a statutory provision prohibiting foreign tourists from wearing gold ornaments.

6. The Tribunal noted that the Department's review petition was dismissed by the Kerala High Court and observed discrepancies in the Commissioner's observations regarding the gold's purity. Considering the precedents and decisions, the Tribunal set aside the impugned orders, allowing the Department to re-export the confiscated goods and allowing the appeals of the appellants.

7. The judgment was delivered on 08/01/2019 by the Tribunal, granting relief to the appellants based on the interpretation of relevant legal provisions and judicial precedents, ultimately setting aside the Commissioner's orders of confiscation and penalties.