TaxTMI 
TaxTMI 
2001 (6) TMI 84
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....ma (driver), Shambu Nath (appellant in Appeal No. C/7/2001) and Lal Bahadur (appellant in Appeal No. C/11/2001). The vehicle and its occupants were taken to the office of the Commissioner of Customs, Lucknow and the vehicle was searched in the presence of independent witnesses. The search revealed secret cavities on either sides of the rear seats. 101 slabs of what appeared to be raw silver along with ornaments and Indian currency of Rs. 1,13,500/- were recovered from the secret cavities. The silver was got assessed for its weight and purity on the spot by assayers summoned by the officers. The assayers reported the total weight of the recovered silver as 187.475 Kgs. and valued the goods at Rs. 10,12,013/-. The purity of silver was reporte....
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.... order dated 23-8-2000 absolutely confiscating the raw silver under Section 111(d) of the Act, confiscating the vehicle with option for redemption on payment of a fine of Rs. 20,000/- and imposing penalties of Rs. 25,000/- each on Shambu Nath and Lal Bahadur. The seized Indian currency was, however, released. Shambu Nath and Lal Bahadur are in appeal against the confiscation and penalties. 3. Perused the records and heard both sides. 4. Ld. advocate, Sh. Naveen Mullick for the appellants submitted that the silver slabs were of 47-64% purity only and could not be considered "silver bullion" so as to attract the provisions of Section 123 of the Customs Act. He, further, submitted that there was no evidence on record to show that the sei....
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....for setting aside the impugned order and allowing the appeals. 6. Ld. JDR, Sh. S. Kumar submitted that the purity of the silver which was reported to be 70% by the assayers, was not challenged by the appellants while replying to the SCN. Silver slabs of 70% purity were covered by the term "silver bullion" in the Notification issued under Section 123(2) of the Customs Act. The goods being so specified under Section 123, the burden was on the appellants to show that the goods were not smuggled goods. This burden was not discharged by the appellants. On the other hand, it was admitted by the appellants, in their statements given under Sections 107 and 108 of the Act, that the goods were smuggled from Nepal into India. Those statements were ....
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....ding to Collins English Dictionary, "bullion" means (i) gold or silver in mass and (ii) gold or silver in the form of bars and ingots, suitable for further processing. There being no dispute of the fact that "silver bullion" was, at the material time, an item notified under Section 123(2) of the Customs Act, the provisions of sub-section (1) of Section 123 were applicable to the silver slabs in question. Ld. Counsel's arguments to the contra cannot be accepted. But, then, Counsel has argued that the initial burden was on the Department before invoking the provisions of Section 123(1) of the Act, to establish that the goods were of foreign origin. Such burden was not successfully discharged by the Customs authorities. The only marks found on....
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....ld have originated from a foreign country. The Bench held that the provisions of Section 123 could not have been invoked in the case. The view taken by the Bench was to the effect that the initial burden was on the Department to establish foreign origin of the goods before Section 123 could be invoked against the owners thereof. The view appears to be a precedent, in the absence of citation of case law to the contrary from the side of the Departmental Representative. 9. With great respect, I may observe that the above view taken in the Kotharis' case appears to be contrary to the legislative intent behind Section 123 of the Customs Act. Sub-section (1) reads as under :- "Section 123. Burden of proof in certain cases. - [(1)] Where any....