2019 (6) TMI 279 - AT - Customs

Tribunal allows appeal on gold confiscation, distinguishes between imported and smuggled goods

The Appellate Tribunal CESTAT Mumbai allowed the appeal against absolute confiscation and penalties imposed on gold confiscated at the airport. The ... Smuggling - Confiscation of Gold - Gold carried and found concealed inside the inner supportive casing of the bag that was carried by the appellant - HELD THAT:- The gold being carried in the present facts and circumstances is not of commercial quantity. Secondly the appellant in the course of investigation upon detection of coated wire, admitted that he was carrying gold. The quantity in the present case is about 311.21 gm. Further that he was not carrying the gold as the carrier. At best it is the case of non declaration, amounting to smuggling. In view of the liberalised import policy for gold, the order of confiscation is modified and the goods allowed to be redeemable on payment of redemption fine. The redemption fine is fixed at ₹ 2.5 lakhs - Further personal penalty of ₹ 1,00,000/- under section 112 (a) & (b) of the customs act is reduced to ₹ 50,000/- - The penalty under section 114AA is not modified. Appeal allowed in part. Issues involved:1. Delay in filing appeal and condonation of delay.2. Maintainability of appeal against confiscation of gold.3. Interpretation of imported goods and distinction between imported goods and smuggled goods.4. Confiscation of gold at the airport without proper declaration.5. Appeal against absolute confiscation and imposition of penalties.6. Comparison with precedent cases for similar circumstances.7. Modification of the order for release of seized goods and reduction of penalties.Detailed Analysis:1. Delay in filing appeal and condonation of delay:The appeal was filed with a delay of approximately 6 months. The appellant explained the reason for the delay due to health issues and was advised rest for 6 months with physiotherapy. The Tribunal considered the reason and condoned the delay subject to a cost of Rs. 3000 to be deposited in the Prime Minister's Relief Fund.2. Maintainability of appeal against confiscation of gold:The matter involved the confiscation of gold found concealed inside the inner supportive casing of the bag carried by the appellant. The appellant's prayer for early hearing was allowed, but the Learned Authorized Representative raised an objection on the maintainability of the appeal.3. Interpretation of imported goods and distinction between imported goods and smuggled goods:The Tribunal referred to a Supreme Court case to explain the distinction between 'imported goods' and 'smuggled goods.' It was observed that goods imported in violation of the law cannot be considered lawfully imported. The appellant had brought the gold wire through concealment, making it smuggled goods and not part of imported goods under baggage rules.4. Confiscation of gold at the airport without proper declaration:The appellant arrived at the Pune airport from Abu Dhabi without filing any customs declaration. Gold wire was found concealed in the trolley bag, leading to a show cause notice for confiscation and imposition of penalties. The Commissioner (Appeals) upheld the absolute confiscation, which led to the appeal before the Tribunal.5. Appeal against absolute confiscation and imposition of penalties:The appellant appealed against the absolute confiscation and penalties imposed. The Tribunal considered previous cases and modified the order, allowing the goods to be redeemable on payment of a redemption fine and reducing the personal penalty under the customs act.6. Comparison with precedent cases for similar circumstances:The appellant's counsel referred to precedent cases where under similar circumstances of seizure and confiscation of goods, the orders were modified to allow release on payment of fine. The Tribunal considered these cases and applied similar reasoning to modify the order in the present case.7. Modification of the order for release of seized goods and reduction of penalties:After considering the arguments and previous cases, the Tribunal modified the order, allowing the seized goods to be released on payment of a redemption fine and reduced penalties. The appellant was entitled to the release of gold on payment of duty, fine, and modified penalties as indicated in the Tribunal's decision.This detailed analysis covers the various issues involved in the legal judgment delivered by the Appellate Tribunal CESTAT Mumbai.