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TMI Blog2024 (4) TMI 379X X X X Extracts X X X X X X X X Extracts X X X X ..... avel outside India, he was also having a valid ticket. The conclusion of the Adjudicating Authority agreed upon, that foreign exchange or currency is prohibited goods and therefore liable for confiscation. However, it is not agreed that it is correct to deny redemption of the same under Section 125 of Customs Act as the discretion is to be exercised having regards to all relevant facts and cannot be arbitrary. Considering the whole factual nature of seizure and mitigatory facts, this confiscation should not have been absolute. An intention to smuggle prohibited goods cannot be equated with attempt to export prohibited goods. There is only venial breach of the provisions of Section 113(d) of the Act. In this view of the matter, the Order of absolute confiscation under Section 113(e) and (h) of the Act is set aside. However, it is held that the foreign currency in question is liable for confiscation under Section 113(d) of the Act, though the Order of absolute confiscation is set aside - it was further held that the seized foreign currency can be redeemed by the Appellant from whose possession it was recovered, on payment of redemption fine of Rs. 10 lakhs. Further, the penalty impos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in contravention of the provisions of the Customs Act read with the Foreign Exchange Management Act, 1999 and the RBI guidelines issued in pursuance of the said Act, and thus is liable for confiscation. 4. Statement of the Appellant was recorded on the same date, wherein, he inter alia stated that he had received the subject foreign currency from one Mr. Abu Baker, who is friend of his brother-in-law Md. Bin Jabeer, with direction to handover to Md. Bin Jabir at UAE, who was a UAE national. He further stated that he did not have any document with regard to the currency. 5. After investigation, show cause notice dated 16th September 2021 was issued alleging that the foreign currency seized equivalent to Rs. 1,13,28,795/-, which was found concealed in sweet packets in the baggage, seized from the Appellant, is liable for confiscation under Section 113(d),(e) and (h) of the Customs Act, read with the provisions of Foreign Exchange Management (Export and Import of currency) Regulations 2015, as amended. Further alleged that the Appellant did not declare the foreign currency and knowingly concealed it by carrying and dealing in foreign currency, which is liable for confiscation under S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as the same is not based on factual evidence. It have been held by Hon ble Supreme Court in the case of Gianchand Vs State of Punjab [1862 AIR 496 SC], that police officers are not the customs officers. The seizure by the police officer and delivery to customs does not amount to seizure by customs officers. 11. The interception of the Appellant outside the airport by the CISF officers is also supported by the deposition of the punch witnesses, in Adjudication proceedings. Admittedly, the Punch witnesses were not present at the time of interception by the CISF, but were later on called by the customs officers at the stage of drawing of panchanama. 12. It was further urged that Section 16(3) of Foreign Exchange Management Act provides that no Adjudication Authority shall hold an enquiry under sub-section (1) except upon a complaint in writing made by any officer(s) authorised by a general or special order by the Central Government; that in terms of Notification S.O.1156E dated 26.12.2000 issued under Section 38 of FEMA, the officers not below the rank of Deputy Commissioner of Customs and Central Excise have been authorised to exercise the powers conferred under the Act for the contr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... obtaining the boarding pass inside the airport. 16. The Appellant further draws attention to the cross examination of the Punch witnesses Md Ismail and Md. Niazuddin. Both have stated that they were not present when the Appellant was intercepted by CISF and foreign currency was recovered from him. Thus, there is no evidence adduced by the Customs to show that the Appellant had entered International customs area. 17. It is further urged that there was no scope to conduct personal search under Section 101 of the Customs act, as currency is not a notified item, nor any special Order has been issued for conduct of search as required under the said Section. Therefore the search and seizure of foreign currency is not legal and proper. Thus, the whole proceedings are vitiated. 18. Section 77 of the Customs Act requires the owner of any baggage shall, for the purpose of clearing it, make a declaration of the contents to the proper Officer. This provision indicates that a declaration under Section 77 of the Act is required to be filed only when the owner proposed to clear the baggage. In the instant case, since the Appellant did not even obtain the boarding pass, the question of filing cur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed as attempt to export. 25. It is further urged that the proceedings are also ab initio void as search and seizure done by at the end of Customs is wholly without jurisdiction. It is also urged that foreign currency cannot be confiscated absolutely. Reliance is placed on the ruling of the Bombay High Court in Commissioner of Customs Vs Rajinder Nirula reported at [2017 (346) ELT 9 (Bom)] wherein Hon ble High Court held - The Hon ble High Court held we do not find any merit in the learned counsel s argument that the course adopted by the tribunal was impermissible. The definition of goods includes currency and negotiable instruments under Section 2(22)(d). When the power of redemption is exercised, what the law postulates is that there is an option to pay fine in lieu of confiscation. Section 125 (1) of the Customs Act 1962 provides that whenever confiscation of any goods is authorised by this act, the officer adjudicating it may, in the case of any goods, the importation of exportation where of his prohibited under this act or any other law for the timing in force, and shall, in the case of any of the other goods, give to the owner of the goods or where such owner is not known, th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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