Tribunal upholds diamond confiscation for smuggling, remands for fair redemption decision.

The Tribunal upheld the absolute confiscation of diamonds valued at Rs. 34,76,000 due to the appellant's conscious attempt to smuggle them without declaring to Customs. The confiscation of other goods and imposition of a penalty of Rs. 3,50,000 were also upheld. However, the case was remanded to the Commissioner for a fresh decision on redemption of the goods under Section 125 of the Customs Act, as the appellant was not given an opportunity to present a defense against absolute confiscation as required by law. The Commissioner was directed to exercise discretion judiciously and allow the appellant a reasonable opportunity to be heard.

---

---

Issues: Attempted smuggling of diamonds, confiscation of goods, redemption of confiscated goods, discretion under Section 125 of the Customs Act, remand of the case

Attempted Smuggling of Diamonds:
The appellant was intercepted at Chennai Airport with concealed diamonds. The stones were certified to be cut and polished diamonds, and the appellant admitted to attempting to smuggle them without declaring to Customs. The Commissioner ordered absolute confiscation of the diamonds valued at Rs. 34,76,000 under relevant sections of the Customs Act, Foreign Trade Act, and FEMA. The Tribunal upheld the confiscation, stating the evidence clearly indicated the appellant's conscious attempt to smuggle the diamonds.

Confiscation of Goods:
The Commissioner also ordered the confiscation of other material objects under Section 119 of the Customs Act and imposed a penalty of Rs. 3,50,000 on the appellant under Section 114 of the Customs Act. The Tribunal found no valid ground against the confiscation of the diamonds, upholding the decision based on the gravity of the offense committed by the appellant under the Customs Act.

Redemption of Confiscated Goods - Discretion under Section 125:
The Tribunal noted that under Section 125 of the Customs Act, the Commissioner had discretion to consider the appellant's plea for redemption of the confiscated goods. The appellant's violation of FEMA and Customs Act made the diamonds fall under the category of "prohibited goods." The Tribunal found that the Commissioner did not give the appellant an opportunity to state his defense against absolute confiscation as required by law. Therefore, the case was remanded to the Commissioner for a fresh decision on redemption of the goods.

Remand of the Case:
The Tribunal set aside the impugned order, except for the confiscation of the diamonds, and allowed the appeal by way of remand for a fresh decision by the Commissioner. The Commissioner was directed to exercise discretion judiciously under Section 125(1) of the Customs Act, determine a reasonable amount of fine for redemption of the diamonds, and redetermine the penalty to be imposed under Section 114 of the Customs Act. The appellant was to be given a reasonable opportunity to be heard before any decision was made.

---