A Single Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), deleted penalty of Rupees 40 lakhs as there was no violation of Section 111 of the Customs Act.
On the basis of specific information, the Directorate of Revenue Intelligence, New Delhi searched premises of the appellant, Rajesh Kumar. The appellant informed that the recovered gold was sale proceeds of smuggled gold sold on that day and also sold during previous week. On a reasonable belief that the recovered gold was smuggled into India and that the said cash amount was sale proceeds of smuggled gold, the same appeared to be liable for confiscation under Section 111 of the Customs Act, 1962. Officers of DRI seized the same under the provisions of section 110 of the Customs Act.
The Commissioner of Appeals observed that the appellant has admitted that he had sold smuggled gold having foreign marking earlier in cash without any bill/ invoice. Further, recovery of Indian currency having face value of Rs. 6.44 crore corroborates the admission of dealing in smuggled gold. Further, observed that the appellant was aware that he was dealing in smuggled gold and accordingly upheld the order of penalty dismissing the appeal.
Aggrieved by the order of the Commissioner the present appeal has been preferred.
The Bench consisting of Anil Choudhary, Judicial Member held that “The appellant has admitted that he had sold smuggled gold having foreign marking earlier in cash without any bill/ invoice. Further, recovery of Indian currency having face value of Rs. 6.44 crore corroborates the admission of dealing in smuggled gold. Further, observed that the appellant was aware that he was dealing in smuggled gold and accordingly upheld the order of penalty dismissing the appeal. provisions of Section 111 as alleged.”
“I further hold that appellant is not involved in acquiring possession of or is any way concerned in carrying, removing, depositing, harbouring, keeping, concealing, selling or purchasing, or in any other manner dealing with any goods which he knew or has reason to believe are liable to confiscation under Section 111. Accordingly, I hold that no penalty is imposable on the appellant in the facts and circumstances under Section 112(b)(i).”
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