Burden of proof for non-notified goods barred confiscation where foreign origin and smuggling were not proved.

Metal scrap treated as a non-notified item placed the burden on the Revenue to prove foreign origin and smuggled character before confiscation could stand. Foreign markings on some scrap pieces were insufficient to show that the entire consignment was of foreign origin, and the surrounding circumstances relied on by the adjudicating authority created suspicion only, not proof of clandestine import. As no evidence of smuggled import was produced, the foundation for confiscation failed. The confiscation of the scrap was therefore set aside, and the confiscation of the truck and the penalties imposed on the appellants were also set aside as consequential relief.

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Issues: Whether confiscation of the metal scrap, the truck used for its transport, and the penalties imposed on the appellants were sustainable when the scrap was a non-notified item and the Revenue had not proved its foreign origin or smuggled character.

Analysis: Metal scrap was treated as a non-notified item, so the burden lay on the Revenue to establish that the goods were of foreign origin and had been smuggled. Foreign markings on some pieces of scrap were held insufficient to prove that the entire consignment was foreign-origin. The surrounding circumstances noted by the adjudicating authority were found to create suspicion only and did not amount to evidence of clandestine smuggling. As the Revenue failed to produce evidence showing smuggled import, the foundation for confiscation was absent.

Conclusion: The confiscation of the metal scrap was unsustainable and was set aside. Consequentially, confiscation of the truck and the penalties on the appellants were also set aside.

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