Uncorroborated co-accused statement cannot fasten customs liability; confiscation and reduced penalty upheld for notified goods recovered elsewhere.

Uncorroborated co-accused statements were insufficient to fasten liability for goods found at B-38, Nizamuddin West, because the investigation did not independently establish the appellant's nexus with those premises; the appellant was given the benefit of doubt on that seizure. Foreign-origin notified goods recovered from the appellant's residence and shop remained liable to confiscation under Chapter IVA of the Customs Act, 1962, and penalty was warranted on that basis. Since liability for the B-38 goods was not sustained, the penalty was reduced, while confiscation and penal action for the residence and shop recoveries were maintained.

---

---

Issues: (i) Whether the appellant could be fastened with liability for the goods found at B-38, Nizamuddin West on the basis of the uncorroborated statement of a co-accused, and (ii) whether confiscation and penalty were sustainable in respect of the goods recovered from the appellant's residence and shop under Chapter IVA of the Customs Act, 1962.

Issue (i): Whether the appellant could be fastened with liability for the goods found at B-38, Nizamuddin West on the basis of the uncorroborated statement of a co-accused

Analysis: The only material connecting the appellant with B-38, Nizamuddin West was the statement of his brother-in-law, which remained uncorroborated. No lease deed was collected, no enquiry was made from the landlord, and the investigation did not independently establish the appellant's nexus with those premises. In the absence of corroboration, the appellant was entitled to the benefit of doubt as regards the goods seized from that location.

Conclusion: The appellant was not held liable for the goods recovered from B-38, Nizamuddin West.

Issue (ii): Whether confiscation and penalty were sustainable in respect of the goods recovered from the appellant's residence and shop under Chapter IVA of the Customs Act, 1962

Analysis: Foreign-origin notified goods were recovered from the appellant's residence and shop, and the appellant did not dispute this part of the order. The goods were liable to confiscation for contravention of the statutory requirements applicable to notified goods, and penalty was legally warranted. However, since liability for the B-38, Nizamuddin West goods was not sustained, the penalty required reduction.

Conclusion: Confiscation and penalty were sustained in principle for the goods recovered from the appellant's residence and shop, but the penalty was reduced from Rs. 50,000 to Rs. 20,000.

Final Conclusion: The appeal succeeded only to the limited extent of relief against the liability relating to B-38, Nizamuddin West and the reduction of penalty, while the remaining confiscation and penal action was maintained.

Ratio Decidendi: A penalty based solely on an uncorroborated statement linking an accused to disputed premises cannot be sustained when the investigation fails to independently establish that nexus.

---