TaxTMI 
TaxTMI 
2026 (8) TMI 811
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....om the said passenger. The Government Approved Valuer vide report dated 07.06.2023, has confirmed that the recovered metallic pieces were of Gold, totally weighing 1164.950 grams, valued at Rs. 69,43,102/-. Shri Vinay Kumar Tiwari, in his statement recorded during the course of investigation has admitted that the recovered Gold is of foreign origin, brought into India by way of smuggling from Dubai to Kolkata through Airways; that he was carrying them from Kolkata and he had no document regarding the licit purchase of the said Gold. He also stated that he had been going to Kolkata for the last 4-5 months to bring such smuggled foreign origin Gold pieces from Kolkata. He also stated that he had information from Gold sellers in Bada Bazar that these Gold pieces were smuggled from Dubai through air route and brought to India illegally and then its foreign marks were erased after being moulded and it has been sold at a good margin. This illegal business is in practice on a large scale and the payments for the said transactions are done through cash and hawala. The recovered foreign origin Gold weighing 1164.950 gram & valued at Rs. 69,43,102/-was seized under Section 110 of the Customs....
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....ing authority has passed the following order: I. ordered for absolute confiscation of Gold, Gold jewellery made thereof weighing 4798.930 grams valued at Rs. 2,62,44,692/- and Diamond studded Gold jewellery made thereof valued at Rs. 49,45,676/- under the provisions of Section 111(a), (b), (d) & (h) read with Section 120 of the Customs Act, 1962. II. Ordered for absolute confiscation of seized Indian Currency of Rs. 11,65,250/- so recovered, which is part of sale proceeds of smuggled foreign origin Gold under Section 121 of the Customs Act, 1962. III. Imposed penalty of- • Rs. 10,00,000/- each upon Shri Vinay Kumar Tiwari, Shri Rajesh Kumar, Shri Atul Gaur and Shri Shivnath; • Rs. 5,00,000/- each upon Shri Rahul Tripathi, Shri Rajneesh Tripathi, Shri Narpat Singh, Shri Kuldeep Modi and Shri Suresh Tiwari 5. Being aggrieved, the Respondent preferred appeal before the learned Commissioner (Appeals). The learned Commissioner (Appeals) acceded to the contention of the Appellants and set aside the confiscation of the impugned Gold & Gold Jewellery weighing at 3633.98 gram valued at Rs. 1,93,01,590/-, Diamond Jewellery of Gold value....
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....eign origin can be suppressed. He further stated that he would have handed over the smuggled gold at the office of the Bright Logistics Services and such smuggled gold used to be transported across India from the office of the Bright Logistics Services. The Ld. Commissioner (Appeals) has failed to consider the fact that the identification of the gold has been tampered with so as to avoid being detected, as also admitted by accused persons in the case in their voluntary statements recorded under Section 108 of the CA, 1962. Such type of modus operandi is prevalent and adopted by them to evade law enforcing agencies. • The finding of the learned Commissioner (Appeals) that "the purity of imported gold bullion is 99.99% which also differs in this case as the purity of seized gold is 99.50% which indicates otherwise" has failed to consider the fact that foreign gold smuggled into the country is re-melted and moulded into various forms like bars, small cut-pieces, jewellery, etc, to escape identification. In such scenario, the purity of gold will definitely undergo a change and that a low purity does not indicate that the said gold has not been smuggled. • The ....
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....record that the seized goods consisted of 20 items of ornaments and diamonds out of which six items were released before the issuance of Show Cause Notice and one item was released by the Adjudicating Authority. Six items were released by the Board on appeal. Only 7 items have been confiscated. These consist of 2 packets of diamonds and 5 ornaments. At the time of seizure neither the diamonds nor the ornaments had any foreign markings or label to suggest that the said goods were smuggled in nature. 9.2. Further, the purity of the said gold in the jewellery has not been checked. In such circumstances, Revenue failed to prove that the gold and diamond ornaments were smuggled one. Learned Counsel submits that in the absence of any foreign marking and purity which is not 999.00, the goods were not liable for seizure under Section 110 of the Customs Act, 1962. The learned Counsel further submits that this is a matter of common knowledge that the standard purity of foreign origin Gold is 999.0. In the present case no test of the seized gold was conducted nor any report was placed on record. It is a fact on record that the foreign origin gold means that its purity must be 99.5% or more....
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....ts that the Appeals filed by the Revenue does not merit consideration. Accordingly, he prayed for rejecting the appeals filed by the Revenue. 10. Heard both the sides and perused the appeal documents. 11. We observe that the gold and diamond jewellery in question were seized from the office of Bright Logistics Services, Lucknow. We find that out of the 20 items, only 7 items containing 2 Packets of diamonds and 5 packets of ornaments were confiscated. Neither the diamonds nor the ornaments confiscated had any foreign markings or labels on them. We find that there is no evidence available on record to show that the said Gold Ornaments and Diamond jewellery seized and subsequently confiscated were of foreign origin. No evidence brought on record to substantiate the allegation that the said gold and diamond jewellery were of smuggled in nature. Accordingly, we find that there is no ground for exercising the 'reasonable belief' that the gold in question were smuggled in nature. As there was no 'reasonable belief' available on record, we are of the considered opinion that the seizure of gold at initial stage itself was invalid. 11.1. In the present case, we find that the gold a....
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....s case, we find that the seizure was neither made on international border or any notified customs area. The gold and diamond jewellery in question also does not contain any foreign marking and purity of the gold is not 999.0 which is normally associated with gold of foreign origin. We also find that the 'reasonable belief' which is mandatory condition required for seizure are absent in this case. We find that there is no forensic, documentary, or testimonial evidence adduced by the Department to establish that the seized gold and diamond jewellery is of foreign origin. Under such circumstances, we hold that the provisions of Section 123 are not applicable to the facts and circumstances of this case. 12.1. The Hon'ble Supreme Court in Collector of Customs v. Ganesh Das Bhojraj - 1994 (70) ELT 441 (SC), held that before the burden shifts to the person seized under Section 123, it must first be established that the goods are of foreign origin, and that mere suspicion is insufficient for this purpose. In Commissioner of Customs v. Abdul Gani - 2012 (278) ELT 474 (SC), the Hon'ble Supreme Court held that in the absence of foreign markings or documentation establishing foreign....
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....edings. It is now well settled that a statement recorded during investigation does not automatically acquire the character of substantive evidence unless the conditions stipulated under Section 138B of the Customs Act, 1962 are duly satisfied. In the absence of compliance with the said provision, such statements lose much of their evidentiary significance and cannot, by themselves, constitute the sole foundation for sustaining serious consequences such as confiscation and imposition of penalties. Therefore, we are of the considered view that the statements attributed to the Respondents herein being untested and remaining substantially uncorroborated by any independent evidence, cannot be accorded decisive evidentiary value so as to establish the allegations levelled against the Respondents. Consequently, we hold that the reliance placed upon such statements by the adjudicating authority, without complying with the mandate of Section 138B of the Customs Act, 1962, cannot be sustained in law. 15. Regarding confiscation of the gold and diamond jewellery under Section 111 of the Customs Act, 1962, we find that the said section applies to goods imported or attempted to be imported in....
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....reventive), Patna, Customs Appeal No.75414 of 2022, the Tribunal has set aside the Order of Confiscation by the Commissioner of Customs, Shillong, wherein Gold weighing 3999.590 gms. valued Rs.1,67,98,278was seized from a passenger of a train. In this case, the Tribunal has held as under: "31. We find that the Impugned Order mainly relied upon the statements of the Noticees 1 to 5 to establish the foreign origin nature of the gold. Other than the statements, there is no other evidence available on record to show that the gold were smuggled into the country from Bangladesh. It is incorrect to rely only on the statements of the co-accused without any corroboration, to prove the smuggled nature of the gold. It is a settled law that the statement of the co accused cannot be relied without any independent corroboration. 31.2 The Tribunal in the cases of Principal Commissioner of Customs (Prev.), Delhi Vs. Ahmed Mujjaba Khaleefa [2019 (366) ELT 337 (T) dismissed the appeal of Revenue holding that jewellery not bearing any foreign marking - other than statement of passenger no other proof produced by Revenue to substantiate the claim that jewellery were smuggled into Ind....