Statutory fiction on likely illegal export supports confiscation and penalty for specified customs goods.

Goods specified for a notified area under Chapter IVB are treated by statutory fiction as goods likely to be illegally exported, enabling confiscation even without direct proof of an actual attempt to take them out of India. The scheme under Chapter IVB is aimed at preventing and detecting illegal export, and once goods are specified, their treatment under the Customs Act follows from that legal characterisation. On that basis, the specified silver was liable to confiscation and the related penalty was sustainable against the assessee.

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Issues: Whether goods specified under Chapter IVB of the Customs Act, 1962 are to be treated as export goods for the purpose of confiscation under Section 113(1) and penalty under Section 114.

Analysis: Chapter IVB was enacted to prevent or detect illegal export of goods. Under Section 11I, the Central Government may specify goods for a specified area having regard to the likelihood of illegal export. Once goods are so specified, a legal fiction operates and they are treated as goods likely to be illegally exported for the purposes of the Act. The absence of proof that the goods were actually intended to be taken out of India does not prevent confiscation where the statutory fiction applies.

Conclusion: The specified silver was liable to confiscation under Section 113(1), and the penalty under Section 114 was sustainable. The revision was rejected against the assessee.

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