1990 (9) TMI 188 - AT - Customs

Tribunal overturns confiscation orders and penalties, grants appellants consequential reliefs.

The Tribunal allowed the appeals, setting aside the orders of confiscation of indigenous goods and the trucks, as well as the imposition of penalties on ... Confiscation Issues Involved:1. Confiscation of indigenous goods.2. Confiscation of four trucks under Section 115(2) of the Customs Act, 1962.3. Imposition of penalties on the appellants.Detailed Analysis:1. Confiscation of Indigenous Goods:The primary issue was whether the confiscation of indigenous goods was justified under Section 119 of the Customs Act, 1962. The show cause notice alleged that the Indian goods were used to conceal contraband goods. However, the adjudication order lacked specific evidence or discussion proving that the indigenous goods were used to conceal the smuggled goods. The term 'concealing' under Section 119 necessitates that the Indian goods must be used in a manner to hide the visibility of foreign goods. The order failed to establish this, and the mere presence of Indian goods along with foreign goods does not suffice to prove concealment. Therefore, the confiscation of indigenous goods was deemed unjustified.2. Confiscation of Four Trucks:The second issue was whether the confiscation of the four trucks under Section 115(2) of the Customs Act, 1962 was warranted. The seized goods were neither notified under Section 123 nor covered by Chapter IV-A of the Customs Act. Thus, the burden of proving the smuggled nature of the goods rested with the department, which it failed to discharge. Notably, many foreign goods were returned to their owners upon the production of valid documents, indicating that the appellants were merely transporting goods as part of their regular business. The Tribunal concluded that there was no evidence to suggest that the trucks were used for smuggling, and thus, their confiscation was unlawful.3. Imposition of Penalties:The third issue concerned the imposition of penalties on the appellants under Section 112 of the Customs Act, 1962. Given the lack of evidence proving the smuggled nature of the goods and the absence of any inculpatory statements from the appellants, the Tribunal held that the penalties were unjustifiable. The appellants were not proven to be involved in the transportation or removal of smuggled goods, and thus, the imposition of penalties was not in accordance with the law.Conclusion:The Tribunal allowed the appeals, setting aside the orders of confiscation of indigenous goods and the trucks, as well as the imposition of penalties on the appellants. The appellants were entitled to consequential reliefs as per the Tribunal's order.