Sh. H. Ismail Quilon vs The Commissioner Of Customs & … on 10 July, 2001

Customs, Excise and Gold Tribunal – Bangalore
Sh. H. Ismail Quilon vs The Commissioner Of Customs & … on 10 July, 2001
Equivalent citations: 2001 (133) ELT 191 Tri Bang


Shri S.S. Sekhon


On 8.8.1995 the Police of Karunagapally seized some goods from the Residence of the Appellant and handed them to Quilon Customs. Taking the case, on the same day, 27 passports of 27 persons were seized by Customs Officers in search of the appellant House, who was Travel Agent and dealt in the purchase and sales of Goods of Foreign origin.

2. The market value of seized goods taken over from Police was Rs. 1,93,240/- CIF Value is not shown in the documents, out of which goods valued at Rs.14,300/- (approx.) market value, only attract section 123 of the Customs Act 1962. The goods were explained by the appellant to be collection of duty paid goods procured by him. The lower authorities on adjudication ordered the confiscation of goods worth Rs.28,500/-. Appropriated the bank guarantee of Rs. 1,65,000/- executed for provisionally released goods not available for confiscation and confiscation of Rs. 365 were foreign currency under seizure. A penalty of Rs. 10,000/- was imposed on the appellant. The Commissioner (Appeals) found as regard the appellant before us:

“6. I have carefully considered the appellant’s submissions. A perusal of the appellant’s statements dated 9.8.95,11.8.95 and 31.10.95 reveal that the appellant is admittedly engaged in the trade of sale and purchase of foreign goods. He is also engaged in purchasing passports from people who return from abroad with the intention of utilizing them in import of consumer goods which are not the bonafide baggage of said passport holders. The position therefore which emerges form the appellant’s own statements is that he has been acting in conjuction with a person called Beemapally, 35, to illegally import consumer goods, the import of which is otherwise restricted under para 156 of EXIM Policy 92-97 in the guise of unaccompanied baggage and to dispose of the same for profit. This version is corroborated by the statements of other co-accused, Anil Kumar, Mohammed Kunju, Shahinar Assainar Kunju, Hamsath Koya, Abdul Sattar Saifuddin, and Ebrahim Kutty Basheer Kutty. All these persons in their confessional statements have stated that had given their passports to H. Ismail. The appellant too admitted the purchase of passports for import of unaccompanied baggage in their names. This unaccompanied baggage was not their bonafide baggage. Therefore what has been recovered by the Police and seized by the Customs in not the bonafide baggage of passengers which has been sold subsequent to clearance by the customs but are consumer goods, the import of which is restricted under para 156 of EXIM policy which have been imported illegally in the guise of passengers unaccompanied baggage by misutilising the passports of the said persons on giving them remuneration between Rs.1500/- to Rs.2,500/- as is evident from the statement of the said persons as cited above and is reflected in the appellant’s own confessional statement. Therefore, the argument of the appellant that these goods are freely available in the contry will not hold water. What is allowed to be imported is bonafide baggage, that is bonafide personal and house hold effects, what is not allowed to be imported is consumer goods belonging to third parties in the guise of unaccompanied baggage by some one else. This is what has happened in the instant case as is evident from the confession statement of the appellant H. Ismail. In such circumstances the plea regarding section 123 by the appellant will also not particularly affect the issue since these are consumer goods which have been imported without valid import licence by misusing the provisions relating to Baggage Rules. In these circumstances these goods become liable for confiscation and since these were not available for confiscation, having been released earlier the original authority appropriated the security money furnished by the appellant in lieu of the goods. I find no legal infirmity in the original’s order. The original authority’s order in this regard is upheld as also imposition of personal penalty of Rs. 10,000/- on the appellant Sh. H. Ismail”.

The present appeal is against this findings of the Commissioner (Appeals).

3. We have heard both sides and considered the matter and find:-

a) We find, that the lower authority has determined, that the appellant had cleared non-bonafide baggage, through Banglore Air Cargo Complex, using the passports of S/Shri Anil Kumar, Fazal and others. If that be so, and the goods were released on a Baggage Declaration made, filed and cleared at Banglore Air Cargo, then we do not find that the Additional Collector Trivandrum had the jurisdiction to sit and decide, whether the clearance on Baggage Declaration Form made by the proper officer at Air Cargo Banglore, was in order or otherwise. The jurisdiction rested with the officers of Air Cargo Banglore. We rely on the decision of Supreme Court in the case of UOI Vs. Ram Narain Bishwanath 1997 (96) ELT 224 (SC) wherein the S.C had held

“4. It seems to us, having regard to the facts set out above, clears that it was for the Customs authorities at Paradip to initiate proceedings against the respondents on the ground that the goods have been imported on fictitious licences and not for the Customs authorities in West Bengal to do so.”

In that case the goods were cleared on Bills of Entry at Pradip Orissa and seized in West Bengal by the Customs Authorities there. In the case before us, the goods are found to be cleared on documents filed, then they were seized by Police and the Customs Officer had no reasonable belief to seize them, yet the officers of Customs at Trivandrum, continued the seizure and confiscation proceedings. These confiscation proceedings, in view of the Supreme Court decision in 1997 (96) ELT 224 (SC) are without jurisdiction and thus required to be set aside.

b) Goods were seized in this case by the Police form the residence of appellant, is an admitted position. The Supreme Court in the case of Gian Chand & Ors. (1984 ECR 105 S.C) where in Foreign Marked Gold was seized by the Police on information from the house of Gian Chand and subsequently possession was obtained by the Customs Department from the Police, the Apex Court did not uphold the seizure to be under Act. ie. Customs Act and held satisfaction of the Customs officer as regards such seizures, was not available, to cause shifting of the burden was on the appellant, to prove that it was not smuggled. In the appeal filed by Gian Chand against the confiscation of same gold the Apex Court once again in (1985 ELR 2233 (SC)), following the decision in (1984 ECR 105 SC) allowed the appeal of Gian Chand and ordered the return of confiscated Foreign Marked Gold. In the case before us, no evidence has been led or found that Baggage Goods could not be sold or procured/purchased by the appellant. Following the decisions of the Apex Court, we have no hesitation to allow the appeal and order the return of the goods covered by section 123 and other goods to the appellant herein this case. Since these goods were required to be proved as smuggled goods, by the department, and that burden has not been discharged by them in the facts of this case. We would therefore, set aside the order of confiscation and penalty imposed on the appellant, as we do not find any justification for the confiscation or the penalty. The order of confiscation of the Foreign Currency seized and confiscated against which no appeal was filed by the appellant, is not disturbed.

4. In view of our findings, the appeal is allowed, all goods except Foreign Currency stand released and the penalty is also set aside with consequential relief.

(Pronounced in the court on 10.7.2001)

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