Godari Rai Vs. Commissioner of Customs - Court Judgment

Excerpt:
1. all the three appeals are being disposed of by a common order as they arise out of the same impugned order passed by commissioner of customs, patna vide which he has absolutely confiscated 44 gunny bags of metal scrap on the findings that the same are smuggled in character.in addition the truck found transporting the said metal scrap has also been confiscated with an option to the appellant to redeem the same on payment of redemption fine of rs. 60,000/- (rupees sixty thousand). in addition personal penalty of rs. 50,000/- (rupees fifty thousand) has been imposed upon shri raghunath prasad, owner of the metal scrap and of rs. 1,000/- (rupees one thousand) on shri godari rai, driver of the truck in question.2. as per the facts on record truck loaded with copper and brass scrap was.....

Judgment:
1. All the three appeals are being disposed of by a common order as they arise out of the same impugned order passed by Commissioner of Customs, Patna vide which he has absolutely confiscated 44 gunny bags of metal scrap on the findings that the same are smuggled in character.

In addition the truck found transporting the said metal scrap has also been confiscated with an option to the appellant to redeem the same on payment of redemption fine of Rs. 60,000/- (rupees sixty thousand). In addition personal penalty of Rs. 50,000/- (rupees fifty thousand) has been imposed upon Shri Raghunath Prasad, owner of the metal scrap and of Rs. 1,000/- (rupees one thousand) on Shri Godari Rai, driver of the truck in question.

2. As per the facts on record truck loaded with copper and brass scrap was intercepted by the customs officers and the goods loaded therein were seized on the reasonable belief that some of the scrap items were found bearing the country of origin as China, England, Taiwan, Italy etc. The owner of the goods Shri Raghunath Prasad before the adjudicating officer submitted that the goods in question belong to his firm named M/s. Sita Metal Traders, Sitamari. The same was registered with the Sales Tax Department and was running the business in metal scrap for the last 18 years. He took the plea before the officers that the appearance of country of origin on some of the pieces of the metal scrap is no proof of the entire quantity of metal scrap being of foreign origin or the same being of smuggled character. He also contended that the onus to prove the smuggled nature of the goods is on the Revenue, and the same has not been discharged by production of sufficient evidence on record.

3. The Commissioner in his impugned order has concluded against the appellant on the ground that no papers could be recovered from the truck, there were markings of foreign Countries on several pieces of the scraps; Sitamari is near the Indo-Nepal border and do not have enough infrastructure justifying movement of huge consignment of metal scrap; that the proposed consignee of the goods have denied having placed any order to the appellant and the owner has deposed that he was taking cash payment for the metal scraps whereas invoice in question suggests payment by draft. On this basis he has concluded that the appellants have not submitted any evidence to prove the indigenous nature of the seized metal scrap and as such the contraband nature of the same is established.

4. After hearing the ld. Counsel for the appellants and Shri A. Sinha and Shri T.K. Kar, ld. SDR for the Revenue I find that metal scrap is a non-notified item in asmuch as the same is neither notified under Chapter IV of the Customs Act, nor under Section 123 of the said Act.

As such, the onus to prove that the scrap in question was of foreign origin and that the same was smuggled is on the Revenue. Appearance of foreign markings of different countries of origin on few pieces of the metal scrap cannot be taken as a scrap as the entire scrap being of foreign origin. Similarly the circumstances discussed by the Commissioner does not reflect upon the smuggled character of the scrap, though the same may raise some doubt. The Revenue has further failed to place any evidence on record to show that the goods have been smuggled clandestinely into the country. The Tribunal in the case of Amar Dutta-1990 (49) E.L.T. 61 has held that onus in respect of non-notified items rests on the Revenue. Similar was the decision of the Tribunal in the case of Hindusthan Bearing Corpn.-1990 (50) E.L.T. 91. In the case of Abdul Mannan1991 (54) E.L.T. 350(T) metal scraps were held to be non-smuggled by observing that the same are easily available into the market and there is no evidence on record to show their smuggled character. In asmuch as in the instant case also there is nothing to reflect upon the smuggled character of the metal scrap in question I set aside the confiscation of the same.

5. Inasmuch as the confiscation of the scrap has been set aside there is no justification for confiscating the truck. The same is ordered to be released without redemption fine. Penalties imposed upon the other two appellants are also set aside.

6. In a nutshell all the appeals are allowed with consequential relief to them. Stay petitions also get disposed of.