TaxTMI 
TaxTMI 
2025 (12) TMI 571
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....tive) [the Commissioner] that imposes a penalty of Rs. 5,00,000/- upon him under section 112(b)(i) of the Customs Act 1962 [the Customs Act]. 2. To appreciate the issues that have been raised in this appeal, it would be useful to narrate the relevant facts. 3. On 19.01.2023, Manish Kumar and Naresh Kumar who were travelling from Chennai to New Delhi in a train were intercepted at Hazrat Nizamuddin Railway Station, New Delhi by officials of the Directorate of Revenue Intelligence [DRI] and a notice under section 102 of the Customs Act was issued to them for search of their luggage. They were then taken for a physical search at the DRI Head Quarters at New Delhi. Thereafter, their statements were recorded at the DRI Office under section....
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....wing seizures were recorded: (i) Gold cut pieces recovered from one transparent box 5 gold pieces: 566 gm 15 small uneven cut pieces: 332.5 gm 17 uneven cut pieces: 1920 gm (ii) Gold jewellery recovered from other 4 transparent boxes Chains: 7898 gm Rings: 1938.4 gm Mix gold articles/jewellery: 1388 gm A total of 11,224.4 gm of gold was seized from the premises of M/s. Bikaner Jewellers. (iii) Gold jewellery/articles recovered from metal locker 3 transparent plastic boxes, 1 pink colour transparent plastic box, 1 big transparent plastic box, collectively weighing 6730 gm along with Rs. 1,60,000 of Indian currency were also recovered and 'detai....
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....ing the jewellery as he had to immediately rush to Mumbai for urgent personal work. He also stated that he had told the appellant that he would take the bag after 4-5 days when he would come back from Mumbai. Bharat Shantilal Shah in his statements also stated that the appellant was not aware of the contents of the bags. 10. The gold jewellery weighing 6730 gms belonging to Bikaner Jewellers was ultimately released by the officers after verification. 11. A show cause notice dated 17.07.2023 was issued to various persons, including the appellant. The allegation made against the appellant is that he had indulged in the activity of handling gold jewellery/articles manufactured from smuggled bars. The relevant portion of the show cause no....
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.... premises of Bikaner Jewellers wherein the officers had recorded the explanation given by the appellant at the time of search proceeding; (ii) The corroboration of the statement of the appellant by Bharat Shantilal Shah; and (iii) The settled law for invoking the provisions of section 112(b)(i) of the Customs Act is that the person should know and should have reason to believe that the goods are liable to confiscation under section 111 of the Customs Act, but in the instant case the appellant had no knowledge of the goods of Bharat Shantilal Shah that were kept in the almirah. 15. The Commissioner, however, imposed penalty upon the appellant under section 112(b)(i) of the Customs Act and the relevant findings are as fol....
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.... made / manufactured from foreign origin gold to be kept at his premise. Thus, I hold that Sh. Pawan Soni for his acts of mission and commission in handling gold jewellery/articles/ gold cut pieces made/manufactured from foreign origin gold knowingly rendered himself liable penal action under section 112(b)(i) of the Customs Act, 1962." (emphasis supplied) 16. Mr. Premendra Ojha learned counsel for the appellant assisted by Ms. Deepansha Saini, made the following submissions: (i) The adjudicating authority failed to consider the key facts, including the ownership of the seized gold; the circumstances in which the bags were kept in the premises of Bikaner Jewellers; business relationship of the appellant with Bharat Shan....
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....hese belonged to Bharat Shantilal Shah and had been kept by him as he had to immediately rush to Mumbai for urgent personal work. The appellant also informed that Bharat Shantilal Shah had told him that he would take back the gold jewellery after 4-5 days when he would come back to Mumbai. The reason given by the appellant was that he knew Bharat Shantilal Shah for the last 5-6 years as he was supplying chains to M/s. Bikaner Jewellers. This is what was also stated by the appellant in the statement made under section 108 of the Customs Act and this is also what was stated by Bharat Shantilal Shah in his statement recorded under section 108 of the Customs Act. 20. The allegation against the appellant is that the said gold jewellery was ma....