Contraband Gold Smuggled from Third Country of Origin is Liable to Absolute Confiscation: CESTAT Remands Matter to President for Fresh Consideration [Read Order]

The Kolkata Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), confirmed penalty imposed and noted that contraband gold smuggled from third country of origin is liable to absolute confiscation.

The facts of the case are that on specific information received by P & I Branch, Kolkata on 19.05.2015, the appellant (1) to (4) were intercepted at Howrah Railway Station. They were brought to the Customs House after issuing spot summon on them. 6 pcs. of gold bars believed to be of foreign origin which were recovered from the packets in the bag with them. The value of the goods was assessed as Rs.1,68,58,500/-.

The four accused intimated that they had collected the said gold bars from one Shashi Kant Patil, Kolkata on 18.05.2015 and were returning to Allahabad to hand over the said gold to Rinku Verma. All of them though have intimated to have worked as carriers in the past as well for Rinku Verma, ranging from 6 months to about 4 years.

The four accused appellant No. 1-4 were regular (workers) carriers for Rinku Verma and that the foreign marked gold, the legal veracity of which was in itself questionable, as found with no supporting documents of procurement and possession of the said gold, certainly establishes the culpability of the four accused and renders all four of them liable for penal action.

On the contrary Rinku Verma in his statement tendered before the authorities has maintained that he holds business dealings with Shashi Kant Patil amongst others. Specifically stated, Rinku Verma admits in his statement dated 26/10/2015 that he had been doing business for last one year with Shashi Kant Patil of Dhanlaxmi Bullion Pvt. Ltd.

The Judicial Member, Ashok Jindal noted that in this case, the person from whom, the gold has been recovered and claimed to be owner of the seized gold and has produced the purchase invoice, which has been confirmed by the seller of the said gold. Therefore, the onus under Section 123 of the Customs Act, 1962, has been discharged.

The Technical Member, Rajeev Tandon observed that “I am of the view that the department has successfully discharged its primary onus at the preliminary stage and with the onus cast onto the appellants under Section 123, not having been discharged in the least, the order assailed warrants no interference and is required to be upheld. Having thus arrived at the irresistible conclusion that contraband gold smuggled from a third country of origin is liable to absolute confiscation and the appellants subjected to imposition of penalty.”

Owing to the difference of opinion the Bench, directed the Registrar to refer the matter to the President for his kind consideration and referring the matter to a third member for the resolution of the conflict and the difference of opinion.

To Read the full text of the Order CLICK HERE

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