2022 (5) TMI 1370 - AT - Customs

Customs Tribunal sets aside order for lack of jurisdiction, directs return of goods to appellant

The Tribunal allowed the appeal, setting aside the impugned order due to the lack of jurisdiction by the Customs (Preventive) at Jaipur. The Tribunal ... Jurisdiction to adjudicate confiscation in relation to baggage rules - town seizure and requirement of lawful seizure by customs officers - onus on revenue to establish smuggled nature where initial interception/seizure is by police - confiscation proceedings void ab initio for lack of jurisdictionJurisdiction to adjudicate confiscation in relation to baggage rules - town seizure and requirement of lawful seizure by customs officers - onus on revenue to establish smuggled nature where initial interception/seizure is by police - confiscation proceedings void ab initio for lack of jurisdiction - Whether the confiscation and adjudication by Customs (Preventive) Jaipur were valid where the appellant was intercepted at Ajmer after arriving from Ahmedabad airport and initial interception/seizure was by non-customs officers. - HELD THAT: - The Tribunal found that the case was founded on the allegation that the appellant had arrived from Dubai at Ahmedabad Airport (a customs station), and therefore matters concerning alleged violation of the Baggage Rules fell within the jurisdiction of the Customs Commissionerate at Ahmedabad. The appellant was intercepted at Ajmer by ATS/police officers and not by customs officers; reliance on precedents where seizure by police and subsequent handing over to customs imposed onus on revenue to prove the smuggled nature of goods was held applicable (reference to Gianchand & others and to Union of India v. Paradip Phosphates Ltd. as discussed in the order). Under these circumstances the Tribunal concluded that the Customs (Preventive) Jaipur proceeded without jurisdiction and that town seizure requirements were not satisfied; accordingly the revenue failed to discharge the burden to maintain confiscation. The consequence, on the determinative facts as found by the Tribunal, is that the adjudication is vitiated for want of jurisdiction and must be set aside. [Paras 16, 17, 18]The proceedings and impugned adjudication by Customs (Preventive) Jaipur are void for want of jurisdiction; the confiscation order is set aside and the seized goods are to be returned to the appellant.Final Conclusion: Appeal allowed; impugned order of confiscation set aside for lack of jurisdiction and the respondents directed to return the seized goods to the appellant within 30 days from receipt of the order. Issues Involved:1. Jurisdiction of Customs (Preventive) at Jaipur.2. Applicability of Section 123 of the Customs Act.3. Declaration and valuation of seized goods.4. Personal use vs. commercial intent of imported goods.5. Penalties and confiscation orders.Issue-wise Detailed Analysis:1. Jurisdiction of Customs (Preventive) at Jaipur:The appellant argued that the jurisdiction for the case lies with the Customs Commissionerate at Ahmedabad, as the appellant arrived from Dubai at Ahmedabad Airport, a Customs Station. The Tribunal found that the entire proceedings by the Customs (Preventive) at Jaipur were without jurisdiction. The Tribunal cited the Supreme Court ruling in the case of Union of India vs. Paradip Phosphates Ltd., which held that jurisdiction lies with the Customs Authorities at the port of importation. Consequently, the proceedings were declared ab initio void.2. Applicability of Section 123 of the Customs Act:The appellant contended that the provisions of Section 123, which shift the burden of proof to the accused in cases of smuggled goods, should not apply as the initial interception was by the police, not customs officers. The Tribunal referenced the Supreme Court case of Gianchand & others, which held that when initial seizure is by police, the burden to prove the smuggled nature of goods lies on the revenue. The Tribunal found that this burden was not discharged by the Customs (Preventive) at Jaipur.3. Declaration and Valuation of Seized Goods:The appellant claimed that he had declared the goods at Ahmedabad Airport, and the valuation of the goods was based on internet prices, not in accordance with any valuation rules. The Tribunal noted that there was no evidence from Ahmedabad Customs to confirm or deny the appellant’s declaration. The Tribunal also acknowledged the appellant's argument that the goods had undergone depreciation and some had expired, affecting their valuation.4. Personal Use vs. Commercial Intent of Imported Goods:The appellant maintained that the goods were for personal use and not for sale, supported by an affidavit. The Tribunal took into account the appellant's statement that he was coerced into recording that the goods were for sale. The Tribunal noted that no duty was demanded in the adjudication order, making the allegations for confiscation redundant.5. Penalties and Confiscation Orders:The Additional Commissioner had ordered the absolute confiscation of certain goods and imposed penalties. The Tribunal, however, found the entire proceedings void due to lack of jurisdiction and ordered the return of the seized goods to the appellant within 30 days.Conclusion:The Tribunal allowed the appeal, setting aside the impugned order due to the lack of jurisdiction by the Customs (Preventive) at Jaipur. The Tribunal directed the Customs Authority to return the seized/confiscated goods to the appellant or his authorized representative within 30 days.