TaxTMI 
TaxTMI 
2024 (3) TMI 703
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.... while he was travelling by bus from Coimbatore to Narsaraopeta along with his wife and sister. The seized gold was in the form of 14 remelted gold bars and two small pieces totally weighing 3304.560gms. Neither the gold bars are of any standard size and weight nor they bear any markings indicating their country of origin. 3. During March 2020, Mr. A. Srinivasa Rao, husband of Smt. A. Varalakshmi made arrangement for purchase of gold bars on short term credit basis from one Mr. Somanath. H, proprietor of M/s Aryan Gold, Bengaluru. Later, as he was not well and not in a position to take journey to Bengaluru, Smt. A. Varalakshmi and her son - Mr. A. Praveen Kumar went to Bengaluru on 06.03.2020 to take delivery of the gold on credit basis from M/s Aryan Gold, Bengaluru and took delivery under tax invoice No. 38 dt.06.03.2020. As they were in a hurry to reach the bus stand to catch the bus for Smt. Varalakshmi's return journey to Narasaraopet, mistakenly, they left the invoice behind in the shop. From the bus stand, Smt. Varalakshmi proceeded to Narasaraopet, whereas, Mr. A. Praveen Kumar carried the gold to Hyderabad as he had to attend a function there and then proceeded to Coimbat....
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....and was not involved in any smuggling. Thus, the Appellant - Mr. A. Praveen Kumar ipso facto retracted his deposition dt.10.03.2020. 5. Evidently, the Government of India on 24.05.2020, had ordered a nationwide lockdown, which continued till 31.05.2020. Thus, the Appellant had no opportunity during all this time to produce the necessary evidences like documents in support of his contention. On the first summons issued by the Department in June 2020, Smt. Varalakshmi appeared before the DRI officers on 12.06.2020, 24.06.2020 and 12.11.2020 and deposed, inter alia, clearly stating that the gold was purchased by her from M/s Aryan Gold, Bengaluru on 06.03.2020 and also produced relevant invoice and also gave evidence of payment made for purchase through RTGS transfer on 19.03.2020. The seller Mr. Somanath. H, proprietor of M/s Aryan Gold, in his statement recorded by officers on 08.09.2020 also admitted the sale of the subject gold under tax invoice No. 38 dt.06.03.2020 made to the Appellants. Smt. Varalakshmi also categorically denied the deposition of her son as recorded by the officers at the time of seizure, as to purchase of gold from Coimbatore. 6. It further appears from the ....
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.....660gms silver. This, they did not inform to their owner - Mr. P.V.M. Jagannadha Rao. On 09.03.2020, they booked bus tickets from Coimbatore to Guntur. As they knew Mr. A. Praveen Kumar, who was also in Coimbatore and on his request, booked the bus tickets for him, his wife and his sister also by the same bus. He and Mr. T. Prasannanjaneyulu were not aware that Mr. A. Praveen Kumar was also carrying gold. 9. The officers, being of the belief that the remelted gold bars not indicating any origin is actually smuggled gold brought into India and remelted to erase the identity of foreign origin/markings, which appeared to have been purchased by these persons without valid bills/documents or vouchers and hence liable to confiscation under the Customs Act. Accordingly, the officers seized the gold, as it appeared to them that the same is liable to confiscation under the provisions of Customs Act along with the packing materials used to wrap and carry gold. 10. In his statement recorded by the officers, immediately on seizure, Mr. A. Praveen Kumar, on 10.03.2020 had, inter alia, stated that he had purchased the gold from M/s Srinidhi Bullion, Coimbatore. His wife and his sister also tra....
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....lied that on 08/09.03.2020, one of his customers from Andhra Pradesh/Telangana approached him and requested for purchase of gold bullion on cash payment. Since he was not having sufficient stock, he made arrangement to enable Mr. A. Praveen Kumar to purchase gold from unknown persons in the market for which he was paid commission of Rs.6,600/- (@ Rs.2000 per kg). He did not know any further details of Mr. A. Praveen Kumar. Further stated that Mr. A. Praveen Kumar used to come to his firm every month. On the apparent shortage of 3488gms of gold as per the stock register, Mr. V.B. Vimal stated that the said shortage is due to nonissuance of sale bill at the time of sale on the same day before the search proceedings. 12. Further, the premises of M/s Varalakshmi Jewellers, Narasaraopet was also searched on 17.03.2020 and no incriminating documents were found. The statement of proprietor of M/s Varalakshmi Jewellers - Smt. A. Varalakshmi was recorded. Subsequently, on 12.06.2020, wherein, she, inter alia, stated that she is the proprietor of M/s Varalakshmi Jewellers and Mr. A. Praveen Kumar is her son and he assists her in the family business. They purchased gold in the form of biscui....
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....asa Rao under Sec 112(a) and 112(b) of the Act. Vide same SCN, notice was also issued to unconnected parties and gold seized from Mr. V. Kranti Kumar and Mr. T. Prasannanjaneyulu and their employer - Mr. P.V.M. Jagannadha Rao, Partner of M/s Venakateswara Jewellers, Narasaraopet, proposing to confiscate 4 small gold pieces totally weighing 1004.16gms valued at Rs.43,24,415/- recovered from Mr. V. Kranti Kumar and 5 small pieces of remelted gold totally weighin 1152.21gms valued at Rs.49,61,992/- seized from Mr. T. Prasannanjaneyulu with further proposal to impose penalty on all these persons. 15. The SCN was adjudicated ordering absolute confiscation of the 14 gold bars and two small pieces of gold totally weighing 3304.56gms valued at Rs.1,40,87,399/- seized from the posession of Mr. A. Praveen Kumar under Sec 111(d) & 111(o) of the Act along with absolute confiscation of the packing material. Further penalty of Rs.35 lakhs was imposed on Mr. A. Praveen Kumar under Sec 112(a) and 112(b) of the Act and similarly, penalty of Rs.15 laksh was imposed on Smt. A. Varalakshmi. Penalty of Rs.15 laksh was also imposed on Mr. A. Srinivasa Rao and Mr. V.B. Vimal under Sec 112(a) & 112(b) of....
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....f Srinidhi Gold, Coimbatore, in his statement dt.12.03.2020 had stated that Mr. A. Praveen Kumar approached him on 08/09.03.2020 and requested for purchase of around 3.3kg gold bullion by payment in cash. Further, he stated that as he was not having sufficient stock, he made arrangement to enable Mr. A. Praveen Kumar to purchase gold from some unknown persons in the market for which he received a commission of Rs.6600/- (@ Rs.2000/- per kg). Thus, the allegation of Revenue is vague, there being no surity as to whether the gold was purchased from Srinidhi Gold or from some unknown persons in the market at Coimbatore. Thus, the SCN is based on vague and contradictory statements which has got no legs to stand. The Revenue has chosen one of the versions of Mr. V.B. Vimal to suit their purpose, although there is no material evidence in support thereof. Further, he urges that the deposition of Mr. A. Praveen Kumar at the time of seizure has been retracted at the first instance in the bail application and thus, the same is no reliable. Further, Revenue failed to examine Mr. A. Praveen Kumar during adjudication proceedings as required under Sec 138B of the Act and thus, the allegation is w....
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.... evidence, in the absence of corroborative evidence. 20. Learned Counsel further relies on the ruling of the Apex Court in the case of Vinod Solanki vs UOI in Civil Appeal No. 7407/2008, wherein it has been held - a person accused of commission of an offence is not expected to prove to the hilt that confession had been obtained from him by any inducement, threat or promise by a person in authority. The burden is on the prosecution to show that the confession is voluntary in nature and not obtained as outcome of threat, etc., if the same is to be relied upon solely for the purpose of securing a conviction. Further, observed - with a view to arrive at findings as regards the voluntary nature of statement or otherwise of a confession, which has since been retracted, the Court must bear in mind the attending circumstances which would include the time of retraction, the nature thereof, the manner in which such retraction has been made and other relevant factors. Law does not say that the accused has to prove that retraction of confession made by him was because of threat, coercion, etc., but the requirement is that it may appear to the court as such. 21. Further, he urges that Commiss....
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....h witness of the prosecution, in the adjudication proceedings, the entire proceedings stood vitiated. The appellate authority had incorrectly held that the appellant was not entitled to cross-examine the prosecution witnesses. 22. Similar view was also taken by the Apex Court in Swadesh Polytex Ltd vs Collector of Central Excise, Meerut [2000 (122) ELT 641 (SC)]. Thus, the statement of Mr. V.B. Vimal is not reliable in the absence of cross-examination, and the same being hit by Sec 138B of the Customs Act. 23. So far the scope of Sec 123 of the Customs Act is concerned, it is urged that the appellants have discharged the onus by submitting the proof of bonafide purchase from M/s Aryan Gold, Bangalore vide tax invoice and the payment for the same, admittedly, made through banking channel. 24. Opposing the Appeals, learned AR for Revenue relies on the impugned order. He further states that as per the appellants, Mr. A. Praveen Kumar with Smt. A. Varalakshmi had gone to Bangalore to purchase gold on credit basis from M/s Aryan Gold on 06.03.2020 and had received the delivery of the gold in question. As this fact was known to Mr. A. Praveen Kumar, he failed to state the same at the ....