Customs confiscation needs affirmative proof of smuggling where burden-shifting does not apply; pending action survives repeal.

In confiscation proceedings for press buttons, the department had to affirmatively prove smuggled import because the special burden-shifting rule did not apply; disbelief of the purchaser's explanation was insufficient, and the confiscation order was unsustainable. The Court also held that pending customs proceedings initiated under the repealed Sea Customs Act, 1878, were preserved by the saving provision and did not fail merely because the Customs Act, 1962 had come into force, so the limitation objection based on fresh action within six months failed. On both merits and repeal-related objections, the challenge succeeded.

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Issues: (i) Whether the order confiscating the press buttons could stand when the department failed to establish that they were smuggled goods and when the statutory burden of proof did not lie on the petitioner; (ii) Whether proceedings could validly continue under the repealed Sea Customs Act, 1878, or whether the Customs Act, 1962 required fresh action within six months.

Issue (i): Whether the order confiscating the press buttons could stand when the department failed to establish that they were smuggled goods and when the statutory burden of proof did not lie on the petitioner.

Analysis: The confiscation was based only on disbelief of the petitioner's explanation and not on affirmative proof by the department that the goods were illicitly imported. The relevant goods were not shown to fall within the class of articles to which the special burden-shifting rule applied, and the department was therefore required to prove smuggling. The Court also noted that the goods were not shown to be prohibited articles and that the record did not justify the inference that they were contraband merely because the petitioner's purchase story was rejected.

Conclusion: The confiscation order could not be sustained and was against the assessee.

Issue (ii): Whether proceedings could validly continue under the repealed Sea Customs Act, 1878, or whether the Customs Act, 1962 required fresh action within six months.

Analysis: The earlier action was treated as continuing proceedings arising from the original notice, and the repeal of the Sea Customs Act, 1878 did not extinguish that action in the absence of a contrary intention. The Court held that goods already seized could not be treated as goods merely subject to customs control so as to attract the limitation argument under the 1962 Act, and the saving provision preserved the pending action.

Conclusion: The limitation and replacement-of-statute objection failed and was against the assessee.

Final Conclusion: The confiscation order was unsustainable on merits, and the writ petition succeeded.

Ratio Decidendi: In confiscation proceedings for goods not covered by the special burden-shifting provision, the department must affirmatively prove smuggled import, and a prior pending customs action survives repeal where the repealing statute does not evince a contrary intention.

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