Customs penalty limited to persons involved in importation; post-import buyer of smuggled goods falls outside the provision.

Penalty under the customs confiscation provision applied only to a person concerned in the prohibited importation, so a buyer who acquired smuggled gold only after importation, even with knowledge of its character, was outside the penal reach and the penalty was unsustainable. The direction to release part of the sale price to the smuggler was also without jurisdiction because the gold was liable to confiscation and the consideration could not lawfully be restored to the importer; on the findings, that amount belonged to the purchaser who had paid it in the transaction. The impugned order was therefore set aside in its material parts.

---

---

Issues: (i) Whether penalty could be levied under Section 167(8) of the Sea Customs Act on a purchaser of smuggled gold who was not a party to the importation; (ii) Whether the direction to release Rs. 4,000 to the smuggler was without jurisdiction and liable to be set aside.

Issue (i): Whether penalty could be levied under Section 167(8) of the Sea Customs Act on a purchaser of smuggled gold who was not a party to the importation.

Analysis: The liability under Section 167(8) extended to confiscation of the smuggled goods and to penalty only on a person concerned in the prohibited importation. The finding recorded was that the petitioner purchased the gold after it had been smuggled, though with knowledge of its character. Such subsequent purchase did not make him an accessory before the fact, nor did it amount to being concerned in the importation itself. The statutory language did not cover a mere buyer of contraband after the act of importation was complete.

Conclusion: The penalty imposed on the petitioner was without jurisdiction and was not sustainable.

Issue (ii): Whether the direction to release Rs. 4,000 to the smuggler was without jurisdiction and liable to be set aside.

Analysis: The amount represented part of the price of the smuggled gold. Once the gold was found liable to confiscation, the sale stood avoided and the monetary consideration could not lawfully be directed to be returned to the smuggler. On the findings recorded, the amount ought to have been restored to the petitioner, who had parted with it in the transaction.

Conclusion: The direction releasing Rs. 4,000 to the smuggler was without jurisdiction.

Final Conclusion: The impugned order was quashed in its material parts, and the petitioner obtained the substantive relief sought.

Ratio Decidendi: Penalty under the customs confiscation provision can be imposed only on a person concerned in the act of prohibited importation, and a post-import purchaser of smuggled goods does not fall within that category merely because he knew the goods were smuggled.

---