TaxTMI 
TaxTMI 
2026 (8) TMI 345
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....t of the confiscated gold on payment of redemption fine. Consequently, the Petitioner also seeks a writ of mandamus directing the Respondent to permit re-export of the seized gold upon such terms as this Court may deem appropriate. 2. The principal issue which arises for consideration in the present Petition is whether the Revisional Authority, in exercise of its jurisdiction under Section 129DD of the Customs Act, 1962 ['Customs Act'], was justified in setting aside the order of the Adjudicating Authority permitting redemption of confiscated gold by way of re-export under Section 125 of the Customs Act, on the ground that re-export of goods forming part of a passenger's baggage is specifically governed by Section 80 of the Customs Act and not by Section 125 thereof. FACTUAL MATRIX: 3. In order to appreciate the controversy involved in the present Petition, the relevant facts, in brief, are required to be noticed. 4. The Petitioner, a national of Turkmenistan, arrived at the Indira Gandhi International Airport, New Delhi, on 01.05.2019 from Turkmenistan. According to the Respondent, after crossing the Green Channel and while proceeding towards the exit gate of the I....
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.... of permitting re-export upon payment of redemption fine. By Order-in-Appeal dated 29.09.2021, the Commissioner of Customs (Appeals) dismissed both the appeals and affirmed the Order-in-Original dated 31.12.2020 in its entirety. 8. Both the Petitioner as well as the Respondent thereafter invoked the revisional jurisdiction of the Central Government under Section 129DD of the Customs Act against the order dated 29.09.2021. The Petitioner sought reduction of the redemption fine and penalties, whereas the Respondent questioned the legality of the direction permitting re-export of the confiscated gold. 9. By the Impugned Order, the Revisional Authority partly allowed both revision applications. While accepting the Petitioner's contention that the demand of customs duty and consequential penalty under Section 114A of the Customs Act relating to the Petitioner's alleged previous imports could not be sustained, it further held that, in matters relating to passenger baggage, re-export is specifically governed by Section 80 of the Customs Act and, in the absence of compliance with the statutory requirements contained in Sections 77 and 80 thereof, the Adjudicating Authority co....
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....hip of the seized gold and the purpose for which it had been brought to India had remained consistent throughout the proceedings. 11.4. It was further submitted that the Order-in-Appeal dated 29.09.2021 specifically records that the Petitioner had claimed ownership of the seized gold from the very inception, including in her statement recorded under Section 108 of the Customs Act, that the Adjudicating Authority had found no material to disbelieve such claim, and that no third person had ever asserted ownership over the seized gold. It was further noticed therein that even the departmental appeal failed to place any material contradicting the Petitioner's ownership. On the strength of these findings, learned counsel submitted that the Revisional Authority was not justified in interfering with the discretion exercised by the Adjudicating Authority permitting redemption by way of re-export. 11.5. It was further contended that the reliance placed by the Respondent upon Section 80 of the Customs Act is wholly misconceived. It was argued that Section 80 merely enables a passenger, who has made a declaration under Section 77 of the Customs Act, to seek detention of goods for subseq....
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.... 12.2. It was further submitted that the Petitioner cannot be regarded as a first-time offender. Drawing attention to the findings recorded by the Commissioner (Appeals), it was contended that the Petitioner's own statements recorded under Section 108 of the Act disclose that she had, on an earlier occasion as well, brought gold into India, sold the same in the domestic market and utilised the proceeds for her medical treatment. It was further submitted that the Petitioner had failed to produce any documentary evidence, including purchase invoices, to establish lawful acquisition or ownership of such a large quantity of gold. According to the learned counsel, the Petitioner's own disclosed financial condition also rendered her explanation inherently improbable and constituted an additional circumstance which the Adjudicating Authority failed to adequately appreciate while extending the discretionary benefit of redemption coupled with re-export. 12.3. It was submitted that both the Adjudicating Authority as well as the Commissioner (Appeals) had concurrently held the seized gold to be "prohibited goods". Once the seized gold had been held to constitute prohibited goods, redemp....
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....dings and that the allegations regarding coercion and improper interpretation were raised for the first time in the writ proceedings. 12.7. It was lastly submitted that the quantity of gold involved in the present case is substantial, namely 2425 grams, valued at more than Rs.48 lakhs at the relevant time. It was argued that extending the benefit of redemption coupled with re-export in such circumstances would dilute the statutory scheme intended to regulate import of valuable goods through passenger baggage and would undermine the statutory framework regulating the import of gold through passenger baggage. ANALYSIS & FINDINGS: 13. This Court has carefully considered the submissions advanced on behalf of the parties and perused the material on record. 14. At the outset, it deserves notice that the scope of the present Petition is considerably narrow. The Petitioner has not assailed the findings recorded by the Adjudicating Authority, as affirmed by the Commissioner of Customs (Appeals), holding the recovered gold liable to confiscation under the provisions of the Customs Act. Equally, the Revisional Authority has already granted partial relief to the Petitioner by setti....
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....s section shall not apply: Provided further that], without prejudice to the provisions of the proviso to sub-section (2) of section 115, such fine shall not exceed the market price of the goods confiscated, less in the case of imported goods the duty chargeable thereon. [(2) Where any fine in lieu of confiscation of goods is imposed under sub-section (1), the owner of such goods or the person referred to in sub-section (1), shall, in addition, be liable to any duty and charges payable in respect of such goods.] [(3) Where the fine imposed under sub-section (1) is not paid within a period of one hundred and twenty days from the date of option given thereunder, such option shall become void, unless an appeal against such order is pending. Explanation.-For removal of doubts, it is hereby declared that in cases where an order under sub-section (1) has been passed before the date on which the Finance Bill, 2018 receives the assent of the President and no appeal is pending against such order as on that date, the option under said sub-section may be exercised within a period of one hundred and twenty days from the date on which such assent is received.]....
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.... must be exercised in conformity with the object, purpose and overall scheme of the enactment. The Legislature has consciously conferred discretion in one category and imposed an obligation in the other. Such legislative differentiation cannot be ignored by treating both categories alike. To do so would amount to rewriting Section 125 rather than interpreting it. 20. The legislative distinction is, therefore, deliberate. Parliament has consciously denied an automatic right of redemption in respect of prohibited goods. If the expression "any other goods" occurring in Section 125 were interpreted so broadly as to include prohibited goods as well, the distinction drawn by the Legislature between the expressions "may" and "shall" would stand obliterated. Such an interpretation would render the opening part of Section 125 wholly redundant. Courts must presume that every word employed by Parliament has been used for a purpose and no part of the statute can be treated as superfluous. 21. Equally significant is what Section 125 does not provide. Although the provision authorises redemption of confiscated goods upon payment of fine, it nowhere provides that such redemption necessarily....
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....crosses the Green Channel and is thereafter intercepted upon detection by the Customs authorities. If the very same benefit could thereafter be claimed merely by invoking Section 125 after confiscation, every passenger carrying undeclared goods would have little incentive to comply with the mandatory declaration requirement under Section 77 in the first place. Such an interpretation would seriously undermine the efficacy of the statutory declaration mechanism and place an honest passenger, who complies with the law, on the same footing as one who consciously conceals goods until detection. Such a consequence could never have been intended by Parliament. 25. In the present case, it is an admitted position that the Petitioner neither declared the recovered gold under Section 77 nor requested detention of the same under Section 80. Rather, according to the record, she crossed the Green Channel and was intercepted only thereafter. The very jurisdictional facts necessary for invocation of Section 80 were, therefore, admittedly absent. Once the statutory conditions prescribed by the special provision were not fulfilled, the Adjudicating Authority could not have achieved the same resul....
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....egard the mandatory requirements governing import of valuable goods into the country. 31. Equally, the explanation offered by the Petitioner does not accord with ordinary human conduct and commercial prudence. If the object was merely to meet the expenses of medical treatment in India, there existed several lawful modes of arranging funds, including carrying permissible foreign currency through authorised channels or transferring funds through recognised banking mechanisms. The explanation offered by the Petitioner, by itself, cannot furnish a legal justification for disregarding the mandatory requirements of the Customs Act. 32. The interpretation canvassed on behalf of the Petitioner would also produce consequences which Parliament could never have intended. Every passenger found carrying undeclared high-value goods could, after interception, seek redemption coupled with re-export by asserting that the goods were intended for meeting personal expenses, medical treatment or some other compelling necessity. Such an interpretation would substantially erode the statutory obligation of declaration under Section 77 and reduce the safeguards incorporated in Section 80 to a matter ....
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....dvance the Petitioner's case. The said decision reiterates that redemption under Section 125 is discretionary and not automatic. However, the issue arising in the present case is qualitatively different. The question here is whether the discretionary power under Section 125 can be exercised so as to confer a benefit which the Legislature has specifically regulated under Section 80. That question neither arose for consideration nor was decided in Nidhi Kapoor (supra). The judgment was principally concerned with the classification of undeclared imported gold as "prohibited goods" and the nature of the discretion exercisable under Section 125. It did not examine the interplay between Sections 80 and 125 of the Customs Act. The judgment is, therefore, clearly distinguishable. 37. The remaining submissions relating to the voluntariness of the statement recorded under Section 108 of the Customs Act, the alleged deficiencies in interpretation, the Petitioner's ownership of the gold and the surrounding factual circumstances no longer materially survive for consideration. The legality of confiscation is not under challenge before this Court. The controversy is confined solely to the lega....