TaxTMI 
TaxTMI 
2025 (11) TMI 1114
X X X X Extracts X X X X
X X X X Extracts X X X X
....ch were smuggled into India from Bangladesh. Consequently, they were arrested on 23.04.2017. 2.1 Further, an intelligence was gathered that at 32. Nalini Seth Road, Kolkata 700007, there was actually three shops under the control of Shri Bapi Das and Shri Gobinda Das brother of Shri Bapi Das, both of whom are in the same business of smuggling of gold. One at third floor having the shop No.305 and the other at 5th floor having two rooms at Room Nos.505 & 509. The said shops were attempted to search on 24.04.2017 and it was found that both the shop cum office premises at 5th Floor were under lock and key. On local enquiry, it was found that the rooms were not open since 22.04.2017. Thereafter, room nos.505 & 509 were sealed and intimation was given to local Police Station i.e. Posta Police Station. 2.2 Summon was also issued to Shri Bapi Das. In room No.305, one Shri Bikash Sarkar, staff of that shop cum office premises named M/s G.D.Gold House, honoured the search authorization and allowed the DRI officers to search. Additional three employees of M/s G.D.Gold House were also found to be present in the shop namely, Shri Nathuram Saha, Shri Haralal Das & Shri Rakesh Saha. Shri B....
X X X X Extracts X X X X
X X X X Extracts X X X X
....am Sarkar in connection with exchange of Bangladeshi Taka as he lost his job, he contacted Shri Bharat Biswas and Shri Shyam Sarkar for some earnings and they gave him a proposal of carrying smuggled gold from Ranaghat to Kolkata or Hridaypur and deliver the same, for which, he will get money of Rs.1000/- per trip. Shri Shyam Sarkar used to call him at the new house of Shri Bharat Biswas and used to handover him the gold smuggled from Bangladesh for carrying to Kolkata. Shri Bharat Biswas was involved in illegal trade of foreign currency also. He involved himself in gold smuggling work since February, 2017 and used to carry smuggled gold from Ranaghat to Kolkata. Initially, he along with Shri Shyam Sarkar used to deliver the smuggled gold at Hridaypur but later, used to deliver at Burrabazar. One person named Shri Bapi Das alias Chhotobabu used to take delivery at Hridaypur. Some employees of Shri Bapi Das used to take delivery at Burrabazar. Sometimes, Shri Shyam Sarkar or Shri Bapi Das or Shri Bharat Biswas used to give him his commission. He further submitted that Shri Shyam Sarkar or Shri Bapi Das or Shri Bharat Biswas used to contact him over phone. He also submitted that that....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... purchased the gold from Shri Gobinda Das and his brother Shri Bapi Das. They could not produce any legal/licit documents for the recovered cash. 2.9 Seized gold was also tested in Customs House Chemical Laboratory, Customs House, Kolkata and the purity of the gold in the samples varies between 99.6% to 99.8% by weight. 2.10 On 12.06.2017, a notice under Section 150 of the Customs Act, 1962, for disposal of the seized gold, was issued to Shri Shyam Sarkar and Shri Asit Roy, who did not stake any claim of the seized gold. 2.11 Thereafter, on the basis of the further investigation, a show-cause notice dated 13.10.2017 was issued to Shri Bharat Biswas, Shri Shyam Sarkar, Shri Asit Roy, Shri Bapi Das and Shri Gobinda Das for absolute confiscation of 140 pcs. of gold biscuits recovered during investigation, for seizure of currency amounting to Rs.43,12,280/- and for imposition of penalties on the co-noticees. 2.12 The matter was adjudicated wherein it was concluded that the seized currency and gold of 140 pcs biscuits were absolutely confiscated and penalties on the co-noticees were imposed. Penalty of Rs.4,88,18,000/- was imposed on the appellant. 2.13 Aggrieved by the s....
X X X X Extracts X X X X
X X X X Extracts X X X X
....erely on the basis of the statements of the employees of the appellant, it has been concluded that the seized currency is the sale proceeds of smuggled gold, but nowhere it has been established from whom the gold was purchased and to whom the gold was sold and how the money was transacted. 10. We further take note of the facts that the smuggled gold and the cash recovered have been absolutely confiscated in this case and no other co-noticee has challenged the impugned order before us. 11. We find that the similar issue has been examined by the judicial pronouncement in Ramchandra Vs. Collector of Customs reported in 1992 (60) ELT 277 (Tribunal), wherein this Tribunal has observed as under: "5. It is also seen that the charges under the Gold (Control) Act has been dropped against all the persons to whom show cause notice has been issued and the charges under the Customs Act has been dropped against the other two. It would appear that the penalty of Rs. 50,000/- on the appellant has been imposed for breach of Section 121 of the Customs Act. Before violation of Section 121 is established the following ingredients must be satisfied: (i) there must be a sale. . ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e Punjab & Haryana High Court in the case of Gurmukh Singh v. Union of India & Others - 1984 (18) E.L.T. 274 (P&H) has observed that if there is no record wherein it could be shown that the petitioner had at any stage imported any goods in pursuance of the import licence, therefore it cannot be the case of the authorities that the seized currency is the sale proceeds of the smuggled goods. In the absence of such evidence the amount is returnable to the person from whom it is seized. The contention of the Revenue that they are competent to confiscate the sale proceeds of the smuggled goods under Section 121 of the Customs Act is wholly fallacious. The Tribunal in the case of Dattaji Deokar v. CC, Bhubaneswar-I - 2002 (147) E.L.T. 390 (Tri.-Kolkata) has held that Revenue is required to prove beyond doubt that the Indian currency was sale proceeds of smuggled gold and in the absence of any evidence on record to establish the same, the confiscation of the Indian currency is not justified." 14. Further, in the case of Commissioner of Customs, Jaipur Vs. Jagdish Prashad Soni reported in 2003 (158) ELT 457 (Tri-Del.), this Tribunal has examined the issue and observed as under ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....es of the case, we find that no evidence has been adduced against the appellant for involvement in the activity of smuggled gold and no cogent evidence has been produced apart from the statements recorded during the course of investigation that the appellant was involved in the activity of smuggled gold and cash recovered during search was the sale proceeds of smuggled gold. Therefore, the penalty on the appellant is not imposable. 17. Further, in the case of G-Tech Industries Vs. Union of India reported in 2016 (339) ELT 209 (P & H), the Hon'ble High Court of Punjab & Haryana, has examined the issue and observed as under: "15. The rationale behind the above precaution contained in clause (b) of Section 9D(1) is obvious. The statement, recorded during inquiry/investigation, by the Gazetted Central Excise officer, has every chance of having been recorded under coercion or compulsion. It is a matter of common knowledge that, on many occasions, the DRI/DGCEI resorts to compulsion in order to extract confessional statements. It is obviously in order to neutralize this possibility that, before admitting such a statement in evidence, clause (b) of Section 9D(1) mandates that ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... of 2019 10 his argument that the statement of a co-accused can be relied upon and it is an admissible evidence. 14. Heard both sides and perused the evidences available on record. 15. We find that the entire case of the Revenue has been built on the basis of the statement of the co-accused. The adjudicating Authority has given his findings about the role of the Appellant in paras 38.25.1 to 38.25.6 and para 38.29. For the sake of ready reference the relevant paras are reproduced below. "38.25.1. I have perused the reply of Shri Gobinda Das to the instant Show Cause Notice. I find that Shri Bishnupada Dey had on interception confessed on 02.04.2017 tht he was offired the work of carrying smuggled gold in lieu of monetary remuneration by Gobindababu @ Gobinda Das. I find that Bishnupada Dey had at the ouset admitted the role of Gobindababu i.e. Gobinda Das in the gold smuggling operations. I find that Bishnupada Dey taking the name of Gobindababu i.e. Gobinda Das without any hesitation and also furnishing a detailed picture of the activities of Gobindababu i.e. Gobinda Das clearly establishes that Gobinda Das was involved as a key person in this smuggling ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....defense by Shri Gobinda Das @ Gobindababu that the mobile Number 8276875110 belonged to another person and thus the Call Details cannot be attributed to him is liable to be rejected outright. 38.25.6. In view of the aforesaid, I find that the defense submitted by Shri Gobinda das @ Gobindababu, is at Variance with the facts of the case, the admissions of Shri Bishnupada Dey in Course of his statements recorded under Section 108 of the Customs Act, 1962, which has specified the role of Shri Gobinda Das @ Gobindababu in the smuggling operations and is thus liable to be rejected outright. 38.29. I find Shri Gobinda Das @ Gobindababu has played a prominent role in the smuggling of subject gold from Bangladesh and its delivery at Kolkata/Dumdum. It is indisputable that Shri Gobinda Das @ Gobindababu had engagned Shri Bishnupada Dey to carry the smuggled gold from Bisirhat to Kolkata in return flro monetary consideration. It is admitted that Shri Gobinda Das had introduced Shri Ratan Kumar Saha to Shri Bishnupada Dey and it is evident that he instructed Shri Dey to deliver the smuggled gold biscuits to Shri Customs Appeal No. 75921 of 2019 12 Saha. Summon was issued to ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....or of G.D.Gold House are one and the same is without any supporting evidence. 19. Revenue has mainly relied upon the statement of Mr Dey to implicate the Appellant in this case. They have relied upon some decisions in the Order-in-Original to support their claim that the statement of the coaccused is an admissible evidence. We have examined the decisions cited by the Adjudicating Authority and our observation about the relevancy of those cases in the present case is as below: 19.1 The First decision relied upon by the Revenue is Paraveen Kumar Saraogi Vs. Union of India reported in 2014 (299) ELT 151 (All.). The said decision was relating to granting of bail in a case of a complaint under Section 135 of the Customs Act, 1962 and subsequent application for quashing of bail under Section 482 of the Criminal Procedure Code. This is not a case similar to the present case on hand and hence, the said decision has no application in the Appellant's case. 19.2 The second decision relied upon by the Revenue is Naresh J. Sukhawani- Vs. Union of India reported in 1996 (83) ELT 258 (S.C.). In this case, the statement of co-accused was supported by other evidences like....