TaxTMI 
TaxTMI 
2011 (11) TMI 237
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....s.1 lakh 2. As per facts on record, the officers of Customs and Central Excise Commissionerate, Kanpur kept surveillance on Kanpur railway station on 17.10.02. At about 11.15 hours, two persons Shri Laxmikant Agrnihotri and Shri Arvind Mishra were intercepted by the officers and put to search. As a result 16 gold biscuits of foreign origin were recovered from the possession of Shri Arvind Mishra and 20 gold biscuits of foreign origin were recovered from the possession of Shri Laxmikant Agnihotri. To test the purity and country of origin of the said gold biscuits, the Government approved assayer Shri Gopal Das Agrawal was called, who after physically examining the gold biscuits opined that the same are of 24 caret purity and of Swiss origin. Inasmuch as the said two persons could not produce any documents showing the licit possession / import /purchase of recovered gold, the same were seized by the officers. 3. The statements of Shri Laxmikant Agnihotri and Shri Arvind Mishra recorded on 17.10.02 revealed that the said persons had brought the gold biscuits from Shri Mahesh Kumar Katta for and on behalf of M/s. Panna Lal Banarsi Das. Th....
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....t of Rs.22 lakhs is not correct. He was only given an amount of Rs.12.20 lakhs which he handed over to Shri Mahesh Kumar Katta on 10.10.02 in exchange of 18 gold biscuits of foreign origin. 6. In follow up action, the officers raided the residential premises of Shri Laxmikant Agnihotri and recovered certain papers like a delivery challan and a sale voucher of Shri M/s. Ram Pratap Jagdish Pratap Katta Jewellers, covering transactions in August, 2002. Statement of Shri Mahesh Kumar Katta, partner of the firm M/s Ram Pratap Jagdish Pratap Katta and also proprietor of M/s. S.M. Jewellers, was also recorded wherein he stated that sale vouchers Nos. 203, 204 and 205 dated 16.10.02 were issued by M/s. S.M. Jewellers to Shri Laxmikant Agnihotri showing sale of total 36 gold biscuits. However, these invoices did not show the name of the purchaser. He also made reference to some previous sale of gold biscuits from his firm, showing the name of Shri Laxmikant Agnihotri. 7. Further statements of one Shri Prashant Tibrewal, Manager of M/s. Saurabh Gems and Jewellery was recorded on 22.10.02 deposing that he did not know the owner of M/s. Panna Lal....
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....anna Lal Banarasi Das, a partnership of Shri Pradeep Jain and Shri Sandeep Jain has admitted the ownership of gold recovered and seized from the possession of Shri Laxmikant Agnihotri and Shri Arvind Mishra. The basic issue required to be decided in the present appeals is as to whether the biscuits in question recovered from the possession of the above two persons were legally imported biscuits or the same were of smuggled nature. 11. Admittedly, primary gold is one of the specified item in terms of the provisions of Section 123 of the Customs Act, 1962. As such the onus to prove that the seized gold biscuits are legally imported biscuits is upon the person from whose possession the same are recovered or upon the person who claims the ownership of the same. M/s. Panna Lal Banarasi Das have produced on record three invoices bearing no. 203, 204 and 205 all dated 16.10.02 issued by the firm S.M. Jewellers of Shri Mahesh Kumar Katta. The said invoices were produced much after the date of seizure by Pradeep Jain on 22.11.02 in support of his claim that the same were legally procured primary gold. In the initial statement of Shri Sandeep Jain recor....
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.... retained by Shri Mahesh Kumar Katta and were subsequently handed over to Shri Pradeep Jain. Not only that there is no names of purchasers of the gold in the said three sale invoices, it is seen that on 16.10.02 total 14 sales vouchers were issued by M/s. S.M. Jewellers to different parties for different quantities against cash sales. This is a strong factor which goes against the appellants. The absence of the name of the purchasers of the gold in question in the sale vouchers produced upon the doubtful nature of the said sale vouchers. Merely the fact that because the total number of biscuits for the said three sales bills comes to 36 which happens to be the number of gold biscuits seized by the officers by itself is not a justifiable reason to conclude that the sales were covered under the said sales vouchers in the absence of name of the person to whom goods were sold. No explanation is coming from the appellant's side to justify the absence of name of the appellants, firm in the sales invoices and for not producing the original copy of the invoice. We strongly hold that the absence of the name of appellant's firm in the said sale invoi....
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....ely importable and available for sale and purchase. The other decision relied upon by the appellants relates to the seizure of gold by the police and are to the effect that where the initial seizure is by the police and the goods are subsequently handed over to the Customs, Section 123 of the Customs Act, 1963 is not applicable and burden of proving the smuggled nature of goods is on the Revenue as decided in Naveen Ahmed Khan vs. CC, Bangalore [2005(182) ELT 494 (Tri-Bang)]. The ratio as declared in the said decision is not applicable to the facts of the present case inasmuch as the gold was admittedly seized by the customs officers. 16. As already observed, conclusion as to whether the gold in question is smuggled or not has to be arrived at based upon the appreciation of the evidence available in each and every case. The appellants in the present case have been trying to cover the transaction with three sale vouchers of M/s. S.M. Jewellers. Having examined the authenticity and genuineness of the said three vouchers, we have already arrived at a finding that the same cannot be held to be covering the transaction in question. As such, we are ....
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....n payment of a redemption fine. It is held by the Courts in many cases in the context of Section 125 of Customs Act as well as in the context of other enactments which give similar discretion, that when discretion is given to a quasi-judicial authority, he shall exercise it in a positive manner unless the reason for exercising the discretion in a negative manner is recorded by the authority. The following decisions in the context of Section 125 of the Customs Act may be seen in this regard. (1) Suresh Kumar Agarwal Vs. CC - 1998 (103) ELT 18 (AP) (2) Suresh Bhosle Vs. CCE - 2009 (246) ELT 77 (Cal.) 20. It is also to be noted that in the case of any imported goods (other than gold) seized for the reason that the goods are not covered by proper import licence, option to redeem the confiscated goods on payment of a redemption fine is normally given except in cases where the goods may cause injury to society at large, may interfere with the public policy, may cause threat to security of the nation, etc. The nature of the prohibition and the nature of the goods have to be taken into account while exercising such discretion. There can be no such reason for absolute c....