AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2025 (6) TMI 269
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.... gold bars along with penalties imposed on them have been set-aside. 2. Brief facts as stated in the impugned order are that a person namely Shri Sumit Verma was apprehended by the Officials of DRI, Lucknow Zonal Unit along with 03 pcs. of gold bars weighing 3000 grams valued at Rs.1,75,55,000/- on 27.01.2023 at Kanpur Railway Station, while he was travelling by Train No.22307 (Howrah-Bikaner Express) from Kolkata to Jaipur. It is the case of the Revenue that when apprehended, Shri Sumit Verma could not produce any licit document in respect of purchase/import of recovered gold. 3. In his statement dated 28.01.2023, Shri Sumit Verma stated that Shri Anil Soni is the owner of the recovered gold bars, who gave the said gold bars to him for delivery to Shri Ritesh Soni at Jaipur. Shri Anil Soni had told him that the recovered gold bars were smuggled from Bangladesh and were melted subsequently to erase the foreign markings and that he could not produce any licit documents with respect to purchase/import of the said recovered gold bars. The recovered gold bars were then seized under Section 110 r/w Section 123 of the Customs Act, 1962. 4. Shri Anil Soni, in his statement dated 24.04.....
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....115/ADC/2023 dated 05.12.2023 wherein the confiscation of seized gold and imposition of penalties on the noticees was confirmed by relying on the statements recorded and the CDR. The Adjudicating Authority also held that tax invoice/e-invoice dated 31.01.2023 was created by Shri Ranjan Soni in respect of seized foreign origin gold to cover up the whole issue of smuggling. 9. Aggrieved with the Order-in-Original dated 05.12.2023, the noticees preferred separate appeals before the Ld. Commissioner (Appeals), which were allowed vide Order-in-Appeal No.384-387-CUS/APPL/LKO/2024 dated 15.07.2024. The Ld. Commissioner (Appeals) has held that the case was of town seizure with no foreign markings engraved on the recovered gold bars, the department could not bring any cogent evidence on record to establish foreign origin of recovered gold and its smuggling into the Country, the recovered gold bars were transported under cover of tax invoice/e-invoice No. RAMJ/50/22-23 dated 26.01.2023 which was duly entered in the stock register and therefore the burden under Section 123 stands discharged. The penalties imposed on the noticees have also been set-aside in the impugned order. 10. Aggrieved ....
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....emises on 15-12-1967 and seized the goods. Section 110 opens with the words "if the proper officer has reason to believe that any goods are liable to confiscation under this Act, he may seize such goods". What is the meaning of "reasonable belief"? Did the officer entertain reasonable belief in the facts and the circumstances of this case? This is the other question to be decided. The Supreme Court has said that reasonable belief is a pre-requisite condition of the power of seizure that the statute confers on the officer. (See Collector of Customs v. Sampathu Chetty, AIR 1962 S.C. 316). The preliminary requirement of Section 110 is that the officer seizing should entertain a reasonable belief that the goods seized were smuggled. 55. Reasonable belief as required by Section 110 refers to the point of time when the goods in question are seized and not to a stage subsequent to the act of seizure. (M.G. Abrol v. Amichand, AIR 1961 Bom. 227). The condition precedent that there was such a reasonable belief anterior to the seizure must exist before the presumption under section 123 can be invoked. Section 123 says : ............... 56. In Babulal Amthalal Mehta v. Collector of Cu....
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.... and has to be before the officer adjudicating the confiscation under section 182 of the Sea Customs Act. No doubt, on the language of Section 178A the presumption of the goods being smuggled arises only when the seizure is made by an officer entertaining a reasonable belief that the goods are smuggled, and in that sense the reasonable belief of the seizing officer is a pre-requisite for the statutory onus to arise. It is also true that at the stage of adjudication, the reasonableness of the belief of the officer effecting the seizure that the goods are smuggled would be the subject-matter of investigation by the adjudicating officer. Nevertheless, it is manifest that at the stage of the adjudication (when only the rule of evidence laid down by the section comes into operation) the very facts which led the seizing officer to effect the seizure, as distinguished from their significance as affording a reasonable belief for the seizing officer to hold that the goods are smuggled, are before the adjudicating officer. These facts which justified the seizing officer to reasonably believe that the goods were smuggled would certainly import a rational connection between the facts on which ....
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....information to form the foundation of his reasonable belief (M.G. Abrol supra). 58. The second reason for entertaining a reasonable belief is that the seized goods were not accounted for by the petitioner on 15-2-1967 when the officer seized the goods from his possession. The seized goods consisted of 20 items of ornaments and diamonds. Out of these six items were released before the show cause notice was issued. One item was released at the adjudication stage. Six items were released by the Board on appeal. Only 7 items have been confiscated. These consist of 2 packets of diamonds and 5 ornaments. The petitioner claimed that they belonged to the queen mother of Nepal. A letter was written to queen mother. On her behalf a reply was received that she had given certain ornaments to the petitioner for polishing, remaking etc., though not for sale. But this was done later on. The letter was written on 3-7-1967. The reply was received on 24-7-1967. But at the time of seizure all that the officer had before him were 2 packets of diamonds and 5 ornaments. Neither the diamonds nor the ornaments had any foreign markings or label to suggest to the customs that these were smuggled goods. I....
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....d be no reasonable belief in the mind of the officer when he seized the goods. On the penalty of Rs. 25,000/-imposed on the petitioner the Board observed : "there is no definite evidence to show that the appellant knew or had reason to believe that those items were smuggled. In the absence of this evidence the penalty imposed is not justified. The Board accordingly remits the personal penalty in full". If the petitioner did not know that the goods were smuggled, how could the customs officer reasonably believe that the goods were smuggled. The petitioner knew better. 62. The customs officer merely thought that as the goods had not been accounted for these are smuggled goods. At the time of seizure what happened was this. The petitioner was present at the shop. He told the customs officer that they were duly entered in his account books but his accountant had gone to the income tax officer. The officer did not wait for the man to arrive to explain the entries to him. He seized the goods and took them away. This was not a case of reasonable belief. It was a case of suspicion. A case of speculation. A case of guess work. 63. As a result Section 123 did not apply to the case. The....
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.... Shri Anil Soni, has rightly held that there is no cogent evidence on record to support the charge of smuggling or foreign origin of seized gold bars. 18. Further, the impugned order records a categorical finding that the noticees discharged burden of proof under Section 123, as under:- "5.6 Further, the appellants have produced a copy of Tax invoice/e-invoice No. RAMJ/50/22-23 dated 26.01.2023 with respect to the recovered gold bars. On careful examination, I notice that it is categorically mentioned in the said invoice that 03 pcs. of gold bars were sent to Jaipur branch by train with Shri Sumit Verma, who was apprehended by the officials, while travelling by train no. 22307 (Howrah-Bikaner Express) from Kolkata to Jaipur. Thus, the said invoice has confirmed the transportation of the recovered gold bars with Shri Sumit Verma by train. I also find that the said invoice is duly entered in the stock register of 'gold'. Hence, I am of the view that the appellants have discharged their obligation in terms of Section 123 of the Customs Act, 1962." 19. We find that the aforesaid finding in the impugned order regarding discharge of onus under Section 123, has not been challe....
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.... issuance of tax invoice and 31.01.2023 as the date on which the tax invoice was acknowledged by IRP. From the FAQ issued by the Board for 'steps of e-invoicing', we find that the tax payer is first required to create GST invoices on their own accounting system, thereafter the invoices are reported to any one of the six IRP, on reporting, IRP returns a signed e-invoice with a unique 'invoice reference number' along with QR code whereupon the invoice is shared with GST systems for auto-population in the suppliers GSTR-1 return. The entire mechanism to report a tax invoice on IRP and thereafter issuance of e-invoice with a unique 'invoice reference number' along with QR code, is to ensure that the details of invoice gets auto-populated in GSTR-1 of the supplier. However, the same will not change the date of tax invoice from 26.01.2023 to 31.01.2023. We further find that the tax invoice dated 26.01.2023 contains the entire details of transaction including the details of consignor, consignee, goods and the tax charged therein. Once all these details including the tax charged therein has not been disputed by the revenue and there is no dispute that the tax charged has been deposited wit....