UBS Mark Omission Insufficient to Confiscate Gold: Orissa HC Confirms Lawful Ownership of Gold under Customs Act [Read Order]
The Court relied on transaction invoices showing legitimate bullion trade chain.
The Orissa High Court held that mere omission of the UBS brand mark in the invoices cannot be a lawful basis for confiscation of gold biscuits under the Customs Act, 1962. The Court affirmed that when the commercial trail is duly established then the respondent had satisfactorily discharged the burden of proving lawful ownership.
The appeal was filed by the Commissioner of Customs (Preventive), Odisha. The dispute arose after 20 gold biscuits of foreign origin were recovered from an individual during a preventive operation. Four invoices from Visakha Bullion Corporation were produced, but they did not contain reference to the UBS brand, leading to seizure and confiscation under Section 111 of the Customs Act, 1962, and penalty under Section 112 of the Customs Act, 1962.
The respondent Satish Kumar Subudhi challenged the orders before the Commissioner(Appeals), which were rejected. On further appeal, the Tribunal set aside the confiscation and penalty, finding the respondent’s purchase legitimate.
Represented by Tushar Kanti Satapathy, the appellant argued that the respondent failed to discharge the burden under Section 123 of the Customs Act, 1962, as the invoices did not specify “UBS” and therefore could not prove lawful origin of the gold biscuits. It was contended that the Tribunal erred in concluding that the goods were not smuggled.
The Tribunal had found that the invoices were issued after genuine sale transactions acknowledged by MMTC Ltd. It held that omission to mention the brand name did not invalidate the legality of purchase, and thus the burden under Section 123 was duly discharged. The Tribunal had then set aside confiscation and penalties, affirming lawful possession of the gold.
The High Court Bench comprising of Chief Justice Harish Tandon and Justice Murahari Sri Raman held that the Tribunal’s findings were based on a proper appreciation of evidence and did not raise any substantial question of law warranting interference under Section 130 of the Customs Act, 1962.
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The Court reiterated that re-appreciation of factual conclusions is not permissible at this stage unless the findings are perverse or contrary to binding precedent. It further observed that the respondent had satisfactorily established legal possession of the gold biscuits through verified invoices and corroboration by MMTC Ltd., and therefore, minor discrepancies such as the absence of a UBS brand description could not form the basis for presuming smuggling.
Thus, the Tribunal’s decision upholding the legality of the goods was sustained by the High Court.
Accordingly, the appeal was dismissed.
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