TaxTMI 
TaxTMI 
1980 (2) TMI 96
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....hereafter, the appellant went up in revision to the High Court which confirmed the conviction and sentence upheld by the Sessions Judge. Then the appellant moved this Court and this appeal is by special leave. 2. The allegations made against the appellant may be briefly stated. On 16-4-1971 P.W. 4, Superintendent of Central Excise issued a warrant (Ext. P3) authorising P.W. 3 and another Inspector to proceed to the house of the appellant at 6.30 a.m. P.W. 3 called P.W. 1 and one Nihalchand as mediators and informed them that the accused had concealed gold biscuits of foreign origin in his house and hence it was decided to search his house. When the search was conducted, the accused was directed to produce the gold biscuits of foreign origin in his possession. The accused denied that the possessed any but the Excise Officials searched the house and found in a secret chamber of an iron safe, which was opened by the accused with the keys in his possession, a bundle containing 28 gold biscuits and a half biscuit marked as M. Os 1-29. All these biscuits bore foreign markings. In another secret chamber were found gold ear-rings in plastic boxes and a bundle of currency notes. The accuse....
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....as to fall within the ambit of Section 111. Dr. Chitale, appearing for the appellant, contended that if the presumption under Section 123 is not available to the prosecution, then there is no legal evidence to show that the appellant had any knowledge or had any reason to believe that the goods were imported or were smuggled without a lawful permit. The counsel appearing for the State, however, submitted that the fact that the gold bore foreign markings and was recovered from the possession of the appellant who had admitted in his statement before the Customs Officers that some unknown person had given it to him, would itself raise a sufficient presumption to attribute knowledge to the appellant that the gold was smuggled without any permit. Although the question raised by the counsel for the parties is not free from difficulty, an overall consideration of the special facts of the present case would show that there could be no difficulty in holding that having regard to the admission made by the appellant and his subsequent conduct, the onus would shift to the appellant to show that the gold found from him with foreign markings was imported without any permit to his knowledge. This....
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....e enquiry before the Collector the principal point which was urged on behalf of the appellants was to deny that the seized gold was of foreign origin and it is the nature of the defence that accounts for the order of the Collector dealing almost wholly with the consideration of that question. In order to reach his finding about the gold being smuggled, the Collector has referred to the conduct of the appellants............These were undoubtedly relevant pieces of evidence which bore on the question regarding the character of the gold, whether it was licit or illicit. Learned counsel is, therefore, not right in his submission regarding the absence of material before the Collector to justify the finding recorded in paragraph 6 we have set out earlier." 5. The facts of the present case appear to us be almost on all fours with the facts of the case mentioned above. Here also, the facts are that gold with foreign markings in the shape of biscuits without indicating any change was recovered from the possession of the appellant. Secondly, the appellant submitted that the gold was brought from outside the country. The appellant further admitted that he did not hold may permit for importin....
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....quite different and so is the nature of the admission made by the appellant. 8. In a later decision of this Court in the case of Commissioner of Income-tax, Madras v. Best & Co. (P) Ltd., (1966) 2 SCR 480, this Court observed as follows:- "When sufficient evidence, either direct or circumstantial, in respect of its contention was disclosed by the Revenue, adverse inference could be drawn against the assessee if he failed to put before the Department material which was in his exclusive possession. The process is described in the law of evidence as shifting of the onus in the course of a proceeding from one party to the other." It is true that this case arose under the provisions of the Income-tax Act but the principles laid down by this Court would apply equally to the facts of the present case. In the case of Collector of Customs, Madras v. D. Bhooramal, (1974) 3 SCR 833 = 1983 E.L.T. 1546, a case under the Customs Act, while dwelling onthe nature and purport of the onus which lay on the prosecution, this Court observed as follows : - "It cannot be disputed that in proceeding for imposing penalties under Clause (8) of Section 167 to which Section 178A does not apply, the burden....
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....t the result would only be that no presumption under Section 123 of the Act could be used against the appellant. We do not think that the High Court or the Magistrate had used this presumption. We find that they had relied upon circumstantial evidence in the case to infer the character of the gold recovered and the accused's guilty knowledge...... A reference to Issardas Daulat Ram v. Union of India, (1962) Supp. 1 SCR 358 is enough to show that the conduct of the accused and the incredible version set up by him were enough to saddle the accused with the necessary knowledge of the character of the goods found in his possession. **** At least, the burden of proving an innocent receipt of gold lay upon the appellant under Section 106, Evidence Act. The totality of facts proved was enough, in our opinion, to raise a presumption under Section 114, Evidence Act that the gold had been illegally imported into the country so as to (be) covered by Section 111(d) of the Act. The appellant had not offered any other reasonable explanation of the manner in which it was being carried." The facts in this case appear to be very similar to the facts in the present case. Furthermore, the case of ....