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TMI Blog2023 (11) TMI 1088X X X X Extracts X X X X X X X X Extracts X X X X ..... estigation that the impugned SCN has come to be issued. 3. Assailing the validity of the SCN, Mr. Lekhi, learned senior counsel has contended that as would be manifest from the tenor of that notice, the respondents have already formed a definitive opinion with respect to the guilt of the petitioner and consequently no useful purpose would be served in the petitioner being compelled to answer the said SCN or to pursue the proceedings before the respondents. Learned senior counsel further contended that the statements of the petitioner which had come to be recorded in the course of investigation have also not been taken into consideration and this facet additionally lending credence to the submissions of the petitioner of a predisposition to decide the issue of confiscation against it. Mr. Lekhi also questioned the intent of the respondents to dispose of the gold even before the confiscation proceedings were completed and submitted that the same is not only violative of the provisions of the Customs Act, 1962 Act but also wholly arbitrary. 4. Controverting the aforesaid submissions, learned counsel appearing for the first respondent would contend that the SCN had itself come to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n origin and also converting purchased smuggled gold into gold jewellery/articles and selling them to local traders in Delhi; II. Foreign-origin gold having foreign markings are smuggled into India by some agent, and purchased by Sh. Bharat Shantilal Shah by making payment in cash; III. Sh. Bharat Shantilal Shah used to deploy his employee(s)/persons(s) for the transportation of smuggled gold bars and gold jewellery/articles made thereof from different parts of county. IV. Planning was made by Sh. Bharat Shantilal Shah for the execution of the operation for bringing the smuggled gold bars having foreign markings from Chennai to New Delhi and gold jewellery/articles manufactured from the smuggled gold from Mumbai to New Delhi. For carriage and transportation of the smuggled gold bars having foreign origin marking from Chennai to New Delhi, Sh. Manish Kumar, Sh. Naresh Kumar, Sh. Krishi D. Jain were deployed as carriers and were aided by Sh. Sanjay Ram. V. A syndicate was being run by Sh. Bharat Shantilal Shah for carriage and transportation of the gold jewellery/articles manufactured from the smuggled gold from Mumbai to New Delhi. Sh. Subhash Tukaram Karan & Sh. Sanjay Ram, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... * Sh. Bharat Shantilal Shah used to collect all payments with respect to sale of gold jewellery/articles made/manufactured out of smuggled gold bars in cash. * Under the cover of sale invoice(s) of small quantity of gold jewelry, Sh. Bharat Shantilal Shah used to send large quantities of gold jewelry made out of smuggled gold along with it. * Sh. Bharat Shantilal Shah used to pay commission to the carriers/ Members for bringing the smuggled gold from Chennai to New Delhi or from Mumbai to New Delhi. Further, Sh. Bharat Shantilal Shah used to bear all the travel and other expenses i.e. travel tickets, stay expenses and food expenses etc. for the member of the said syndicate. Therefore, in view of above, it appears that Sh. Bharat Shantilal Shah knowingly and intentionally indulged himself in the prejudicial activity of purchasing, transporting, carrying, selling and dealing with smuggled gold bars having foreign markings from Chennai to New Delhi for monetary consideration. He also knowingly and intentionally indulged himself in the prejudicial activity of carrying, selling and dealing with gold jewellery manufactured from smuggled gold bars having foreign markings from Mumb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ain cases) Order, 1993, made under Section 3 read with Section 4 of the Foreign Trade (Development and Regulation) Act, 1992. 103.2 In terms of para 2.01 (b) of foreign Trade Policy, 2015-20 which came into force w.e.f. 01.04.2015, there are some items which are free for import/export, subject to conditions stipulated in other Acts or law for the time being in force, import of these items do not require any license/authorization/permission from the DGFT. However, some of these items are subject to the Policy conditions as well as subject to conditions under any other law for the time being in force. Section 3(2) of Foreign Trade (Development and Regulations) Act 1992, empowers Central Government to make provisions for prohibiting, restricting or otherwise regulating imports of goods. Notification No. 49/2015-2020 dated 05.01.2022 has been issued by DGFT, Ministry of Commerce whereby import of Gold has been restricted subject to certain conditions. Further, under Section 3 (3) of FT (D&R) Act 1992, the goods to which any order under Section 3(2) applies have been deemed to be goods prohibited under Section 11 of the Customs Act, 1962. 103.3 And, whereas, during the relevant peri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for import. It appears that a passenger has to overcome statutory disabilities to import gold as a part of his baggage. Similarly, only the notified canalizing agency is eligible to import gold. The non-compliance of restrictions shall be tantamount to prohibition. On the basis of evidences brought on record, it appears accordingly that Sh. Bharat Shantilal Shah, Sh. Manish Kumar, Sh. Naresh Kumar, Sh. Krishi D Jain, Sh. Subhash Tukaram Karan and Sh. Sanjay Ram, Sh. Pawan Soni, Sh. Sunil Khandelwal and Sh. Sanjay Khandelwal have willingly and knowingly indulged in dealing, concealing, possession, collection, transportation and selling of smuggled gold of foreign origin thereby dealing in prohibited goods, as defined under section 2(33) apart from smuggling, as defined under section 2(39) of the Act ibid. 103.10 And, whereas, on the basis of evidences brought on record, it transpires that the seized gold bars totally weighing 12,000 Grams, and gold cut pieces 2818.5 Grams, and gold bars/gold cut pieces used in the manufacturing of 18035.26 grams gold jewellery/ articles (excluding the gold jewellery totally weighing 2721.04 grams used for the concealment of gold jewellery/ articl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the case brought on the record above, it appears that the seized gold bars, gold cut pieces of foreign origin and gold used in manufacturing of gold jewellery/ articles were of foreign origin and appear to have been illegally smuggled. Therefore, on a reasonable belief that the recovered gold bars totally weighing 12,000 gram, gold cut pieces collectively weighing 2818.5 grams were smuggled gold of foreign origin and were seized vide Seizure Memo dated 19.01.2023. Further, on a reasonable belief that 18035.26 grams gold jewellery/ articles and 11,224.4 grams of gold jewellery were made/manufactured from the smuggled gold, the same were also seized vide Seizure Memo dated 19.01.2023. xxx xxx xxx 119. And whereas, it appears that gold and manufacturers thereof are covered under Section 123(2) of the Customs Act, 1962. It further appears that Sh. Bharat Shantilal Shah hatched a conspiracy for dealing in smuggled gold bars and gold Jewellery made/manufactured from foreign origin smuggled gold. He knowingly made planning for execution of operations for dealing in smuggled gold, which they knew is liable to confiscation under Section 111 of the Customs Act, 1962. Further, he also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be confiscated under Section 118 and Section 119 of the Customs Act, 1962; xxx xxx xxx 128. Now therefore, (i) Sh. Bharat Shantilal Shah S/o Sh. Shantilal Shah, (DOB 07.01.1974) R/o 203, Mohan Palace CHS Ltd., 57th Road, 3rd TPS, Borivali (West), Mumbai-92, (ii) Sh. Subhash Tukaram Karan S/o Sh Tukaram Karan R/0 Room No. 2, Shakti Chawl, Dombivali West, Maharashtra 421201; (iii) Sh. Anand Dasmal Shah S/o Late Shri Dasmal Chogmalji Shah, partner in Anand Shah Jewels LLP, 10tr Floor, Wing B, Diamond Court, Napean Sea Road, Mumbai, Mumbai City, Matrarashha- 400026; are hereby called upon to Show Cause to the Pr. Commissioner of Customs(Preventive), New Custom House, Near IGI Airport, New Delhi-110037 as to why: I. gold jewellery totally weighing 2721.04 grams which were used for the concealment of gold jewellery/ articles and covered under two invoices no. SG-460 dated 17.01.2023 and SG-160 dated 18.01.2023 recovered from the possession of him under Panchnama dated 19.01.2023 and seized vide Seizure Memo dated 19.01.2023 should not be confiscated under Section 119 of the Customs Act, 1962; 129. Now therefore, (i) Sh. Bharat Shantilal Shah S/o Sh. Shantilal Shah, (DO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion that the respondents appear to have arrived at. This is evident from the SCN using the expression "it appears" at more than one place. 8. We, on a holistic consideration of the SCN, find ourselves unable to accept the contention that the same is a manifestation of a predisposed state of mind of the respondents. We also bear in mind the well settled principle that courts should desist from entertaining challenges to SCNs' and interference being warranted only in exceptional circumstances and where it be found that the same is questioned on jurisdictional grounds. The challenge as mounted in terms of the instant writ petition clearly fails to meet the aforesaid tests as formulated. 9. While we are thus inclined to negative the challenge laid to the impugned SCN, we also take into consideration the submission of the learned counsel appearing for first respondent and who had on instructions stated that they would hold their hands and not proceed further under Section 110(1D) of the Act and in terms of the Notice dated 17 May 2023 awaiting the outcome of the SCN proceedings. 10. Accordingly, and while the challenge to the SCN dated 17 July 2023 fails, we dispose of the writ petit ..... X X X X Extracts X X X X X X X X Extracts X X X X
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