1997 (1) TMI 474 - AT - Customs

Appeals Allowed: Orders Set Aside on Doubtful Statements & Lack of Evidence

The Tribunal set aside the orders, allowing the appeals filed by the appellants due to doubts regarding the voluntary nature of the statements and lack of ... Smuggling - Gold Issues Involved:1. Legality of the interception and search conducted by Customs Officers.2. Validity of the statements recorded by the Customs Officers.3. Justification for the seizure and confiscation of gold.4. Imposition of penalties under Section 112 of the Customs Act, 1962.5. Credibility of the evidence presented by the appellants.6. Procedural lapses and their impact on the case.Issue-wise Detailed Analysis:1. Legality of the interception and search conducted by Customs Officers:The appellants, Shri P.L. Rao and Md. A. Munaf, were intercepted by Customs Officers on 5-2-1992 at around 8.20 PM. The search conducted in the presence of independent witnesses led to the recovery of gold pieces from their waist belts. The total weight of the seized gold was approximately 1091.9 grams. The appellants failed to produce valid documents for the legal acquisition and possession of the gold, leading officers to believe it was smuggled and thus liable for confiscation under the Customs Act, 1962.2. Validity of the statements recorded by the Customs Officers:The appellants contended that their statements were not voluntary and were recorded under duress. They argued that signatures were taken on blank papers, and discrepancies in dates and the manner of recording indicated fabrication. The statements were critical as they were incriminating, but the appellants retracted them soon after being released on bail, filing affidavits to protest the manner in which their signatures were obtained.3. Justification for the seizure and confiscation of gold:The Deputy Commissioner of Customs confiscated the seized gold under Section 111(d) of the Customs Act, 1962, and imposed penalties on the appellants. The Commissioner (Appeals) upheld this order, but the appellants argued that the gold represented their customers' melted jewelry, and they had affidavits from customers to support this claim. They also maintained registers (G.S. 13) to document the transactions, which were rejected by the adjudicating authority without sufficient reasons.4. Imposition of penalties under Section 112 of the Customs Act, 1962:The penalties of Rs. 50,000 each were imposed on the appellants under Section 112 of the Customs Act, 1962. The appellants challenged these penalties, arguing that there was no independent evidence to support the charges against them, and the statements used as the basis for the penalties were neither voluntary nor corroborated by other evidence.5. Credibility of the evidence presented by the appellants:The appellants presented affidavits from customers and maintained registers to show that the gold was legally acquired and represented melted jewelry. They argued that the adjudicating authority discarded this evidence on flimsy grounds. The Commissioner (Appeals) did not find favor with the appellants' evidence, citing a lack of correlation between the affidavits and the seized gold.6. Procedural lapses and their impact on the case:The Commissioner (Appeals) acknowledged procedural lapses by the Customs Officers but deemed them insufficient to override the facts. However, the Tribunal found that these lapses, along with the manner of recording statements and the lack of independent corroborative evidence, cast doubt on the voluntary and true nature of the statements. The Tribunal emphasized that confessional statements need independent corroboration, which was absent in this case.Conclusion:The Tribunal concluded that the evidence on record did not conclusively establish the culpability of the appellants. The voluntary character of the statements was in doubt, and there was no substantial evidence to support the charges. Consequently, the Tribunal set aside the impugned orders and allowed the appeals filed by the appellants, providing them with consequential reliefs.