Confiscation based on doubtful panchnama failed where witness affidavits denied presence and no proper verification was made.

Confiscation based solely on a panchnama drawn during search could not stand where the supporting witnesses later filed affidavits denying their presence at the factory and the authority rejected those affidavits without verification. The proper course was to test the witnesses by cross-examination or otherwise confirm their version before treating the panchnama as reliable evidence. Once the panchnama became doubtful, the seizure proceedings also lost their evidentiary foundation. Confiscation and the consequential penalties were therefore not sustainable.

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Issues: Whether the confiscation and penalties could be sustained when the panchnama and seizure proceedings were rendered doubtful by affidavits of the witnesses denying their presence at the factory.

Analysis: The seizure and confiscation rested entirely on the panchnama drawn during the search. The witnesses later filed affidavits stating that they were not present when the proceedings were recorded. The authority below rejected those affidavits summarily. In such a situation, the proper course was to test the witnesses by cross-examination or otherwise verify their version before relying on the panchnama as the foundation for confiscation. Once the panchnama itself became suspect, the seizure proceedings also lost their reliability.

Conclusion: The confiscation and consequential penalties could not be sustained and the appeals were allowed.

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