TaxTMI 
TaxTMI 
2009 (12) TMI 280
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....thiban. The Department's case is that these persons had come to the airport at the behest of Shri Ramesh to receive the gold jewellery from passengers arriving from Singapore. They were from to be in possession of a list containing names, passport numbers and other descriptions of the passengers including their name, description of clothing and footwear and colour printouts of their photographs. They were also found with Rs.54,000/- of Indian currency. The officials also gathered the following information on enquiry as recorded in para 3 of the impugned order:- "On being enquired about the paper containing a list of names and other descriptions, Shri Laksliminarayanan said that the list contained names of passengers to whom gold jewellery in packets had been given at Singapore as per the arrangement made by his employer Shri Ramesh and that they had to identify the said passengers upon arrival and receive the gold jewellery packet against the payment of monetary consideration agreed upon; that the marking "2P/500/2500" in the list against each passenger denoted that the passenger would be bringing two packets of gold jewellery and 500 Singapore Dollar and Rs.2,500/- to be paid a....
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....form of jewellery valued at Rs. 58.28 lakhs and Singapore Dollars 6500 have been seized from 13 passengers as per details given below: S.No Name of the Passenger Quantity of the jewellery seized (in gms) Value (in Rs.) @ Rs.940/- per gm. Singapore Dollars 1 P. Ramachandran Manicame 475 446500 500 2 Mariappan Saravanan 474 445560 500 3 Muthusamy Mariappan 470 441800 500 4 Natarajan Manikandan 471 442740 500 5 Nandapuneedi Narsimhan 501 470940 500 6 Poonam Rajavel 489 459660 500 7 Chinnathambi Periyasamy 475 446500 500 8 P.Samsudeen Syed Mohamed 482 453080 500 9 Ayyasamy Sekar 474 445560 500 10 Kuppasamy Govindasamy 468 439920 500 11 Chinnapan Anandaraj 478 449320 500 12 Kalimurugan 455 427700 500 13. Muthali Pachamuthu 488 458720 500 Total 6200 5828000 6500 As per records, these 13 passengers were intercepted alter Customs declaration, whose photographs were found in the fax papers recovered from the occupants of the Toyota Quails Car, bearing Regis....
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....ls, personal descriptions, No. of packets of gold jewellery handed over, monetary consideration agreed upon would be listed and sent by fax or email to Shri C.V. Ramesh; that with the help of the said fax copies and photos received through email to Shri G.V. Ramesh and his accomplices would identify the passengers coming out of Chennai Airport and receive the gold jewellery and that Shri. G.V. Ramesh and his accomplices would be using the Toyota Quails Car, bearing Registration No. TN04 M 9595 for smuggling operation through Anna International Airport, Chennai. The voluntary statement of the passengers dated 7-12-2007 and also the voluntary statements of the occupants of the car dated 8-12-2007 confirms in-formation received by the Directorate of Revenue Intelligence. The passengers had only given the descriptions of the person who handed over the jewellery to them at Singapore and the occupants of the car had mentioned the name of the person who handed over the jewellery to the passengers at Singapore as Shri Vijay who is an employee of Shri. G.V. Ramesh. The occupants of the car have also stated that they are employees of Shri. G.V. Ramesh and they have acted in accordance wit....
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....is established that Shri G.V. Ramesh and his accomplices have frequently engaged hn smuggling activities in the same modus operandi and the Toyota Car of Shri G.V. Ramesh has been used previously in similar operations. In his statement dated 3-12-2007 Shri Lakshminarayanan, has clearly stated that he is an employee of Shri G.V. Ramesh, proprietor of Shri Abirami jewellers for a monthly salary of Rs.4500/-and has given details of the way in which Shri. G.V. Ramesh used to arrange for import of gold through eligible passengers, through one Shri Vijay who is also an employee of Shri Ramesh. Shri Dev Kishan Joshi has also stated that arrangements were made by Vijay, an employee of Shri G.V. Ramesh at Singapore for sending gold through passengers. It is ascertained from M/s. Arunlekha Travels, Shenoy Nagar, that they have booked the travel tickets of Shri G.V. Ramesh and Shri Vijay to and from Singapore frequently and therefore it is confirmed that Shri Vijay and Shri G.V. Ramesh have operated together in the smuggling of gold. Shri Lakshminarayanan in his statement has stated that Shri Vijay sends the details of the passengers carrying gold by fax or email to email id of Shri. Rames....
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....ation No. TN04 M9595 for an amount of Rs.18,000/- per month but the Advocates have not submitted the original documents for perusal or the copy of the hire agreement has not been attested as a true copy and hence the genuineness of the hire agreement is not established satisfactorily The version that the three are brokers, functioning independent of Shri G.V Ramesh and Shri Janakiraman is a driver, who is driving the vehicle of Shri G.V.Ramesh on hire appears to be an after thought to exculpate Shn G.V. Ramesh, their employer from the case. The possession of Indian Currency is not an offence, but Rs. 27,000/- in the manner kept packed clearly shows that they were meant for payment to the passengers after receiving jewellery and the 500 Singapore Dollars from oath of them which in turn supports the modus operandi as detailed in the Show Cause Notice. Regarding the contention that none of the passengers mentioned the names of Shri Lakshminarayanan, Partheeban, Kathiravan, Janakiraman, Vijay and Shri. G.V. Ramesh, it is understood that the passengers will be identified with the photograph faxed from Singapore and as per the advice of the per son arranging the jewellery from Singapo....
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....ame have not refracted their statements and confirmed that the gold does not belong to them. The other 11 passengers had on and off confirmed and refracted their statements. Finally the 11 passenger vide letter their retraction letter No. 3, dated 22-3-2008, 29-3-2008 and 9-4-1038 have stated that the gold belongs to them and all the statements stating otherwise were obtained by coercion and threat. All this confirms that there has been some kind of coercion from vested interest to retract their voluntary statement given on 7-12-2007. The written submissions dated 6-6-2008 of Shri Ramachandran Manicame given from Singapore stating that the gold Jewrllery does not belong to him and he had brought it for a monetary consideration of Rs.2000/- can be taken to be stated without any coercion from vested interests. Citation of c to argue that the statement of co-accused is insufficient to penalise is taken note of. In the instant case Shri Akbar of M/s. AAA Enterprise and Sun Dev Kishan Joshi are not coaccused. The judgment in the case of Rehana Begum, 1996 (84) FIT. 378 Para 13 stating that just coming to receive the passenger does not constitute an offence or abetment which is punishabl....
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....at it has been used frequently for their smuggling operations and hence it appears to be liable to confiscation under Section 115 of the Customs Act, 1962. Regarding 10000 Singapore dollars equivalent to Indian Rs.270,000/- seized from the premises of Shri Abirami Jeweilery, no proof has been given by Shri G.V. Ramesh as to the legal acquisition of the same. The denomination of the currency, the details of the contents of the fax message seized, the statement of Shri Dev Kishan joshi and Shri Akbar confirm the source of the foreign currency seized and hence the same is liable to confiscation under Section 1 and (I) of the Customs Act, 1962. Regarding the Indian currency of Rs.54000/- seized from Slid. Lakshminarayanan, it is obvious from the way it has been packed and also from the statement of Shri Lakshminarayanan that it has been brought for payment to the passengers on receipt of the gold jewellery from then. But I find that there is no provision in Customs Act under which the same is liable to confiscation. Shri G.V. Ramesh is also liable to penalty under Section 117 for not honouring the summons issued under Section 108 of the Customs Act, 1962. Taking into account t....
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....t the Red Channel. In the present case, the passengers were intercepted before they could go to the Red Channel. (iv) As the impugned gold jewellery is not a prohibited item, the same cannot be absolutely confiscated. Redemption of the confiscated gold jewellery has to be allowed on payment of redemption fine and duty under Section 25 of the Customs Act, 1962. (v) In Appeal No. C/374/2008, the Tribunal vide its Final Order No. 401/2009 dated 8-4-2009 has followed the earlier order of the Tribunal in the case of Liaquat Ali Hatneed v. CC, Chennai - 2003 (156) E.L.T. 863 (Tri.-Chennai) wherein fine and penalty were reduced to 10% of the amounts imposed by the customs authorities. 6. The learned senior counsel argues that the 5 appellants other than the 11 passengers are not connected with the import of gold and hence there can be no case for imposition of personal penalty, confiscation of the car and foreign currency. In regard to the passengers, he says that the cases should be dropped and if at all the impugned gold jewellery is held to be liable for confiscation, redemption of the same should be allowed at a nominal fine and penalty. 7. Smt. Indira Sisupal, the learned....
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....ociates of Shri Ramesh on being shown the photographs of theirs and would have collected their remuneration. She states that the customs authorities had to take prompt action and intercept the passengers to protect the interest of revenue. 10. She also draws attention to the fact that Shri Ramesh has not cooperated with the investigation and has not appeared before the DI authorities and though he has been denying in his letter dated 9-5-2008 in reply to the show cause notice the allegations against him, his staff Shri Dev Kishan Joshi in his statement given by him on 29-2-2008 under Section 108 of the Customs Act, 1962 has clearly admitted to the modus operandi adopted by Shri Ramesh, and such statement which has been referred to in the impugned order is clearly admissible as evidence. 11. She further states that organized smuggling of gold ornaments by Shri Ramesh and his associates through passenger carriers is evident from the statements of two passengers who have not retracted their statements at any point of time and who are also not appellants before the Tribunal. She states that the impugned goods which were not declared in the baggage declaration form cannot attain l....
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....ed in the handwriting of the passengers. Against Col. No. 5, which is meant for declaring total value of dutiable goods being imported, the passengers have declared either nil or a small amount of Rs.2,000/- or Rs.1,000/-. The amount indicated is grossly inadequate to cover the value of the gold jewellery brought by each of them which ranges from Rs.4,27,700/- to Rs.4,70,940/-. Thus the non-declaration is established. These cases of wrong declaration cannot be covered under the cited circular dated 22-2-2001. Having signed the Disembarkation Card and the declaration, it is clear that the appellant-passengers had no intention of going to the Red Channel but to exit out of the Green Channel handing over the customs declaration at the gate. If they had any intention of going to the Red Channel and pay duty, then they would have declared the amount of gold jewellery brought in by them or they would have left the whole declaration blank to be filled up with the assistance of the Red Channel officers. The fact that the declarations were filled up and signed without declaring the gold coupled with the statements given on the date of seizure as well as subsequently when the retractions wer....
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.... was reduced to 10% of the amount imposed by the Department. In this context, we note the observations of the Honbie Bombay High Court in the case of Commissioner of Customs, Mumbai v. M/s. Vathhav Exports, Mumbai and Others - 2009 (244) E.L.T. 527 (Bom.) 2009-TIOL-673-HC-MUM-CUS in which the Hon'ble Court has observed as follows:- "Even if the option of payment of redemption fine may be given to the importer, the fine amount should not be just sufficient to wipe out the profits but it should be more than that. If the person is required to pay only the amount which he has saved by not paying the premium for securing genuine replenishment licence, he will never feel pinch of being caught. He may commit same wrongs repeatedly and as and when he is caught, he may pay amount equivalent to the premium. In our considered opinion, redemption fine should be more than that." With the above observation, the Hon'ble High Court increased the redemption fine in that case from 3% of the value of the diamonds to 20% of the value of the diamonds. Hence the plea of the appellants that redemption fine and penalty should be low does not find support from the Hon'ble High Court's order cited abo....