Burden of proof in customs confiscation: foreign origin alone cannot justify seizure without prima facie proof of smuggling.

Confiscation of foreign-origin goods could not be sustained where the goods were not covered by Section 123 or Chapter IV-A of the Customs Act, 1962 and the Department had not first made out a prima facie case of smuggling. In that situation, mere foreign origin, seizure on information, or restricted import character did not shift the burden to the claimants. The Department had to adduce sufficient material showing the smuggled character of the goods before any obligation arose for the claimants to prove lawful import. As no adequate enquiry or proof was placed on record, confiscation was set aside and release of the claimed bales was directed.

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Issues: Whether confiscation of the seized goods under Section 111(d) of the Customs Act, 1962 could be sustained when the goods were not covered by Section 123 or Chapter IV-A of the Act and the Department had not first established that they were smuggled into India.

Analysis: The goods were found to be of foreign origin, but that circumstance by itself did not create any statutory presumption of smuggling because the goods were neither notified under Section 123 nor covered by Chapter IV-A of the Customs Act, 1962. In such a case, the initial burden lay on the Department to adduce material sufficient to make out at least a prima facie case that the goods were smuggled. Mere foreign origin, seizure on information, or restricted import character was insufficient to shift the burden onto the appellants. Since no adequate enquiry or proof of smuggled character was brought on record, the appellants were not required to affirmatively prove lawful import.

Conclusion: The confiscation could not be sustained and the appellants were entitled to release of the 30 bales claimed by Shri S.N. Sarkar and the 2 bales claimed by Shri Latif.

Final Conclusion: The appeals succeeded to the extent of the appellants' claimed bales, and the confiscation order was set aside for those goods.

Ratio Decidendi: Where goods are not covered by Section 123 or Chapter IV-A of the Customs Act, 1962, the Department must first prove the smuggled character of the goods at least prima facie before any burden shifts to the claimant; foreign origin alone is insufficient to justify confiscation.

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