Bombay HC Stays CESTAT’s Order Granting Redemption of Confiscated Gold: Questions Tribunal’s Jurisdiction and Passenger’s Eligibility under Customs Act [Read Order]
The Bombay HC stayed the CESTAT’s order that had allowed a passenger to redeem confiscated gold, questioning the Tribunal’s jurisdiction and the passenger’s eligibility under the Customs Act.
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The Bombay High Court at Goa, comprising Justices M.S. Karnik and Nivedita P. Mehta, stayed the order of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), which had allowed respondent Shehbaz Nasir Khan Rizwani to redeem confiscated gold ornaments on payment of a fine of ₹1,25,000 and reduced the penalty to ₹50,000, holding that confiscation without the option of redemption was not a valid exercise of authority under Section 125 of the Customs Act, 1962.
The appellant, the Commissioner of Customs contended that the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) had exceeded its jurisdiction since the impugned order was revisable under Section 129DD of the Customs Act, 1962.
The appellant further urged that the Tribunal’s order was perverse as it ignored the material on record showing that the respondent, a frequent flyer who made around 90 short visits abroad between 2014 and May 2019, was not an eligible passenger under the Act.
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The appellant also submitted that, in terms of Para 2.20 of the Foreign Trade Policy and Sections 3(3) and 11(1) of the Foreign Trade (Development & Regulation) Act, 1992, the imported gold would constitute “prohibited goods” under Section 2(33) of the Customs Act, 1962.
The respondent’s counsel argued that the gold ornaments were the respondent’s personal property carried to India for a family function and that the Tribunal had already safeguarded the revenue’s interest by directing redemption on payment of fine.
After considering the substantial questions of law on which the appeal was admitted and the issues raised, the High Court held that the impugned order needed to be stayed as an interim measure. Accordingly, the Court stayed the operation of the CESTAT’s order pending disposal of the appeal.
The assessee was represented by Mohammed Wasim Qureshi, while Asha Desai appeared for the appellant.
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