Legal principle

Redemption of confiscated goods under Section 125 of the Customs Act is a discretionary relief and not a matter of right, and goods imported in breach of statutory restrictions (here, Baggage Rules, 2016 conditions on gold) mutate into 'prohibited goods' under Section 2(33), permitting absolute confiscation without any option of redemption.

Court decision

The Court disposed of the writ petitions with no costs, upholding the orders of absolute confiscation and the refusal of redemption: Rule 5 of the Baggage Rules, 2016 permits only 20g (men) / 40g (women) of gold jewellery and requires a 1-year stay abroad, which the petitioners (4 days' stay, 996g) plainly failed; the gold therefore mutated from restricted to prohibited goods; redemption of prohibited goods is not a matter of right but a discretion under Section 125; and the authorities' discretion was well-founded, so the impugned orders did not warrant interference. The Court decided in favour of the Union/Department.

Facts

Three members of the same family (Geetha, Madhan Kumar and Kannathasan) arrived at Chennai from Dubai on 20.02.2018 after a four-day stay and passed through the Green Channel, denying they carried dutiable gold. Personal search resulted in recovery of 996 grams of 24-carat gold ornaments (332g, 282g and 382g respectively) valued at Rs.30,60,708, concealed beneath their clothing. Customs seized the gold under a mahazar, and adjudication ended in absolute confiscation under Section 111(d) and (l) of the Customs Act, 1962, with the Section 114A penalty later set aside on first appeal but confiscation otherwise confirmed, and the revision confirming the orders. The petitioners challenged the orders in writ petitions seeking release of the gold on payment of redemption fine under Section 125, claiming gold is not a prohibited item.

Key provisions

• Section 125, Customs Act, 1962 — Option to pay fine in lieu of confiscation
• Section 111(d), Customs Act, 1962 — Confiscation of improperly imported goods etc
• Rule 5, Baggage Rules, 2016 — Jwellery
• Section 3(3), Customs Act, 1962 — Classes of officers of customs