RAJ KUMAR GUPTA Vs. COMMISSIONER OF CUSTOMS

JUDGEMENT

(1.) THE appellant was imposed a penalty of Rs. 5 lakhs by the Commissioner of Customs, Lucknow by Order -in -Original dated 12.9.97. The matter relates to the seizure and confiscation of dried ginger recovered from two trucks by the Customs (Prev.) officers on 233.95 on the National Highway between Lucknow and Sitapur. By the impugned order the said ginger valued at Rs. 8,01,040 was confiscated under Section 111(d) of the Customs Act, 1962 and personal penalties were imposed on six noticees under Section 112(b). The Commissioner found that the said ginger was liable to confiscation since it was smuggled from Nepal and it was not of Indian or Nepalese origin. The penalty on the present appellant was imposed on the finding that the Export certificate issued at Bhairaw Nepal and the transport builty of Bajrang Transport Corpn. showed that the smuggled goods in question were to be transported to Shri Raj Kumar Gupta (appellant), Khari Baoli, Delhi and statements of Shri Ranjit Singh, cleaner of the vehicle and Shri Guru Sewak Singh Driver, both supported the allegation that the appellant was the consignee in respect of the impugned goods. Commissioner therefore held that the appellant was a person who was concerned in the purchase/ sale/disposal of the smuggled dry ginger and therefore liable for penalty under Section 112(b).

(2.) ARGUING the case of the appellant (Shri Raj Kumar Gupta), Ld. Counsel Shri Naveen Mullick submitted that the entire case of the Department has been built on the statements given by the cleaner and driver of the seized truck. These persons had never met or seen the present appellant. On the other hand, the appellant had even from the beginning (in reply to the show cause notice) denied having any connection with any of the other noticees or the goods seized. Even the address shown in the builty accompanying the goods was vague and incomplete. Even the statement given by Shri Sanwar Mall, Proprietor of Kedar Rice and Oil Mills in Nepal on 17.10.95 had stated that as per his knowledge the goods were of Nepalese origin. The Department had not shown any record of any payment made by the appellant towards the seized goods to the supplier. No allegation of purchase/sale/disposal of smuggled dried ginger in question can therefore, be made against the appellant. The Department had also failed to discharge the burden of initially proving that the goods were of Third -country origin (other than India and Nepal) which alone would make the goods liable to confiscation. The statements of the driver and the cleaner only went to the extent of saying that they were of 'foreign origin'. On the other hand, the statement of Shri Sanwar Mall was clearly to the effect that the goods were purchased by him from Nepalese farmers. Shri Sanwar Mall had denied that the ginger was of Third -country origin.

(3.) LD . Counsel also made pointed reference to the observations made in the finding portion of the order (internal page 10) where reliance has been placed on the opinion purported to be of some experts in the trade of dry ginger. The Commissioner had observed that the experts had opined that the dry ginger in question was neither of Nepalese origin nor of Indian origin but of Third country origin. He had also observed that one can distinguish the dry ginger of Chinese origin with dry ginger produced in India and Nepal. The dry ginger produced in India and Nepal was reddish in colour while dry ginger produced in China was white in colour. Ld. Counsel submitted that no copy of the trade opinion referred to in the impugned order had been made available to the appellant. He had no occassion to examine the said trade opinion or to question the competence of the so called experts or to contest their opinion. He submitted that the reliance placed by the Commissioner on such an important piece of evidence against the appellant without providing appellant with an opportunity to examine and contest its reliability and authenticity had vitiated the conclusions arrived at by the Commissioner and the penalty imposed on the appellant.