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TMI Blog2013 (1) TMI 727X X X X Extracts X X X X X X X X Extracts X X X X ..... hey have satisfied the principles laid down by the Supreme Court, they are deemed to have discharged the burden of proof cast on them and established their case. Therefore, we do not find any reason to find fault with the findings that the goods in question are smuggled into the country and consequently they are liable to confiscation under Section 111(d) of the Customs Act. It is not necessary that the goods should be prohibited from import under FTDR Act for them to be confiscated under Section 111(d). In this case the allegation is that the goods have been removed without payment of customs duty and therefore, they are liable to confiscation under Section 111(d) of the said Customs Act. Commissioner has imposed various penalties on the persons from whose possession the goods had been seized under Section 112(b) of the Customs Act. It is now well established that mens rea is an important ingredient for imposing a penalty on the persons enumerated in Section 112(b) of the Customs Act. The goods may be liable to confiscation for contravention of the provisions of the Customs Act but the person who is in possession of the goods need not necessarily have anything to do with either sm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on, as the case may be, after taking additional evidence, if necessary. (1A) The Appellate Tribunal may, if sufficient cause is shown, at any stage of hearing of an appeal, grant time to the parties or any of them and adjourn the hearing of the appeal for reasons to be recorded in writing : Provided that no such adjournment shall be granted more than three times to a party during hearing of the appeal." (Emphasis supplied) Since sufficient opportunities as envisaged under the law have been given to the appellants which they failed to avail and since the appeals are more than a decade old, we take up the appeals for consideration and disposal. 3. These four appeals are taken up together for disposal as the subject matter and the legal issues involved are identical. These appeals arose out of four different orders passed by the Commissioner of Customs (Imports), Mumbai, on various dates. The Commissioner in the impugned orders confiscated the goods, imposed redemption fines and also imposed penalty on the person from whose possession the goods w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mainly relied on the fact that the appellants could not explain the possession of the imported goods nor were they in a position to explain as to where they got the goods from nor were they in a position to say whether duty had been paid on the goods or not. To come to the conclusion that the goods are smuggled and therefore were liable to confiscation, the Commissioner relied on the above evidence even though the goods in question were not notified under Section 123 of the Customs Act. He mainly relied on the decision of the Supreme Court in D. Bhoormull's case and of Kanungo & Co.'s case [1983 (13) E.L.T. 1546 and 1983 (13) E.L.T. 1486 respectively]. Quoting from the decision of the Apex Court in D. Bhoormull's case, he observed that the law does not require the prosecution to prove the impossible. All that it requires is the establishment of such a degree of probability that a prudent man may on its basis believe in the existence of the fact in issue. Thus legal proof is not necessarily perfect proof, often it is nothing more than a prudent man's estimate as to the probabilities of the case. He observed that the incidence, extent and nature of the burden of proof for proceeding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellants are under no obligation to retain Bills of Entry and other import documents permanently in respect of imported goods; that the department was trying to throw the burden cast on it on the appellants who were innocent traders in the impugned goods; that there is abundance of case law that in respect of non-notified goods to say that the burden to prove that the goods are smuggled is on the department; that if the case of the department is that the goods in question were imported under DEEC and were diverted to local market, the proper authority to adjudicate the case would be the Commissioner in charge of the port through which the goods were imported and not the Commissioner, Mumbai; and that in any view of the matter, the department failed to establish that the goods were smuggled into the country and on the basis of mere presumptions and assumptions the goods cannot be confiscated under Section 111(d) of the Customs Act. 6.1 In the writ petition filed before the Hon'ble High Court, the petitioners made the following submissions :- (a) In the case of Commissioner v. Bhavdeep Metals (India) - 2004 (178) E.L.T. 170, a co-ordinate bench of the Tribunal held that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dings given in the adjudicating authority's order and the grounds averred in the reply to the writ petition which are summarized briefly as below :- (i) As regards the jurisdiction of the Customs Department at Mumbai, to adjudicate the case, since the goods were seized at Mumbai, they have jurisdiction to adjudicate the case. They rely on the decision of the Hon'ble Apex Court in the case of Shashank Foods Pvt. Ltd. [1996 (88) E.L.T. 626 (S.C.)] and of the Tribunal in the case of Engee Industrial Services Pvt. Ltd. [1996 (87) E.L.T. 152], (ii) The appellants have admitted that goods under seizure are of foreign origin and ownership of the goods are claimed by them and they had purchased the goods from local parties. No documents are produced by the petitioners evidencing the licit import of the goods. In the show cause notice it has been alleged that the goods were imported under DEEC scheme and they were diverted. If that is so, the goods are liable to confiscation for violations of the provisions of the Exim policy and the provisions of the customs duty exemption under Sections 111(d) and 111(o) of the Customs Act, 1962. (iii) The appellants have claimed that they have procure ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es not have jurisdiction to adjudicate the present case. However the said decision of the Tribunal was overruled by the Hon'ble Karnataka High Court in the same case reported in 2009 (244) E.L.T. 504 (Kar.) and it was held that the jurisdictional authorities in whose jurisdiction the seizure of the goods took place has authority to adjudicate the case. An identical issue was considered by this Tribunal in the case of Engee Industrial Services P. Ltd. (supra) and the Tribunal held that "the cause of action which commenced at the place of clandestine import continues, and removal or transfer of such goods is part of the continuing cause of action. A part of the cause of action is at the place to which the goods are conveyed and the proper officer having territorial jurisdiction over the place of seizure has jurisdiction to initiate, conduct and conclude adjudication proceedings". In the light of these decisions, we hold that the customs authorities at Mumbai who effected seizure of the impugned goods have jurisdiction to adjudicate the case and the contention to the contrary are rejected. 8.2 The next contention of the appellants is that since the goods are not notified under S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uppliers had not supplied the impugned goods. When the appellants were confronted with these facts, they were unable to give any satisfactory explanation nor any evidence by way of bills/challans indicating the licit procurement of the goods. Thus the onus of proof shifted from the Revenue to the appellants which they have not discharged. 8.3 A similar issue came up before the Hon'ble High Court of Bombay in the case of Sailash Amulakh Jogani v. UOI [2009 (241) E.L.T. 348 (Bom.)] and the Hon'ble High Court held as follows in para 17 of the judgment. "17. None of the persons present at the office premises could satisfactorily explain from whom the diamonds were purchased. They did not give particulars of the sellers from whom the diamonds were purchased. These facts were within the special or peculiar knowledge, which the Department cannot prove and is not expected to prove. In view of the non-disclosure of facts which were within the special knowledge of the persons from whom the diamonds were seized, the burden to prove that the diamonds were smuggled which undoubtedly rested on the Department is alleviated. Very slight evidence is, therefore, sufficient to discharge i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Department may be considerably lightened even by such presumption of fact arising in their favour. However, this does not mean that the special or peculiar knowledge of the person proceeded against will relieve the prosecution of the Department altogether of the burden of producing some evidence in respect of that fact in issue. It will only alleviate that burden to discharge which very slight evidence may suffice." 8.5 The circumstances prevailing in the present appeals suggest that the department is able to raise a presumption in its favour with regard to the existence of the fact sought to be proved when the owners of the goods refused to divulge correctly as to where they got the goods from. That the goods are of foreign origin is not denied by the appellants. The Supreme Court also observed in Kanungo's case (supra) that a false denial could be relied by the customs authorities for the purpose of coming to the conclusion that the goods had been illegally imported. Thus, when the appellants claim that they have purchased the goods from some persons and when the latter deny having sold the goods to the appellants, it can be concluded that the appellants were making a false ..... X X X X Extracts X X X X X X X X Extracts X X X X
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