2024 (4) TMI 181 - AT - Customs

Customs Act Section 123: Revenue Failed to Prove Smuggling of Chinese Goods Despite Restricted Status of HCFC Gas

Shri Debesh Dey, Shri Sanjay Kumar Das, Shri Jahar Das Versus Commissioner of Customs (Preventive) And Versus Commissioner of Customs (Preventive)

The HC ruled in favor of the appellant, setting aside the order for absolute confiscation of goods and penalties. Customs officers had seized refrigerant ... Smuggling - Absolute Confiscation - levy of penalties - 2060 numbers of green coloured refrigerant gas cylinders believed to be containing HCFC Gas - 5280 packets of Mosquito Repellents - 4800 pieces of Ladies garments - old and used TATA Trucks, which were allegedly used for transportation of the said goods - burden to prove - HELD THAT:- It is found that the mosquito repellents and ladies garments in question are of foreign origin or smuggled one has to be proved by the Revenue. However, the Revenue has failed to prove that the same are smuggled in nature. From the investigation conducted, it is not forthcoming as to how the Revenue has alleged that the impugned mosquito repellents and ladies garments are smuggled ones. Further, the above said items are not notified items under Section 123 of the Customs Act, 1962 - As the Revenue has failed to establish the ‘smuggled’ nature of the goods in question, the impugned mosquito repellents and ladies garments cannot be confiscated. HCFC gas confiscated from the godown of the appellant - it is the allegation of the Revenue that the same is a restricted item and was manufactured only in China - HELD THAT:- It is found that the goods in question are ‘restricted’ items, but not ‘prohibited’ items. In these circumstances, the onus lies on the Revenue to prove that the said goods were smuggled in nature, which the Revenue has failed to prove. Merely saying that the goods in question can only be manufactured in China cannot form the basis for absolute confiscation of the said goods recovered during the course of investigation. Therefore, we hold that the said HCFC gas cannot be confiscated. The order of confiscation of the goods in question is set aside - As the goods in question are not liable for confiscation, therefore, no penalty can be imposed on the appellants. The impugned order set aside - appeal allowed. Issues Involved:- Absolute confiscation of goods- Imposition of penaltiesSummary:The case involved an appeal against the order for absolute confiscation of goods and imposition of penalties. The Customs Officers found various items in a godown, including refrigerant gas cylinders, mosquito repellents, and ladies garments, believed to be smuggled. The appellant, in-charge of the godown, claimed that the goods were brought by another person from Manipur without proper documentation. The Revenue alleged that the goods were of foreign origin and illegally imported. After investigations, it was claimed that the gas cylinders were of Chinese origin. The Tribunal found that the Revenue failed to prove that the mosquito repellents and ladies garments were smuggled items. As these items were not notified under Section 123 of the Customs Act, they could not be confiscated. Regarding the HCFC gas, although it was a restricted item, the Revenue could not prove that it was smuggled. Merely stating that the gas was manufactured in China was not sufficient for confiscation. Therefore, the Tribunal set aside the order of confiscation and penalties, providing relief to the appellants.