TaxTMI 
TaxTMI 
2007 (3) TMI 154
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....ed informer, the Assistant Commissioner, Customs (Prey.) Division, Motihari formed a Preventive Team under the leadership of Sri M.W. Haque, Superintendent (Prey.) to locate and intercept a truck being Registration No. BR- 1G-3248 suspected to be loaded with Nepalese Vanaspati Ghee. The team rushed towards Pipra Kothi where the said truck was likely to cross but on the way near Bariyarpur Village on N.H. the said truck was found parked along road side facing to wards Pipra Kothi. Two independent witnesses present on the spot, were requested to accompany the Preventive party along with the vehicle loaded with goods up to Customs office, Motihari. The said Truck was searched in presence of that two independent witnesses resulting in recovery of 750 Tins of Vanaspati Ghee bearing label of Bawarchi & Nutkhat brand long with a few tins found without any label. All tins packed were pasted either with Bawarchi or Natkhat brand wrappers but without having any batch number, date of manufacturing and M.R.P. Keeping in view the modus operandi as intimated by the informer that tin Jar containing Nepalese Vanaspati Ghee are smuggled from Nepal and stored at some places, where wrapper of the man....
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....rty outside Uttar Pradesh. They sold 750 tins of Vanaspati ghee to Rajasthan Packer, Kanpur against Bill Nos. 251, 254, 256, 2303 and 2304 duly prepared by him. Goods which comes out from factory bear Batch number, date of manufacturing and MRP etc. compulsorily. 6. On the statement dated 5-11-2004 said Shri Yamuna Kumar Sikaria stated that he has brought tme goods from M/s. Ram Niwas Dharma Bhandar against Bill Nos. 251, dated 1-10-2004, 254 dated 4-10-2004, 256, dated 5-10-2004, CM Nos. 2303 and 2304, dated 15-10-2004, but he did not remember whether tin jar containing vanaspati ghee were bearing batch number, date of manufacturing and MRP etc. or not? 7. Driver of the said truck Shri Bhagya Narain Singh was interrogated on 9-11-2004 by the Supermtendent (Prey.), Customs (P) Division, Motihari which he submitted that he had not taken diesel during his 2½ days journey en- route to Kanpur and back. Whereas Shri Pradip Kumar Singh, owner of the said truck submitted in his interrogatory statement dated 9-11-2004 that the driver might have purchased diesel on the way. He further submitted that four containers each of 60 litres diesel were kept in the truck. The driver of ....
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....issioner, Customs(Prev.), Division, Motihari brought on record that most of the subject seized Tins containing Nepalese Vanaspati Ghee bear a mark SSGU significantly imposed on the tins containers. Most of the tin jars are packed with lid cover bearing printing marks "Amrit" (in Hindi) which is a Trade brand of Nepalese Shiv Shakti Ghee Udyog (short form SSG). This fact leads to the conclusion that the Vanaspati Ghee packed in tin/jars are manufactures by Shib Shakti Ghee Udyog and imported from Nepal illegally. 11. If therefore, appeared that the detained 750 tins of Vanaspati ghee were smuggled goods and therefore, the same along with truck bearing registration number BR-1G-3248 totally valued at Rs.8,50,000 /- were seized as claimed under Section 110 of the Customs Act, 1962, as claimed 29-10-2004 at 15:30 hrs. in the official premises of Customs (P) Division, Motihari, after observing the required formalities in presence of two independent witnesses for violation of prohibitory provision of the Customs law. 12. The Joint Commissioner, Customs, Patna ordered for release of seized 750 Tins of Vanaspati Ghee valued at Rs. 4,50,000/- and truck bearing registration number BR 1....
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....004. While he reached Pipra Kothi via Gorakhpur he was having huge amount of liquid money and in fitness of things he stopped the truck in front the owner's office and as he was not available in his office, he went to owner's native place. In the mean time the Customs officials of Motihari visited the office of the truck owner and found the truck parked at his office. Then the Customs official drived the truck to Customs office, wherein cash amount worth Rs. 29,000/- kept in the truck was also taken over by the Customs officials. 16. Sri Pradeep Kumar Gupta, owner of the truck narrated the reply of the driver of truck adding that before departure of his truck the tank was filled with diesel and four jars of sixty litres were also filled and kept in the said truck at Balua Petrol Pump. 17. Sri Ram Bhandar, "consignee" P.O. Charampa District - Bhadrak, Orissa submitted that his firm never placed any order with the consignor Shri Yamuna Kumar Sikaria, Prop. M/s. Rajasthan Packers, 18AD Block. Shyam Nagar, Kanpur (U.P.) though they made telephonic call intending to send a consignment of vegetable ghee on commission basis but for some reasons the deal could not materialise. On the....
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.... 23. Yet another serious missing ingredient in the Panchnama/Seizure Memo/Show Cause Notice and in the impugned order is the absence of "reason able belief". Learned Advocate submits that neither on 29-10-2004 when the goods and the truck were apparently detained without any authority of law nor subsequently after a month when the Panchnama and Seizure Memo were pre pared there is any recording that the Seizing Officers entertained "reasonable belief". This is a serious lacunae. 24. The Hon'ble High Court of Punjab and Haryana at Chandigarh in the case of Mapsa Tapes Pvt. Limited v. Union of India [2006 (201) E.L.T. 7 (P&H)] in CWP No. 6022 of 2005, decided on 28-4-2006, has held as follows :- "Search and Seizure - Validity of - Exercise of power of seizure liable to be struck down unless 'reasons to believe' were duly recorded before action of search and seizure is taken - Nothing produced before Court to show as to whether reasons were recorded or not before search was authorised or seizure took place - Search and consequent seizure of goods declared illegal - Sections 105 and 110 of Customs Act, 1962." 25. Further the Hon'ble High Court of Delhi in the case of Shanti ....
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....from Nepal or some other foreign country, either without payment of duty or in contravention of any restriction or prohibition imposed by statute. Smuggled goods - When does presumption arise? - Section 123 of the Cus toms Act, 1962. The word 'smuggled' means that the goods were of foreign origin and that they had been imported from abroad. Since, in the instant case, there was nothing absolutely from which inference about their origin or recent import could arise nor there was definite evidence to show that the appellant knew or had reason to believe that those items were smuggled, therefore, the presumption under Section 123 of the Customs Act that the goods were 'smuggled' did not arise. Reasonable belief cannot be based on suspicion or speculation. If the goods had not been accounted for and the Customs Officer did not wait for the Accountant to explain the entries and seized and took them away, it cannot be said that the Customs Officer had exercised a reasonable belief but it was a case of mere suspicion or speculations on guess work. 26. Another aspect of this case is that, since there was no reasonable belief, no presumption could be raised under Section 123.....