2023 (8) TMI 1693 - AT - Customs

Seizure of betel nuts: burden of proof on revenue to prove smuggling and origin, failure resulted in appellate dismissal.

Seizure and burden of proof concerning imported betel nuts: because the goods are not designated as notified items, the legal onus rests on the revenue to ... Seizure of u/s 110 - Burden of proof - third country origin betel-nuts - failed to produce any evidence to that effect and in this regard. - HELD THAT:- It is case booked by the revenue against the respondents that they have smuggled betel nut through truck which was intercepted and was found parked adjacent to a petrol pump, namely, Akharaghat Service Station, Kolhan Dadar, before Zero Mile on Muzaffarpur Sitamarhi Road and the same is smuggled one, but we find that the betel nut in question is neither notified items under Section 123 of the Customs Act, 1962. Therefore, the onus lies on the Revenue to prove that the impugned goods are smuggled one from where and which is the country of origin and how they were transported into India. The Revenue has failed to produce any evidence to that effect and in this regard. We do agree with the fact that the Revenue has failed to discharge their obligation to prove that the impugned goods are of smuggled in nature with any cogent evidence. Thus, we do not find any infirmity in the impugned order and the same is upheld and the appeals filed by the Revenue are dismissed. Issues: Whether the Revenue proved that the seized betel nuts were of third country origin and therefore smuggled/contraband, justifying seizure, confiscation and imposition of penalties on the respondents.Analysis: The proceedings concern a consignment intercepted and seized under Section 110 of the Customs Act, 1962, with adjudication resulting in confiscation and penalties. The impugned goods were not among goods notified under Section 123 of the Customs Act, 1962; consequently the legal burden rests on the Revenue to establish that the goods were of third country origin and smuggled into India. The adjudicator relied on findings of concealment and defective documents to treat the goods as contraband. On appeal, documentary evidence including a tax invoice, market regulatory fee receipt and Form DIX was placed on record by respondents to show local purchase and possession. The Revenue did not produce independent cogent evidence to establish foreign origin, cross-border movement, or that the documents were forged, nor did it satisfactorily displace the statutory burden to prove smuggling.Conclusion: The Revenue has failed to prove that the seized betel nuts were of third country origin or smuggled; the appellate decision dropping proceedings is upheld and the Revenue's appeals are dismissed.