No Confiscation of Gold can be done in Absence of any Act of Illegal Import or Smuggling of Goods: CESTAT [Read Order]

The Kolkata bench of the Customs Excise and Service Tax Appellate Tribunal (CESTAT) held that the confiscation of gold or any goods cannot be done in the absence of any act of illegal import or smuggling of goods. 

Shimul Sarkar, the appellant assessee purchased gold with valid documents from Vicky Jewellery Works Pvt. Ltd. Syakra Para Lane, Bowbazar, and Paul Gold House and Sons, Syakra Para Lane, Bowbazar; and had also purchased the gold biscuits. 

The assessee appealed against the order passed by the Commissioner (Appeals) for confirming the allegations that the purchased gold pieces were smuggled into India and are liable to confiscation under Section 111(b) and 111(d) of the Customs Act,1962 and the persons engaged in this case are liable to be prosecuted under Section 135 of the Customs Act and for the imposition of penalty under section 114AA of the Customs Act. 

Atika Sumran Ahmed, the counsel for the assessee contended that reasonable belief was the only safeguard available against any indiscriminate seizure against any person and the absence thereof makes the entire seizure proceedings bad in the eyes of the law. 

Also submitted that Section 110 of the Customs Act envisages that a proper officer of customs having a reasonable belief that any goods were liable to be confiscated, may seize such goods and here, there had been no reasonable belief on the part of the officer concerned while seizing the goods. 

A.K.Choudhary, the counsel for the department contended that an offense had been committed in violation of Section 7 (C) read with Section 11 of the Customs Act and hence seized the above-recovered goods under Section 110 of the Customs Act, on the reasonable belief that the same had been smuggled into India and are liable to confiscation under Section 111(b) and 111(d) of the Customs Act. 

The Bench observed that in the case of Ajit Bhosle, the court held that the reasonable belief of the officer concerned is absent in the present case and the only safeguard for individuals available under the Customs Act, the seizure was void ab initio. Hence, the goods are liable to be released unconditionally. 

A single-member bench comprising Ashok Jindal (Judicial) held that there was no finding being adhered to which could credibly prove that the assessee engaged in smuggling/illegal importation of the seized goods. 

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