1986 (7) TMI 283 - AT - Customs

Tribunal Upholds Confiscation of Foreign Gold Slabs

The Tribunal upheld the impugned order under the Customs Act, 1962, confirming the confiscation of gold slabs of foreign origin seized from the ... Smuggled goods Issues:1. Seizure of gold slabs believed to be of foreign origin.2. Validity of impugned order under Customs Act, 1962.3. Application of statutory presumption under Sections 120, 111(d), and 123 of the Act.4. Confiscation of smuggled gold of foreign origin.5. Redemption option for seized gold.Analysis:1. The judgment pertains to the seizure of gold slabs believed to be of foreign origin from the residential premises of the appellants. The gold was found in the possession of the appellants without a satisfactory explanation for its licit acquisition, leading to its seizure by the authorities under mahazar, attested by witnesses.2. The validity of the impugned order under the Customs Act, 1962 was challenged by the appellants' counsel on various grounds. The counsel argued that the adjudicating authority failed to invoke the presumption under Section 123 of the Act in the show cause notice, thus rendering any reliance on it in the order of adjudication invalid. Additionally, the counsel contested the findings of the Mint Officer regarding the foreign origin of the gold, citing lack of reasons provided and questioning the authority of the officer who conducted the tests.3. The application of statutory presumptions under Sections 120, 111(d), and 123 of the Customs Act was a key issue in the judgment. The Senior Departmental Representative argued that once the gold was proven to be of foreign origin, the presumption under Section 123 automatically applied. The counsel contended that the gold's foreign origin made it liable for confiscation under Section 111(d) of the Act, irrespective of any changes in its form or shape.4. The Tribunal analyzed the provisions of Sections 120 and 111(d) of the Act concerning confiscation of improperly imported goods. It clarified that even if imported gold was converted into a different form, it remained liable for confiscation under the Act. The Tribunal upheld the applicability of the statutory presumption under Section 123 in cases involving goods like gold, emphasizing the burden of proof on the possessor to establish the goods were not smuggled.5. The appellants sought the option of redemption for the seized gold, which was denied by the Tribunal due to the gold being confirmed as smuggled. The judgment confirmed the impugned order and dismissed the appeals, citing the clear proof of the gold's foreign origin justifying its confiscation under the Customs Act, 1962.Additional Judgment:In Customs Appeal Nos. 223 and 224 of 1985(MAS), similar circumstances led to the dismissal of the appeals based on the reasoning provided in the main judgment regarding the seizure and confiscation of gold believed to be of foreign origin.