TaxTMI 
TaxTMI 
2026 (3) TMI 1091
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.... after he had passed through the green channel, as he was moving suspiciously. The CISF officials found that the appellant was carrying four packets covered with polythene paper concealed on his body. The CISF officials vide letter dated 15.02.2020, informed the AIU officials that two packets each weighing 200 grams were recovered from his socks and another 2 packets each weighing 350 grams were recovered from his undergarments, that the appellant himself admitted that the four packets were gold in paste form. The appellant along with his two checked-in bags and one hand bag and the 4 packets said to contain gold in paste form weighing approximately 1100 grams and which were recovered from his body by the CISF officials was handed over to the Customs. The officers questioned the passenger as to whether he has any contraband items with him to which the passenger has replied that he had arrived from Singapore by Flight No. TR-574 on 15.02.2020 at 01:10 hrs and that he tried to smuggle out gold in paste form and that he concealed the gold in paste form in his socks and also in his undergarments. Then the officers in the presence of passenger and in the presence of independent witnesse....
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....l violates the mandatory provisions under Section 138B of the Customs Act, 1962. Learned Counsel for the appellant has reliance placed in this regard on the decision of the Hon'ble Supreme Court in Andaman Timber Industries Vs commissioner of Central Excise [2015 (3254) E.L.T. 641 (SC)], wherein, it has been held that denial of cross-examination amounts to violation of principles of natural justice. 8. It is further submitted that what was allegedly recovered was gold paste and not primary gold and the same was subsequently processed chemically to obtain gold bars. Thus, the goods seized were not identified or established as smuggled gold. 9. Learned Counsel for the appellant also submits that the interception to place outside the Customs area, and therefore, the requirement of declaration under Section 77 of the Customs Act does not arise. 10. Learned Counsel for the appellant further submits that Section 123 of the Customs Act, 1962, which shifts the burden of proof in respect of notified goods cannot be invoked unless, the Department first establishes reasonable beliefs regarding smuggling. Reliance has been placed on the judgments of Bombay High Court in Union of India....
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....ng jurisdiction: i) Mannu Yadav Vs Commissioner of Customs (Airport), Kolkata [2008 (230) ELT 274 (Tri-Kol)] ii) Dinker Khindria Vs Commissioner of Customs, New Delhi [2009 (237) ELT 41 (Tn-Del)] 13. The statement given by the appellant has not been retracted till now. The statement made before Customs officers under Section 108 of the Customs Act, 1964 are admissible evidence. In this regard, Learned AR reliance placed on the following judgments: i) Shri Romesh Chandra Mehta Vs State of West Bengal [1999 (110) ELT 324 (S.C.)] ii) Sucha Singh Vs Assistant Collector of Customs, Amristar [2010 (262) ELT 225 (P&H)] iii) M/s Yogey diamond Vs Commissioner of Customs (Priv), Mumbai [2004 (176) ELT 717] 14. Learned AR also submits that no any request for cross-examination was made by the appellant before the Adjudicating Authority. This plea was raised for the first time only in the grounds of appeal before the Commissioner (Appeals), who has examined this contention in details. Right of cross-examination is not necessary in every case, its depends upon its facts and circumstances. 15. Learned AR reliance has placed on following judgme....
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....g persons, namely: (a) any person who has landed from or is about to board or is on board any vessel within the Indian customs waters. (b) any person who has landed from or is about to board, or is on board a foreign-going aircraft. (c) any person who has got out of, or is about to get into, or is in, a vehicle, which has arrived from, or is to proceed to any place outside India. (d) any person not included in clause (a), (b) or (c) who has entered or is about to leave India. (e) any person in a customs area. 101. Power to search suspected persons in certain other cases (1) Without prejudice to the provisions of Section 100, if an officer of customs empowered in this behalf by general or special order of the Principal Commissioner of Customs or Commissioner of Customs, has reason to believe that any person has secreted about his person any goods of the description specified in sub-section (2) which are liable to confiscation, or documents relating thereto, he may search that person. (2) The goods referred to in sub-section (1) are the following: (a) gold (b) diamonds (c) manufactures ....
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....see was adversely affected. It is to be borne in mind that the order of the Commissioner was based upon the statements given by the aforesaid two witnesses. Even when the assessee disputed the correctness of the statements and wanted to cross-examine, the Adjudicating Authority did not grant this opportunity to the assessee. It would be pertinent to note that in the impugned order passed by the Adjudicating Authority he has specifically mentioned that such an opportunity was sought by the assessee. However, no such opportunity was granted and the aforesaid plea is not even dealt with by the Adjudicating Authority. As far as the Tribunal is concerned, we find that rejection of this plea is totally untenable. The Tribunal has simply stated that cross-examination of the said dealers could not have brought out any material which would not be in possession of the appellant themselves to explain as to why their ex-factory prices remain static. It was not for the Tribunal to have guesswork as to for what purposes the appellant wanted to cross-examine those dealers and what extraction the appellant wanted from them. 7. As mentioned above, the appellant had contested the truthfulne....
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....486 (S.C)] had made following observations: "12. We may first deal with the question of breach of natural justice. On the material on record, in our opinion, there has been no such breach. In the show-cause notice issued on August 21, 1961, all the material on which the Customs Authorities have relied was set out and it was then for the appellant to give a suitable explanation. The complaint of the appellant now is that all the persons from whom enquiries were alleged to have been made by the authorities should have been produced to enable it to cross-examine them. In our opinion, the principles of natural justice do not require that in maters like this the persons who have given information should be examined in the presence of the appellant or should be allowed to be cross-examined by them on the statements made before the Customs Authorities. Accordingly we hold that there is no force in the third contention of the appellant." 42. In Surjeet Singh Chhabra Vs Union of India [1997 (89) E.L.T. 646 (SC)], the Apex Court observed as under: "3. It is true that the petitioner had confessed that he purchased the gold and had brought it. He admitted that he pur....
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....9] this Court observed: (SCC p. 308, paras 24-25) "24. The principles of natural justice, it is well settled, cannot be put into a straitjacket formula. Its application will depend upon the facts and circumstances of each case. It is also well settled that if a party after having proper notice chose not to appear, he at a later stage cannot be permitted to say that he had not been given a fair opportunity of hearing. The question had been considered by a Bench of this Court in Sohan Lal Gupta Vs Asha Devi Gupta [(2003) 7 SCC 492] of which two of us (V.N. Khare, C.J. and Sinha, J.) are parties where in upon noticing a large number of decisions it was held: (SCC p. 506, para 29) '29. The principles of natural justice, it is trite, cannot be put in a straitjacket formula. In a given case the party should not only be required to show that he did not have a proper notice resulting in violation of principles of natural justice but also to show that he was seriously prejudiced thereby.' 25. The principles of natural justice, it is well settled, must not be stretched too far." (See also Mardia Chemicals Ltd., Vs Union of India [(2004) 4 SCC 311 : (2004) 4 Scale 3....
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.... is compliance of Section 138(B) of the Act, though the same cannot be claimed as an unfettered right in all cases, in the facts of the present case, both Mr. Sushil Aggarwal and Mr. Aidasani are afforded an opportunity to cross-examine Mr. Bhalla."" 28. In the present case, the entire proceedings against the appellant are based on un-retracted statement of the witnesses, corroborative evidence in the form of recovery material. Therefore, no any prejudice caused to the appellant. 29. The plea that the recovered substance were initially gold in paste form also does not help the appellant. The material was processed and confirms to contain gold weighing 844 grams, which clearly establishes the nature of the goods. 30. Further, gold is a notified under Section 123 of the Customs Act, and once possession is established, the burden shifts upon person from whom, it is recovered to prove its licit origin. 31. In the present case, the appellant has failed to produce any evidence to establish the lawful acquisition or import of the said gold. 32. Hon'ble Kerala High Court in the case of Om Prakash Khatri, supra, which is affirmed by Hon'ble Supreme Court, wherein, it was held....
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....ed. The fact that the gold bars and pieces did not have any marking on them is suspicious and it points to a concerted effort to erase the marking on them. The burden under Section 124 which is only of a reasonable belief; is effectively discharged by the Department who initiated action on the basis of the seizure and the record statements of the detained persons. The mere fact that the interception and seizure was not affected in an international border or near an airport or seaport is irrelevant, since the statements of the intercepted persons clearly indicate that they were asked to avoid such means of transport and stick to the normal modes of public transport. There can also be no presumption drawn that the carriers of smuggled gold after the gold reaches the country would only resort to commutation by air or sea. The persons from whom the gold was seized disowned the same and said that they were mere carriers of Om Prakash Khatri, who accepted that the gold seized belonged to his Company. Then the onus to prove that the gold was not smuggled, so as to upset the reasonable belief entertained by the Department shifted and squarely rested on his shoulders. The gold bars and piec....