ORDER
P.G. Chacko, Member (J)
1. These appeals are against an order passed by. the Commissioner of Customs in adjudication of a show-cause notice dated 4-9-1998 issued by himself under Section 124 of the Customs Act. The show-cause notice was based on the following facts:
At about 9:00 p.m. on 20-3-1998, officer of Customs (Tuticorin) intercepted, on Kodai Road near Madurai, a jeep bearing registration No. PY-01-K 5082 coming from Dindigul to Madurai. S/Shri K. Mohammed [Appellant in Appeal No. C/257/99], C. Shamsudeen [Appellant in Appeal No. C/258/99] and P. Mohammed AH [Appellant in Appeal No. C/259/99] were found travelling in the jeep and they told the officers that they were going on a pilgrimage to Era-vadi from Perinthalamanna (Kerala). When queried in the presence of independent witnesses as to whether they were carrying any gold, they replied in the negative. However, on a thorough search of the vehicle, the officers could locate a cavity in the wiring box behind the meter board. They recovered four parcels, wrapped in newspaper and tied with rubber bands, from that cavity. Upon opening the parcels, they found 45 (25 + 20) gold bars of foreign origin in two of these parcels and Indian currency of Rs. 41,625/- (Rs. 24,750/ + Rs. 16,875/-) in the other two parcels. The above persons could not produce any document to prove licit acquisition of the gold. The gold bars, currency and vehicle were seized under a mahazar. Statements of the above three persons were recorded by the officers. Those statements were to the effect that the seized gold bars had been purchased from one Prakash Chand (Bangalore) as per the instructions of, and with the cash given by, Shri K. K. Saidalavi [Appellant in Appeal No. C/256/99] and was being transported to Madurai for delivery to one Shri Chettiar. It was also stated that similar deliveries of gold had been effected on behalf of Saidalavi to one Sh. Vilas Sait and one Sh. Sathish (both, of Madurai) earlier. The statements also showed that secret cavities were made in the jeep by its owner and driver, Shri K. Mohammed as instructed by Shri Saidalavi for the purpose of transporting smuggled gold. All summonses issued by the department to Shri Saidalavi for personal appearance were futile. However, he sent a telegram from Kottakal (Kerala) to the Assistant Commissioner of Customs (Tuticorin) on 23-3-1998 claiming that the above gold, bars had been purchased from M/s. Navarathan Jewellers (P) Ltd., Bangalore under Bill No. 5562 dated 20-3-1998 and had suffered duty and requesting that the gold be immediately released to him. In a subsequent letter sent to the Commissioner of Customs (Trichy), with copy to the Assistant Commissioner of Customs (Tuticorin), Shri Saidalavi again claimed that the gold bars had been legally purchased from M/s. Navarathan Jewellers (P) Ltd. who, he claimed, had purchased 500 gold bars (including the above 45 gold bars) from M/s. M.M.T.C. (Bangalore) under Invoice No. 686 dated 17-3-1998. It was also submitted that the gold covered under the said invoice was out of a stock legally imported by M/s. MMTC. Shri Saidalavi also submitted that he had purchased the 45 gold bars through a broker, namely Prakash Chand. He also claimed to have dispatched the gold bars to Madurai through S/Shri K. Mohammed, C. Shamsudeen, P. Mohammed Ali. Shri Saidalavi, subsequently sent a letter to the Superintendent of Customs, Tuticorin also. Statements of Shri Prakash Chand were also recorded by the investigating officers, wherein Shri Prakash Chand stated that he had purchased 45 gold bars from Shri Sajjan Jain of M/s. Navarathan Jewellers (P) Ltd. and sold the same to one Syed Ali’s persons. Shri Sajjan Jain’s statements were also recorded, wherein he admitted that he had sold 45 gold bars to Shri Prakash Chand. He also produced a bill book to show the sale of 45 gold bars to Syed Ali under Bill No. 5562 dated 20-3-1998. He also produced invoice No. 686 dated 17-3-1998 of M/s. MMTC, Bangalore to show the purchase of 500 gold bars. Enquiries made regarding registration of the jeep revealed that the address of the registered owner (K. Mohammed) given in the registration certificate was fake. Investigators also obtained a report from the Income Tax authorities regarding the cash given by Shri Saidalavi for the purchase of 45 gold bars. This report showed that Shri Saidalavi had stated to the Income Tax authorities that he had handed over Rs. 22.50 lakhs to S/Shri K. Mohammed, C Shamsudeen and P. Mohammed Ali on 18-3-1998 for purchase of gold and that the said cash belonged to Shri Nawas Sheriff and Shri Mohammed Ali, who were his (Saidalavi’s) partners in the business of purchase and sale of imported gold. It was on the basis of the results of all these investigations that the subject show-cause notice was issued, which proposed confiscation of the seized items and imposition of penalties on the appellants, besides S/Shri Prakash Chand, Sajjan Jain and Vilas Sait. These proposals were contested by the noticees.
2. In adjudication of the above show cause notice, the Commissioner of Customs ordered absolute confiscation of the gold bars under Section 111(e) of the Customs Act, of the jeep under Section 115(2) of the Act, of the currencies under Section 121 of the Act and of all the packing materials under Section 119 of the Act. He also imposed penalties of Rs. 5.00 lakhs, Rs. 3.00 lakhs, Rs. 2.50 lakhs, and Rs. 2.50 lakhs on S/Shri Saidalavi, K. Mohammed, C. Shamsudeen and P. Mohammed Ali, respectively under Section 112(b) of the Customs Act. Similar penalties were also imposed on S/Shri Prakash Chand and Sajjan Jain. In Appeal No. C/256/1999, Shri Saidalavi has challenged the confiscation of gold bars as well as the penalty imposed on him. In Appeal No.C/257/99 Shri K. Mohammed has prayed for setting aside the order of absolute confiscation of his jeep as also the penalty imposed on him. The remaining appeals are against the penalties imposed on the appellants.
3. Heard both sides. Ld. Senior Advocate Shri B. Kumar submitted that the appellants had adequately discharged their burden of proof under Section 123 of the Customs Act. Relying on the Supreme Court’s judgment in State (Delhi Administration) v. Sanjay Gandhi 1978 SCC (Cri.) 223, ld. Counsel submitted that it was enough for the appellants to prove their case by a preponderance of probabilities as in a civil case. They did not have to establish their case beyond reasonable doubt. Adverting to the evidence on record, he submitted that Shri Saidalavi had purchased the gold bars in question from M/s. Navarathan Jewellers (P) Ltd., through Shri Prakash Chand under Bill No. 5562 dated 20-3-1998 and that the said gold bars were out of a stock of 500 gold bars purchased by M/s. Navarathan Jewellers from M/s. MMTC, who had imported the gold bars in accordance with law. As these transactions were evidenced by documents [Bill No. 5562 dated 20-3-1998, Sales Register maintained on 20-3-1998 by M/s. Navarathan Jewellers, Certificate dated 24-4-1998 issued to Shri Syed Ali by M/s. Navarathan Jewellers and Invoice No. 686 dated 17-3-1998 issued by M/s. MMTC to M/s. Navarathan Jewellers] coupled with the statements of S/Shri Prakash Chand and Sajjan Jain, it was to be held that Shri Saidalavi had established illicit acquisition of the 45 gold bars seized by the Customs authorities. According to Id. Counsel, since the degree of proof required under Section 123 of the Customs Act was not more than that required in a civil case, the question whether Shri Saidalavi had succeeded in discharging his burden of proof was to be decided upon on the basis of preponderance of probabilities in the case. Referring to the confessional statements of S/Shri K. Mohammed, C. Shamsudeen and P. Mohammed Ali relied upon by the respondent, Id. Counsel submitted that all those statements were retracted before the Judicial Magistrate at the earliest opportunity and hence it was not correct to rely upon such statements, Referring to the report of Income Tax authorities. Id. Counsel submitted that nothing contained therein could be relied on to say that Shri Saidalavi had indulged in smuggling of the gold bars seized by the Customs. It was argued that a correct assessment of the evidence on record would show that the preponderance of evidence in this case consisted-of the aforesaid documents and the statements made by S/Shri Prakash Chand and Sajjan Jain and the same was enough to hold that the 45 gold bars were shown to have been lawfully acquired by Shri Saidalavi. Hence, according to Id. Counsel, the seized gold was not liable to be confiscated at all and consequently neither the vehicle could be confiscated nor any penalty was imposable on any of the appellants. Ld. Senior Advocate also endeavoured to draw a parallel between the present case and the case of Samir Kumar Roy v. CC (Prev.) Calcutta 2001 (135) E.L.T. 1036 (Tri. – Calcutta), wherein the Commissioner’s order of absolute confiscation of 20 pieces of gold biscuits of foreign origin from a Maruti car belonging to the appellant [Samir Kumar Roy] was set aside by the Tribunal after holding that the burden cast on the appellant under Section 123 of the Customs Act had been discharged to the requisite extent.
4. Ld. SDR reiterated the findings of the adjudicating authority. She particularly relied on the statement given by Shri Saidalavi to the Income Tax authorities on 26-5-1998, wherein he disowned the cash of Rs. 22.50 lakhs given to S/Shri K. Mohammed, C. Shamsudeen and P. Mohamed AH on 18-34998 for the purchase of gold, which was contrary to the claim made by Shri Saidalavi earlier in his telegram dated 23-3-1998 [sent to the Assistant Commissioner of Customs] and his letter dated 24-3-1998 [submitted to the Commissioner of Customs] that he had purchased 45 gold bars from M/s. Navarathan Jewellers through Shri Prakash Chand with his own money. Shri Saidalavi’s statement given to the Income Tax authorities was never retracted. According to Id. SDR, there was nothing in the statement of Prakash Chand and Sajjan Jain to indicate that the gold bars which they claimed to have sold to Shri Saidalavi were the same as those seized by the Customs officers. Had the two been the same, Shri Saidalavi’s men while travelling in the jeep would have carried a proper bill issued by M/s. Navarathan Jewellers. These men could not produce any such bills to the Customs officers. Ld. SDR also pointed out that the owner-cum-driver of the jeep [K. Mohammed] had clearly stated that he had got secret cavities made in his jeep for concealment of contraband gold, as per instructions of Shri Saidalavi. This statement was never contradicted by Shri Saidalavi. Had the acquisition and transportation of the gold bars been in accordance with law, there would not have been any reason for Shri Saidalavi or his men to conceal the goods in a secret cavity of the vehicle and Shri Saidalavi’s men would not have denied having so concealed the gold bars, before the Customs officers. It was also argued that the retractions made by S/Shri K. Mohammed, C. Shamsudeen and P. Mohamed Ali, before the Judicial Magistrate in the month of May 1998, of their statements given to the Customs officers in March 1998, were not valid in law. Ld. SDR also doubted whether “Saidalavi” and “Syed Ali” were one and the same. The Cash Bill No. 5562 dated 20-3-1998 issued by M/s. Navarathan Jewellers, Bangalore mentioned the name of purchaser of 45 gold bars as “Syed Ali”. The certificate issued by the company on 24-4-1998 also mentioned the name of the purchaser as “Syed Ali”. The sales register maintained by the company for 20th March 1998 did not mention names of purchasers. Though Shri Saidalavi claimed that his name was spelt as “Syed Ali” in Arabic language, there was no evidence on record to substantiate this claim. Ld. SDR submitted that there were serious lacunae in the evidence adduced by Shri Saidalavi, which was not enough to discharge his burden of proof under Section 123 of the Customs Act. Ld. SDR contested the Counsel’s legal proposition that a preponderance of evidence, as in a civil case, was enough for persons accused of having smuggled gold, to discharge the burden of proof in terms of Section 123. According to ld. SDR, the view taken by the Supreme Court in Sanjay Gandhi’s case (supra) was not applicable to the facts of this case. She has also endeavoured to distinguish the case of Samir Kumar Roy (supra) from the case on hand.
5. We have given careful consideration to the submissions. At the outset, we shall address the legal issue raised by ld. Senior Advocate relying on the Apex Court’s judgment in Sanjay Gandhi’s case. The case against Shri Sanjay Gandhi, s/o Smt. Indira Gandhi, former Prime Minister of India, was that 150 spools of the Hindi film ‘Kissa Kursi Ka’ which portrayed the story of his and his mother’s political doings during the emergency period were destroyed at the premises of his company viz. Maruti Ltd., Gurgaon, under his instructions. After the emergency was lifted and Janata Government came to power, the premises of M/s, Maruti Ltd. were raided, whereupon incriminating materials were received indicating that the spools of the film ‘Kissa Kursi Ka’ were burnt and destroyed in the factory premises. A security officer and a security supervisor of the company were arrested on the date of raid and they gave confessional statements before the Chief Metropolitan Magistrate (New Delhi) and were later granted pardon under Section 306 of the Criminal Procedure Code. After completion of the investigation, a charge-sheet was filed by the CBI in the Court of the Chief Metropolitan Magistrate citing a large number of witnesses for proving charges under Sections 120B, etc. of the Indian Penal Code, framed against Shri Sanjay Gandhi. In the proceedings before the Chief Metropolitan Magistrate, the security supervisor resiled both from the statement which he had made to the police under Section 161 of the. Cr. P.C. and from his judicial confession. Subsequently, an application was filed by the Delhi Administration in the High Court of Delhi for cancellation of the respondent’s bail. That application was dismissed by the High Court, against which a Special Leave Petition was filed in the Supreme Court. A legal issue arose before the Supreme Court as to the standard of proof required for cancellation of bail. Their lordships held that the same standard of proof as in a civil case would apply to the incidental issues arising in a criminal trial, like cancellation of the bail granted to the accused. It was held that the prosecution could establish its case, in an application for cancellation of bail, by showing on a preponderance of probabilities that the accused had attempted to tamper or had tampered with its witnesses. In para 14 of its judgment, the Apex Court considered the nature of the burden which rested on the prosecution in an application for cancellation of bail and it was held as under:
Indeed, proof of facts by preponderance of probabilities as in a civil case is not foreign to criminal jurisprudence because, in cases where the statute raises a presumption of guilt as, for example, the Prevention of Corruption Act, the accused is entitled to rebut that presumption by proving his defence by a balance of probabilities. He does not have to establish his case beyond a reasonable doubt. The same standard of proof as in a civil case applies to proof of incidental issues involved in a criminal trial like the cancellation of bail of an accused. The prosecution, therefore, can establish its case in an application for cancellation of bail by showing on a preponderance of probabilities that the accused has attempted to tamper or has tampered with its witnesses. Proving by the test of balance of probabilities that the accused has abused his liberty or that there is a reasonable apprehension that he will interfere with the course of justice is all that is necessary for the prosecution to do in order to succeed in an application for cancellation of bail.
[Emphasis added]
6. It is not in dispute that Shri Saidalavi was required to rebut the presumption created under Section 123(1) of the Customs Act. Section 123 reads as under:
SECTION 123. Burden of proof in certain cases – [(1) Where any goods to which this Section applies are seized under this Act in the reasonable belief that they are smuggled goods, the burden of proving that they are not smuggled goods shall be –
(a) in a case where such seizure is made from the possession of any per-son,-
(i) on the person from whose possession the goods were seized; and
(ii) if any person, other than the person from whose possession the goods were seized, claims to be the owner thereof, also on such other person;
(b) in any other case, on the person, if any, who claims to be the owner of the goods so seized.]
(2) This Section shall apply to gold, [and manufactures thereof] watches, and any other class of goods which the Central Government may by notification in the Official Gazette specify.
It is nobody’s case that the above provision is not applicable to the gold bars in question. Since the gold bars were seized from the possession of S/Shri K. Mohammed, C. Shamsudeen and P. Mohamed Ali, it was incumbent on them, in terms of Section 123(1)(a)(i), to prove that the seized gold bars were not smuggled goods. Since Shri Saidalavi claimed ownership of the gold bars, he was equally liable, under Section 123(1)(a)(ii), to prove that the gold bars were not smuggled goods. The Commissioner has absolutely confiscated the gold bars under Section 111(e) of the Customs Act. In terms of Section 111(e), “any dutiable or prohibited goods brought from a place outside India and found concealed in any manner in any conveyance” shall be liable to confiscation. The gold bars were brought from outside India as evidenced by the foreign markings on them and were recovered from a conveyance (jeep). The allegation of the department is that the gold bars in question were “smuggled”. In terms of definition of “smuggling” under Section 2(39) read with Section 111(e) of the Customs Act, “concealment” of the above goods in the vehicle is an act of “smuggling”. Section 123(1) presumes that goods like gold notified by the Central Government and seized under the Customs Act could be reasonably be believed to have been smuggled by the person from whose possession the goods were seized as also by any person (other than the person from whose possession the goods were seized) who claims to be the owner of the goods. On the facts of the present case, the burden was on the appellants to prove that the gold bars in question were not smuggled by them that is, they had a liability to prove that the goods were not concealed in the vehicle by them.
7. Ld. Senior Advocate has argued that, for discharging the above burden of proof, it was enough for the appellants to establish a preponderance of probabilities to show that the gold bars had been lawfully acquired by Shri Saidalavi and the same were lawfully being transported at the time when the conveyance was intercepted by the officers of Customs. In this connection, reliance has been placed on para 14 of the Supreme Court’s judgment in Sanjay Gandhi’s case (supra), the relevant part of which we have already extracted in this order. Their lordships held that, where the statute raised a presumption of guilt, the accused was entitled to rebut that presumption by proving his defence by a balance of probabilities. Section 123(1) of the Customs Act [which embodies an exception to the general rule of evidence : affirmanti non neganti incumbit probatio, meaning, the burden of proof is on him who affirms, not on him who denies] raised presumption of guilt against the appellants, smuggling being an activity with culpable mental state inherent therein. We shall now proceed to ascertain whether the balance of probabilities in this case is in favour of the appellants.
8. It was claimed by Shri Saidalavi that the 45 gold bars had been purchased by him from M/s. Navarathan Jewellers (P) Ltd. (Bangalore) through a broker, Prakash Chand and that those gold bars were out of a stock of 500 gold bars purchased by M/s. Navarathan Jewellers from Ms. M.M.T.C and, further, that M/s. MMTC had acquired the stock of gold bars through lawful import. The evidence cited by Shri Saidalavi in support of this claim consists of:
(a) Cash Bill No. 5562 dated 20-3-1998 issued by M/s. Navarathan Jewellers (P) Ltd. (Bangalore);
(b) Sales Register maintained by them for the date 20-3-1998;
(c) Invoice No. 686 dated 17-3-1998 issued by M/s. MMTC to M/s. Navarathan Jewellers (P) Ltd.;
(d) Certificate dated 24-4-1998 issued by M/s. Navarathan Jewellers.
(e) Statements of S/Sh. Prakash Chand and Sajjan Jain.
The 45 gold bars in question were claimed to be part of a consignment of gold imported by M/s. MMTC. But no reliable evidence [such as Bills of Entry filed by M/s. MMTC, Invoices issued to them by foreign suppliers, Customs clearance order, etc.] of such goods having been imported by M/s. MMTC was brought on record by Shri Saidalavi, though the invoice issued by M/s. MMTC to M/s. Navarathan Jewellers was produced. This invoice of MMTC covers a quantity of 500 pieces of what is described as “GOLD TT BARS (.999 Purity)”. This document does not mention any markings of foreign origin, in the description of goods. The seized gold bars had the markings “CREDIT SUISSE, 10 TOLAS 999.0”. We find that the description of goods given in the above invoice No. 686 dated 17-3-1998 issued by M/s. MMTC to M/s. Navarathan Jewellers (P) Ltd. is not enough to establish that the 45 gold bars of foreign origin seized by the Customs authorities were a part of the goods covered by the said invoice. Again, Cash Bill No. 5562 dated 20-3-1998 raised by M/s. Navarathan Jewellers on Syed Ali describes the goods simply as “T.T. For”, which is not enough for a correlation either with the goods covered by M/s. MMTC’s invoice or with the gold bars seized by the Customs authorities. The sales register of M/s. Navarathan Jewellers dated 20-3-1998 indicates several cash sales of gold bullion (T.T. Bar) having been made on 20-3-1998 and these include a sale of 45 gold bars at a price Of Rs. 20,99,250/- under Voucher No. 5562. This register does not mention purchaser’s names and hence this document is per se not proof of M/s. Navarathan Jewellers having sold 45 gold bars to any particular person. In the certificate dated 24-4-1998 issued to “WHOMSOEVER IT MAY CONCERN” by M/s. Navarathan Jewellers, it is seen certified that, out of the gold bars purchased from M/s. MMTC, a quantity of 45 gold bars were sold under a valid bill to one Shri Syed Ali through one Shri Prakash Chand. This certificate also indicates that it was issued at the request of Mr. Syed Ali. The certificate was purportedly issued by the authorized signatory of M/s. Navarathan Jewellers (P) Ltd. Shri Saidalavi, who wants to rely on this document, has not disclosed the name of the authorized signatory who issued the certificate to him on behalf of M/s. Navarathan Jewellers. Above all, the name of the purchaser mentioned in Cash Bill No. 5562 dated 20-3-1998 and the certificate dated 24-4-1998 is “Syed Ali” and not “Saidalavi”. Though Shri Saidalavi claimed that, in Arabic language, his name was spelt as Syed Ali, he did not prove this claim, nor did any of the other appellants, all of them Muslims, mention the name ‘Syed Ali’. All of them referred to ‘Saidalavi’ only.
9. Sh. Sajjan Jain’s statement is that Sh. Prakash Chand purchased 45 gold bars from him on 20-3-1998 and requested for a bill in the name of Syed Ali and that the bill was accordingly issued to Prakash Chand at that time. Sh. Prakash Chand has also stated that he received the bill from Sh. Sajjan Jain on 20-3-1998 itself but did not deliver it to Sh. Saidalavi’s men. He delivered the bill to Sh. Saidalavi’s brother “after some days”. But Saidalavi has not brought on record any oral evidence of his brother to prove this version of Prakash Chand. In the normal course of trade, a bill is issued along with the goods under sale. In this case, the broker withheld the bill issued by the seller and did not deliver it along with the goods, which is an abnormal practice, which calls for an explanation. Sh. Prakash Chand has not explained this in any of his statements. These circumstances only seem to detract from the probabilities of the seized gold bars having been purchased by Saidalavi under Bill No. 5562 dated 20-3-1998.
10. Though, on 20-3-1998, Shri Saidalavi claimed in his telegram that he had purchased 45 gold bars from M/s. Navarathan Jewellers under Cash Bill No. 5562 dated 20-3-1998 and claimed absolute ownership over the goods, he stated before the Income Tax authorities on 26-5-1998 that the cash of Rs. 22.50 lakhs given to his men for purchase of the gold did not belong to him but belonged to his partners (Nawas Sheriff and Mohammed Ali) and that he was only a broker in the transaction. In the present appeal, Shri Saidalavi has fallen back upon his “telegraphic” versions to claim ownership over the gold bars. Obviously, Shri Saidalavi is far from consistent in his defence. But “his men” – the other appellants – incriminated him in their statements dated 21-3-1998 and 23-3-1998. These were retracted by them in May ’98 before the criminal court. These belated retractions are inconsequential in the absence of evidence to show that the appellants were made to give the above statements under duress or in terrorem and kept under such coercive conditions by Customs officers till the date of retraction. According to the above statements it was at the instance of Sh. Saidalavi that the secret cavity was made in the jeep and the gold bars and currency were concealed therein and transported to Madurai. Sh. Saidalavi failed to rebut this evidence adduced by his own men.
11. In the aforesaid circumstances, it is our considered view that the balance of probabilities in this case is against Shri Saidalavi and it cannot be said that he succeeded in discharging his burden of proof under Section 123(1) of the Customs Act even in terms of the decision rendered by the apex Court in Sanjay Gandhi’s case. Consequently, the gold bars in question were “smuggled” in terms of Section 2(39) and hence liable to confiscation under Section 111(e) of the Customs Act, and, consequently Shri Saidalavi and his men were liable to be penalized under Section 112(b) of the Act. The vehicle used for the smuggling was liable to confiscation under Section 115(2).
12. We have also considered the Tribunal’s decision in Samir Kumar Roy (supra) cited by Id. Senior Advocate. In that case, gold biscuits were found concealed underneath front seat of the Maruti car belonging to the appellant. On 16-10-1995 the appellant claimed ownership of the goods. He gave a self-incriminating statement on interrogation by officers of Customs. But, in his bail application before the Calcutta High Court, he claimed that he had purchased the gold biscuits from one Shri Mansukhlal T. Bavishi of Mumbai and produced a bill dated 12-10-1995. Shri Bavishi, in his statement, admitted having sold the gold biscuits to the appellant under the said bill dated 12-10-1995. He also stated that he had acquired those gold biscuits from one NRI namely Ismail who had lawfully imported the goods. On these facts, the Tribunal recorded a finding that the gold biscuits had been licitly acquired by Samir Kumar Roy. As rightly submitted by ld. SDR, the present case is clearly distinguishable from that of Samir Kumar Roy inasmuch as, in the case of Samir Kumar Roy, the bill dated 12-10-95 and the oral evidence of Shri Bavishi lawlessly supported the appellant’s claim that the gold biscuits had been lawfully acquired. The evidentiary lacunae and inconsistencies afflicting Shri Saidalavi’s case were not there for Samir Kumar Roy’s case.
13. We have held that the 45 gold bars were liable to confiscation. But the impugned order does not seem to have considered as to whether the goods could be allowed to be redeemed under Section 125. We are of the view that the gold bars could have been allowed to be redeemed against payment of a fine de-terminable by the adjudicating authority in terms of Section 125. Ld. Counsel has submitted that, at the material time, the Government had a liberal policy as regards import of gold. This submission has not been contested. We are of the view that, having regard to the Government’s liberal policy, it was not necessary to order absolute confiscation of the gold bars. We hold the same view in respect of the conveyance.
14. As regards Indian currency of Rs. 41,625/- confiscated by the Commissioner under Section 121 of the Customs Act, we note that the allegation in the show-cause notice was that this money represented sale proceeds of the seized gold bars. We are unable to comprehend this case of the department. The department has all along been saying that the 45 gold bars were being transported by Shri Saidalavi’s men for delivery to someone at Madurai. The currency was also seized along with the gold bars from the same vehicle. How could it be that the currency represented the sale proceeds of 1 the gold bars? Hence the currency was not liable to be confiscated at all.
15. As regards the penalties on the appellants, we have already found that they were liable to be penalized under Section 112(b) for having smuggled goods with the knowledge that the said goods were liable to confiscation under the Customs Act. However, the quanta of penalties imposed on them appear to be harsh. We reduce the penalty on the first appellant to Rs. 3.00 lakhs (Rupees Three lakhs only) and the penalties on the remaining appellants to Rs. One lakh each. The currency seized should be released to its owner. The Commissioner shall determine the quanta of redemption fine for the gold bars and the jeep in terms of Section 125 and deliver the items to the respective claimants against payment of such fine. For this limited purpose, we remand the case to the Commissioner, who is expected to give the claimants a reasonable opportunity of being heard before passing orders.
16. The impugned order will stand modified accordingly. All the appeals are disposed of.
(Pronounced in open Court on 22-9-2005)