2019 (5) TMI 674 - HC - Customs

Quashing of proceedings u/s 135 of Custom Act, 1962 - Smuggling - Gold Bars - seizure - applicant claims the ownership of the recovered gold bars and has moved release application - HELD THAT - In absence of any valid paper at the time of seizure of the gold bars it becomes smuggled commodity and proved as such under the law. Since the issues involved are contentious and legal it has been brought to the notice of the court and after recording the statement u/s 108 of the Custom Act, notices were sent to the applicant thrice, which the applicant fails to respond to and he failed to raise any plea before the authority concerned. Now the applicant is given reasonable opportunity to appear before the authority/ court concerned to set up his defence to the best of his ability, for which six weeks time is given to the applicant to move proper application in response to the notice and to put in his physical presence before the authority concerned - in case applicant moves an application within the time prescribed before the authority/court concerned, he or it as the case may be shall, after affording opportunity of hearing to both the parties, pass appropriate order without incurring any further delay. Application disposed off.

Summary

Issues:
- Quashing of proceedings under section 135 of Custom Act, 1962
- Ownership claim of recovered gold bars
- Allegations of smuggling and possession of smuggled commodity
- Validity of recovery and possession under section 137 of Custom and Excise Act
- Opportunity for the applicant to set up defense

Quashing of Proceedings under Section 135 of Custom Act, 1962:
The applicant sought to quash the proceedings of complaint case no. 49 of 2019 under section 135 of the Custom Act, 1962. The applicant claimed innocence and ownership of the recovered gold bars, asserting that no offense had been committed. The applicant contended that relevant documents proving innocence had been submitted, and the gold bars were wrongly labeled as smuggled by the custom authorities due to lack of evidence of a purchase transaction.

Ownership Claim of Recovered Gold Bars:
The applicant claimed ownership of the seized gold bars and had filed a release application. However, the Union of India/Custom Department argued that the lack of valid documentation at the time of seizure classified the gold bars as smuggled commodities under the law. The possession was shown by lawful authority during the recovery and preparation of the 'Panchnama,' as mandated by section 137 of the Custom and Excise Act.

Allegations of Smuggling and Possession of Smuggled Commodity:
The gold bars, approximately seven in number weighing 7 kg worth ?2 crores, were seized from an individual who stated that he worked as a carrier for the applicant. The applicant claimed ownership and innocence, while the authorities alleged that the lack of valid documentation at the time of seizure classified the gold bars as smuggled commodities.

Validity of Recovery and Possession under Section 137 of Custom and Excise Act:
The Union of India/Custom Department emphasized that the possession was shown by lawful authority during the recovery process, as required by section 137 of the Custom and Excise Act. The applicant was given an opportunity to appear before the court to present a defense within six weeks, failing which the court order would be deemed void.

Opportunity for the Applicant to Set Up Defense:
The court granted the applicant six weeks to appear before the authority/court concerned to present a defense. If the applicant failed to do so within the stipulated time, the court order would be considered void. No coercive action was to be taken against the applicant during this six-week period. The application under Section 482 Cr.P.C. was finally disposed of with these directions.