Tribunal Waives Penalty: Stay Granted on Confiscation of Silver & Ornaments

The Appellate Tribunal CEGAT, New Delhi, considered two stay applications regarding the confiscation of silver and ornaments worth Rs. 99,000, with a penalty of Rs. 10,000 imposed on each appellant. The appellants alleged coercion in obtaining statements, lack of personal hearing, and financial hardship. The Tribunal noted the absence of a notice of hearing in the order-in-original, supporting the appellants' claim of an ex parte order. Given the circumstances, including the confiscation and financial difficulties, the Tribunal waived the pre-deposit of the penalty amount and stayed its recovery during the appeal proceedings.

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Issues: Stay applications regarding confiscation of silver and ornaments, violation of Customs Notification No. 76/65, coercion in obtaining statements, lack of personal hearing, financial hardship of the appellants, waiver of pre-deposit of penalty amount.

In this judgment by the Appellate Tribunal CEGAT, New Delhi, two stay applications were considered concerning the confiscation of silver and ornaments following a common order-in-original issued by the Commissioner, Allahabad. The appellants were found carrying silver, which was initially seized by the police and later handed over to Customs. The case was adjudicated, resulting in the confiscation of silver and ornaments worth Rs. 99,000, with a penalty of Rs. 10,000 imposed on each appellant. The appellants argued that the case against them was based on statements obtained under coercion from them by the police, without proper markings on the goods, and without a personal hearing. They contended that the impugned order was passed ex parte, violating principles of natural justice. The appellants also highlighted their financial hardship, stating their low monthly incomes of Rs. 600 and Rs. 900, respectively, and requested a waiver of the penalty pre-deposit.

The Departmental Representative opposed the appellants' prayer, emphasizing the importance of the appellants' statements, which indicated their involvement in melting silver and selling goods of foreign origin in the Indian market. The appellants had admitted to bringing goods from Nepal, including silver and gold, for sale in India. The appellants argued that their statements were not voluntary, as they were recorded in custody during the night and retracted upon release. The Tribunal observed that the order-in-original did not reference a notice of hearing, supporting the appellants' claim of an ex parte order without a personal hearing. Considering the circumstances, including the confiscation of goods and the appellants' financial difficulties, the Tribunal found it appropriate to waive the pre-deposit of the penalty amount and stayed its recovery during the appeal proceedings.

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