2023 (7) TMI 1029 - AT - Customs

Tribunal Upholds Commissioner's Decision on Gold Release and Confiscation

The Tribunal upheld the Commissioner's decision to release certain quantities of gold bullion/coins/jewelry to the appellant, finding that confessional ... Confiscation - Smuggling - Gold Bullion - Gold Jewellery - Gold Mines - retraction of statements - corroborative evidences or not - burden to prove - release of certain quantity of gold bullion/coins/jewellery to the appellant, based on the statements of the Appellant tendered under the Customs Act, 1962 - HELD THAT:- The critical evidence on which the entire case has been based is on the statements dated 27.04.2017, 28.04.2017 and 29.04.2017 of the appellant, wherein he has stated that he had no bills/invoice for the gold with foreign markings. These statements have subsequently been retracted before the appropriate authority by the appellant. There are no other corroborative evidences which have been unearthed by the investigating team in support of their contention - the appellate authority has concluded that sufficient independent evidence needs to be adduced to corroborate the department’s contention regarding smuggled nature of the gold and in the absence of the same, it cannot be concluded that all the gold which was seized from the business & residential premises was smuggled. There are catena of decisions that have consistently held that retracted statements cannot be the sole basis for action under the Customs Act without any independent corroborative evidence. In the instant case, the Appellate authority has rightly held in the impugned order that “in view of the above, any conclusion that the seized gold, gold coins and jewellery which was not released and which has been subsequently confiscated were smuggled into India or made from the smuggled gold, on the basis of the statements of the appellant dated 27.04.2017, 28.04.2017 and 29.04.2017 is not sustainable”. In the light of several decisions which have also been relied upon by the Commissioner (Appeals) in the impugned order, it is difficult to accept the contention of the department that the statements were tendered voluntarily by the appellant and its subsequent retraction is a mere afterthought. To attract Section 123, the goods must be smuggled goods. The term ‘smuggled goods’ means goods of foreign origin and imported from abroad. In the present case, there is no dispute that the goods with foreign marking are of foreign origin. The appellant has not adduced any evidence to indicate that the same were procured locally. Appellants who claim that the gold to have been legally procured have to produce documents evidencing payment of duty as well as documents evidencing their legal ownership/possession - The appellant has not adduced any evidence to indicate that the same were procured locally. Appellants who claim that the gold to have been legally procured have to produce documents evidencing payment of duty as well as documents evidencing their legal ownership/possession. During the course of investigation, it is recorded that gold bullion/coins/jewellery which was satisfactorily explained by the appellant was released to him by the investigating agency themselves. Inability to discharge burden of proof required under Section 123 of Customs Act, 1962 - HELD THAT:- The contention that the said gold biscuits were purchased some eighteen months back, had been held to be not acceptable inasmuch as ten such gold biscuits with a lesser weight could not have been used to make eleven gold biscuits of higher weight. It was more so when the accused had admitted under Section 108 of Customs Act, 1962 to have purchased ten foreign marked gold biscuits of lesser weight, heated them and hammered to obliterate the foreign marks. Since the lawful possession of the said foreign marked gold biscuits were not proved, the same were held liable to confiscation. The Commissioner Appeals has taken a fair stand and reduced the penalty amount, proportionate to the confiscated gold - there is no infirmity in the impugned order which requires no modification - Appeal dismissed. Issues Involved:1. Whether the Commissioner (Appeals) erred in releasing certain quantities of gold bullion/coins/jewellery to the appellant based on the statements tendered under the Customs Act, 1962.2. Whether the Commissioner erred in upholding the confiscation of foreign-marked gold bullion/coins.Summary:Issue 1: Release of Gold Bullion/Coins/JewelleryThe appellant argued that confessional statements tendered had been retracted and thus held no evidentiary value. The adjudicating authority was required to give specific findings regarding the allegations that the bullion/coin/jewellery were smuggled. The appellant explained the gold as ancestral property or declared to the income tax department, arguing that the onus was on the Revenue to establish that the evidence was inadmissible. The Commissioner (Appeals) observed that despite various confessional statements, substantial quantities of gold, coins, and jewellery had been released during the investigation, indicating that the confessional statements had no evidentiary value. The Commissioner (Appeals) relied on several judicial decisions that supported the need for independent corroboration of retracted statements. The appellate authority concluded that sufficient independent evidence was required to corroborate the department's contention regarding the smuggled nature of the gold, which was absent in this case.Issue 2: Confiscation of Foreign-Marked Gold Bullion/CoinsThe appellant failed to produce valid documents for the gold with foreign markings. The Commissioner (Appeals) upheld the confiscation of gold bullion bearing foreign markings and 2807.29 grams of gold coins of 22-carat purity that bore images of King Edward, Elizabeth, and similar foreign coins without BIS Hallmark. The Commissioner (Appeals) noted that the appellant did not provide conclusive evidence to explain the licit possession of such clearly foreign-marked gold coins. The appellate authority gave cognizance to the existing evidence and settled judicial pronouncements, holding that the quantity of gold/gold coins/jewellery without foreign markings or with BIS Hallmark or stamps of Indian Banks, Indian jewellers, or company names were liable to be released.Final Judgment:The Tribunal found no infirmity in the impugned order and dismissed both the appeals, upholding the confiscation of foreign-marked gold bullion/coins and the release of other quantities of gold bullion/coins/jewellery as justified by the Commissioner (Appeals). The penalty amount was proportionately reduced.