ORDER
M.V. Ravindran, Member (J)
1. These appeals are directed against Order-in-Original No. CCP/ADJ/SR/07A/2007 dated 28.3.2007.
2. The relevant facts that arise for consideration are that the officers of Marine and Preventive Wing of Customs (Prev.) Commissionerate visited the godown located at a place called Bhiwandi on 17.2.2003 and noted that imported goods i.e. polyester fabrics were lying there. The officers directed the godown-keeper to produce the document or record of such foreign originated fabrics. As the godown-keeper could not produce any document / record of the foreign origin fabrics, the officers, in the presence of two independent panchas and godown-keeper, systematically inventorised the fabrics of foreign origin in the godown premises. Subsequently on 29.5.2003 the officers seized the goods and deposited the same in Customs godown at Todi Industrial Estate. The appellants herein claimed the ownership of the said goods and in support of their claim, they submitted copies of bills of entry No. 000235 dated 2.1.2003 and 000609 dated 9.1.2003, along with packing list. Adjudicating authority in the first round of litigation did not accept the contentions and confiscated the entire goods besides imposing penalties on the current appellant. In the first round of litigation before the Tribunal, the Tribunal vide its order No. 622/06-SM(BR) dated 12.4.2006 remanded the matter back to the lower authorities to re-adjudicate the issue and come to a conclusion afresh. The current impugned order is passed in pursuance to the direction of denovo adjudication, vide which goods were confiscated and imposed penalty on the appellants.
3. Ld. counsel appearing on behalf of the appellant submits that the order-in-original itself is contradictory. He draws our attention to the findings of the adjudicating authority that the goods seized under panchanama were in fact in bales i.e. in loose form and number of rolls and the adjudicating authority has tried to link it to the goods imported by the bill of entry. It is his submission that once the goods were received by the appellant, they unpacked the same and packed it into bales and deposited in the cartons. He relies upon the above bills of entry to submit that the duty liability has been discharged on these goods. He submits that the entire quantity was seized in 2003 and even if confiscation is set aside, they will be unable to use these goods and the revenue should be directed to pay the value of the fabrics so seized by them. He also seeks that interest should be paid to them. He relies upon the judgment of the Tribunal in the case of Mohammed Yaseen, Bangalore v. Commissioner of Customs, Bangalore 2005 (102) ECC 305 (Tri) for this proposition. He also relies upon the decision of the Hon’ble High Court of Rajasthan in the case of Rang Lal v. Union of India for the proposition that the amount is to be refunded along with interest. He submits that the said judgment of the Hon’ble High Court of Rajasthan was upheld by the Hon’ble Supreme Court as reported at Union of India v. Ranglal .
4. Ld. SDR, on behalf of the revenue, submits that the findings of the ld. adjudicating authority are very clear and it is seen that the goods which were seized and the bills of entry produced were totally not tallying. It is his submission that the goods covered by bill of entry No. 000609 dated 9.1.2003 were in 80 cartons and each carton was containing ten pieces / rolls. He submits that the total length of rolls, number of cartons as seized by the authorities as compared with the bill of entry are totally mis-matching. He submits that the length of the Taiwan origin fabrics did not match with the bill of entry, packing list. It is his submission that the department has sufficiently proved that the goods are smuggled, and the appellants are unable to prove that the goods were in their possession licitly hence the Commissioner’s order is correct and does not require any interference. The ld. SDR also relies upon the judgment referred to by the ld. Commissioner.
5. We have considered the submissions made at length by both sides and perused the records. At the outset we have to consider whether the goods which were seized by the authorities from the godown were covered under the Notification as issued under the provisions of Section 123 of the Customs Act, 1962. We find that the goods which were seized were synthetic polyester fabrics and covered by the Notification issued under Section 123. Provisions of Section 123 mandates for the goods which are notified under this section it was for the claimant to prove that such goods were not smuggled and are in their possession licitly. In this case the seizure of the synthetic polyester fabric was done by the authorities on 18.2.2003 from a godown at Bhiwandi. The current appellant i.e. M/s Warren Trading Pvt. Ltd. had claimed the ownership of such seized goods. Hence it was for the said M/s Warren Trading Pvt. Ltd. to prove that the goods were not of smuggled nature.
6. The fabrics were seized by the authorities from the godown at Bhiwandi on 18.2.2003 by a panchanama. We may read portion of panchanama from the show cause notice which gives details about the seizure.
On 18.2.2003 the officers visited the godown No. 19 D’souza compound, Purna village, Bhiwandi and in presence of the panchas and Shri Upendra Sharma opened the seal of the godown and entered the premises. The officers then in the presence of two independent panchas and Shri Upendra Sharma systemically inventorised the fabrics of foreign origin stored in the godown premises which were as follows:
S.
No.
Markings
No.
of
Bales
Total
No.
of
Rolls
Country
of
Origin
1.
Shini
Ind. Ltd.
109
Loose
91720
Korea
2.
Punhams
Chino Tex
5
48
Taiwan
3.
Heavy
Twill Titanic P/D
25
273
Korea
139
1258
It can be seen from the above re-produced portion that the authorities, when they seized the synthetic polyester fabrics, the said fabrics were in loose form and packed in cartons.
7. Detailed panchanama which was drawn by the authorities on 25.9.2003, as reproduced at Para 26 of the impugned order also indicates that the goods which were seized by the authorities originated from either Korea or Taiwan. All in all, it can be seen from the panchanama that the goods i.e. synthetic polyester fabrics had originated from Korea or Taiwan. The appellant M/s Warren Trading Pvt. Ltd. produced two bills of entry viz. 000235 dated 2.1.2003 and 000609 dated 9.1.2003. The packing list attached with the bills of entry clearly indicate that the appellant had imported 167 cartons of synthetic polyester fabrics totaling to 44,488 yards of fabric. The adjudicating authority in his impugned order at para 28 has tried to correlate the goods which were seized to those goods which were imported by the bills of entry and came to the conclusion that except for six entries none of the entries are matching. We are afraid to accept this proposition. The details of the seized goods as per panchanama clearly indicates that the country of origin is Korea or Taiwan. The details in the packing list attached with the bills of entry 000235 dated 2.1.2003 and 000609 dated 9.1.2003 clearly indicated that the goods were of Korea or Taiwan origin. It is also seen from the impugned order that the chart which was reproduced by the adjudicating authority (in para 28) clearly indicates that there are at least six entries which match with all the details in bills of entry. This would clearly go to show and indicate that the goods which were seized from the godown were legitimately imported under the said bills of entry. It may be possible that the appellant after importing the goods and paying appropriate duty as assessed, on the bills of entry, might have repacked the goods and sold it subsequently or stored it in the godown. The matching of the entries from the bill of entry No. 000235 dated 2.1.2003 to that goods seized from the godown, would clearly indicate that the goods which were seized by the authorities were not of smuggled nature. The appellants having produced the bills of entry regarding the proof that the goods are not smuggled nature, it was for the revenue to prove that the said goods were of smuggled nature. The exercise which was embarked upon by the adjudicating authority has not proved beyond doubt that the goods were of smuggled nature. This conclusion can be arrived at from the fact that the goods which were seized were not in original package but were in loose condition as is evident from the show cause notice. If that be so, and on the fact that six entries in the bill of entry No. 000235 dated 2.1.2003 were matching totally with the goods which were seized under panchanama, would indicate that the goods which were confiscated, are licitly imported into India. As such, we hold that the goods which were seized and subsequently confiscated by the authorities were duty paid goods and the revenue has failed in its endeavor to prove that the goods were of smuggled mature.
8. The contention of the appellant’s counsel that today they may not be able to use the goods which were seized in the year 2003 seems to the on the strong footing. The goods which were seized and confiscated by the authorities were synthetic polyester fabrics which during the relevant period had demand. The said fabrics might have lost its importance and due to storage of the goods for more than four years, the said goods might have lost its value and importance. As such, we are of the view that the appellants have made out a case for the entitlement of the full mazhar value of the goods which were seized and confiscated by the authorities, as the confiscation of the goods is held as improper. As regards the interest on the confiscation, which is reversed by us, the judgment of the Hon’ble High Court of Rajasthan in the case of Rang Lal and upheld by the Hon’ble Supreme Court, the appellant is eligible for the interest @ 10% as held by the Hon’ble High Court of Rajasthan.
9. Since we have set aside the confiscation, the penalty imposed on the current appellant is liable to be set aside.
Accordingly, we find that the impugned order which absolutely confiscates the entire seized goods is unsustainable and is liable to be set aside on the factual matrix alone and we do so. The appeals are allowed as indicated herein above.
(Pronounced in court)