1. Briefly the facts are that on 19/01/96 police seized 12 foreign market gold from one Shri Vithal R. Chikla. As per the order of Additional Chief Metropolitan Magistrate, Kurla, Mumbai, the gold bars were taken over by the Customs under a Panchnama dated 25/01/96. The appellant in this case approached the police and claimed the gold stating that it was on his instructions that Shri Chilka was carrying the gold from Mumbai to Hyderabad and that the gold should be returned to him. The Additional Chief Metropolitan Magistrate therefore directed the police to hand over the gold to Customs for proceedings to be conducted under the Customs Act. It transpired that the appellant claimed that the gold in question was brought into India by one Vazue Abdul Razaque Umer, Passport No. P-840388, that the said gold was handed over to him for sale; that he knew Razaque for the last four years; that Razaque under an affidavit stated that he handed over the gold to the appellant and that the sale proceeds would have been returned to Razaque but for the seizure, other details that needs to be mentioned is that the gold in question was being sent to Nizamabad to be sold in that place with the help of one Shri Balia. The latter however stated that he was never informed by Shri Chikla that he was coming to Nizamabad for the purpose of selling the gold etc.
3. The Ld advocate's main contentions are that Section 123 of the Customs Act doest not apply to goods seized by the police and handed over to the Customs Officers; that the Passenger who brought the gold from abroad clearly stated in his affidavit that he cleared the gold through Customs legally; that the baggage receipt produced by the appellant clearly shows that the 12 F.M. gold bars were brought into the country legally; that some minor discrepancy in the passenger's P.P. Number cannot be held against them; that the Department did not discharge the burden cast on them to prove that the gold is smuggled into the country; that the gold is not liable to confiscation under Section 111 (d) of the Customs Act and the person concerned is not liable for penalty.
4. The Ld DR, Shri Arun Chopra while defending the order of the Commissioner (Appeals) submitted that the gold was seized under a Panchnama under the orders of Additional Chief Metropoiitan Magistrate and therefore, the earlier police seizure came to an end on 25/01/96 and under these circumstances, it cannot be held that it was the police who seized the gold. He argued that Section 123 is applicable to the goods. The appellant failed to prove that the goods in question are not smuggled. He reiterated the contention of the Commissioner (Appeals) and argued that no relief is called for.
5. I observe that the Department could establish through the Examiner of Questioned Documents that the affidavit purported to have been signed by Razaque was not signed by him and the signature on the affidavit did not tally with the one on the passport of the passenger who was supposed to have brought the gold in his baggage. This goes to prove that the appellant's claim that the gold in question was brought by Razaque is false. Therefore, the question as to how the gold came into the country remains large open. The answer could be given only by the person who claims the gold. The appellant failed to do so.
6. In regard to the contention that Section 123 does not apply to the facts of this case, I observe that even if it does not, the Department still has established that the gold in question is smuggled. This needs a little elaboration. The popular perception is that in the case of non-notified goods, a Customs Officer cannot question the owner of imported goods as to how he acquired the said goods. There is nothing in the Customs Act, which prohibits an Officer from conducting an enquiry into non-notified goods. In the present case, the appellant himself came forward with a theory that the gold in question was brought by a particular passenger. The Department could successfully establish that the theory put forward by the appellant was not correct.
He had no alternative answer. The burden cast on the Department (In this case because the gold was taken over from the police) to establish the smuggled nature of the gold is not such that the Department has to prove it to the hilt. In the case reported 1983 (B) ELT 1546, the Supreme Court held that the burden of proof on the Department is discharged under the provisions of Section 156 of the Evidence Act, if circumstantial or direct evidence sufficient to raise a presumption in favour of facts sought to be proved. Burden of proof shifts to the appellant, if the evidence is recorded against the appellant's version and it does not get discharged, if the appellants are not found to meet reference arising there from. In the present case, the appellant put forth a theory that the gold in question was brought by a passenger and in support of this contention filed and affidavit purported to have been signed by the passenger. The Department could establish that the passenger holding a particular passport number could not have signed the affidavit. Once this is done, the burden to establish that the goods are not smuggled even in the case of non-notified goods shifts on to the person who claims himself to be the owner of the goods. I hold that the person concerned, the appellant in this case, has not been successful in establishing that the presumption raised against him is wrong. One should remember that even in D. Bhoormati case the Supreme Court was dealing with goods, which were non-notified, while conveying the degree of proof, required in cases involving smuggling.
7. In view of what has been discussed above. I hold that the gold in question is rightly confiscated. Having regard to the circumstances, however. I reduce the penalty to Rs. 50,000/- imposed by the lower authority.
8. Confiscation of gold is upheld. Penalty reduced as above. Appeal partly allowed.