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2025 (12) TMI 1683
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....ri Akash Jha (Appellant No. 3), and Shri Abhishek Agrawal (Appellant No. 4) are upheld. 5.17 The appeals filed by Shri Harkanth Singh, Shri Umesh Kumar Agarwal, Shri Akash Jha, and Shri Abhishek Agarwal are hereby rejected 2.1 Acting on specific intelligence that two persons carrying smuggled gold in a Kia Seltos bearing Registration No.MP-07CG-9015 towards Gwalior from New Delhi via Yamuna Expressway and would dispose the smuggled gold to some person(s) in Gwalior. The Officers of Directorate of Revenue Intelligence (DRI) along with the Panchas reached the Jewar Toll Plaza around 6 pm on 11th September 2023 and kept discreet surveillance of the vehicles coming from Delhi which were about to cross Jewar Toll Plaza. 2.2 At around 6:15 pm, a vehicle matching the description of the vehicle coming from the Delhi side was identified and intercepted at the entrance at Jewar Toll Plana on Yamuna Expressway. The DRI officers noticed that at the time of Interception, the above said White Colour Kia Seltos car bearing Reg. No.MP-07-CO-9015 was occupied by two persons, one in the driver seat and the other is the passenger seat in front. 2.3 The officers asked them for the id....
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....er packet wrapped with brown tape were recovered. Further on being searched, another cavity was noticed beneath the driver's seat. Nothing incriminating was found in this cavity. Search of remaining parts of vehicle was conducted and nothing objectionable object was found. 2.8 From the first packet which was wrapped with the help of a rubber band two (02) rectangular-shaped pieces of yellow colour metal were recovered along with two (02) paper bearing the description "Gold Testing Report" dated 11.09.2023 with Sl.No. 69 & 70 issued by Kalash Computerized Tunch Centre, 32/3193, Beadon Pura, Karol Bagh, New Delhi. The DRI officer gave markings 1 and 2 on these yellow metal pieces for identification purposes. 2.9 From the second packet which was wrapped with brown tape assorted jewellery of yellow metal (Rings, Earrings with Chain and pendants) were recovered. 2.10 Statement of Appellant-I was recorded under Section 108 of the Customs Act 1962 on 11/09/2023 wherein he replied to the questions before him as under:- (i) में आकाश झा पुत्र श्री जी&#....
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....0;ा हूँ। (ii) मैं M/s मोहित ज्वेलस में सेल्स का कार्य देखता हूँ और मैं करीब डाई वर्ष से मोहित ज्वेल्स में कार्य कर रहा हूँ उसके पूर्व में में. जैनम ज्वेलर्स सर्राफा बाज़ार ग्वालियर के यहाँ कार्य करता था। (iii) मैं. मोह....
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....;बाइल न 9009599993 एवम श्री अभिषेक अवान का मोबाइल न 9009599992 है। श्री उमेश अग्रवाल मकान न 108, ग्रुप 8 आनियाना अपार्टमेंट ग्वालियर में अपने परिवार के साथ रहते हैं। (v) मैं आज सुबह दिनांक 11.09.2023 को श्री अभिषेक अग्रवाल की कार किया सेल्त....
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....379;ने का छोटे टुकड़े जिनका वजन लगभग 50 ग्राम था तथा कुछ स्वर्ण आभूषण जो कि लगभग 118 ग्राम वे मुझे सौंप दिए। सोने कि वस्तुओं की प्राप्ति कि सूचना मैंने थी उमेश अग्रवाल को उनके मोबाइल फोन पर फोन करके दी थी। (vi) मै छोटू कí....
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....2358;ी मूल के सोने के देश में आ जाने के बाद उसको पिचला कर दोबारा से उसकी सीने की बार बने जाती है और उसे लेने के लिए श्री उमेश अग्रवाल मुझे दिल्ली भेजते हैं। (viii) मेरे द्वारा न ही छोटू न हि उसके सहयोगी को कोई धन या रुपये ....
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....;ं 17 रैगर पुरा विष्णु मंदिर के पास से नेता हूँ। मैं मैं० मोहित ज्वेल्स के सेल्स काउन्टर में बैठता हूँ तो कई बार मैं. मोहित ज्वेल्स के मालिक श्री उमेश अग्रवाल को फोन में बातें करता सुनता हूँ जिसमें वो छोटू को हवì....
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....2331;िपा दिया तथा 50 ग्राम के मोने के 3 छोटे टुकड़े मैने अपनी जेब में रख लिए थे। इसके बाद ग्वालियर के लिए रवाना होने से पहले अपने चलने कि सूचना श्री उमेश अग्रवाल को देकर हम दोनी ग्वालियर के लिए रवाना हो गाए। जब भी हम इ....
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....352; से दिल्ली मोना लेने आता हूँ परंतु मेरे अलावा कभी कभी दुकान के अन्य कर्मचारी विरेंद्र बौरमिया, रोशन परिहार भी आते हैं। जी में उपरोक्त तथ्य से अवगत हूँकि विदेशी मूल का मोता जो कि बिना वैध दस्तावेज के आप अपने ì....
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....#2340; कि गयी थी। छोटू ने सम्बंधित गोल्ड टेस्टिंग रिपोर्ट सुबता के प्रमाण के तौर पर उस गोल्ड बार के साथ लपेट कर, गोल्ड बार मुझे सौंप दिए थे। मैंने उक्त दोनों रिपोर्ट को देखने के स्वरूप में आज की तारीख में दिनांक सह&#....
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....6;ुत्र. एक 7 वर्ष की पुत्री एवम एक 5 वर्ष की पुत्री के साथ रहता हूँ। में ग्वालियर जिले में स्थित डबरा नामक कस्बे में तक (फल) पड़ा है। मैं मोहित ज्वेल्म जो कि ग्वालियर के सरफि बाज़ार में स्थित है में नौकरी करता है। (ii) ....
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....;की उम्र लगभग 55 वर्ष है, साथ ही उनके बड़े पुत्र अभिधिक अग्रवाल जिनकी उम्र लगभग 28 वर्ग एवम उनके छोटे पुत्र मोहित अग्रवाल उम्र लगभग 25 वर्ष है, भी साथ में व्यव्माय करते हैं। श्री उमेश अग्रवाल का मोबाइल न 9009599993 एवम श्री अ....
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....306; अब तक तीन बार श्री उमेश अग्रवाल के परिवार कि गाड़ी लेकर आया है जिसमें मैं थी आकाश आ. के माथ तस्करी का सोना ले कर खालियर गया हूँ। जैसा कि में बता चुका हूँ कि श्री उमेश अग्रवाल के यहाँ मेरे अतिरिक्त और ड्राइवर है&....
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....; दो बार (gold biscuits) में थे और स्वर्ण आभूषण जी कि लगभग 118 ग्राम का पैकेट हमने गाड़ी में बनी खाली जगह (Cavity) विषा दीया। 3 सोने का छोटे टुकड़े जिनका वजन लगभग 50 ग्राम या आकाश ने अपनी pant कि जेब में रख लिया और हम दोनों ग्वालियर के लिये चल प&....
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....50;ुझे पता है कि उक्त बस्तुवे विदेशी मूल के सोने से बनायी गयी हैं। न ही मेरे पास और न ही श्री आकाश झा पास उपरोक्त सोने से सम्बंधित कोई भी कागज थे और न ही छोटू ने सोने कीड उक्त वस्तुएं सौंपते वक्त दीये गये थे। (ix) जिस &....
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....04; बरामदकी गयी सोने कि वस्तुएँ श्री उमेश अग्रवाल जो कि मैं, मोहित ज्वेल्स के सर्राफा बाजार, ग्वालियर के मालिक हैं को सौंपनी थी और वे उन्हीं की है। 2.12 Summons were issued to both Appellant-I and Appellant-III for appearance in the DRI Noida office on 12.09.2023 to tender their Voluntary Statement under Section 108, of Customs Act 1962. 2.13 On 12.09.2023, at ACC Export IGI Airport New Delhi, the appraisement was conducted by the Jewellery Appraiser in the presence of the Panchas and Appellant-III and Ap....
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....#2352;ान कार में बनी विशेष कैविटी में लगभग 2kg विदेशी मूल का सोना दो गोल्ड बार (gold bars) के रूप में तथा कुछ स्वर्ण आभूषण जिनका वजन लगभग 118 ग्राम था बरामद किये। इसके अलावा मेरे पास से, 3 सोने का छोटे टुकड़े जिनका वजन लगभग 50 ग्राम था....
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.... 1,13,03,617/- 1,26,35,345/- (ii) Jewellery Appraiser ने वस्तुओं के सोने का होने कि पुष्टि के साथ साथ मैं उपरोक्त दिए गए शुद्धता एवं मूला का आंकलन मही है और में इससे सहमत हूँ। अपनी महमति के स्वरुप में आज दिनांक 12.09.2023 कि तारीच सहित हस्ताक्षर भी कर रहा है। ....
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....381;वालियर जा रहे थे जब DIRI अधिकारियों ने हमें जेवर टोल पर टोक लिया था। [iv] इसके बाद अधिकारियों ने मुझे सीमा शुल्क अधिनियम 1962 की धारा 123 के प्रावधान के बारे में समझाया और उसका संज्ञान लेने का आग्रह किया, जिसके अनुशार जि&....
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....#2344;े कि वस्तुओं से संबंधित खरीद, विक्की के कोई भी कागजात नहीं है और न ही इन सोने कि वस्तुएँ को दिल्ली में सौंपते वक्त मुझे दिये गये थे। मुझे यह भी पता है कि चूंकि यह मोने कि वस्तुएँ तस्करी कि है इसलिये इनसे संबंधि....
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....; शामिल न होने का वचन देता है। (vi) मैं पुनः दोहराता हूँ की मोने कि वस्तुएँ जो कि किया मेल्टोम (Kia Seltos) संख्या MP07CG9015 कार एवं मेरे पास से बरामद हुई हैं उन्हें में श्री उमेश अग्रवाल जो कि मैं मोहित ज्वेल्स के सर्राफा बाजार, गî....
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....कार में बनी विशेष कैविटी से लगभग 2kg विदेशी मूल का सोनादी गोल्ड बार (gold bars) केरूपमें तथा कुछ स्वर्ण आभूषण जिनका वजन लगभग ग्राम 118 था, बरामद किये। इसके अलावा आकाश झा के पास से 3, सोने का खोटे टुकड़े जिनका वजन लगभग 50 ग्राम था....
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.... 1,13,03,617/- 1,26,35,345/- (ii) Jewellery Appraiser ने वस्तुओं के सोने का होने की पुष्टि के साथ साथ में उपरोक्त दिए गए शुद्धता एवं मूल्य का आंकलन सही है और में इससे सहमत है। अपनी सहमति के स्वरुप में आज दिनांक 12.09.2023 कि तारीख सहित हस्ताक्षर भी कर रहा है। ....
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....; लिया था। [iv] इसके बाद अधिकारियों ने मुझे सीमा शुल्क अधिनियम 1962 की धारा के प्रावधान 123 के बारे में समझाया और उसका संज्ञान लेने का आग्रह किया, जिसके अनुशार जिम व्यक्ति के पास में सोने कि बरामदगी होती है उसी के ऊपर स....
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....कागजात नहीं है और न ही इन सोने कि वस्तुएँ को दिल्ली में सौंपते वक्त आकाश झा को कोई कागज दिये गये थे। मुझे यह भी पता है कि चूंकि यह सोने कि वस्तुएँ तस्करी कि हैं इसलिये इनसे संबंधित खरीद, बिक्री के कोई भी कागजात ê....
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....325;े सर्राफा बाजार, ग्वालियर के मालिक हैं को ग्वालियर में सौंपनी थी और ये उन्हीं की हैं। 2.15 As Appellant I and Appellant III could not produce any document showing licit import, possession and transportation of above said gold pieces and gold jewellery recovered from their possession. Hence, the recovered two bars of gold, assorted gold jewellery and three irregular gold pieces weighing 2167 grams were seized by the DRI officer under Section 110 of the Customs Act, 1962 on a reasonable belief that the same were liable for confiscation under the provisions of the Customs Act, 1962. The newspaper and brown colour adhesive tape used for packing and concealing the seized gold, which were kept in an A-4 yellow envelope sealed with DRI seal were also seized under Section 110 of the....
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.... in the shop. Shri Vitthal Salunkhe then showed them the video recording of the said particular time and identified the two persons from the recording, who according to him brought the gold bars to the shop for testing. A screenshot of the said two persons who were identified by Shri Vitthal Salunkhe was also taken. A printout of the screenshot was also taken out on which Shri Vitthal Salunkhe and the panchas put their signatures. On being asked about the details of both the persons identified by Shri Vitthal, he expressed his inability and stated that he does not have the personal details or the phone number relating to both the said persons. However, he undertook to provide the details as and when they come again for testing of gold if they come to the shop again in the future. The Officers then conducted a systematic search of the shop, in order to recover any possible document/receipt which could be relevant to the investigation. However, nothing incrementing was found during the search. Proceedings were recorded under Panchnama, dated 06.10.2023. 2.18 On the basis of the identification of the said person who has brought the gold bars for testing of purity by Shri Vithhal Ja....
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.... जाने वाले सोनेया सोने कि वस्तुए को शुद्धता दुसरी टंच कीदुकानोंसे करवाने का काम करता हूँ। इसके अलावा में सोने या मोने कि वस्तुओकी डिलीवरी, श्री प्रिंस सोनी के कहेअनुसार भी करता हूँ। मैंने कलश टंच सेण्टर द्....
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....7; उक्त मोना उन दो व्यक्तियों थी आकाश आ एवं श्री हरकंठ सिंह को किसनेदिया। (v) श्रीप्रिंस मोनी जी जो भी सोना जॉब के लिए भेजते हैं उसपर ग्राहक के आगे नाम NC JI ही लिखवाने को कहते हैं। पर ये किम व्यक्ति या फर्म में ताल्ल&#....
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....;रे टंच सेंटर पर 7 लड़के काम करते है जोकि सोने की शुद्धता की जाँच करते हैं। उनका औसतन वेतन 15000/-रुपए है। (iii) M/s Kalash Computerised Tunch Center में लगभग 400 ग्राहकों के सोने का टंच शुद्धता की जाँच करता है। मेरे सेंटर पर कजा मोना, पक्का मोना, बार एवं ç....
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....#2357;ं विक्रय से सम्बंधित कागजात ना तो लाते है और ना ही हम उनसे मांगते है। (iv) जैसा की मैंने प्रशन 3 के उत्तर में कहा था कि दिन में औसतन 400 लोग सोना या सोने की वस्तुओं की शुद्धता कि जाँच कराने मेरे टंच सेंटर पर आते है इसल&....
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....र लेकर आया था। मैं पुनः पुष्टि करता हूँ कि उक्त दोनों पर्चियों से सम्बंधित सोना यही व्यक्ति लेकर आया था। (v) मैं NCJI नाम के व्यक्ति एवम फर्म को व्यक्तिगत रूप से नहीं जानता। जैसा मैंने प्रशन 6 के उत्तर में कहा था कì....
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....uts of GST registration in support of his submissions that all three firms operating from the said showroom only, under his dated signature. He clarified that he was working as a manager of M/s Kailash Chand and Sons, from where he was drawing a salary of Rs. 50,000/- per month. However, he admitted that he supervises the work of the entire showroom. The setting of the showroom which housed all three firms related to ach other by virtue of being father/sons/brother confirmed that the premises were being used run as a family affair and the common space including the infrastructure was being shared for conducting family business from there. The Officers then enquired about the status of Sh. Akash Jha and Sh. Harkanth Singh, to which he informed that they both were employees of M/s K.C. Gold. Proceedings were recorded under Panchnama drawn on the spot in the presence of independent witnesses. 2.22 A search was conducted at the residence of Appellant IV in his presence. On being asked about his family and his business, Shri Umesh Agrawal informed that he and his sons were engaged in the business dealing in gold/silver jewellery and bullion. Nothing incnminating was recovered duri....
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....66; काउंटर एवं उसके पीछे का हिस्सा कैलाश चंद एंड सन्स का है। जहाँ से हम बाँदी का व्यापार करते है। (ii) मेरी फर्म कैलाशचंद एंड संस के अलावा मेरे बड़े बेटे अभिषेक अग्रवाल की फर्म के सी गोल्ड इस शोरूम में घुसते ही बाए....
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....ी एवं जून 2022 में जिसे बेच दिया गया इसलिए अब वह भी यहीं पर स्थित है। क्यों यह फर्म एक पारिवारिक फर्म है इसलिए तीनों कर्म का व्यापार इसी जगह से होता है। (iv) हालाँकि मेरे दोनों बच्चों के नाम भी दो कर्म रजिस्टर्ड है प....
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....; हूँ। मैं चाँदी के आभूषण एवं वस्तुएँ आगरा, राजकोट, मथुरा एवं बम्बई के विभिन्न ज्वेलर्स से खरीदतेजैसा कि मैंने पहले भी बताया कि यह एक पारिवारिक व्यवसाय हैं तो के नी गोल्ड का मारा काम भी मेरी ही निगरानी में होत&....
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....हूँ। वे दोनों ही मेरे निर्देशानुसार कार्य करते हैं। (vi) श्री आकाश झा एवं श्री हरकंठ सिंह दिल्ली में SR बुलियन एवं RK बुलियन जिनकी दुकाने दिल्ली के चाँदनी चौक के कूचा महाजनी इलाके में हैं, से मेरे कहने पर सोना लात....
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....2359;्टि करता है कि यह वहीं सोना है जिसे लेने के लिए मैंने श्री आकाश एवं हरकठ को दिल्ली भेजा था। (viii) श्री आकाश झा एवं श्री हरकंठ सिंह के पास से बरामद हुआ सोना दिल्ली से एक छोटू उर्फ रवि बदरी नामक व्यक्ति जिसका मोबाइ&....
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....5;ी बचाने के लिए हम ऐसा करते हैं। (ix) मेरी जानकारी के अनुसार रवि बदरी उर्फ छोटू की दुकान कूचा महाजनी दिल्ली में स्थित है मगर उसका सही पता एवं नाम मुझे नहीं पता। हमें जब भी उसे सोना खरीदना होता है तो उसे कैश में पेë....
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....2344;गद राशि से प्राप्त हुई थी उसी धनराशि में हमने आगे छोटू को भुगतान किया था।अब इस बारे में थी हरकंठ सिंह एवं श्री आकाश झा अपने अपने बयान दिनांक 11.09.2023 एवं 12.09.2023 में बता चुके हैं तथा में इससे सहमत है। (xi) KIA सेल्टोस कार संख्य....
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....ो विदित है कि हमारा सोने एवं चाँदी के आभूषणों का काम है तथा इन्हें दिल्ली से ग्वालियर लाने ले जाने की सुरक्षा हेतु ही वे विशेष रूप से निर्मित कैविटी कार में बनवायी गयी थी। (xiii) मैंने धारा 123 के प्रावधानों को देख ....
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....ing in a white Kia Seltos car bearing no MP07CG9015 registered in the name of Shri Abhishek Agrawal and the gold being seized vide Seizure Memo dated 12/09/2023 should not be confiscated under Section 111(b) and Section 111(d) of the Customs Act, 1962. (ii) The seized car, a white KIA Seltos bearing registration no MP07C09015 should not be confiscated under Section 115 of the Customs Act, 1962 as it was used for carrying and transporting the seized illicit Foreign-Origin-Gold. (iii) The seized packing material i.e. newspaper, plastic pouch, brown colour tape, used to conceal the seized Foreign Origin Gold, should not be confiscated under Section 118 and Section 119 of the Customs Act, 1962. (iv) Penalty should not be imposed upon the noticees under Section 112 (a) and/or 112(b) of the Act. 2.28 The show cause notice was adjudicated as per the Order-in-Original dated 06.05.2024 holding as follows:- "ORDER i. I order for absolute confiscation of seized foreign smuggled gold, comprising of two gold bars & Gold Piece (Along with 2 small gold Snippets), Assorted Jewellery (Pendent, rings & Earrings with chain) recovered from Sh. Akash Jha and Sh....
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.... Counsel appearing for the appellants and Shri Santosh Kumar learned Authorised Representative appearing for the revenue. 3.2 Arguing for the appellant learned Counsel submits that- ⮚ The seized gold is not smuggled foreign-origin gold but is lawful stock of M/s. KC Gold, owned by the Appellant. Supporting documents include:- ○ Detailed stock registers ○ Purchase bills from Aggarwal Jewellers and D.S. Jewellers with payment details ○ Melting report from M/s JBR Gold Testing & Refinery dated 10.09.2023 confirming conversion of 2725.670gms of 18KT ornaments into 2048.140 gms of 995 purity bullion (ANNEXURE A-8) Pg. 191. ○ 117.960 gms of jewellery issued as design samples ⮚ The cavity in the Kia Seltos was made only for safe storage during transit, not for concealment of contraband. ⮚ No foreign markings were found on the seized gold; appraisement report only confirmed weight and value, not foreign origin. ⮚ The seized gold matches with lawful stock as per stock registers and books of accounts. ⮚ Statements of Appellant I, II and IV an....
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.... (stock registers, bills, melting reports) are afterthought/fabricated. OIO/OIA rejected documentary evidence without verification. Appellant consistently produced authentic documents. Authorities ignored them instead of verifying. Documents prove lawful stock. Rejection without examination is arbitrary. Appellant IV implicated for instructing his employees to retrieve gold from Delhi. OIO suggests his action contributed to smuggling His role for managerial, did not directly partake in any physical act of smuggling. His business practices such as purchasing gold without formal receipts (a method used to avoid excessive tax \duty) though legally debatable, are standard in the industry and should not automatically imply illicit activity. His business records and stock registers that corroborate the legal procurement of gold. His appeal also highlights the retraction filed on 07. 02. 2024, clarifying that carlier statements (made under pressure) were not reflective of actual practices. As per the OIO & SCN, Appellant I recorded statement implicated him in the smuggling process. Orders- He was merely a sala....
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.... The statements recorded under Section 108 of the Act were obtained under duress and were subsequently retracted. ii. The seized gold was not of foreign origin or smuggled, lacking foreign markings, and was part of the legitimate stock of M/s K.C. Gold (proprietor: Appellant No. 4). iii. Appellant No. 4 had provided documents (purchase invoices, stock registers, melting reports) proving the licit source of the gold, which were allegedly ignored. iv. The gold was being transported from Gwalior to Delhi by Appellant. No. 3 and Appellant No. 1 (employees of Appellant No. 4) for making jewellery, and the return journey occurred because making charges could not be agreed upon with 'Suraj Gold' in Delhi. v. The cavity in the car (owned by Appellant No. 4) was made for the safety of the gold during transport, not for concealment of smuggled goods. vi. The burden of proof under Section 123 of the Act was not discharged by the department, and the seizure being a town seizure, the presumption of smuggling does not apply. vii. There is no corroborative evidence apart from the retracted statements, and the alleged supplier ....
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....ing of the transport operation by Appellants 2 and 4. v. Appellant No. 2's own statement dated 21.10.2023 admitting he instructed Appellants 1 & 3, acknowledging the gold was procured without documents from 'Chotu (mobile no. 9654198492) to evade taxes/duties, and confirming Appellant No. 4's knowledge and the use of his car. vi. The recovery of Gold Testing Reports (Sl. No. 69 & 70 dated 11.09.2023 from Kalash Computerized Tunch Centre) along with the gold bars, which were later linked through investigation (CCTV identification by Shri Vitthal Salunkhe and statement of Shri Raj Kumar Soni) to Shri Raj Kumar Soni getting the bars tested at the behest of Shri Prince Soni. This contradicts the narrative of the gold being old stock from Gwalior and points to a recent transaction/handling in Delhi before departure. vii. The initial attempt by Appellants 1 and 3 to mislead investigators by stating they worked for M/s Mohit Jewels, when they were actually employees of M/s K.C. Gold (proprietor: Appellant No. 4), as noted in Para 5.2.26 of the O1O. Therefore, the Adjudicating Authority rightly relied on these corroborated statements. The claim of dur....
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....ble. It defies commercial logic to transport gold worth over Rs 1.26 Crores over a long distance without first finalizing critical aspects like making charges, especially when such negotiations could easily occur via phone/email. This story lacks credence and reinforces the view that the gold was illicitly procured in Delhi, as initially stated by Appellants 1 and 3. 5.9 Crucially, Appellant No. 2 (Umesh Agrawal) himself admitted in his statement that the gold was procured without documents from Chotu' in Delhi to evade taxes/duties and that he paid Rs 1.22 Crores in cash. This directly refutes the legitimate sourcing claim made by Appellant No. 4 (Abhishek Agrawal). 5.10 The appellants claim the cavity in the Kia Seltos car (owned by Appellant No. 4) was for safety. However, the nature of the cavity specially constructed under the passenger seat, accessed by loosening bolts points strongly towards concealment for illicit purposes rather than mere safety. Legitimate transport of valuable goods typically involves standard security measures, not hidden compartments requiring tools to access. Appellant No. 2 admitted the cavity was made for security during transp....
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....urden under Section 123, the corroborative CDR evidence, the presence of recent testing slips from Delhi, and the clear roles played by each appellant in the conspiracy the Adjudicating Authority correctly concluded that the gold was smuggled and liable to absolute confiscation under Section 111(b) & (d) of the Act. The vehicle, being used for transporting and concealing smuggled goods with the knowledge and involvement of the owner (Appellant No. 4) and the mastermind (Appellant No. 2), was rightly held liable for confiscation under Section 115(2), with an option for redemption under Section 125. The packing materials used for concealment were correctly held liable for confiscation under Sections 118 & 119. 5.13 The penalties under Section 112(b) are justified as all four appellants were knowingly concerned in carrying, removing, keeping, concealing, or otherwise dealing with goods (the smuggled gold) which they knew or had reason to believe were liable to confiscation under Section 111. Their actions and omissions directly rendered the goods liable to confiscation. The quantum of penalty imposed on each appellant appears commensurate with their respective roles in the sm....
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....ation. 25. Section 178A provides for burden of proof. It says : "(i) Where any goods to which the 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 on the person from whose possession the goods were seized. (2) This section shall apply to gold, gold manufactures, diamonds and other precious stones, cigarettes and cosmetics and any other goods which the Central Government may, by notification in the Official Gazette, specify in this behalf. (3) Every notification issued under sub-section (2) shall be laid before both Houses of Parliament as soon as may be after it is issued." 26. Large scale smuggling of gold or other goods into India may pose a threat to the economic and fiscal interests and policies of the State. Such illicit trade is often carried on by organized international smugglers in the secrecy of the under-world. The more it is organized, the less are the chances of its detection, and greater the difficulty of proving the offences relating thereto. Laws have therefore been enacted in most countries, which mark a partia....
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....icit business remain in the special or peculiar knowledge of the person concerned in it. On the principle underlying Section 106, Evidence Act, the burden to establish those facts is cast on the person concerned : and if he fails to establish or explain those facts, an adverse inference of facts may arise against him, which coupled with the presumptive evidence adduced by the prosecution or the Department would rebut the initial presumption of innocence in favour of that person, and in the result prove him guilty. As pointed out by Best 'Law if Evidence' 912^th Edn. Article 320, page 291), the "presumption of innocence is, no doubt, presumption juris : but every day's practice shows that it may be successfully encountered by the presumption of guilt arising from the recent (unexplained) presumption of fact. Thus the burden on the prosecution or the Department may be considerably lightened even by such presumption of fact arising in their favour. However, this does not mean that the special or peculiar knowledge of the person proceeded against will relieve the prosecution or the Department altogether of the burden of producing some evidence in respect of that fact in issue. It will ....
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....ng that there was no direct evidence that the gold had been smuggled after March 1947, it was held that a finding to that effect could be reached by referring to "the conduct of the appellant in connection with (a) the credibility of the story about the purchase of this gold from three parties, (b) the price at which the gold was stated to have been purchased which was less than the market price and (c) the hurry exhibited in trying to get the gold melted at the refinery with a small bit of silver added so as to reduce the fineness of the gold and thus approximate the resultant product to licit gold found in the market". 40. In the case before us, the circumstantial evidence suggesting the inference that the goods were illicitly imported into India, was similar and reasonably pointed towards the conclusion drawn by the Collector. There was no violation of the rules of natural justice. The Collector had given the fullest opportunity to Bhoormull to establish the alleged acquisition of the goods in the normal course of business. In doing so, he was not throwing the burden of proving what the Department had to establish, on Bhoormull. He was simply ....
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....at the statement made by the appellant-IV was not retracted till the time of the adjudication proceedings to an specific query made during the course of argument. In respect of restriction for production of the document at the time of arrest and bail proceedings before the Court of Magistrate and thereafter, Counsel replies in negative. When asked to produce the copy of decision of the Courts, the reply was also negative. In the case of M/s K.I. Pavunny 1997 (90) ELT 241 (SC) after referring to earlier decisions Hon'ble Supreme Court has observed as follows:- 26. In Naresh J. Sukhawani v. Union of India - 1996 (83) E.L.T. 258 (S.C.) = 1995 Supp. 4 SCC 663 a twoJudge Bench [to which one of us, K. Ramaswamy, J., was a member] had held in para 4 that the statement recorded under Section 108 of the Act forms a substantive evidence inculpating the petitioner therein with the contravention of the provisions of the Customs Act as he had attempted to export foreign exchange out of India. The statement made by another person inculpating the petitioner therein could be used against him as substantive evidence. Of course, the proceedings therein were for confiscation of the contraban....
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.... 27- 30 ..................... 31. It is seen that the contraband of 200 gold biscuits of foreign marking concealed in a wooden box and kept in the pit in the compound of the appellant was recovered at 9.00 a.m. on December 6, 1980 in the presence of Panch (mediator) Witnesses including PW-3. This is proved from the evidence of PWs 2, 3 and 5. There was nothing for PW3 to speak falsehood against the appellant who is a friend of him. PWs 2 and 5 also withstood the gruelling cross examination. There is nothing to disbelieve their evidence. The appellant herein made statement under Section 108 at 1 p.m. on December 6, 1980, i.e., after four hours. It is unlikely that during that short period PW-2 and 5 would have obtained the retracted confession under Ex. P-4 in his own hand-writing running into 5 typed pages under threat or duress or promise. No doubt the wealth of details by itself is not an assurance of its voluntary character. The totality of the facts and circumstances would be taken into account. On a consideration of the evidence, the High Court accepted that Ex. P-4 is a voluntary and true confessional statement and accordingly it convicted the appellant of t....
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....tatements made were never re-tracted till 07.02.2024, much after issuance of Show Cause Notice on 08.11.2023.Hon'ble Madras Hogh Court has in the case of K. Rahuman Sait [2021 (376) E.L.T. 476 (Mad)] observed as follows: 25. Considering the facts and circumstances of the present case, more particularly, when the present case arises under the provisions of the Act, the appellant cannot place reliance on the decision in the case of Capt. M. Paul Anthony, which was the matter concerning the service condition of the appellant therein. The said decision is wholly inapplicable to the case on hand. The Tribunal, which is the last fact finding forum, has re-appreciated the factual matrix and rendered a finding that on the date when the officers of the Department conducted search operations in the godown at Tuticorin, the appellant was present and the cartons, which were lying in the godown, when opened, were found to contain sandalwood concealed along with Mangalore Roofing Tiles. Further, the admissibility of the statement recorded under Section 108 of the Act from the appellant on 11-31998, was considered by the Tribunal and it was held that the said statement is admissible and ....
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....3, 6, 7 and 8 respectively gave Exts. P2, P5, P6 and P7 statements under Section 108 of the Act to the Customs Officers. There is nothing on record to show that these statements were retracted, But the Magistrate proceeded on the assumption that these statements were retracted and the record evidencing this fact are missing in the case records. If so he ought to have enquired into the matter and traced out the records. He over-looked the fact that even if they were retracted, belated retractions will not be of much value because it could only be taken as the result of afterthought or advice. In fact there was no retraction and if at all there was retraction it was only when questioned under Section 313 of the Code. 4.8 Thus we do not find any merits in the submissions made by the appellants in respect of legal acquisition/ possession of the gold confiscated on the basis of the documents which they have produced belatedly or in respect of the belated retraction of statement done. In a similar case relating to smuggling of gold, where similar stand has been taken by the appellant, rejecting all the arguments advanced by the appellant in respect of confiscation of the gold Hon'ble ....
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....om the statement under section 108 itself that the identity of the person intercepted was revealed, which was found to be verified and correct by the Assistant Commissioner (Preventive) in the office of the Principal Commissioner, Central Goods and Service Tax and Central Excise, Tikrapara Dhamtari Road, Raipur by communication dated 2-8-2017, which is produced in the memorandum of appeal at page 76 along with the documents in support of the notice issued, produced at Annexure-A. The identity of the owner of the gold seized from the intercepted person also was revealed from the statement. The statement also admitted the person having boarded Howrah-Mumbai Mail Express, and that he was travelling to Raipur; in the course of which, some persons in civil dress woke him up and introduced themselves as officers of DRI, Patna. They searched his body and during the course of search, the smuggled gold kept hidden and covered inside the pants, was detected. So much of the statement has not been retracted from. 16. The person intercepted had also disclosed the name of the person from whom he had received the gold bars at Kolkata, who had directed him to hand over the same to the res....
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....on, is correct. Even then it has to be established that the gold, which even on a visual inspection, is clearly discernible as sourced from outside the country, is imported in accordance with the Act, specifically Sections 46 and 47 read with Section 7 of the Act. There is no escape from this, even if, we fail to reckon the statement of the person intercepted that in his knowledge the gold was smuggled from Bangladesh. We reiterate, at the risk of repetition, that the fact of possession of the gold bars, which was seized by the DRI official from his person and that he was carrying it in the Howrah-Mumbai Mail Express, stands clearly established. Whether it was first taken from Raipur or it was obtained in Kolkata, are irrelevant facts; when looking at the aspect of importation and the validity of seizure, by reason of the belief entertained by the DRI official that the gold bars were not imported in accordance with the provisions of the Act. 20. On the above admitted facts, we have looked at the decision in Ganpati Overseas (supra) and the principles deduced by the learned Judges from the judicial pronouncements in Naresh J. Sukhawani and K.I. Pavunny (both supra). We spec....
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....evealed from a mere visual inspection, which discloses the markings on the gold bars. Now, the question arises as to whether the alleged owner of the goods referred to as Noticee No. 2, the respondent herein, had obtained valid possession through a legal import made by him. 22. At this juncture, we look at the Original and the appellate orders which the respondent seeks to sustain. The order of the Tribunal extracts the reasoning of the First Appellate Authority, which reasoning and further findings by the Tribunal, are challenged as perverse by the appellant herein. The Department placed reliance on the fact that none of the cars owned and used by the noticee Nos. 3 and 4, son and father, who allegedly sold the gold bars to Noticee No. 2, had travelled from Bhilai to Raipur. This is in the context of the specific statement made by Noticee No. 3; a dealer located at Bhilai, that he had delivered the goods to Noticee No. 2; with his business at Ranchi. Investigation revealed that none of the cars, owned by the Noticee Nos. 3 and 4, the numbers of which were supplied to the DRI, crossed the Kharun Toll Plaza. The goldsmith 'Subh', to whom the gold bars were allegedly....
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....pecially when the statement under section 108 was retracted and was not corroborated by any material evidence. It was also found that there was no attempt by the Department to trace out the whereabouts of Sonu and Chandan Malik, the former of whom was referred to, in the retracted statement, as the person who handed over the smuggled goods. There was no attempt made by the customs authorities to trace out the entire chain of the alleged smuggling of gold. The absence of description of the gold bars in the invoice produced to support the sale and purchase was held to be irrelevant in the libralised economy, post repeal of the Gold Control Act; which does not remain to be a legal requirement. The Tribunal accepted the findings of the First Appellate Authority. 25. We have already referred to the admitted position that the two gold bars recovered were sourced from abroad; which is undisputed. The possession of the person intercepted also is admitted and the ownership is said to be on the respondent in the present appeal. Section 123 (2) of the Act specifically makes it applicable to gold and when gold is seized under the Act, as per sub-section (1) on a reasonable belief that....
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....ed never called him over telephone. Mukesh Ganatra who was also carrying on the business of gold jewelry, feigned ignorance about Subh Karigar @ Sohan Verma. He admitted to have known the respondent with whom he had no business relations and he denied that he introduced any person by name of Subh Karigar to the respondent. 28. We have also looked at the statements of the Noticee Nos. 2 to 4, as extracted in Annexure-A. Noticee No. 2, the respondent herein, was summoned thrice and the statements were recorded on 4-8-2017, 5-8-2017 and 188-2017. The respondent at the first instance, produced the photocopy of the invoice dated 21-7-2017 issued from Saheli Gems and Jewellers Pvt. Ltd. for purchase of 2 kilograms of gold bar valued at Rs. 58,80,000/- along with stock details and sale and purchase invoices from January 2014 to January 2017. He also produced the original of the Karigar Issue Slip which was received and signed by the respondent and a faded copy of Letter No. 2702/2017 in the letter-head of Sri Adinath Jewellers addressed to Shubh. Both the Karigar slip and letter addressed to Shubh are of no consequence since already it has been found that Shubh did not exist in t....
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....acquainted with Noticee No. 2, but asserted that they had given 2 kilograms of gold on credit; highly suspicious. 31. The First Appellate Authority and the Tribunal had entirely relied on the invoice dated 21-7-2017 produced by Noticee No. 2 to hold that the seized gold bars were purchased from Saheli Gems and Jewellers Pvt. Ltd. We cannot but hold that the reliance placed is wholly irrelevant since the two sets of bill books produced requires further evidence to establish the transactions between Saheli Gems and Jewellers and Adinath Jewellers having occurred on the day it is said to have occurred; prior to the interception and seizure, especially since no payment was made for the purchase. Viewed in this context, it is pertinent that the invoice does not contain the description of the gold bar sold, thus, making it impossible to identify the gold sold, to be the very same gold recovered from the person of Noticee No. 1. Then again, if the gold recovered, from its physical appearance itself did not disclose its source; probably the invoice would have had a semblance of evidentiary value, even if the payments were made after the seizure of the gold; which discounts the evi....
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....jewelery goes contrary to this common knowledge available. Further, we do not find any merits in the above submission as to why for making jewelery again of 18 to 20 karats someone first purify the gold obtained by melting of the jwelery to this purity and thereafter re-add impurities for making the jewelery. On a specific quary raised during the course of argument after doing some research in the Court with regards to process of purification, Counsel for the appellant submitted that there is some Aquaregia process by which impure gold could have been purified. We do not find any merits in the said submission because that was never even stated by the person at Kailash Tunch Center who specifically deal with regard to testing of the gold purity. We do not find any merits in this argument. In case of Gudipati Subba Reddy [2023 (385) E.L.T. 394 (Tri. Hyd)] Hyderabad bench observed as follows: 7.8 I also observe that gold of Indian origin is generally of 916 purity (22 carat). Bureau of Indian standards has certified BIS 916 22 carat, BIS 958 23 carat, BIS 750 18 carat, the 999 quality is the 24 carat gold. It is 22 carat gold which is used in ornaments. Hence for India, the m....
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.... a finding, the tribunal has referred to certain decisions and holds that he noticees have explained the source of procurement of gold which is not denied by the revenue and further having no mark on the gold and purity of the gold is not in conformity of the foreign gold, the benefit of doubt goes in favour of the noticees. 23. Further the tribunal holds that the statements recorded during the investigation was retracted by the respondent and other two co noticees and they are not admissible in absence of corroborative evidence. After referring to certain decisions, the tribunal hold that the currency seized from the respondent and the other two co noticees were not established by the revenue with corroborative evidence to show that the same are the sale proceeds of smuggled gold and then proceeds to refer to a certain decision and has recorded its conclusion in paragraph 26 holding that the respondent and the two co noticees have submitted that the smuggled/procured gold in question is made out of old gold jewellery purchased in cash and the said fact has not been denied by the revenue by any cogent evidence, therefore the gold in question is not liable for confiscation ....
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.... correctness of the validity of the retraction, the point of time at which the retraction was made whether the retraction was consistent and whether it was merely a ruse. These aspects have not been examined by the learned tribunal resulting in perversity. The mobile phones which were recovered and the call details record which were obtained have all been elaborately discussed by the adjudicating authority. This aspect has not been dealt with by the learned tribunal. The seizure cannot be denied by the respondent since the seizure list was drawn in the presence of two independent witnesses and the DRI officers and copy of which was handed over to the respondent and the other two co noticees. Further we find there was nothing on record before the learned tribunal to hold that mere melting of old gold jewellery will yield gold of less purity and considering the quantity which has been seized, it can never be the case of the respondent or the other two co noticees that they have done the melting process at their residence as such melting requires expertise and also use of several chemicals. Thus, the observations of the tribunal have to be held to be without any basis or foundational ....
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....when recovered, its transportation and the use of fake challans along with the phone call details clearly establish the role and involvement of all the persons involved . The appellant by taking such plea is indeed trying to mislead but the fact is that the goods smuggled, even if they change their form by melting, they still remain smuggled goods which are liable to confiscation under the Act. Reliance is also placed on the decision of the Kerala High Court in Mammu & Anr. v. Asst Collector of Central excise 1984 (17) E.L.T. 54 (Ker.) = 1981 taxmann.com 56 (Ker.) where it has been held that since no definite tests have been prescribed under law, whether an article is gold of particular quality and purity, it has to be borne in mind that the opinion of an expert on this point is relevant under section 45 of the Evidence Act. ⮚ Rakesh Luthra [(2024) 14 Centax 255 (Tri.-Del)] 9. ..... It is also seen that once there is an admission by the appellant himself, nothing further is required to be proved to the contrary. The Supreme Court in Surjeet Singh Chabbra v. Union of India [1997 (89) E.L.T. 646/1996 taxmann.com 71 (S.C.)] held that confession made by the app....
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....ment to show that the gold was legally imported by them or that it was purchased by them from somebody who had legally imported it. 34. Learned counsel for the appellant submitted that on 8-12-2015 the appellant had retracted his statement and, therefore, it cannot be relied upon. We have gone through the statements made before the learned CMM by the appellant in his application for bail which is at page 109 to 112 of the appeal book. The application only states that the statement was not made by the appellant. However, there is nothing in the statement made before the learned CMM explaining the nature of the gold seized from the appellant. In the absence of any other explanation, the statements made by the appellant and Shri Ahadees before the officer must be accepted as correct. These statements corroborate each other and with the panchnama. The cross-examination of Shri Ahadees by the learned counsel for the appellant also confirm the facts pertaining to this seizure and also that on previous two occasions smuggled gold was transacted between the appellant and Shri Ahadees. The mobile phone recovered from the appellant and which was used to communicate with Shri Ahadees....
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....nce, the penalties imposed upon under Section 112 (b) are also justified. In case of Gudipati Subba Reddy, referred earlier, Hyderabad bench observed as follows: From the entire above discussion of facts, evidences and circumstances, it is clear that the appellants in this case had acquired possession of such gold which they could not prove to be of India origin. There has been no denial that they were purchasing the gold at the cheaper rate which rather corroborates that they were in possession of smuggled gold. Section 112(b) of the Act is wide enough to penalise even a person acquiring possession or in any way dealing with the goods which he knows or has reason to believe are liable for confiscation under Section 111. Thus it is held that the appellants had rendered them liable for imposition of penalty. I do not find any infirmity in the findings of the adjudication authorities below while imposing penalty upon the appellant. Even with respect to the appellant Shri Atluri Ramanjaneya Reddy, the owner of the Hyundai Xcent in question, I do not find any reason to differ from the findings arrived at by Original Adjudicating Authority in Para 17.6 of the Order-in-Original ....
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.... them in their ordinary sense with reference to other clauses of the Act or Rules as the case may be, so far as possible, to make a consistent enactment of the whole statute or series of statutes/rules/regulations relating to the subject-matter. Added to this, in construing a statute, the court has to ascertain the intention of the law making authority in the backdrop of the dominant purpose and the underlying intendment of the said statute and that every statute is to be interpreted without any violence to its language and applied as far as its explicit language admits consistent with the established rule of interpretation." In case of Sunny Kakar referred earlier, following was observed: 37. The last question to be answered is regarding the penalty under Section 112(b)(i) of Rs. 50 lakhs imposed upon the appellant. We find that as per Section 112(b) any person who acquires possession of or is in any way concerned in carrying, removing, depositing, harbouring, keeping, concealing, selling or purchasing, or in any other manner dealing with any goods which he knows or has reason to believe are liable to confiscation under section 111 is liable to penalty. In case o....