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TMI Blog2023 (2) TMI 678X X X X Extracts X X X X X X X X Extracts X X X X ..... relevance and reason - The discretion has to be exercised in conformity with the purpose for which it has been conferred and the object which it seeks to achieve. Reasons must be recorded in support of it. In the exercise of discretion, non-consideration or non-application of the mind to the relevant factors would not only render the exercise manifestly erroneous, but would also warrant judicial interference. The power to give an option to the importer to redeem the prohibited goods upon payment of fine is a power coupled with the duty and in any event it should be exercised fairly and reasonably and not arbitrarily and capriciously, there must be at least an application of mind to the discretion in terms of Section 125 of the Act. There is no reference whatsoever to any of orders which according to the petitioner was passed by the Respondents herein under similar circumstances wherein the benefit of the option under Section 125 of the Act was extended to similarly placed importers. While it is true that the Appellate Authorities may or may not agree with the submissions of the petitioner, it is rudimentary that quasi-judicial authorities ought to apply their mind to the iss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... way Bridge. ii) There was also intelligence that some of the passengers had abandoned the Gold inside the Aircraft while dis-embarking. In view of the above intelligence the entire flight was rummaged and six packets containing gold which were covered with black adhesive tapes were found/ recovered. The seven passengers including the petitioner were escorted to the Air Intelligence Unit at Customs Arrival Hall and on enquiry it is stated that all the seven passengers including the petitioner accepted carrying foreign origin gold bars/cut gold bars. The quantity of gold recovered from the petitioner by way of jewellery weighed 1147.2 Gms and the same was valued at Rs.35,48,651/-. It was also alleged that the passengers including the petitioner admitted that they had smuggled the gold bar/jewellery for monetary consideration and were not the actual owner of the same. Thereafter, the purity/origin and value of the said gold bars were examined by Govt. Approved Appraiser. iii) Statements were obtained from the petitioner and the other passengers under Section 108 of the Customs Act, 1962 (hereinafter referred to as the Act ). The petitioner allegedly stated that due to her famil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ). It was further submitted that gold was not prohibited, mere non-declaration of the gold by itself would not render the same as being prohibited and thus invoking Section 111 (d) of the Act was clearly unjustified. (f). It was further submitted that in terms of Section 125 of the Act, the Authority ought to, grant the option of paying fine in lieu of confiscation in the case of goods other than prohibited gold, while in the case of prohibited goods the Officer may extend the above option exercising its discretion. It was thus submitted that the petitioner ought to be granted/extended the option to pay fine in lieu of confiscation as gold is not prohibited goods. 4. The order in original came to be passed by the 3rd Respondent, after considering the objection confirming the proposal while rejecting the request for grant of option to pay fine in lieu of confiscation in terms of Section 125 of the Act inter alia on the following grounds:- (i). That all the seven passengers including the petitioner were intercepted at the Green Channel and in response to an oral enquiry as to whether any gold bar/cut bars were in their possession all of them replied in the negative. The en ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irway Bridge and not at the Green Channel as alleged by the Respondents and submitted that the point of interception is crucial. (c). That she had declared the gold to the Officers and the Respondents erred in assuming non-declaration of gold. (d). That in similar cases, the Commissioner of Customs Appeal had rejected the case filed by the Revenue and reliance was placed on the above to suggest that the department must be consistent. Reliance was also placed on the order of the revisional authority in similar circumstances wherein reexport was permitted. Reliance was placed on the following: (i).F.No.373/43/B-Cus RA dated 16.04.2008 and also the instructions of CBEC vide letter F.No.495/3/94-Cus-VI dated 02.03.1994. (ii). To suggest that ownership is not a relevant criteria the appellant further submits that the Revision Authority has passed an order in JABBAR ILYAS and others in F.NO.373/6, 8-11, 23-25, 28-29/8/07-RA ORDER NO. 212- 221/07 DATED 27.04.2007 and reduce the personal penalty and redemption fine reasonably. (iii). E.No.380/57/B/16-RA/1015 dated 31.01.2018. (e). That the issuance of common proceedings of the petitioner along with six other passengers wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dent that the petitioner had no intent of declaring the gold and intended to evade the payment of Customs duty. The relevant portions of the First appellate order is extracted below:- 7. The Government has gone through the case records it observed that the seizure in this case was on the basis of specific intelligence of the Officers of DRI. The rummaging of the aircraft has resulted in the recovery six packets of gold in primary form totally weighing 1047.9 grams, examination of each the 6 Applicants resulted in the recovery of 1791.8 grams of gold in primary form. The Applicants examination resulted in the recovery of 1147.200 gms of gold jewellery valued at Rs. 35,48,652/-(Rupees Thirty five lakhs Forty Eight thousand and Six hundred and Fifty two). The Applicant in her statements has admitted to being a part of smuggling plan so as to smuggle gold into the country. The Applicant has admitted that the gold was given to her by one Shri Mani and his uncle Shri Shanmugam to be handed over to his mother in India, for which she would be monetarily compensated. It is evident that the applicant intercepted in the above operation is a carrier and not the owners of the smuggled gold ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was submitted by the learned counsel for the Respondents by relying upon the counter and the written submissions and the typed set of papers filed, that the orders of the Respondents do not warrant interference as the appellate authorities have considered the grounds raised by the petitioner and emphasis was also placed on the fact that the petitioner had in her statement under Section 108 of the Act admitted and has chosen to come up with a different version after a lapse of six months vide letter dated 02.03.2017. That any import of gold against the regulations/conditions stipulated for legal import would result in the goods falling under the category of prohibited goods . That once it is prohibited goods it becomes a matter of discretion vested with the appropriate authority to grant/extend the option of payment of fine in lieu of confiscation under Section 125 of the Act or not to do so. 11. Heard both sides, perused the materials on record. 12. I find that both the appellate as well as the Revisional authority has not addressed the primary question raised by the petitioner as to whether gold is not prohibited goods but at the highest only restricted goods and mere non-c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd capriciously, there must be at least an application of mind to the discretion in terms of Section 125 of the Act. 14. On a reading of the orders of the 1st and 2nd Respondents, it appears to me that there is non-application of mind to the discretion that ought to be exercised even assuming that the imported gold have to be treated as prohibited goods. 15. Secondly, I find that there is no reference whatsoever to any of orders which according to the petitioner was passed by the Respondents herein under similar circumstances wherein the benefit of the option under Section 125 of the Act was extended to similarly placed importers. While it is true that the Appellate Authorities may or may not agree with the submissions of the petitioner, it is rudimentary that quasi-judicial authorities ought to apply their mind to the issues raised and material on record before arriving at a conclusion. I am afraid that the 1st as well as the 2nd Respondents had passed orders without applying their mind to the issues raised in particular, whether non-compliance of the conditions attached to the restricted goods, the same would be treated as prohibited goods nor to the orders relied upon to s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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