TaxTMI 
TaxTMI 
2026 (9) TMI 1515
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....s to 100 grams of gold in the form of kada/bangle claimed by the appellant to have been manufactured out of gold lawfully purchased in the domestic market. The Department treated the said gold as being of foreign/smuggled origin and consequently ordered its confiscation and imposed penalty upon the appellant. 3. The case had earlier travelled to this Tribunal. By Final Order dated 03.10.2024, this Tribunal noticed that the appellant had specifically relied upon purchase invoices issued by M/s Augmount Enterprises Pvt Ltd., Hyderabad and M/s Preeti Jewellers, Secunderabad, and had claimed that 999 purity gold purchased under those invoices had been used for manufacture of the seized kada/bangle. This Tribunal found that neither the Adjudi....
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.... the reverse burden contemplated under Section 123 of the Customs Act and, if so, whether the appellant has satisfactorily discharged such burden. 8. At the outset, this bench takes note of the recent judgment of the Kolkata High Court in Anil Kumar Soni & Shri Anil Kumar Goud, supra. The Hon'ble High Court has held that "reasonable belief" under Section 123 is not dependent upon the geographical location of seizure and that a town seizure cannot, by itself, insulate and person from the operation of Section 123 of the Customs Act, 1962. The test is one of prudence based upon the cumulative circumstances. The Court further held that absence of foreign markings does not Ipso Facto negate a reasonable belief of smuggled origin. The Bench bo....
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.... in the light of the ratio in the Shri Anil Kumar Soni / Goud, supra. In the Kolkata High Court case, the crucial defect noticed was an "identity mis-match": the respondent's claimed that 22-carat gold ornaments had merely been melted, whereas, the seized bullion showed purity of 99.5-99.6%; no refinery certificate or melting memo explaining the transaction from 22-carat scarp jewellers to such high-purity bullion was produced. The same reasoning cannot mechanical be applied where the appellant's specific case is that the input gold itself was of 999 purity and had been purchased under identified domestic GST invoices. If the invoices relate to 999 purity gold and the purchases are genuine and accounted for, there is no unexplained conventi....
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....ure of article, statements recorded, documentary provenance, accounting trail and surrounding circumstances. 11. In the present case, the article is admittedly a kada/bangle and there is no finding brought to my notice that it contained any foreign inscription or marking. There is also no allegation comparable to the concealment in a specially stitched waist belt which constituted one of the principal circumstances in the case of Anil Kumar Soni / Goud, supra. Transportation through a domestic courier for stated job-work purposes cannot, without further incriminating material, be equated with physical concealment designed to avoid detection. Further, the documentary defense of the appellant is not a vague plea that the gold had been purc....
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....ts inadequate there because they failed to bridge the factual and scientific gap between the claimant old jewellery and the seized high-purity bullion. The Court held that GST invoices without documentary nexus to the claimed melting/ refinery were insufficient in those peculiar facts. 13. In the present case, however, where the appellant claims purchase of 999 purity gold itself, the reasoning concerning absence of refinery records for converting 22-carat ornaments into 99.6% bullion as no direct application unless the Department first establishes that the invoices relied upon by the appellant do not relate to gold of the description and purity claimed or that they have no credible nexus with his business stock. Thus, although this Benc....