1974 (4) TMI 33 - SC - Customs

Supreme Court Upholds Customs Collector's Decision in Confiscation Case

COLLECTOR OF CUSTOMS, MADRAS AND OTHERS Versus D. BHOORMULL

The Supreme Court held that the High Court erred in reversing the judgment of the Single Judge and quashing the Customs Collector's order. The appeal was ... Smuggled goods — Burden of proof is on the Department — Presumptions of innocence — Penalty — Seized goods — Writ jurisdiction — Criminal trials Issues Involved:1. Locus Standi of Bhoormull2. Burden of Proof on the Customs Department3. Confiscation of Goods under Section 167(8) of the Sea Customs Act4. Application of Section 106 of the Evidence Act5. Procedural Fairness and Natural JusticeIssue-wise Detailed Analysis:1. Locus Standi of BhoormullThe appellant argued that Bhoormull had no locus standi to invoke the extraordinary jurisdiction of the High Court under Article 226 of the Constitution because there was not even prima facie evidence to show that at the time of seizure, he was in ownership or juridical possession of the goods. The respondent countered that all proceedings were conducted by the Collector on the assumption that Bhoormull was the claimant or the supposed owner of the goods, and no objection was raised at any stage before the High Court regarding his interest in the confiscated goods.2. Burden of Proof on the Customs DepartmentThe fundamental rule in criminal or quasi-criminal proceedings is that the burden of proving that the goods are smuggled lies on the Department. This principle was emphasized by the respondent, who argued that no evidence was produced by the Department to show that the goods in question were smuggled. The Department, however, contended that the burden of proof had shifted to Bhoormull due to the totality of the circumstances and the conflicting and incredible explanations provided by Baboothmull and Bhoormull. The Department relied on the principle underlying Section 106 of the Evidence Act, which places the burden of proving facts especially within the knowledge of the accused on the accused themselves.3. Confiscation of Goods under Section 167(8) of the Sea Customs ActThe Collector of Customs ordered the confiscation of the goods under Section 167(8) of the Sea Customs Act based on several determinative circumstances, including the prohibition of importation of such goods since 1957 and the dubious conduct of Baboothmull and Bhoormull. The Division Bench of the High Court, however, quashed the Collector's order, holding that the onus on the Department to prove that the goods were smuggled could not shift to Bhoormull and that mere suspicion could not substitute for proof.4. Application of Section 106 of the Evidence ActThe principle underlying Section 106 of the Evidence Act was invoked by the Department, arguing that the source and circumstances of the acquisition of the goods were facts especially within the knowledge of Bhoormull and Baboothmull, and their failure to disclose these facts justified an inference of illicit importation. The Supreme Court supported this view, stating that the Department is not required to prove facts that are especially within the knowledge of the opponent and that the burden of proof can be sufficiently discharged by circumstantial evidence.5. Procedural Fairness and Natural JusticeThe Supreme Court held that the Collector's order did not suffer from any apparent error or defect of jurisdiction and was consistent with the rules of natural justice. The Collector had given the fullest opportunity to Bhoormull to establish the alleged acquisition of the goods in the normal course of business. The Division Bench of the High Court was not competent to go into the question of the adequacy of the evidence in the exercise of its jurisdiction under Article 226 of the Constitution.Conclusion:The Supreme Court concluded that the learned Judges of the High Court were in error in reversing the judgment of the learned Single Judge and in quashing the order of the Collector of Customs. The appeal was allowed, the judgment under appeal was set aside, and the writ petition was dismissed. The parties were left to bear their own costs due to the legal point involved.