Appeal Dismissed, Confiscation Upheld, Smuggling Involvement Established

The appeal was dismissed, upholding the order of adjudication. The Tribunal confirmed the absolute confiscation of the gold and the penalty imposed, finding no merit in the appellant's claims and defenses. The order of the Commissioner (Appeals) granting redemption was set aside, and the appellant's involvement in smuggling was conclusively established.

---

---

Issues Involved:
1. Legality of the seizure of 2.5 kgs of gold from the appellant.
2. Validity of the appellant’s claim regarding the lawful purchase of gold.
3. Justification for the imposition of redemption fine by the Commissioner (Appeals).
4. Applicability of Section 123 of the Customs Act, 1962.
5. Legality of the appellant’s conviction in the criminal trial.
6. Appropriateness of the absolute confiscation of the gold and the penalty imposed.

Detailed Analysis:

1. Legality of the seizure of 2.5 kgs of gold from the appellant:
The appellant was found in possession of gold with foreign markings, which was seized by Customs on 22.04.1992. The appellant’s statement, recorded on 23.04.1992, claimed coercion and undue influence. Customs alleged the gold was smuggled, and the appellant was a carrier. The appellant’s defense included a purchase claim from Shri Abubacker of Kerala, supported by a customs duty receipt from Mumbai, which was not accepted by Chennai Customs. The investigation revealed that the appellant had concealed the gold in his rectum and traveled under a false identity, which was confirmed by his confession and the recovery of the torn air ticket.

2. Validity of the appellant’s claim regarding the lawful purchase of gold:
The appellant asserted that he purchased the gold from Abubacker, who allegedly brought it through Mumbai Customs. However, no inquiry was made by Customs from Abubacker, and the receipt was not accepted as proof. The appellant’s claim lacked credibility as he could not provide evidence of being a gold dealer or his income-tax status. The investigation found no substantial evidence supporting the appellant’s story, and the alleged transaction with Abubacker was deemed fabricated.

3. Justification for the imposition of redemption fine by the Commissioner (Appeals):
The appellant argued that the redemption fine of Rs. 15,00,000/- imposed by the Commissioner (Appeals) was unreasonable, as it was based on the market value of gold as on 23.07.2015 instead of the date of possession. The Tribunal found that the Commissioner (Appeals) erred in granting the option to redeem the gold under Section 125 of the Customs Act, 1962, as the gold was smuggled and the appellant failed to prove lawful import.

4. Applicability of Section 123 of the Customs Act, 1962:
Section 123 of the Customs Act, 1962, places the burden of proof on the person from whose possession the gold is seized to prove it is not smuggled. The gold, being a notified good, carried foreign markings, and no evidence of lawful import was provided by the appellant. The Tribunal upheld that the gold was rightly seized and confiscated, as the appellant failed to discharge the burden of proof under Section 123.

5. Legality of the appellant’s conviction in the criminal trial:
The appellant and his accomplices were convicted in the criminal trial, which was a testimony to the illicit import of the gold. The appellant’s confession and the investigation’s findings, including the recovery of the gold and the torn air ticket, supported the conviction. The retractions by R.K. Verma and Gopichand Soni were found to be incredible and fabricated. The Tribunal noted that the conviction was based on cogent and credible evidence.

6. Appropriateness of the absolute confiscation of the gold and the penalty imposed:
The Tribunal held that the seized gold was smuggled and ordered its absolute confiscation, rejecting the option for redemption. The penalty imposed by the Adjudicating Authority was confirmed. The Tribunal emphasized that smuggling involves secrecy and stealth, and the Department successfully proved its case through direct and circumstantial evidence. The appellant’s defense was deemed futile and baseless.

Conclusion:
The appeal was dismissed, upholding the order of adjudication. The Tribunal confirmed the absolute confiscation of the gold and the penalty imposed, finding no merit in the appellant’s claims and defenses. The order of the Commissioner (Appeals) granting redemption was set aside, and the appellant’s involvement in smuggling was conclusively established.

---