Statutory presumption in customs seizure upheld where contemporaneous evidence of lawful origin was not produced.

Customs seizure was valid where officers had prima facie reasonable belief, based on prior information, the search result, and the absence of contemporaneous documents, that the goods were smuggled; the statutory presumption therefore applied. The claimant then failed to rebut that presumption because the alleged Jaipur purchases, transporter statements, and supplier statements were not supported by satisfactory bills or account records at the time of seizure, so confiscation was sustained. A separate penalty on the proprietor was not warranted on the facts and was set aside, while the firm's penalty remained in force.

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Issues: (i) whether the seizure of the goods was based on reasonable belief that they were smuggled goods so as to attract the statutory presumption; (ii) whether the appellant discharged the burden of proving that the goods were not smuggled goods; (iii) whether the separate penalty imposed on the proprietor could stand apart from the penalty on the firm.

Issue (i): Whether the seizure of the goods was based on reasonable belief that they were smuggled goods so as to attract the statutory presumption.

Analysis: Reasonable belief must exist at the time of seizure and need only be supported by prima facie material. The presence of prior information, the search result, and the absence of contemporaneous documentary support for the goods furnished sufficient basis for the customs officers to act. The sufficiency of the material is not to be examined as if in appeal over the officer's subjective satisfaction.

Conclusion: The seizure was effected on reasonable belief and the statutory presumption was attracted.

Issue (ii): Whether the appellant discharged the burden of proving that the goods were not smuggled goods.

Analysis: The appellant relied on alleged purchases from Jaipur and statements of transporters and suppliers, but the supporting bills and account records were not produced at the time of search and seizure, and the documentary trail remained unsatisfactory. The statements also did not conclusively connect the seized goods with lawful indigenous procurement. On the facts, the appellant failed to rebut the presumption under the burden-shifting provision.

Conclusion: The appellant did not discharge the burden of proving lawful origin of the goods, and confiscation was sustained.

Issue (iii): Whether the separate penalty imposed on the proprietor could stand apart from the penalty on the firm.

Analysis: Since the proprietor was the person behind the business concern, a separate penalty on him in addition to the penalty on the firm was not warranted in the circumstances.

Conclusion: The separate penalty on the proprietor was set aside, while the penalty on the firm was upheld.

Final Conclusion: The confiscation of the goods was maintained, but the individual penalty did not survive, resulting in only partial relief to the appellant.

Ratio Decidendi: For the statutory presumption in customs matters to operate, seizure must rest on prima facie reasonable belief at the time of seizure, and once attracted, the claimant must rebut it with credible contemporaneous evidence of lawful import or acquisition.

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