Legal principle

An Order-in-Appeal passed beyond the six-month period under Section 128A(4A) without a plausible explanation for the delay must be set aside, and the burden of proving that gold seized deep inside Indian territory is smuggled lies on the Revenue and is not discharged by foreign markings alone without verification.

Court decision

The Tribunal set aside the OIA for non-adherence to the six-month time-frame under Section 128A(4A) and allowed the appeal on that ground, and further held the impugned order unsustainable on merits because the Revenue failed to discharge its onus of proving the smuggled nature of the gold; the appellant was granted consequential relief as per law. The Tribunal declined to separately rule on the delay in the de novo OIO, having already allowed the appeal.

Facts

On 23.11.2001, local police seized 7 gold bars (816.480 g, valued Rs.3,64,000) and 86.290 g of gold jewellery from the appellant near Ghughumari Bridge, Cooch Behar, and handed the case to Customs; the appellant claimed he ran a shop 'Gopal Jewellers' and bought biscuits from three named local persons. The original OIO dated 24.10.2003 absolutely confiscated the gold and imposed a Rs.1,00,000 penalty; after two remands, de novo adjudication was taken up only in 2017 and the OIO dated 13.07.2018 released the ornaments, absolutely confiscated the gold bars and reduced the penalty to Rs.75,000. The appellant's appeal was dismissed by the Commissioner (Appeals) via OIA dated 24.09.2020, nearly two years after it was filed on 06.09.2018.

Key provisions

• Section 128A(4a), Customs Act, 1962 — Procedure in appeal
• Section 111, Customs Act, 1962 — Confiscation of improperly imported goods etc
• Section 123, Customs Act, 1962 — Burden of proof in certain cases
• Section 119, Customs Act, 1962 — Confiscation of goods used for concealing smuggled goods
• Section 28(9), Customs Act, 1962 — Recovery of duties not levied or not paid or short-levied or short- paid or erroneously refunded
• Section 110, Customs Act, 1962 — Seizure of goods, documents and things
• Rule 4, Customs (Appeals) Rules, 1982 — Form of application to the [Commissioner] (Appeals)
• Rule 3, Customs (Appeals) Rules, 1982 — Form of appeal to [Commissioner] (Appeals)