1999 (5) TMI 42 - HC - Customs

Appeal Dismissed with Modifications, No Costs Awarded

The appeal was dismissed with modifications, and no order as to costs was made. The court upheld the Trial Judge's order, emphasizing that the discretion ... Confiscation - Import Issues Involved:1. Whether gold is a prohibited item within the meaning of the Customs Act, 1962.2. Whether the Trial Judge's order was appropriate under Section 125 of the Customs Act, 1962.Summary:Issue 1: Whether gold is a prohibited item within the meaning of the Customs Act, 1962.The appellant argued that gold is a prohibited item under the Customs Act, 1962, citing Section 2(33) and Section 125 of the Act. The respondent countered that gold is not a prohibited item based on the provisions of the Customs Act and relevant notifications. The court examined the Foreign Trade (Development and Regulation) Act, 1992, particularly Section 3, which allows the Central Government to regulate imports and exports. Public Notices No. 51 and No. 54 of 1997 were considered, which allowed the import of gold by designated agencies without a license. The court concluded that gold is a prohibited item under the legal fiction created by Section 3(3) of the 1992 Act, which must be given full effect. The court referenced several judgments to support the interpretation of legal fiction, including Gajraj Singh v. State Transport Appellate Tribunal and Commissioner of Income Tax, Madras v. Urmila Ramesh.Issue 2: Whether the Trial Judge's order was appropriate under Section 125 of the Customs Act, 1962.The appellant contended that the Trial Judge should not have exercised discretion under Section 125 of the Customs Act, as it applies only to non-prohibited goods. The court noted that the Trial Judge's order was passed after multiple adjournments and upon the appellant's concession. The court emphasized that the Trial Judge was led to believe that gold was not a prohibited item, and the order was made with the appellant's consent. The court found that the Trial Judge's discretion was exercised appropriately and was not contrary to law. The court extended the time for the appropriate authority to pass a final order by three months from the date of communication of this order.Conclusion:The appeal was dismissed with modifications, and no order as to costs was made. The court upheld the Trial Judge's order, emphasizing that the discretion exercised was appropriate and in accordance with the law.