Suspicion cannot be treated as proof in absence of Corroborative Evidence: CESTAT reduces Penalty under Customs Act [Read Order]

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Delhi bench comprising Mr Anil Choudhary, member (judicial) has held that, Suspicion cannot be treated as proof in absence of Corroborative Evidence.

As per the intelligence report on the smuggling of gold, the revenue recovered and seized gold valued at Rs. 1,11,96,000/-. Mr Rajeev Kumar, the appellant stated that he was working in M/s Saffron Diamond and Jewellery Pvt Ltd, a company owned by Mr Pawan Kumar Arora, and directed him on the telephone to collect a 10 rupee note from Mr Sameer and was further directed to collect 4Kg of gold from Room No. 201, Delhi pride Hotel.

The Additional Director issued a show-cause notice to confiscate the four gold bars weighing 4kg and having a tariff value of Rs. 1,03,19,000/- and market value of Rs. 1,11,96,000/- which was seized. Further, a penalty under Section 112 of the Customs Act was imposed on appellants for the acts of omission and commission.

The adjudicating authority observed that the seized gold bars have a foreign marking – ‘Kaloti Dubai’. Under provision 123 (2) of the Customs Act, the onus to prove that the seized gold was not smuggled, was on Mr S.B. Taha & Ms A.J. Macud, who have failed to discharge the onus. The appellants stated that their statement recorded during the investigation was not their voluntary statement.

 The Tribunal observed that revenue had not discharged the onus and that the statement recorded during the investigation was given freely and voluntarily by them. It is an established principle of law that suspicion, howsoever strong, cannot be treated as proof in absence of corroborative evidence.

 The Tribunal held that even though gold was not recovered from him, there is strong evidence that he had gone on the said day to the hotel Delhi Pride to receive the gold from the Filipino nationals and upheld the imposing of penalty under Section 112 of the Act. The Tribunal reduced the quantum of penalty from Rs. 1 lakh. to Rs. 25,000/- The appeal was allowed in part. Mr Jitendra Singh, Ms Ekta Kapoor & Ms Reena Rawat appeared on behalf of the Appellant and Ms Tamanna Alam appeared on behalf of the Respondent.

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