Judgment:
2. On 13-1-95, the Customs officers of Varanasi on the basis of specific information intercepted 450 Kgs. of foreign origin cloves at the premises of M/s. Banaras Roadways Transport, Varanasi booked by M/s. Rajasthan Corporation, Varanasi to Shri Ratan Lal and Shri Suresh Kumar of Allahabad under the description as "Kali Til". The consignment was seized for action under the provisions of Customs Act. In the follow-up action, the officers recovered small cardamom, cloves, Javitri, Badam, Dalchini and Chiraungi of foreign origin valued at Rs. 1 Lakhs on the ground that Shri Shanker Lal, Proprietor of M/s.
Rajasthan Corporation could not produce any documents for the illicit importation of the said goods. The case was adjudicated by the Dy.
Commissioner of Customs, who ordered for absolute confiscation of 450 Kgs. of cloves of foreign origin. He also confiscated 66 Kgs. of cloves, 163 Kgs. of small cardamom, 26 Kgs. of Javitri, 12 Kgs. of Badam, 20 Kgs. of Dalchini and 129 Kgs. of Chiraunji, all of foreign origin under Section 111 of the Customs Act but allowed redemption on fine of Rs. 50,000/- in lieu of confiscation. These goods seized from premises of M/s. Rajasthan Corporation, were released provisionally under the orders of the Hon'ble High Court of Allahabad. He also imposed a penalty of Rs. 15,000/- on Shri Shanker Lai under Section 112 of the Customs Act. The Commissioner (Appeals) reduced fine to Rs. 10,000/- and penalty to Rs. 5,000/-.
3. Ld. Counsel for the appellants pleaded that he is not disputing the absolute confiscation of 450 Kgs. of Cloves. He is only arguing on confiscation of the goods seized from the shop of M/s. Rajasthan Corporation and penalty imposed on Shri Shanker Lal. It was pleaded that even though the goods seized from the shop may be of foreign origin but these are not notified goods and as per the Circular of the Board dated 14-12-85 when the goods are recovered from a person who is not proved to be the importer of the goods and claims to be the purchaser of the goods, onus is only on the Customs authorities to establish that the goods were imported contrary to the import prohibition or restriction. It was pleaded that the Customs has totally failed to produce any evidence that the appellants have imported these goods. Reference was made to the various decisions of the Tribunal holding that if the goods are not notified under Section 123 of the Customs Act, the Customs authorities have to establish that the goods have been illicitly imported to hold them liable for confiscation. He also referred to the findings of the Commissioner (Appeals) in para 12 to the following effect: Except this, no other evidence has been on record to show that the goods are of smuggled nature particularly when the goods are not notified under Section 123 of the Act and are easily available in the Indian market.
He, therefore, pleads that in view of this, the goods are not liable for confiscation and the appellants are not liable for penalty.
4. On behalf of Revenue, it was pleaded that the appellants had produced certain bills under which they claimed to have purchased the impugned goods. However, the bills were for one to two years old purchases held to be not pertaining to the goods in dispute as the items being perishable in nature may not be covered by these bills.
Therefore, the bills were rejected by the lower authorities.
5. I have considered the submissions made by both the sides. Since the appellants are not contesting the confiscation of 450 Kgs. of Cloves valued at Rs. 45,000/-, the order of the Commissioner (Appeals) absolutely confiscating these goods is upheld.6. As regards the goods seized from the premises of Rajasthan Corporation, the appellants admitted that although some of them are of foreign origin but the department has totally failed to establish that these have been imported in violation of the Customs Act. As per Board's Circular, it is for the department to establish that the goods have been imported in violation of the Customs Act and are liable for confiscation. Since no such evidence has either been collected or investigated, in the circumstances, it cannot be said that the goods seized from the business premises of M/s. Rajasthan Corporation are liable for confiscation. I, therefore, find no reason to hold the confiscation in order when the foreign origin and illicit import of the goods has not been established. Accordingly, confiscation of goods seized from the premises of Rajasthan Corporation is set aside and the penalty imposed on Shri Shanker Lal under Section 112 of the Customs Act is also set aside.