TaxTMI 
TaxTMI 
2022 (11) TMI 1012
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....za, Sivalayam Street, Vijayawada. 3. That on the basis of some intelligence, Officers of DRI Hyderabad intercepted one Mr. T. Nandu on the road near Kaleswara Road, Vijayawada. Mr. T. Nandu was carrying black colour bag. On being checked by the Officers, he was found to be carrying Rs.32,75,000/-. On being interrogated by the Officers, he stated that he has collected the said amount from the appellant - J. Suresh, Prop. of Shri Hanuman Gold, at Vijayawada, after selling him one kg. gold in the form of two flat bars having '999' mark engraved all over it. On the same day on enquiry, Mr. T. Nandu stated that he had purchased the said 1 kg. gold previous day from some person in Chennai for cash, after paying Rs.32,64,000/-. It appeared to the Officers that this amount of Rs.32,75,000/- was the sale proceeds of smuggled gold, the said amount was seized under panchnama alongwith the bag. 4. Thereafter the Officers on the same day (22.01.2019) searched the shop premises of this appellant at Pavani Gold Plaza, Vijayawada. Upon search the officers found one gold bar weighing 476.640 gms. (in bar form) and also cash of Rs. 4,44,000/-. On being enquired this appellant agreed that he ha....
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.... and thereafter purchased gold from Mr. T. Nandu totaling 1 kg. for Rs. 32,75,000/-. He further stated that he does not have any purchase documents for purchase made from Mr. T. Nandu. He further stated that out of 1 kg. gold purchased in the morning he has made some sales, out of which the balance 476.640 gms. have been found and seized by the officers. Both this appellant and Mr. T. Nandu were arrested on 23.01.2019 thereafter were granted bail. Within about ten days this appellant and Mr. T. Nandu retracted their statement which were recorded on 22.01.2019. 7. This appellant under summons, was again interrogated and his statement was recorded on 14.06.2019 wherein he interalia affirmed the panchnama dated 22.01.2019 as correct and also affirmed the purchase of 1 kg. gold bar for Rs. 32,75,000/- from Mr. T. Nandu. Further stated that he has already sold 523 gms. in retail to various persons in cash and the balance gold 476.640 gms. was found and seized under panchnama. He did not have any bills in support of sale/ purchase of gold. He further handed over to Rs. 10 lakhs to the officer as balance of the sale proceeds for sale of 523 gms. of gold, as the said amount has been rea....
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.... impose penalty under Section 112. Under the same show cause Mr. T. Nandu was also required to show cause as to why not the cash recovered from Mr. T. Nandu of Rs. 32,75,000/- be confiscated under Section 121 of the Customs Act with proposal to impose penalty under Section 112 of the Act. 11. This appellant contested the show cause notice wherein he interalia stated that admittedly it is a case of town seizure from his shop. Further, no foreign marking had been found on the gold seized from him. Thus, there is no presumption of smuggling of gold save and except on the vague statement of Mr. T. Nandu. Further, admittedly Mr. T. Nandu have also purchased gold from Chennai open market. Admittedly, the said gold bars was cast in India, having no marking or any serial number of any foreign refinery. There cannot be any presumption of smuggling. Further the said gold was not seized from the border area or any customs station. Thus, the whole allegation of smuggling is only by way of assumption and presumption having no legs to stand. Admittedly, appellant has purchased two gold bars weighing 500 gms. approx. from Mr. T. Nandu. Admittedly, gold bar of 500 gms. are not made out of India....
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....haped or tola bar (111.66 gms) or 1 kg. bar which contains the embossing and serial number given by the refiner. These markings reveal the nature of foreign origin of the gold. In the facts of the present case and in absence of any marking of foreign refinery nor the bars being of the weight, which is usually prepared by the gold refiner(s) located outside India. There is no reasonable basis available with Revenue to form the opinion that the seized gold appears to be smuggled. The whole allegation of Revenue as to the smuggled nature of gold is based on the statement of the appellant and Mr. T. Nandu, which has been retracted soon thereafter. 16.1 Learned Counsel relies on the ruling of Division Bench of this Tribunal in the case of Customs Appeal Nos. 30495 - 30496/2017 Final Order No. A/30018-30019/2021 dated 15.02.2021, under similar facts and circumstances of town seizure, where the gold did not have any foreign marking, it was held that there is no reasonable basis available with Revenue to form the opinion that the seized gold was smuggled. In such circumstances, it was held that the burden of proof under Section 123 did not shift from Revenue on the appellants. Further, ....