Burden of proof for foreign-marked gold under Customs law was held discharged, defeating confiscation and penalties.

Foreign-marked gold attracted the statutory burden under Section 123 of the Customs Act, requiring the claimant to prove licit acquisition to defeat confiscation and penalties. The majority found that purchase invoices, banking records, ledger entries, and the seller's supporting statement and records sufficiently established lawful purchase, while the Revenue failed to produce specific adverse evidence disproving those documents or proving smuggled origin. On that basis, the burden was held discharged in favour of the claimant, and confiscation and consequential penalties were unsustainable. A dissenting view would have treated the delayed claim and retracted statements as inadequate, but it did not prevail.

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Issues: Whether the appellants discharged the burden under Section 123 of the Customs Act, 1962 so as to negate confiscation of the seized gold and the consequential penalties.

Analysis: The seized gold was recovered as foreign-marked gold, so the statutory burden under Section 123 lay on the person claiming ownership of the goods. The claimant produced purchase invoices, banking records and ledger entries, and the seller's statement and records were also brought on record to support the asserted licit purchase. The majority accepted that the Revenue did not bring on record specific adverse evidence to disprove the invoices and supporting transactions or to conclusively establish that the gold was procured through the earlier alleged cash route. On that view, the claimant satisfied the burden of proving that the goods were not smuggled. The dissenting view treated the delayed claim, the retracted statements and the supporting documents as insufficient and would have upheld confiscation and penalties.

Conclusion: The burden under Section 123 stood discharged in favour of the claimant, and the confiscation and penalties were unsustainable.

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