TaxTMI 
TaxTMI 
TaxTMI 
2025 (12) TMI 612
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....w 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 108 of the Customs Act. The search of Manish Kumar and his baggage resulted in recovery of 7 gold bars, collectively weighing 7000gm, from a blue colour trolley bag which contained a purple colour trolley bag and a black colour bag. Rs. 1,17,590/- of Indian currency was also recovered and seized. Similarly, the search of Naresh Kumar and his baggage resulted in recovery and seizure of 5 gold bars, collectively weighing 5000 gm, from a blue colour trolley bag which contained a brown colour trolley bag and a black colour bag. Rs. 1,19,820/- of Indian currency was also recovered from him and seized. 4. According to the appellants, these statements were forcibly recorded under section 108 of the Customs Act and they were asked to state that they were employees of Bharat Shantilal Shah and ....
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.... bars having foreign markings from Chennai to New Delhi for monetary consideration. xxxxxxxxxxxx 108. And whereas, Sh. Manish Kumar, Sh. Naresh Kumar and Sh. Krishi D Jain voluntarily admitted that they are repeat offenders and carried smuggled gold from Chennai to Delhi on earlier occasions also on the directions of Sh. Bharat Shantilal Shah. 111. And, whereas, the seized gold bars collectively weighing 12,000 grams having tariff value Rs. 5,98,48,560/- (Rupees Five Crore Ninety Eight lakh Forty Eight thousand Five hundred Sixty only) recovered and seized from the possisseon of Sh. Manish Kumar and Sh. Naresh Kumar. xxxxxxxxxx which were illegally and illicitly imported, contrary to prohibition imposed under various laws discussed on the importability of gold by way of regulation/restriction/control/order etc. are liable to confiscation under Section 111(a)/(b) and Section 111(d) of the Customs Act, 1962. xxxxxxxxxxx 115. And whereas, the Indian currency amounting to Rs. 1,17,590/- recovered and seized from the possession of Sh. Manish Kumar and the Indian currency amounting to Rs. 1,19,820/- recovered and seized from the possession of ....
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....iv) It was in this context that Rinkesh Kumar alias Prem Singh had called the appellants at Chennai to deliver the 12 gold bars and the cash amounting to Rs. 2,40,000/- to Mukesh Soni. He had also given the appellants a letter dated 17.01.2023 along with a job-work issue order dated 02.11.2022, which was present in the envelope. In the said letter dated 17.01.2023, Rinkesh Kumar alias Prem Singh had clearly stated that Mahesh Soni had told him subsequently not to make any jewellery out of the 12 gold given to him and, therefore, he was returning the same along with a cash amount of Rs. 2,40,000/-. 9. The Principal Commissioner did not accept the submissions made in the replies filed by Manish Kumar and Naresh Kumar and confirmed the demand of penalty of Rs. 1.50 crores on each of them under section 112(b)(i) of the Customs Act. The relevant observations are as follows: "143.7 Thus, in the instant case, Sh. Manish Kumar, Sh. Naresh Kumar and Sh. Bharat Shantilal Shah failed to prove licit possession of 12 Gold bars weighing 12000 Grams. In addition, the 12 Gold Bars had Foreign Marking, hence, the said Gold Bars are of foreign origin and the said Gold Bars can only be im....
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....hat the Indian Currency amounting to Rs. 1,17,590/- recovered and seized from the possession of Sh. Manish Kumar and Rs. 1,19,820/- recovered and seized from the possession of Sh. Naresh Kumar is liable for confiscation under Section 121 of the Customs Act, 1962 and I hold accordingly. 143.17 xxxxxxxxxxx. In view of the above discussion, it is already established that all 12 Gold Bars weighing 12000 Grams carried by them were of foreign origin and smuggled and hence, liable for confiscation under Section 111(b) and 111(d) of The Customs Act, 1962. xxxxxxxxxx. 157. xxxxxxxxxx. Therefore, I hold that Sh. Manish Kumar and Sh. Naresh Kumar for their acts of omission and commission of dealing, carrying, transporting of foreign origin gold bars have rendered themselves liable for penal action under Section 112(b)(i) of the Customs Act, 1962." (emphasis supplied) 10. Shri Vishwa Raj Singh, learned counsel for the appellant assisted by Shri Rishabh Thakur, made the following submissions: (i) Penalties could not have been imposed upon the appellant under section 112(b)(i) of the Customs Act; (ii) It was obligatory on the part of the d....
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....ts made by Bharat Shantilal Shah and the appellants under section 108 of the Customs Act. In Customs Appeal No. 51986 of 2024 (Bharat Shantilal Shah vs. Principal Commissioner of Customs (Preventive) decided by order of date, it has been held that Bharat Shantilal Shah was not the owner of the 12 gold bars as no reliance could have been placed on the statements made by Bharat Shantilal Shah and the appellants under 108 of the Customs Act. 14. The appellants had, in their replies to the show cause notice, clearly stated that Mahesh Soni, owner of M/s. B.S. Brothers and Industries, Jaipur had given the said 12 gold bars to Prem Singh on 02.11.2022 along with Rs. 2,40,000/- on job work basis. However, as Mahesh Soni was not keeping well he executed a will dated 15.11.2023 naming his brother Mukesh Soni as the inheritor of his properties, including the 12 gold bars from the stock of his firm. Mahesh Soni died on 01.12.2022 and so Rinkesh Kumar alias Prem Singh had called the appellants at Chennai to deliver the said 12 gold bars and cash amounting to Rs. 2,40,000/- to Mukesh Soni with the relevant documents. This is how the appellants explained the possession of the 12 gold bars and....
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....ggled gold recovered from his person. There is no mention of any such circumstances in the order of the Collector or even in the reply affidavit filed in the High Court by the Assistant Collector of Central Excise and Land Customs, New Delhi, though the appellant had said in Ground C of the writ petition that there was absolutely no material before Respondent 3 on which he could have come to a finding that the petitioner had imported the said gold." (emphasis supplied) 19. Neither the show cause notice nor the impugned order hold that the appellants had any connection with the importation of the gold bars/ gold prior to the actual imports. It was for the department to have established conclusively, without shifting burden on the appellants, that the goods were smuggled. The case of the department is based on the statements made under section 108 of the Customs Act, which statements, as noticed above, cannot be considered as relevant as the procedure contemplated under section 138B of the Customs Act had not been followed. 20. It also needs to be remembered that it is not the case of the department that the 12 gold bars were imported by the appellants. 21. Section ....