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of <h1>Gold confiscation overturned after jewellers prove legitimate ownership with purchase records and banking evidence under Section 123</h1> <h3>Sri Praful Kumar Jain (Authorised Signatory of M/s Padmavati Jewellers) Versus Commissioner of Customs Hyderabad – II</h3> Sri Praful Kumar Jain (Authorised Signatory of M/s Padmavati Jewellers) Versus Commissioner of Customs Hyderabad – II - TMI Issues Involved:1. Confiscation of gold u/s 111(d), 111(i), and 111(j) of the Customs Act.2. Imposition of penalty u/s 112(a) and (b) of the Customs Act.Summary:Issue 1: Confiscation of Gold u/s 111(d), 111(i), and 111(j) of the Customs ActThe appellant, a jeweller and proprietor of M/s Padmavati Jewellers, faced absolute confiscation of 211.07 grams of gold valued at Rs. 10,70,547/- u/s 111(d), 111(i), and 111(j) of the Customs Act. The Air Intelligence Unit intercepted a consignment containing foreign marked gold bars without proper documents. Upon verification, the officers found foreign marked gold bars and other items in packages sent by M/s VBS Parcel, Hyderabad. The gold was certified as 24-carat foreign origin by a government-approved assayer. The appellant failed to produce satisfactory documents regarding the procurement of the foreign marked gold, leading to the issuance of a show cause notice and subsequent confiscation order.Issue 2: Imposition of Penalty u/s 112(a) and (b) of the Customs ActA penalty of Rs. 2,14,000/- was imposed on the appellant u/s 112(a) and (b) of the Customs Act. The appellant contended that the seized gold was purchased under proper invoices and was not of foreign origin. The appellant provided evidence of purchasing gold from reputed dealers and sending it for job work. However, the respondent rejected the appellant's explanation, leading to the imposition of the penalty.Appellant's Arguments and Tribunal's FindingsThe appellant argued that they regularly purchase gold from authorized dealers and provided invoices and job work challans as evidence. The appellant also presented stock registers, ledger accounts, and GSTN portal summaries to support their claim. The Tribunal found that the appellant had led cogent evidence and discharged the onus u/s 123 of the Customs Act. The Tribunal noted that the lower authorities had arbitrarily rejected the appellant's explanation based on assumptions and presumptions.ConclusionThe Tribunal allowed the appeal, setting aside the impugned order. The appellant was entitled to the return of the seized gold or refund of the auction proceeds along with interest as per rules.Order PronouncedAppeal allowed on 27.03.2024.
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