2022 (4) TMI 213 - AT - Customs

Smuggling - Gold bars - Existence of sufficient evidences or not - retraction of statements on which reliance placed upon - Tribunal having power to grant stay or not - Confiscation - penalties - HELD THAT - In the instant case, the Department could not adduce any evidence to prove that the gold was of smuggled in nature. Once, Shri Rajendra Sethiya has staked his claim on the impugned gold and has submitted documents to establish the same; it was incumbent upon the Department to disprove the same with the documentary evidence or cogent investigation. The Department attempts to disprove the claim of Shri Rajendra Sethiya on the basis of arguments that his cars did not pass to certain toll plaza, his tower location did not indicate that he travelled to Bhilai on the particular date and his transaction with Saheli Gems and Jewelers Private Limited, Bhilai was the first one and there too it was on credit. It is found that these claims would not stand to scrutiny of law as no further evidence to disprove the claim has been adduced. It is not uncommon in the trade that a particular person or firm enters into a trade with another person or firm for the first time. For the same reason, it cannot be said that the transaction is not involve genuine purchase. Sale of credit also is common in business. What is to be seen that whether the transaction was genuine, factual or only a fabricated one. It is found that money has been paid to M/s Saheli Jewelers though the later date which is again not an uncommon practice in the trade. The transactions of money though completed at a later date cannot be dismissed as fake without further investigation into the facts as to whether the transfer of money has really taken place or not. No such investigation has found to be taken place. Again the transaction is attempted to be discarded citing the Toll report and tower location etc. as these evidences cannot be taken as a conclusive evidence as there are various possibilities as discussed by the learned Adjudicating Authority. No further investigation on this issue has taken place by questioning the persons concerned and the case is attempted to be built up of logical arguments which, is found to be incorrect. Also, it is found that the seizure was not in Customs area but was on a train at Tatanagar. The intercepted person was brought to DRI office in Patna and seizure and other proceedings have taken place in Patna. Therefore, it was incumbent upon the Department to prove that the impugned gold is of foreign origin and that too a smuggled one. Therefore, it is found that the only semblance of evidence available with the Department is the retracted statement of Shri Sonu Jal and conjectures based cell tower location and toll plaza records. In the instant case, the Adjudicating Authority has examined the facts and circumstances of the case and came to the conclusion that the statement of Shri Sonu Jal cannot be relied upon in view of the absence of cogent corroborative evidence. It has been since placed on record that said Shri Sonu Jal is no more and he passed away on 18.10.2020 as per the death certificate issued by the Registrar, Birth and Death, Municipal Corporation, Raipur. Under the circumstances, it is found that the findings of the learned Adjudicating Authority are legal and proper and as such the impugned order does not require to be interfered with. Thus, there are no merit in the appeals filed by the Department and it is held that for the reasons discussed, the same are not maintainable and are liable to be dismissed. Appeal dismissed - decided against Revenue.

Issues Involved:
1. Confiscation of gold bars.
2. Imposition of penalties on various appellants.
3. Validity of retracted statements.
4. Burden of proof under Section 123 of the Customs Act, 1962.
5. Admissibility of evidence and corroboration.

Issue-wise Detailed Analysis:

1. Confiscation of Gold Bars:
The officers of DRI, Patna, seized two gold bars from an individual on a train. The gold was claimed by another individual who provided documents to support the legal purchase of the gold. The Additional Commissioner confiscated the gold and imposed penalties. However, the Commissioner (Appeals) set aside the confiscation and penalties, prompting the Department to file appeals.

2. Imposition of Penalties on Various Appellants:
Penalties were imposed on multiple individuals involved in the case. The Commissioner (Appeals) overturned these penalties, leading to the Department's appeal. The Tribunal upheld the Commissioner (Appeals)'s decision, finding no evidence to support the penalties.

3. Validity of Retracted Statements:
The Department's case heavily relied on the confessional statement of the individual from whom the gold was seized. This individual retracted his statement, claiming it was made under duress. The Tribunal noted that the retraction was corroborated by documents presented during judicial custody, thus diminishing the evidentiary value of the original statement.

4. Burden of Proof under Section 123 of the Customs Act, 1962:
The Tribunal emphasized that the burden of proof to establish that the gold was smuggled lay with the Department. The appellants provided credible evidence, including purchase bills and stock registers, to prove the legal purchase of the gold. The Department failed to disprove this evidence, thereby not meeting the burden of proof.

5. Admissibility of Evidence and Corroboration:
The Tribunal found that the Department's reliance on cell tower locations and toll plaza records was insufficient to disprove the appellants' claims. The Tribunal highlighted that the Department did not conduct a thorough investigation to corroborate their claims. The Tribunal also noted that the retracted statement, without corroborative evidence, could not be the sole basis for confiscation and penalties.

Conclusion:
The Tribunal upheld the Commissioner (Appeals)’s decision, finding that the Department failed to provide sufficient evidence to justify the confiscation of the gold and the imposition of penalties. The Tribunal dismissed the Department's appeals and miscellaneous applications, affirming that the seized gold should be returned to the claimant and the penalties on other appellants should be set aside.

← Previous Next →