2026 (3) TMI 937 - HC - Customs

Confiscation and penalties under Customs law upheld based on consistent recorded statements and mobile forensic corroboration.

Challenge concerned sustainability of confiscation, penalties and related monetary demands under the Customs regime; the court relied on consistent ... Smuggling - Scope of admissibility of statements recorded under Section 108 of the Customs Act as substantive evidence - confiscation of smuggled goods - redemption and re-export subject to redemption fine - sufficiency of material to sustain confiscation and penalties under the Customs Act - forensic digital evidence as corroboration Admissibility of statements recorded under Section 108 of the Customs Act as substantive evidence - Statements recorded under Section 108 of the Customs Act can be relied upon as substantive evidence to connect an implicated person with the contravention. - HELD THAT: - It is settled position of law that statement recorded under Section 108 of the Customs Act can be considered for the purpose of proceedings against the parties like the present petitioner qua implicated in a statement recorded under Section 108 of the Customs Act. An authoritative support can be drawn from the judgment of Apex Court in the matter of Naresh J. Sukhawani Vs. Union of India [1995 (11) TMI 106 - SUPREME COURT]. The Court accepted that the passenger's statements recorded under Section 108 were consistent across multiple recordings and, together with collateral material (including forensic analysis of a detained mobile phone and statements of other persons), constituted admissible material to connect the petitioner with the smuggling activity. The judgment relied on precedent holding that Section 108 statements are material evidence that may be used to incriminate and connect parties to Customs contraventions. [Paras 10, 11, 12, 14, 22] The Court held Section 108 statements admissible and properly considered by authorities for adjudicating confiscation and penalty proceedings. After considering the consistent statements of the passenger, implicated statements of a money exchanger, forensic phone analysis showing communication between the passenger and the petitioner, and the petitioner's failure to cooperate with summons, the Court concluded that there was adequate material establishing the petitioner's involvement, knowledge that the goods were liable for confiscation, and acts amounting to improper export. On that basis the impugned findings of confiscation and the imposition of penalties were not found to be without legal basis. [Paras 18, 19, 20, 21, 23] The Court found the evidence sufficient and declined to interfere with the confiscation and penalty orders. The Court held that the fact a passenger was permitted redemption and re-export did not entitle the petitioner to identical relief; differing treatment in outcomes of co-accused does not automatically provide a basis for challenging the impugned orders under Article 14 where the petitioner was separately connected by evidence to the contravention. [Paras 24] Article 14 argument based on parity with the co-accused was rejected. Final Conclusion: The petition was dismissed; the Court upheld the use of Section 108 statements and the collateral evidence as sufficient to sustain confiscation and penalties, and rejected the plea for parity with a co-accused permitted redemption. Issues: Whether the orders of confiscation and imposition of penalties and other consequential demands under the Customs Act, 1962 and related regulations against the petitioner are sustainable.Analysis: The recorded statements under Section 108 of the Customs Act, 1962 relating to the passenger were consistent across multiple dates and implicated the petitioner as having acted in concert with the passenger and a money exchanger in respect of carriage and receipt of smuggled gold. Forensic analysis of the passenger's mobile phone corroborated communication linking the petitioner to arrangements for purchasing and bringing gold into India. Collateral material, including statements of other implicated persons and conduct such as non-cooperation with summons, was considered together with the statutory scheme comprising provisions dealing with confiscation, redemption, imposition of penalty, duty demand and interest, and offences attracting Sections 111, 112, 112A, 114, 114A, 114AA, 117, 124, 125, 28 and 28AA of the Customs Act, 1962 and Section 13 of the Foreign Exchange Management (Export & Import of Currency) Regulations, 1999. The available evidence was held sufficient to connect the petitioner to the contravention and to support orders of confiscation, penalty and related monetary demands.Conclusion: The impugned orders imposing confiscation, penalties and consequential demands against the petitioner are sustainable and the petition is dismissed; decision is against the petitioner and in favour of the revenue.