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TMI Blog2023 (9) TMI 728X X X X Extracts X X X X X X X X Extracts X X X X ..... acts and circumstances of the case, consequently, the goods are not liable for confiscation, as held by Member (Judicial); or (b) Whether the appellant have failed to discharge their burden under Section 123 of Customs Act, 1962 and hence, the goods are liable for confiscation in the facts and circumstances of the case as held by Member (Technical). - HON BLE MR. ASHOK JINDAL, MEMBER (JUDICIAL) AND HON BLE MR. RAJEEV TANDON, MEMBER (TECHNICAL) APPERANCE : For the Appellant : Shri N.K. Chowdhury, Advocate For the Respondent : Shri M.P. Toppo, Authorized Representative PER ASHOK JINDAL : The appellants are in appeals against the impugned order for confiscation of 6 kg gold recovered on 19.05.2015 from Appellant No. (1) to (4 ) and imposition of penalty on all the appellants. 2. The facts of the case are that on specific information received by P I Branch, CC (P), WB, Kolkata on 19.05.2015, the Appellant Nos. (1) to (4) were intercepted at Howrah Railway Station. They were brought to the Customs House after issuing spot summon on them. 6 pcs. of gold bars believed to be of foreign origin having inscription PMAP SUISSE 1 KILO GOLD 995.0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4). On the basis of the said Notice, on 12.10.2015, the said Appellants opposed and objected to the pre-trial disposal of the seized gold and prayed to return the same to the original owner i.e. Appellant No. (5). The Appellant No. (5) also made a prayer for release of the seized gold. 2.5 On 16.10.2015, the statement of Shri Sashikant Patil was recorded, who denied having relation with the Appellant No. (5) and also denied having sold any gold of Appellant Nos. (1) to (4). The Appellant No. (5) also tendered his statement on 26.10.2015 stating that he was engaged in the business of purchase and sale of the gold jewellery at Delhi, Mumbai Kolkata. He also stated that he knew the Appellant No. (1) to (4), who worked for him. The seized gold was also actually purchased by the Appellant No. (5) from Shri Prodeep Kumar Bhathra of M/s Snehal Gems Pvt. Ltd., Mumbai, Appellant No. (6), against the invoices. The statements of the Directors of said Appellant Companies were recorded on 08.01.2016, who stated that they know the Appellant No. (5) and also accepted that he has sold 6 kgs of gold to Appellant No. (5) against the invoices and tendered the payment related documents. 2.6 On ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) I impose a penalty of Rs. 10,00,000/- on Shri Rinku Verma, Noticee No. 5 under Section 112 (b) of the Customs Act, 1962. (ix) I impose a penalty of Rs. 10,00,000/- on Shri Raghendra Kumar Dhuriya, Noticee No. 1 under Section 114AA of the Customs Act, 1962. (x) I impose a penalty of Rs. 10,00,000/- on Shri Sourabh, Noticee No. 2 under Section 114AA of the Customs Act, 1962. (xi) I impose a penalty of Rs. 10,00,000/- on Shri Subham Verma, Noticee No. 3 under Section 114AA of the Customs Act, 1962. (xii) I impose a penalty of Rs. 10,00,000/- on Shri Golu Verma, Noticee No. 4 under Section 114AA of the Customs Act, 1962. (xiii) I impose a penalty of Rs. 50,00,000/- on Shri Rinku Verma, Noticee No. 5 under Section 114AA of the Customs Act, 1962. (xiv) I impose a penalty of Rs. 50,00,000/- on Shri Pradeep Kumar Bothra, Noticee No. 6 under Section 114AA of the Customs Act, 1962. Against the said order, the appellants are before us. 3. The ld. Counsel appearing on behalf of the appellants, submitted that the ownership of the impugned gold has been claimed by the Appellant No. (5), who has purchased the said gold from Appellant No. (6) through proper ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Saha : 2012 (275) ELT 435 (Tri. Kol.), (iii) Impiaz Ikbar Pohiwala : 2019 (365) ELT 167 (Bom.), (iv) Gopal Prasad : 2018 (362) ELT 309 (Kol.) which has been affirmed by the Hon ble Patna High Court as reported in 2020 (371) ELT 243 (Patna). (v) Nand Kishore Somani : 2016 (333) ELT 448 (Tri-Kol), which has been affirmed by the Hon ble Calcutta High Court as reported in 2016 (337) ELT 10 (Cal.). (vi) M/s Hari Manthan Jewellery House Pvt. Ltd. vide Final Order No. 75480-75484/2022 dated 17.08.2022. 4. On the other hand, the ld.A.R. appearing on behalf of the Revenue, supported the impugned order and submitted that initially when the gold was recovered from the possession of Appellant Nos. (1) to (4), they have stated that they acquired the possession of gold from Shri Patil and later on, at the time of pre- trial disposal notice, they have changed their version to cover illicit possession of gold. He also submitted that the Appellant No. (5) has procured the invoices from Appellant No. (6) to make legalized the transactions and the possession of the seized gold is afterthought. Therefore, the said documents cannot be relied upon. To support his conten ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the seized gold, has discharged his burden under Section 123 of the Customs Act, 1962 by producing purchase invoices and the Appellant No. (6) has supported the same. In that circumstances, we are of the view that the Appellant No. (5) has discharged his onus in terms of Section 123 of the Customs Act, 1962 in the light of the decision of the Tribunal in the case of Nitya Gopal Biswas (cited supra), wherein this Tribunal has observed as under : 6. It is observed from the case records that Smt. Chhabi Biswas and Shri Joy Gopal Biswas were intercepted on 5-9-2000, moving in a Tata Sumo vehicle near Doltala with 60 foreign marked gold biscuits in their possessions. None of those two persons could furnish any document regarding licit possession of the gold biscuits at the time of interception and the said gold biscuits were seized on the ground that they were smuggled when read with Section 123 of the Customs Act, 1962. Both Smt. Chhabi Biswas Shri Joy Gopal Biswas also stated that these gold biscuits are believed to have come from Bangladesh. Shri Joy Gopal Biswas in his first statement also stated that these foreign marked gold biscuits were obtained from one Joynal for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o 7 of this order :- Section 4. 123 of the Act is an exception to the normal rule of the burden being upon the prosecution to establish the guilt of the accused. Ordinarily every element that constitutes the offence has to be proved by the prosecution and this burden never shifts. But the burden shifts on the accused when Section 123 of the Act is invoked. After the initial burden of acquiring reasonable belief is discharged by the Customs, it is the offender who has to establish the lawful importation and acquisition of the gold. The appellants in this case have not questioned the existence of reasonable belief. They, however, consistently claimed that the gold was legally acquired. Gold 5. occupies a special position in the Indian psyche. Gold is the most liquid investment capable of being encashed at any time in any society or locality. Gold is routinely presented to temples and to relatives on ceremonial occasions. It is customary, even mandatory that a bride is given away with gold ornaments. The demand for gold in India is perennial. There was only one gold mine operating at Kolar near Mysore which would produce about 2 tons of gold every year. That has also stoppe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... permitted to import and sell gold. At a later date passengers of Indian origin arriving into India after a prescribed period of stay abroad were permitted to import 5 kgs. of gold. Gold can also be imported on Special Import Licences. No restrictions were placed upon the disposal of gold so imported on payment of duty. According to official statistics the legal import of gold through these Schemes was of the following magnitude : Year Import of Gold in Metric tones OGL BAGGAGE SIL TOTAL 1996 - 256 42 298 1997 62 398 68 548 1998 532 93 19 644 1999 513 39 18 570 2000 158 2 1 163 (Upto June) 6. As a res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iscuits by producing a bill. It is also observed from the first statement dated 5-9-2000 of Smt. Chhabi Biswas and Shri Joy Gopal Biswas that it was only their belief that said gold biscuits were from Bangladesh. It is also not coming out of the investigation as to how both of them believed that gold in their possession was of Bangladesh origin. As already observed trace leading to Joynal, mentioned by Shri Joy Gopal Biswas in his very first statement dated 5-9-2000, was not followed by investigation to establish that seized foreign marked gold biscuits were in fact smuggled into India. Reasonable doubt of smuggled nature of foreign marked gold may be sufficient for the purpose of seizure of gold, by virtue of Section 123 of the Customs Act, 1962, but the same is not sufficient for confiscation under Section 125 of the Customs Act, 1962 when appellant has produced legal document of their licit acquisition. Accordingly, it is held that department is not able to establish the smuggled nature of seized foreign marked gold whereas claimant appellant has been able to discharge his burden by providing licit document of the purchase of 60 foreign marked gold biscuits. In the light of libe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d nature of seized gold but suspicion howsoever grave cannot take the place of evidence when appellant has discharged his onus. It is accordingly held that statements recorded on 5-9-2000 were not reflecting the correct facts of the case. Accordingly, issue framed at para 5(i) above is decided in favour of the claimant appellant and against the Revenue. 6.1 Further, in the case of Ratan Kumar Saha (supra), this Tribunal again held that there was a transaction between buyer and seller of the gold, which was claimed and accepted. Therefore, the burden under Section 123 of the Customs Act, 1962, have been discharged. 6.2 Further, in the case of Imtiaz Iqbal Pothiawala (supra), the Hon ble Bombay High Court has observed as under : (ix) The impugned order dated 3rd June, 2005 has held that the respondent No. 1 has discharged the burden of proof under Section 123 of the Act. This as the respondent No. 1 had explained the source of his purchase namely from [M/s. Paras Bullion and M/s. Pavan Jewellers]. In fact, the person running two firms viz; - Mr. Bhupendra Thakkar has himself admitted in his statements to the Office of DRI that the seized gold has been sold by him to resp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore the Hon ble High Court of Kerala, was that whether the onus of legitimate possession of gold lies on the Revenue under Section 123 of the Customs Act, 1962, wherein the Hon ble High Court has held that the onus is on the person whose possession of the gold has been recovered, but in this case, the person from whom, the gold has been recovered and claimed to be owner of the seized gold and has produced the purchase invoice, which has been confirmed by the seller of the said gold. Therefore, the onus under Section 123 of the Customs Act, 1962, has been discharged. 10. In view of the above discussions and findings, we hold that the Appellant No. (5) has discharged the onus under Section 123 of the Customs Act, 1962. Therefore, the seized gold is not liable for confiscation. Consequently, no penalties are imposable on all the appellants. 11. In view of the above observation, we set aside the impugned order and allow the appeals with consequential relief, if any. (Pronounced in the open court on 29.08.2023 .) Sd/- (Ashok Jindal) Member (Judicial) PER: RAJEEV TANDON 12. The primary question in the present appeals at its very root concerns the evaluatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of time) in certain cases, the timing of joining of investigations by key accused-claimant of the foreign marked gold and the purported seller all need to be considered closely in a holistic and comprehensive manner, interlinking these stray bits of evidence in the spatiotemporal context and the timelines of the case. FACTUAL RECAP 16. For a quick factual recap, suffice to state that on 19.05.2015, the four appellants 1-4, namely Rajendra Kumar Dhuria, Saurabh, Golu Verma and Shubham Verma were nabbed by the authorities at Howrah railway station with 6 pieces of 1 kg. gold bar each. The said gold was foreign marked of Swiss origin and 995.0 purity. The inscription on the gold bars being PMAPSUISSE PMAP ESSAYEUR FONDEUR While Rajendra Kumar Dhuria and Shubham Verma were found to be in possession of two such gold bars of foreign origin of 1 kg. each, one piece of such foreign marked 1 kg. gold bar was recovered from the possession of each of Golu Verma and Saurabh. The total seized gold was thus 6 kgs. Their interdiction, with the foreign marked gold in their possession, by the authorities is stated to be in pursuance of a specific information available with the authorit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent of 4 accused appellants recorded under Section 108 of Customs Act wherein admitting that they worked as a carrier of foreign marked gold for Rinku Verma for which they were paid Rs. 1500 each. Further admitting that the said gold was procured from Shashi Kant Patil of Dhanlakshmi Bullion Pvt. Ltd Kolkata. (note the perfect unison in the statements of the 4 accused as to the source of procurement of gold the name of the owner for whom they worked as carriers). The accused also indicate the amounts of cash they carried to the shop of Shashi Kant Patil of Dhanlakshmi Bullion Pvt. Ltd. admission of Ashish Patil cousin of Shashi Kant Patil that they deal in sale and purchase of foreign marked gold. Shashi Kant Patil was at the shop between 1230 p.m. to 5.30 p.m. 20.05.2015 All the 4 accused arrested, to be later released on bail only on 3 July 2015 and 7th July 2015 ( after nearly 45 days of arrest) 23.06.2015 09.7.2015 Shashi Kant Patil fails to appear each time against the summons issued to him. 28.07.2015 Statements of 4 appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... read over approx. 2 months, appears before the authorities for the first time after nearly 4 months of the date of seizure, dis-regarding repeated earlier summons (total three) issued to him on/for 23 June 2015, 9 July 2015 and 14 August 2015. 26.10.2015 Rinku Verma, the subsequent claimant of this confiscated gold appears before the authority for the first time, post seizure, (well over 5 months of the seizure/confiscation) and submits 4 invoices towards purchase of gold from Snehal Gems Pvt. Ltd., tenders a statement without any explanation of repeated disregard of summons and his non-appearance before the authorities all this while. 14.12.2015 Summons issued to Director/Partner/Proprietor of Snehal Gems-not honoured 08.01.2016 Pradeep Kumar Bothra, Director of Snehal Gems Pvt. Ltd, appears before the authorities for the first time, violating earlier summons issued to him for 30.10.2015 and 30.11.2015. While admitting that he has sold the 6 kg. gold to Rinku Verma against the 4 bills tendered by him, he, however, [could not confirm the description, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gold several months after the impugned seizure. The gross delay for such unexplained length of time is not only perplexing and intriguing but is a clear pointer and also suggestive and indicative of attempting at manouvering and creating a room in time and space, sourcing for alleged manipulation and cover up for the legal possession of gold. It may be noted that both Rinku Verma and Shashi Kant Patil did not honour any of the summons during the intervening period, repeatedly issued to them, and it was only at the stage of pre- trial disposal of the gold initiated by the Department after nearly five months of the seizure, that Rinku Verma introduces himself to the Department for the first time by way of a letter objecting to the said disposal of gold under Section 110(1A) of the act ibid. In fact the repeated issue of summons not being honoured by the key conspirators, for the initial four-five months of enquiry, certainly tantamounts to non-co-operation, from which adverse inference can safely be drawn. As discussed, in subsequent paras this non-co-operation is with a certain objective creating space to buy time in the intervening period to manipulate the documentation process t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the fact that while Rinku Verma alleges that he had sent the four carriers appellant 1-4 viz. Golu Verma, Saurabh, Shubham Verma, Rajendra Kumar Dhuriya, to exchange foreign marked gold in lieu of jewellery and claims to have business relations with Shashi Kant Patil, the latter however refuses to even recognize his carriers, least of all know them. This is despite the fact that, some of those carriers have been working for Rinku Verma for several years and all of them have made multiple visits to Kolkata in the past. The fact that Shashi Kant Patil, lied on this aspect and refused to identify the four accused, before the authorities is evident, as it was on the basis of details furnished by the four carriers that the business premises of Shashi Kant Patil were identified. The testimony of Shashi Kant Patil s brother further, who was at the shop at the time of visit by the officers, confirms that he was present at the shop on the day of the seizure. The testimony of Rinku Verma, specifically brings out the name of Shashi Kant Patil, as regards business dealings and not that of the latter s father or brother who were also associated with the business of Dhanlaxmi Bullions in vari ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lace, tender exact details of the business premises of the latter and wherefrom they had admitted to have procured the gold and could lead the investigators to his premises as a follow up on 19.05.2016. They even informed the authorities of his alias as Bunti. This establishes the falsehood and concocted, fabricated and tutored version of the statements of the 4 accused, as revised later. While stating in the statement of- 15.02.16/16.02.16 that they had been given the gold by Rinku Verma for its exchange for jewellery from Sonapatty, it need to be noted here, that the specifics of shop name/dealer, design of jewellery, nature of jewellery whether bangles or necklace or rings etc. are missing unlike the initial two statements (later touted as not proper or voluntary) wherein all the 4 accused appellants No. 1-4, had tendered precise information about the acquisition of gold from Shashi Kant Patil. BURDEN OF PROOF 24. Section 123 of the Customs Act is an onerous piece of legislation and is an exception to the normal principle. Viewed in this backdrop its rigors and enforcement are all also very strict. In the said circumstance, the burden of proof after initial vesting o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ilable with the carriers, at the point of interception at Howrah railway station, the same could be presented by way of a facsimile transmission, Email, whatsapp copy or any other form of digitalized transmission, and produced before the authorities in support of the bonafide purchase, as well as to demonstrate the innocence of the accused. Moreover, the fact that this being a case of no small seizure, the collective value of seized gold is close to Rs. 1.7 crore. Although the fact that Rinku Verma has consciously abstained himself from appearing before the authorities has come out too well from the investigations, it cannot be lost sight of and need be noted particularly that all the while for nearly five months and for unexplained and muted reasons, the out of scene picture and the silence is clearly demonstrative of the fact that Rinku Verma was not in possession of any document evidencing licit procurement of the seized gold. It further evidences and establishes that the process of manipulating and managing a scandal and sourcing of invoices/papers artificially and attempts at procurement of fictitious and fabricated sale/purchase vouchers was actually going on behind the scene ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s attempted legitimizing of the gold seized. This one time documentation is an exercise in securing legitimacy and overcome the onus as cast upon Rinku Verma the claimant of the seized/confiscated gold. Also it is interesting to note that prior to the purported sale and even thereafter, there has been no other sale to Rinku Verma at least till the completion of enquiries spread nearly over a one year period. The imputed sales over a ten day period carrying sequential invoice numbers leave nothing to imagination towards a concocted sale documentation and completely give up the edifice surreptitiously built upon. 29. Also it is a fact on record, that Snehal Gems Pvt. Ltd., Mumbai, the alleged seller of the 6 kg. of gold to Rinku Verma, did not honour the summons issued to him on more than one occasion. He only chose to appear before the authorities when both he and Rinku Verma were obviously convinced that book keeping and manipulation/preparation of bills and vouchers has been duly acknowledged and completed in their records and at all other places as may be put to questioning by the authorities. Such despicable conduct to not join the investigations on part of both Rinku Verma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t legitimization and a cover up for the seized/confiscated 6 kg of foreign marked gold. 30. Moreover, it defies all pragmatism and is bereft of any sound logic, rather it cannot get more insane than this that one supposedly is in possession of all required licit documentation to establish legal ownership and acquisition but still feels it appropriate to allow their persons/employees to not only go to jail but stay put there for over a month and a half, do not respond to repeated summons issued in order to ascertain truth and present the purported documents for nearly six months, fails to present themselves before the authorities for no specific reason. Further, moreso when the stakes involved are so very high that admittedly it derails the business of Rinku Verma for the next six months, virtually bringing it to a closure/standstill-under such circumstances it cannot be anybody s case to needlessly hold on for such inordinate length of time. In fact, were it to be so, one would have presented oneself suo motto, at the first instance to get not only the seized gold released, but also enable the release of the arrested personnel, for no apparent fault and without any further loss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rchase, by Rinku Verma, a payment of over Rs. Thirty eight lakh (Rs. 38,36,750/- to be precise) i.e. almost 25% of the value of the seized gold was still outstanding from Rinku Verma as due to Pradeep Kumar Bothra, Direrctor of Snehal Gems Pvt. Ltd. and no evidence of having remitted the same could be supplied. 33. What these bits of evidence aptly establish is the enormous amount of falsification, manipulation and coverup undertaken in an organized manner to somehow secure a licit facade for the seized/confiscated gold. Thus while dummy sales could be manipulated closer to the date of seizure in May, it was not possible to demonstrate payments in back date. The following sequence reveals the entire story: 1. Date of seizure of FM gold. - 19.05.2016 2. Purported date of sale (as a legit cover) - 02.05.15 to 12.05.15 3. Date of payment(as a cover in support of legit sale) -19.08.15,20.08.15, 26.08.15, 01.09.15, 04.09.15, 08.09.15 22.09.15. (With nearly 25% of payment still outstanding and remained unpaid) 4. Date of Rinku Verma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be confirmed it is for seized gold. 35. This assertion of categorical negation that there is no evidence (by way of import documents), to establish the imported character of seized/confiscated foreign marked gold or to relate it with downstream local dealers with documentary evidence, or to even link it for certainty with the purported invoices of Snehal Gems, tendered by Rinku Verma to the department by Pradeep Bothra supports fully, the coverup version. This is thus a complete failure at an attempt to cross the threshold of Section 123 of Customs Act, and the onus that has befallen upon Rinku Verma, as a claimant of the seized/confiscated foreign marked gold. 36. The fact of categorical assertion that Pradeep Bothra did not have import documents concerning the seized gold (ref-Q.No. 10 of testimony of Pradeep Bothra dated 08.01.2016), when read alongwith his testimony in response to Q 6. wherein he failed to recognize the gold sold as the one under seizure and the unqualified, unequivocal and unconditional failure and testimony to confirm that the payment that he received from Rinku Verma was towards the said seized gold, fails to link the purchase documents tendered by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d not include even a single solitary purchase voucher of gold of 1 kg bar of 995 purity, though they have included in the paper book purchase vouchers for gold of 995 purity for 150 gms, 242 gms, 417.839 gms and several of them of cut and polished diamonds (Needlessly enclosed as part of paper book completely unwarranted). All this is again carried out with intents and singular objective of attempting to befool the investigation and create confusion. On the subject it may be of relevance to state here that at Pg. 161 of the paper book is enclosed the following document: This appears to be again a clever attempt at fraudulent conduct. From the above it is noted that the top part of the page is clearly marked/washed out. However, it appears that the name of the impugned seller could be DAFFODILS CHS GODREJ of Garden Takka Panvel, Navi Mumbai, however at the bottom right end corner of this invoice the Authorized signatory is someone for Falcon Gold House Pvt. Ltd. Also the weight herein does not tally with that of seized gold, there being also no date thereon. The Ld. Advocate for the appellant also could not explain the discrepancy. Thus with all the lacunae mention ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ku Verma - there is no transactional document or ledger copy etc. tendered to the investigators by him, indicating gold supplied by/to Rinku Verma, except for the four fabricated and tailor made invoices said to be towards sale of gold to him. 41. Moreover Pradeep Bothra, the Director of Snehal Gems could not identify the accused persons appellant 1-4 namely Rajendra Kumar Dhulia, Saurabh, Shubham Verma and Golu Verma (this aspect of enquiry is most relevant in view of the statement of Rinku Verma that the four had been working for him and he had business relations with the former. Moreover, Pradeep Bothra, as stated earlier, could not provide any import document in respect of the said seized gold sold by him. His categorical assertion to the question in this regard was a firm No . 42. The learned Adjudicating Authority while dwelling on the subject of illegal import of gold as pointed out as per notification no. 12/2012-Cus dated 17.03.2012 (as amended) has noted that gold in any form allowed to be imported, upon payment of applicable duty, is subject to fulfillment of certain specific conditions. That it was evident that the conditions as imposed on import of such gold thr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nku Verma for its exchange at Kolkata. This proposition is unacceptable in view of what has been discussed in earlier paras. 45. As for the role of the four accused appellant No. 1-4 viz. Rajendra Kumar Dhulia, Saurabh, Shubham Verma and Golu Vermais concerned, it may be noted that the four aforesaid persons admitted in their voluntary statement on 19.05.2015 that they were gold carriers for Rinku Verma of Katra, Manmohan Park, Allahabad. Rinku Verma also in his statement before the investigating authority has admitted the said four persons worked for him. Moreover, it is significant that there was no change in the version of the accused and the contents of the initial first statement tendered by them were maintained, even in their subsequent statements given to the Customs authorities, under Section 108 of Customs Act, on 28.07.2015 i.e. nearly three week after release and grant of bail by the ld. CMM. Further, these statements are valid pieces of evidence as held in: Surjeet Singh Chhabra Vs. UOI 1997 (89) ELT 646 SC (It even upheld the binding nature of a statement, retracted within six days) Illiyas Vs. Collector of Customs, Madras 1983 (13) ELT 142 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . besides their own personal information such as the place of stay in Kolkata, duration of stay, their place of stay at Allahabad, education etc. There is no allegation, for these statements tendered on 19/05/2023 as being involuntary or coerced upon or being forced upon to state so or any other allegation of inducement etc. as could cast a shadow of doubt on the veracity and truthfulness, accuracy and bonafides of the said statements. 48. Furthermore, what is important is the aspect that material facts contained in these statements are not only corroborated with one another but also with the material facts on ground. There is thus no reason to doubt the veracity of these statements. What affixes a stamp of bonafideness, correctness and truthfulness to the contents of these voluntary statements of 19.05.2015, is the fact of reassertion and reconfirming of the contents thereof, by all the four Appellant No. 1-4 Shubham Verma, Golu Verma, Rajendra Kumar Dhuriya and Sourabh viz. in their subsequent statement dated 28/07.2015, recorded after they were enlarged on bail and that too not immediately post release, but well after around two weeks of the grant of bail to them by the Ld. C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore dismissed as lacking any evidentiary value. CASE LAW ANALYSIS. 51. In so far as the case laws cited by the Hon ble Member (Judicial) in support of his findings, is concerned, the following paras are put forward (i) Nitya Gopal Biswas Vs. Commissioner of Customs. It is pertinent to observe that unlike the present case, in this case the claimant had filed his claim towards the foreign marked gold biscuits seized with the authorities, almost immediately after the seizure and interception of gold biscuits. Para 2.1 clearly points out this fact. Relevant portion of the said Para is reproduced as hereunder:- That 60 gold biscuits were given to him by the younger brother Shri Nitya Gopal Biswas at 2 p.m. on 5-9-2000 for delivering the same back to him near Sealdah. That on the same day 25-9-2000 Shri Nitya Gopal Biswas filed a claim petition for the seized gold biscuits and that the same were purchased from one Shri Laljibhai Kanjibhai Soni of M/s. L.K. Soni, Ahmedabad by making cash payments and a photocopy of Sale bill No. 422, dated 29-8-2000 was also furnished. That Shri Lalji Bhai K. Soni of Ahmedabad has confirmed in his statement to have sold the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... On 8th March, 2000, 575 gold bars valued at Rs. 3.09 crore were found along with Indian currency of Rs. 21 lakhs from a cavity in a jeep, belonging to respondent No. 1. At that time, the jeep was being driven by Mr. Anis Ashraf (Driver of respondent No. 1); (b) Respondent No. 1 and his driver were not able to produce any documents in support of legal possession of the 575 gold bars and Indian currency of Rs. 21 lakhs. This led to a reasonable belief on the part of the officers of the respondent that the goods are liable for confiscation. Therefore, the 575 gold bars and Rs. 21 lakhs cash found were seized under Section 110 read with Section 123 of the Act. This as gold is a notified goods under Section 123 of the Act, while cash was seized in the reasonable belief that it is sale proceeds of smuggled goods; (c)---------- (d) On 9th March, 2000, respondent No. 1 made a statement under Section 108 of the Act to the officers of respondents. In his statement, respondent No. 1 stated that 575 seized gold bars were purchased from one Mr. Chandubhai (also known as Bhupendra Thakkar); (e) At the same-time, on 9th March, 2000, the officers of the respondent recorded the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubsequently, SSB officers handed over Shri Sujit Kumar and the seized material to the Customs Officers, Motihari. Shri Sujit Kumar, in his statement dated 20.04.2014 and 21.04.2014, stated that the seized gold biscuit was given to him by Shri Chandreshwar Prasad/Shah. The gold was scheduled for delivery to Shri Mahavir Shah/Prasad in his shop M/s. Shakuntala Jewellers at bakergunj, Patna. It is also stated that both Shri Chandreshwar Prasad/Shah and Shri Gopal Prasad/Shah used to carry gold from Nepal to India illegally. Shri Gopal Prasad/Shah by his letter dated 10.05.2014 addressed to the Commissioner of Customs, Patna stated that he was engaged in manufacture and sale of gold and silver ornaments and running a jewellery shop by the name of Saraf Jewellers. He stated that he purchased two pieces of gold bars from M/s. Bhwana International, Chandni Chowk, Delhi on 14.04.2014 vide Bill No. B1/R1/002, dated 12.04.2014 and B1/R1/003, dated 14.04.2014 respectively. It is also stated that on his instructions his brother Shri Chandreshwar Prasad/Shah handed over the gold to Shri Sujit Kumar for carrying it to Patna to hand it over to Shri Mahavir Prasad/Shah to make gold ornaments in ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es with the supplier of the said gold found the matter to be in support of the appellant. Under the circumstances, the ratio of this case law is clearly not applicable to the present matter 52. In view of the aforesaid discussions on each of the case laws, the support of which the Hon ble Member (J) has extensively drawn upon in arriving at his findings, to my mind are inapplicable to the present appeal and are clearly distinguishable with the facts of the present matter, both in factual contents as well as the legal perspective in terms of Section 123 of the Act. Thus the ratio of none of the said case laws actually comes to the rescue of the appellants and no support can be drawn therefrom in support of the pleadings of the appellant. Disregarding, the applicability of the pronouncements of the aforesaid decisions as discussed in para 51, I am of the view that the appellants have failed to discharge the onus cast upon them under Section 123 of the Act ibid and all the appellants are, also liable for penal consequences in law in view of the mens rea as evident and the contraventions in law. 53. Now, on the other hand, I would like to dwell upon, certain case laws, in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e was some tampering of marks and numbers on the gold bars seized form the Carrier, the Tribunal erred in holding that mere tampering of marks and numbers did not prove that the gold bars were of foreign origin. The fact that there was tampering of the marks and numbers of the seized gold bars coupled with the fact that the Owner thereof could not disclose the source of acquisition should necessarily lead to an inference that the seized gold bars were of foreign origin, smuggled into the territory of India. (Emphasis Supplied) The initial testimonies of the four appellants 1-4 viz. Rajendra Kumar Dhuriya, Sourabh, Shubham Verma and Golu Verma, thus cannot be washed off in thin air. (ii) In view of my findings in earlier paras and the fact that the two statements tendered by the appellants 1-4 viz. Rajendra Kumar Dhuriya, Sourabh, Shubham Verma and Golu Verma, are found to be voluntary, there is no doubt that the same can in itself be the sole basis for conviction, as was also held by the Hon ble Supreme Court in the case of K.I. Pavunny Vs. Asstt. Collector.(HQ.) Commissioner of Excise Collectorate, Cochin 1997 (90) ELT-241 SC. The Hon ble Apex Court therein ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... compound one would ensure that others having access to the compound may not indulge in digging and carrying away the same. As soon as the appellant and/or the members of his family had sight of such visitor or movement by others, they would immediately catch hold of such person or would charge them. Obviously, therefore, it would be the appellant who had concealed 200 gold biscuits of foreign marking in is compound at a place always visible from his bed-room window. Therefore, the High Court was right in its conclusion, though for different reasons, that Ex. P-4 is a voluntary statement and was not influenced by threat, duress or inducement etc. Therefore, it is a voluntary statement given by the appellant and is a true one. 20. The question then is : whether the retracted confessional statement requires corroboration from any other independent evidence? It is seen that the evidence in this case consists of the confessional statement, the recovery panchnama and the testimony of PWs 2, 3 and 5. It is true that in a trial and proprio vigore in a criminal trial. Courts are required to marshal the evidence. It is the duty of the prosecution to prove the case beyond reasonable doub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de and whether or not it was voluntary and true. These require to be tested in the light of given set of facts. The high degree of proof and probative value is insisted in capital offences. 21. In Kashmira Singh s case the co-accused, Gurcharan Singh made a confession. The question arose whether the confession could be relied upon to prove the prosecution case against the appellant Kashmira Singh. In that context, Bose, J. speaking for bench of three-Judges laid down the law that the Court requires to marshal the evidence against the accused excluding the confession altogether from consideration. If the evidence de hors the confession proves the guilt of the appellant, the confession of the co-accused could be used to corroborate the prosecution case to lend assurance to the Court to convict the appellant. The Court considered the evidence led by the prosecution, de hors the confession of co-accused and held that the evidence was not sufficient to bring home the guilt of appellant Kashmira Singh of the charge of murder. The appellant was acquitted of an offence under Section 302 IPC but was convicted for the offence under Section 201 IPC for destroying the evidence of murder a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vidence adduced by the prosecution. 26. In Naresh J. Sukhawani Vs. Union of India 1996 (83) E.L.T. 258 (S.C) = 1995 Supp. 4 SCC 663 a two-Judge Bench [to which one of us, K. Ramaswamy, J., was a member] had held in para 4 that the statement recorded under Section 108 of the Act forms a substantive evidence inculpating the petitioner therein with the contravention of the provisions of the Customs Act as he had attempted to export foreign exchange out of India. The statement made by another person inculpating the petitioner therein could be used against him as substantive evidence. Of course, the proceedings therein were for confiscation of the contraband. In Surjeet Singh Chhabra Vs. Union of India 1997 (89) E.L.T. 646 , decided by a two- Judge Bench to which one of us, K. Ramaswamy, J., was a member the petitioner made a confession under Section 108. The proceedings on the basis thereof were taken for confiscation of the goods. He filed a writ petition to summon the panch (mediater) witnesses for cross-examination contending that reliance on the statements of those witnesses without opportunity to cross-examine them, was violative of the principle of natural justice. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llant herein made statement under Section 108 at 1 p.m. on December 6, 1980, i.e., after four hours. It is unlikely that during that short period PW-2 and 5 would have obtained the retracted confession under Ex. P-4 in his own hand- writing running into 5 typed pages under threat or duress or promise. No doubt the wealth of details by itself is not an assurance of its voluntary character. The totality of the facts and circumstances would be taken into account. On a consideration of the evidence the High Court accepted that Ex. P-4 is a voluntary and true confessional statement and accordingly it convicted the appellant of the offences. It is seen that Ex. P-4 was given in furtherance of the statutory compulsion and the appellant made statement in unequivocal terms admitting the guilt. It is seen that in Barkat Ram s case, this Court accepted the retracted confessional statement and upheld, on that basis, the conviction. In Vallabhdas Liladhar s case and also in Rustom Das s case the retracted confessional statement found basis for conviction and in the latter the recoveries were relied as corroborative evidence. In Haroom Abdulla s case, this Court used the evidence of co- accused ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -4 under Section 108 of the Evidence Act and the evidence of PWs 2, 3 and 5. The prosecution proved the case beyond doubt and the High Court has committed no error of law. (Emphasis Supplied) (iii) It may further be pointed out that a co-ordinate bench of the Tribunal in the case of Rajesh Pawar Vs. Commissioner of Customs.(P), West Bengal, Kolkata . 2003 (152) ELT 201 (Tri-Kol.), had dismissed the plea of retraction of the statement based on the grounds of given under pressure, when no such plea was raised before the CJM at the time of making of the bail application. It also observed that there was no basis to tamper with the makings on the gold bar were it sourced legally. The observations of the Tribunal in para 6 of its order are very pertinent hence reproduced hereunder: 6. The fact remains that 11 pcs. Of foreign gold biscuits have been recovered from the appellant s possession. In his initial statement, he has admitted that these gold biscuits were purchased by him from two unknown persons. There is not even a whisper of fact in the said statement that the gold biscuits were purchased by him from M/s G. Seal Co. The said statement which is detailed, is w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and therefore the said order of the Tribunal was maintained [2020 (372) ELT 683 Cal] by the Hon ble High Court. In stating so, it reversed the order of the single Bench [2014 (309) ELT 600 Cal.] that had faulted upon the Tribunals order. In addition even costs were imposed on the appellants in the matter besides even categorizing the defence arguments as dishonest. Further, the SLP filed by the accused against the said order of the DB also got to be dismissed [2022 (382) ELT A 99SC] . (iv) Also, in the case of Mohamadbhai Chotubhai Cutpiecewala and Another Vs. Additional Collector of Customs 1986 (25) ELT 413 T., it is clear that a spontaneous statement deserves consideration and cannot be merely rejected by a belated retraction. This is so as the same is given without premediation, ill will, bias etc. (v) It may be pertinent to also advert to the case of Phoola Ram V. Commissioner of Customs, Jaipur 2007 (208) ELT 308 (Tri Del.), wherein non-response to the summons issued by the authorities was held as an act of non co-operation for which it was felt safe to draw an adverse inference. It had also pointed out that a statement impleading the employ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... indicates that the appellant no. 2 was carrying smuggled foreign marked gold biscuits and the Indian currency, which was sale proceeds of smuggled silver. Further, I find that appellant no. 4 had claimed the ownership of the seized foreign marked gold biscuits and Indian currency. It was the contention of the appellant no. 4 that he had legally purchased these gold biscuits from M/s Dhan Cholia Sons, Delhi vide bill 12 dated 17-10-97. I find from records that the authorities had visited the residential/business premises of the appellant no. 4 in Bikaner on 24-10-97. On that date, appellant no. 4 was not available but his son was present in the residence/business premises. The search of the business premises did not reveal any sale or purchase of the gold and nor did son of appellant no. 4 produce any record regarding the purchases of foreign marked gold biscuits and the currency being in possession for sale and purchase transaction of agricultural land. I find from records that the appellant no. 4 did not attend summons which were issued by the authorities to him till 19-12-97. The authorities had issued 6 summons to the appellant no. 4 to cooperate in the in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant no. 2 and appellant no. 4 , the absolute confiscation as ordered by the lower authorities is correct and does not require any interference. (Emphasis Supplied) (vi) In the case of Jamtaraj Kewalji Govani Vs. State of Maharashtra AIR 1968 SC 178 the Hon ble Apex Court while considering the matter had observed that in view of the time gap between the date of seizure and the submission of documents, the necessary inference in the case has to be drawn. (vii) Even in the case of Rasilaben H. Rathod Vs. Commissioner of Customs, Ahmedabad 2003 (156) ELT 675 T., involving a seizure of 58320(58.320 kgs) grams of foreign marked gold this Tribunal had categorically held the bills as produced by the party to show the acquisition of gold as licit, to be non acceptable. (viii) Moreover, when documentary evidence is tendered in support of licit acquisition of gold (to which onus under Section 123 applies), it is of paramount importance and rather formidable to ensure 100% accuracy and matching of the goods with the details as contained in the bills/invoice submitted in support as a cover. Even a small little mismatch is safe enough to discredit those bills/vouchers/i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onstrate the licit acquisition of foreign marked gold is false, forged and fabricated. The attempted rebuttal of the onus cast upon the appellants under Section 123 of Customs Act 62 has failed completely and very miserably. 56. In the given circumstances and my foregoing discussions, I am of the view that the department has successfully discharged its primary onus at the preliminary stage and with the onus cast onto the appellants under Section 123, not having been discharged in the least, the order assailed warrants no interference and is required to be upheld. Having thus arrived at the irresistible conclusion that contraband gold smuggled from a third country of origin is liable to absolute confiscation and the appellants subjected to imposition of penalty, l order accordingly. Under the circumstances, I uphold the Order-in-Original, confiscating absolutely the said 6kg foreign marked gold alongwith the other items and also uphold the imposition of penalty as contained in operative part of the adjudication order (i) to (xiv). 57. The order of the learned adjudicating authority is therefore upheld and all the appeals filed are dismissed. Lackadaisical Investigations ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l months after seizure, thereby if not negating, severally diluting the very purpose of the enactment. That nothing can be worse than this that the CDR data of the prime accused, Rinku Verma appears to have not been investigated at all. There being no reference to it in the show cause notice. Likewise no locational details of the telephone numbers of the four carriers were sought for, to ascertain confirm the actual pick up spot of the foreign marked gold as stated in original statements and refuted/denied several months later. Even the show cause notice is also vaguely and casually drafted, with several important details not having been gone into, it even does not list the RUDs. There are several other serious breaches in the investigations undertaken by the department. It is time therefore, that the department trained its officers to undertake investigations in a professional manner, and each and every aspect is looked into. Speed, is the essence in conduct of such investigations, and that should be the norm. The drafting of notice should also be taken as an essential component of this training process. The registry is therefore directed that a copy of this order be marked to the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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