ORDER
S. Kalyanam, Member (J)
1. Appeal Nos. 225 to 227/85(MAS) arise out of a common order and relate to single transaction. Since a common question of law would arise for consideration in Customs A.Nos. 223 and 224/85, all the appeals are taken up together and disposed of by a single order. For the purpose of convenience, we set out the facts in Customs Appeal Nos. 225 to 227/85 (MAS).
2. On 14-6-1984 at 6.00 AM, the Superintendent of Central Excise, Hqrs. Preventive, Coimbatore alongwith his officers visited the residential premises of appellant Smt. Kannammal on the basis, of information and recovered therefrom 7 gold slabs kept under a cover of paper packet in a trunk box alongwith ten paper chits. The total quantity of gold was found to be 1046.200 gms. Since the gold in rectangular and square shapes were believed to be in a changed form from out of smuggled gold and since no acceptable explanation was offered by the persons concerned for the licit acquisition of the same, the gold was seized by the authorities as per law, under mahazar, attested by witnesses. Appellant Kannammal gave a statement before the authorities on 14-6-1984 that the seven gold bars under seizure were kept in her house by appellant Ravi who was the nephew of appellant Thirumoorthy, a certified goldsmith and that Ravi informed her that the gold slabs were meant’ for unaccounted sales. Appellant Ravi also gave a statement that the seven gold slabs under seizure belonged to his uncle, appellant Thirumoorthy and were kept in the residence of Kannammal for purposes of safety and that his uncle was doing gold business un-accountedly. Appellant Thirumoorthy also gave a statement on 14-6-1984 to the effect that the gold slabs under seizure as well as the 10 paper chits related to his illegal gold business. The purity of the gold slabs was also ascertained through the officers of the Mint and the report of the Mint Officer was to the effect that the gold slabs were foreign origin. It is in these circumstances proceedings were instituted after further investigations, against the appellants which ultimately resulted in the impugned order, now appealed against.
3. Shri Suganchand Jain, the learned counsel for the appellants assailed the validity of the impugned order on the ground that inasmuch as the allegation in the show cause notice against the appellants is that the gold under seizure was manufactured out of foreign gold, neither the presumption under Section 123 of the Customs Act, 1962 nor confiscation of the same in terms of Section 111(d) of the Act is permissible. It was further urged that the adjudicating authority has not invoked the presumption against the appellants in terms of Section 123 in the show cause notice and so the same cannot be relied upon in the order of adjudication against the appellants. The learned counsel further contended that notwithstanding the fact that the report of the Mint Officer dated 31-8-1984 contains a finding that the gold concerned in the case is of foreign origin, no reasons have been given by the authority for reaching that finding. It was therefore, contended that no reliance could be placed on the report of the Mint Officer. It was further urged that the Mint Officer has also remarked that “to the best of his knowledge and belief, no bullion dealer, refiner etc., in India, is known to manufacture gold of this purity on commercial basis”. The learned counsel argued that this observation of the Mint Officer would clearly prove that gold of this purity out of Indian gold is possible, if not on commercial scale at-least in a small way. The report of the Mint Officer was also assailed by the learned counsel on the ground that it contained the signature of the General Manager who would not have conducted the test and therefore, the report itself is not acceptable in law. The learned counsel placed reliance on the judgments of the Delhi High Court reported in 1983 ELT(D) 1715 in the case of Shantilal Mehta v. Union of India and Anr. judgment reported in the same volume at page 2142 in the case of Dadha Commercial Corporation v. Union of India and contended that notwithstanding the fact that the purity of the gold concerned in those cases was found to be of the order of, 999.1 and 998.5 as per the Mint report, the Delhi High Court rejected the case of the Department that the gold could be said to be of foreign origin merely on the basis of such purity without any foreign markings.
4. Shri K.K. Bhatia, the learned Senior Departmental Representative submitted that the report of the Mint Officer dated 31-8-1984 clearly contains an endorsement that the gold under seizure is of foreign origin. This copy of the report of the Mint Officer was admittedly sent to the appellants and an opportunity was also given to the appellants to challenge the same and since appellants have neither rebutted nor challenged the correctness of the same, the finding under the report is conclusive to establish that the gold under seizure is of foreign origin. The learned SDR further urged that once the gold under seizure is proved to be of foreign origin, the presumption under Section 123 of the Act would become automatically applicable and in the instant case, the appellants have not rebutted the presumption arising against them under Section 123 of the Act. The learned SDR further submitted that gold of foreign origin would be confiscable in terms of Section 11 l(d) of the Act and the mere fact that, the contraband gold has been given a different shape or form making it liable for confiscation under Section 120(1) of the Act also would not in any way render the same anytheless confiscable in terms of Section 111(d) of the Act. The learned SDR further urged that notwithstanding the fact that the presumption invoked against the ‘appellant in terms of Section 123 of the Act has not been specifically set out in the show cause notice, this being a statutory presumption, that would ipso facto follow the moment the gold under seizure is established to be of foreign origin.
5. We have carefully considered the submissions of the parties herein. We do not find any fundamental difference in the legal import between Section 120 and 111(d) of the Customs Act, 1962. Section 111 deals with confiscation of improperly imported goods namely, goods brought from a place outside India. Section 111(d) makes it clear that goods which are imported or attempted to be imported or are brought within the Indian Customs waters for the purpose of being imported, contrary to any prohibition imposed by or under this Act (Customs Act), or any other law for the time being in force are liable to confiscation. It is not disputed that import of gold is prohibited under law. If an imported gold is converted into a different form or shape, still the same would be liable for confiscation and in our opinion, Section 120 of the Act which permits confiscation of smuggled gold notwithstanding any change in their form is only an enabling provision. Therefore, the plea of the learned counsel that inasmuch as the substance of the allegation in the show cause notice comes only within the mischief and ambit of Section .120(1) of the Act, the adjudicating authority is not entitled to confiscate the gold under Section 11 l(d) of the Act much less entitled to invoke the presumption in terms of Section 123 of the Act is not legally tenable. As rightly contended by the learned SDR, Section 123 of the Customs Act merely deals with burden of proof in respect of articles like gold, diamonds etc. and in terms of Section 123, if seizure of goods notified under Section 123 is made from the possession of any person, the person from whose possession such goods are seized should prove that they are not smuggled goods. We therefore, do not find any substance in the plea of the learned counsel that the impugned order is vitiated by reason of the fact that the statutory presumption embedded in Section 123 of the Act and which has been invoked against the appellants in the present case has not been specifically set out in the show cause notice. We have gone through the report of Mint Officer dated 31-8-1984. It is not disputed that the report contains a categorical finding that the gold under seizure is of foreign origin. It is further not disputed that this copy of the report was given to the appellants and the appellants were afforded an opportunity to challenge the correctness of the same. We find that the appellants have not in any way rebutted, much less challenged the correctness of the finding of the authority of the Mint in the report dated 31-8-1984. We therefore, accept the report of the Mint Officer and hold that the gold under seizure has been clearly proved to be of foreign origin. The plea of the learned counsel that no reasons have been given by the mint authority for reaching the conclusion that the gold is of foreign origin is not acceptable because the appellants did not question at any point of time the correctness of the finding of the Mint authority much less sought any opportunity for the Mint authority being summoned by the adjudicating authority so as to enable the appellants to examine them. The observation of the Mint authority in the said report that gold of such high purity as concerned in the case is not ordinarily manufactured on commercial scale, does not in any way help the appellants at all. Even assuming for the purpose of argument that high purity gold is being manufactured by bullion dealers or refiners, if not on commercial basis, at least on a small scale basis, as contended by the learned counsel for the appellants, that would not in any way detract from the finding of the Mint authority that the gold concerned in the instant case is of foreign origin. We do not find any substance in the plea of the learned counsel that the report of the Mint authority is signed by the General Manager of the Mint and so not acceptable. The point which presumably, the learned counsel is trying to make out of this plea is that the authority who actually conducted the test has not put his signature in the report and the signature containing the report of the General Manager in such a circumstance is not entitled to any acceptance under law. In the context of the appellants’ conduct in not even challenging the correctness of the finding in the report of the Mint authority and in the absence of any such plea, either before the adjudicating authority or in the reply to the show cause, notice, we are not inclined to countenance this plea and assuming for the purpose of argument that the appellant is entitled to raise this question for the first time, we do not find any substance therein also. It is common knowledge that an authority administratively in-charge of a particular office or unit is entitled to forward or send a copy of the report of the officer in respect of an analysis made in the office. The ratio of the rulings relied upon by the learned counsel in the judgments of the Delhi High Court are not applicable to the facts and circumstances of this case because in the said cases of Delhi High Court, there was no certificate by any officer of the mint with a specific finding that the gold concerned therein was of foreign origin. The judgments of the Delhi High Court are clearly distinguishable on facts and are not applicable to the facts and circumstances of this case.
6. Therefore, on consideration of the entire evidence available.’ on record, we find that the gold under seizure has been clearly proved to be of foreign origin rendering it confiscable in terms of Section 111(d) of the Act read with Section 120(1) of the Act. At this stage, the learned counsel made a fervent plea for being permitted exercise the option of redemption in respect of the gold under seizure. We are not inclined to countenance such a plea for the simple reason that the gold concerned in the case is found to be smuggled gold. In the result, the impugned order appealed against is confirmed and the appeals dismissed.
Customs A.No. 223/85 and 224/85 (MAS)
So far as Appeal Nos. 223 and 224 of 1985(MAS) are concerned, since identical question arises for consideration in similar circumstances, we adopt the reasoning given aforesaid and dismiss those appeals also.