Burden of proving smuggling requires affirmative evidence; foreign markings alone cannot sustain confiscation or penalty.

Goods outside Chapter IVA and Section 123 of the Customs Act attract no statutory presumption, so the Department must prove smuggling by affirmative and corroborative evidence. Foreign markings alone, without examination of the goods, quantification, or other supporting material, were insufficient to establish foreign origin or illicit import. Mere failure to produce documents showing lawful acquisition did not, by itself, prove smuggling, and the authorities could not rely on grounds beyond the show cause notice. On that basis, confiscation of the goods and vehicle under Sections 111 and 115, and the associated penalty, were held unsustainable.

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Issues: Whether the impugned goods and vehicle were liable to confiscation and penalty on the basis of alleged smuggled character of the goods, and whether the Department had discharged the burden of proving smuggling.

Analysis: The goods were found not to be notified goods under Chapter IVA of the Customs Act, 1962 and were also outside Section 123 of the Customs Act, 1962, so the burden lay on the Department to affirmatively establish smuggling. The record did not show conclusive proof of foreign origin or smuggled character. Foreign markings by themselves, without examination of the goods, quantification, or corroborative evidence, were insufficient. The finding also turned on the settled rule that mere non-production of documents proving licit acquisition does not by itself establish smuggling, and that the authorities could not travel beyond the scope of the show cause notice. In the absence of conclusive proof, confiscation under Section 111 and confiscation of the vehicle under Section 115 were not sustainable.

Conclusion: The Department failed to prove that the goods were smuggled, and confiscation and penalty were not legally sustainable.

Final Conclusion: The review application was rejected and the order allowing release of the goods was upheld.

Ratio Decidendi: When goods are not covered by the statutory presumption, smuggling must be proved by affirmative and corroborative evidence, and suspicion or foreign markings alone cannot justify confiscation or penalty.

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