Claim to seized goods must be examined on legal title, not mere custody, before confiscation can stand.

In confiscation proceedings, the authority must examine a claimant's legal title to seized goods on merits and cannot reject the claim merely because the goods were not seized from the claimant's custody. The Patna HC noted that the Collector misdirected himself by treating lack of physical seizure from the petitioner as decisive, when the real issue was whether she could prove ownership and whether the ornaments were liable to confiscation as smuggled goods. The impugned order was therefore vitiated by an error of jurisdiction and was set aside, with the matter remanded for rehearing after the petitioner was given an opportunity to lead oral and documentary evidence.

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Issues: Whether the Collector of Central Excise acted on an error of jurisdiction in refusing to consider the petitioner's claim to the seized gold ornaments on the ground that they were not seized from her custody, and whether the order should be set aside and the matter remanded for fresh consideration.

Analysis: The petitioner was entitled to have her title to the ornaments examined on merits. The decisive question was not merely whether the articles were seized from her possession, but whether she could establish legal title to them and, if so, whether they were liable to confiscation as smuggled goods. The Collector wrongly declined to entertain the claim solely because the ornaments had not been seized from the petitioner's custody, thereby misdirecting himself on the legal scope of his duty. Since the claim had to be adjudicated after giving the petitioner an opportunity to produce oral and documentary evidence, the impugned order was vitiated by an error of jurisdiction.

Conclusion: The order rejecting the petitioner's appeal was set aside and the matter was remanded to the Collector of Central Excise for rehearing and disposal in accordance with law after giving the petitioner an opportunity to establish her claim.

Ratio Decidendi: In confiscation proceedings, the authority must determine the claimant's legal title to the seized goods and cannot refuse to entertain the claim merely because the goods were not seized from the claimant's possession.

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