2020 (3) TMI 579 - CGOVT - Customs

Smuggling - Gold bars - concealment in the baggage - absolute confiscation - prayer for redemption and reduction in quantum of penalty - HELD THAT - It is observed that gold in any other form other than ornaments does not come within the ambit of bona fide baggage as per the Baggage Rules, 2016. The applicant has brought gold of foreign origin in raw form/small pieces weighing 1000 grams. This is an admitted fact by the applicant in his voluntary statement tendered under Section 108 of Customs Act, 1962 wherein he has stated that he is the owner of the recovered gold and the same has been purchased by him on cash payment in Dubai. Prohibited goods or not - HELD THAT - From the evidence on record it is observed that the applicant crossed the green channel without declaring the impugned articles in his possession in the Customs declaration form or in any other form to the Customs officers and thereby violated Section 77 of the Customs Act, 1962. Therefore the applicant has attempted to smuggle the impugned gold bars with an intention to evade customs duty in gross violation of provisions of Customs Act, 1962 and rules made thereunder read with Foreign Trade Policy (2015-2020). Hence the impugned goods are liable for confiscation under Section 111 of Customs Act, 1962. It is observed that C.B.I. C. had issued instruction vide Letter F. No. 495/5/92-Cus. VI, dated 10-5-1993 wherein it has been instructed that in respect of gold seized for non-declaration, no option to redeem the same on redemption fine under Section 125 of the Customs Act, 1962 should be given except in very trivial cases where the adjudicating authority is satisfied that there was no concealment of the gold in question. Thus, absolute confiscation upheld. Penalty - HELD THAT - Although the penalty of ₹ 4,80,000/- has been imposed under Section 112(a) read with Section 114AA of the Customs Act, 1962, it is observed that penalty is not imposable under Section 114AA of the Customs Act, 1962. Since penalty can only be imposed under Section 112(a) of Customs Act, 1962, penalty of ₹ 4,80,000/- under Section 112(a) of Customs Act, 1962 is upheld. Revision application dismissed.

Summary

Issues:
Confiscation of gold bars, imposition of penalty, redemption of confiscated goods, violation of Customs Act, 1962, eligibility to import gold, redemption fine, smuggling of goods, application of Section 125, prohibited goods, imposition of penalty under Customs Act, 1962.

Confiscation of Gold Bars:
The case involved the confiscation of gold bars weighing 1000 grams, valued at &8377; 24,20,290, which were concealed in a baggage trolley. The Commissioner (Appeals) upheld the confiscation under Sections 112 and 114AA of the Customs Act, 1962, due to lack of lawful import/possession declaration.

Imposition of Penalty:
A penalty of &8377; 4,80,000 was imposed on the applicant for attempting to smuggle the gold bars to evade customs duty. The penalty was justified under Section 112(a) read with Section 114AA of the Customs Act, 1962, as the applicant violated customs procedures by not declaring the gold.

Redemption of Confiscated Goods:
The applicant sought redemption of the confiscated gold under Section 125 of the Customs Act, 1962, for home consumption or re-export. However, the adjudicating authority correctly decided not to offer redemption, citing the concealment of goods and the intention to evade customs duty.

Violation of Customs Act, 1962:
The applicant admitted to purchasing the gold in Dubai and attempting to bring it into India without proper declaration. This act constituted a violation of the Customs Act, 1962, and rules governing the import of goods, leading to the confiscation of the gold bars.

Eligibility to Import Gold:
The applicant claimed that gold should not be considered a prohibited item and argued for the release of the confiscated goods on redemption fine. However, the Commissioner (Appeals) determined that the applicant was not eligible to import gold under relevant notifications and regulations.

Prohibited Goods and Penalty Imposition:
The judgment highlighted that the imported gold in raw form violated the Baggage Rules, 2016, and was considered prohibited goods. The penalty imposed under Section 112(a) of the Customs Act, 1962, was deemed appropriate, while penalty under Section 114AA was found inapplicable.

In conclusion, the Government rejected the Revision Application, modifying the Commissioner (Appeals) order to uphold the penalty under Section 112(a) of the Customs Act, 1962. The judgment emphasized the seriousness of attempting to smuggle prohibited goods and evade customs duties, affirming the confiscation and penalty imposed in this case.