Burden of proof under Customs law continues where police only detain goods; legal seizure is required to shift it.

Mere police detention or guarding of goods does not amount to seizure for the purpose of Section 123 of the Customs Act, 1962; the statutory burden continues unless there is a legal seizure in the customs sense. On the facts discussed, the gold was only kept under guard pending inquiry and was later seized by customs, so the burden remained on the claimants to prove lawful origin. Their explanation was not accepted, and the confiscation under Section 111(d) and penalties under Section 112 were upheld as sustainable.

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Issues: (i) Whether the goods were seized by the police so as to displace the application of the burden-of-proof rule under Section 123 of the Customs Act, 1962; (ii) whether the confiscation of the gold and the penalties imposed on the appellants were sustainable.

Issue (i): Whether the goods were seized by the police so as to displace the application of the burden-of-proof rule under Section 123 of the Customs Act, 1962.

Analysis: The decisive question was whether the police had effected a seizure or had merely detained the goods while keeping them under guard pending investigation. On the record, the goods were not taken into police possession in the legal sense; the police had intercepted the persons, kept the gold in the same premises under guard, and the customs authorities subsequently seized it after enquiry. The distinction between detention and seizure was material, because Section 123 applies where goods are seized under the Customs Act in a reasonable belief that they are smuggled. The factual finding was that there was no prior seizure by police to prevent the statutory burden from operating.

Conclusion: Section 123 of the Customs Act, 1962 applied, and the burden remained on the appellants to prove that the gold was not smuggled.

Issue (ii): Whether the confiscation of the gold and the penalties imposed on the appellants were sustainable.

Analysis: Once the burden under Section 123 remained on the appellants, their explanation and documentary claims were not accepted by the adjudicating authority. The customs authorities had recorded statements, conducted enquiry, and found the possession and movement of the gold inconsistent with lawful acquisition. The Tribunal found no basis to interfere with the conclusions on confiscation under Section 111(d) of the Customs Act, 1962 or with the penalties imposed under Section 112 of the Customs Act, 1962. The quantum of penalty was also found not excessive in the circumstances.

Conclusion: The confiscation and penalties were upheld.

Final Conclusion: The appeals failed in entirety, and the customs order confiscating the gold and imposing penalties stood affirmed.

Ratio Decidendi: For the purpose of Section 123 of the Customs Act, 1962, mere police detention or guarding of goods does not amount to seizure; the statutory burden on the claimant continues unless there is a legal seizure that displaces it.

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