TaxTMI 
TaxTMI 
TaxTMI 
2025 (4) TMI 1725
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....ight of 4th and 5th October, 2022 through a train between Howrah and New Delhi were intercepted by the officers of Revenue and were brought at an office situated in Varanasi and at the said office, search of the person of the said two travelers was conducted in presence of independent witnesses and on search gold weighing 2998.50 grams was recovered which was valued at Rs. 150,80,192/- by Government Valuer. Under the belief that the said gold may be liable for confiscation, the above stated gold was seized by Customs Officers under section 110 of the Customs Act, 1962 through a seizure memo dated 05.10.2020. In a statement recorded by Customs officers, Shri Amit Kumar Soni stated that said gold bars were handed over to him by Mr. Pintu Singh near Bara Bazar, Kolkata on the instructions of Mr. Rajesh Kumar who is appellant in the present case. The samples of seized gold were forwarded to Revenue laboratory called CRCL which has given its report dated 05.11.2020 about the purity of the seized gold as 99.72%, 96.20% and 96.61%. Shri Amit Kumar Soni and Shri Shahid Hussain were arrested on 06.10.2020 and were produced before Hon'ble Special Chief Magistrate, Varanasi who remanded ....
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....ed 10.12.2021 to the above stated show cause notice. Shri Rajesh Kumar in his reply dated 23.01.2021 has stated that his statement was recorded under duress and subsequently at the earliest occasion, he has retracted that statement. He has further stated that when his premises was searched, there was no recovery of any smuggled gold. Further, he has stated that he had started a business of foreign exchange from 05.04.2019 and since no smuggled gold was recovered from his premises, the recovery of Indian currency cannot be treated as sale proceeds of smuggled gold. He further stated in his reply that there was no corroborative evidence to substantiate the charges of smuggling of gold. Shri Parvez Khan in his letter dated 10.12.2021 has stated that the seized gold did not have any foreign mark and therefore there were no reasons to treat the same as gold brought into India. He has further stated that the seized gold was Indian gold and therefore it is not established that he has acted in a manner to deal with smuggled gold. He further argued that for the said reason, he is not liable for imposition of penalty. Not appreciating the defence submitted by Shri Rajesh Kumar and Shri Parve....
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....me seller with the same purchaser selling two pieces of gold bar with 99.40% purity totally weighing 2 KGs was submitted. Further, he has also submitted a copy of settlement agreement of family dispute which was entered into within the family and was on stamp paper of Rs. 100/- and was notarized and signed by one Shri Lalji and other 6 members on the other side including appellant Shri Rajesh Kumar. The copy of said family agreement indicates that it was notarized on 15.07.2020. He has further submitted that said agreement indicates that Shri Lalji who had purchased 3 KGs of gold through above stated two invoices, was distributed fully to Shri Rajesh Kumar, appellant by Shri Lalji who is his father. He has also submitted a copy of Final order No. 75553/2024 dated 01.03.2024 passed by this Tribunal at Eastern Zonal Bench, Kolkata in the case of Shri Purnanand Ramchandra Mishra Vs. Commissioner of Customs and also a copy of Final order no. 75678-75681/2024 dated 17.04.2024 passed by this Tribunal Bench at Kolkata in the case of Shri Neeraj Agarwal and others Vs. Commissioner of Customs. Learned counsel has also submitted his arguments in support of the grounds of appeal in ....
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....to whom sale is made and the quantity of gold sold to which customer has to be established. In the present case, he argued that no such evidence is brought on record and therefore Revenue has failed to establish that seized currency was sale proceeds of smuggled gold. (b) The father of Shri Rajesh Kumar had purchased 3 KGs of gold from M/s. Vikas Gold and Silver, Kolkata through two invoices bearing no. 502 dated 15.07.2007 and 545 dated 22.02.2008 and through the separation agreement entered in the year 2020, allotted permanently said 3 KG gold to Shri Rajesh Kumar and the same gold was sent through Shri Amit Kumar Soni and Shri Shahid Hussain to Kolkata to be sold but since the sale did not take place, Shri Amit Kumar Soni and Shri Shahid Hussain were returning back with gold from Kolkata to Sultanpur and they were intercepted by officers of Revenue and gold was seized. At the time of seizure of gold, Shri Amit Kumar Soni and Shri Shahid Hussain were having photocopies of said two invoices no. 502 and 545 with them to establish licit source of possession of gold but the officers did not take cognizance of the same and seized the said gold. (c) He further submitt....
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....it their response within a period of one week from the date of hearing. We note that no such response filed by Revenue is available on record. 8. From the case record, we note that three gold bars totally weighing 2998.50gms were seized. The said gold bars were belonging to Shri Rajesh Kumar, the appellant. Samples of the said gold bars were taken and sent to Revenue laboratory which through test report dated 05.11.2020 informed the purity of gold to be 96.20%, 96.61% and 99.72%. The residential premises of Shri Rajesh Kumar, the appellant was searched and from his residence Indian currency of Rs. 1,01,25,600/- and two samples of gold weighing 4.9 and 4.72 grams were seized. On contest by both the appellants, the original authority through the said Order-In-Original dated 31.03.2022 as held seized gold to be smuggled gold and confiscated the same absolutely under Section 111 (b) and (d) of Customs Act, 1962. Further, seized Indian currency of Rs. 1,01,25,600/- was absolutely confiscated under Section 121 of Customs Act, 1962. Two samples of gold weighing 4.9 and 4.72 grams were confiscated absolutely under Section 111 (b) and (d) of Customs Act, 1962. Shri Rajesh Kumar....
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...., the sale proceeds thereof shall be liable to confiscation. (G) Section 123 (1) Where any goods to which this section applies are seized under this Act in the reasonable belief that they are smuggled goods, the burden of proving that they are not smuggled goods shall be---- (a) in a case where such seizure is made from the possession of any person, (i) on the person from whose possession the goods were seized; and (ii) if any person, other than the person from whose possession the goods were seized, claims to be the owner thereof, also on such other person; (b) in any other case, on the person, if any, who claims to be the owner of the goods so seized. (2) This section shall apply to gold [and manufactures thereof,] watches, and any other class of goods which the Central Govt. may by notification in the Official Gazette specify. (H) Section 125 Whenever confiscation of any goods is authorized by this Act, the officer adjudging it may, in the case of any goods, the importation or exportation whereof is prohibited under this Act or under any other law for the time being in force, and shall, in the case ....
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....cation therefore the question of any smuggling involved in the whole proceeding does not arise. Revenue has also not established as to the said Indian currency being accumulated by sale of which smuggled goods and by sale to whom and when. Therefore, we hold that Revenue could not make out a case that either 2998.50gms of gold nor two samples of gold weighing 4.9 and 4.72 grams were liable for confiscation. Revenue also could not make out a case that Indian currency of Rs. 1,01,25,600/- was sale proceed of sale of smuggled goods. We, therefore, hold that gold weighing 2998.50 grams and 4.9 and 4.72 grams was not liable for confiscation and Indian currency was also not liable for confiscation. We note that Section 112 (b) deals with imposition of penalty on a person dealing with goods which are liable for confiscation. We have already held that goods were not liable for confiscation therefore Shri Rajesh Kumar was not liable to be imposed with the penalty of Rs. 20,00,000/. We also hold that Shri Parvez Khan was not liable to be imposed with a penalty of Rs. 3,00,000/-. We, therefore, hold that both the impugned Orders-In-Appeal are liable to be set aside and as a res....