SHAFI AHMED Vs. COMMISSIONER OF CUSTOMS

JUDGEMENT

(1.) BOTH these appeals are against a common Order -in -Original No. 53/89, dated 16 -10 -1989 passed by Collector of Customs and Central Excise wherein Indian currency of Rs. 3,00,000/ - has been confiscated under Section 121 of Customs Act, 1962 along with cloth piece used for concealing the same. However, no penalty has been imposed.

(2.) HEARD Shri Satish Sundar, Ld. Advocate for both appellants. He submits that briefly, on 2 -12 -1988, Customs officers intercepted the two appellants in the train between Madras and Mangalore and recovered Indian currencies totalling Rs. 3,00,000/ -. Initial statements recorded was to the effect that the money was handed over by a person from Salem for delivery to an unknown person at Kanhangad Railway Station. Seven days later, appellant Shri Shafi Ahmed retracted and submitted that appellant Shri A. Sadiq Basha gave the money to him for purchase of a second -hand lorry. Appellant Basha also retracted on the same day and these retractions were to the effect that the money was for use of purchase of a second -hand lorry. On 26 -12 -1988, appellant Shafi Ahemd claimed money by a letter to the Customs authorities. The Order -in - Original was passed ex parte as no one appeared for the hearing, as per the order.

(3.) LD . Advocate submits that apart from the initial statement of the two appellants which were retracted within 7 days and that the retraction by both the appellants was supplemental to each other's story, there is no direct or indirect evidence to show that the currency represented the sales proceeds of the smuggled goods. In this connection, he cites the decision in the case of Ramchandra v. CC as in 1992 (60) E.L.T. 277 (Tribunal) wherein four tests have been laid down to arrive at a violation of Section 121 ibid. He submits that no one of these tests are fulfilled by the above facts and therefore, the ratio of the said decision is applicable in this case. Further he submits that the said decision was relied on in the decision of the Tribunal in the case of Pradip Kumar Singh v. CC as in 1998 (104) E.L.T. 111 (Tribunal) and these four tests were applied therein. Further submits that this Tribunal vide Final Order No. 2549/98, dated 9 -12 -1998 in Appeal No. C/91/91 had similar/applied these four tests laid down in the case of Ramchandra supra and the currencies seized therein were released. Ld. Advocate further cites the decision in the case of Lalith Kumar and Ors. v. CC as in 1988 (38) E.L.T. 366 (Tribunal), wherein it was held that even if the statement with regard to the origin and source of currency given by the appellants is found to be false, that would not ipso facto lead to the conclusion that the currency represented the sales proceeds under Section 121. He further cites the decision in the case of S. Kotteswaran v. CC as in 1997 (91) E.L.T. 435 (Tribunal), wherein it was held that burden on the department to prove that the money represented sales proceeds and mere non accountal as to receipt of money is not sufficient to taint it. He also cites the decision in the case of CC v. Om Prakash as in 1993 (67) E.L.T. 966 (Tribunal), wherein it was held that the department cannot rely only on retracted statements of the accused without any corroboration by independent evidence for confiscation of currency under Section 121. He submits that this is exactly the facts of the case in the present appeals. He submits that in view of these decisions, there is no evidence to show that the currencies seized represented sales proceeds of smuggled goods. He further submits that in para 11, the Ld. Commissioner himself in the order impugned has admitted that since there is no evidence to show that it was these two appellants who had acquired the gold and sold the same, therefore he chooses not to impose any penalty on them. He submits that since the appellants have not dealt with selling the gold as already concluded in the impugned order, therefore any currency found on them would automatically not be connected with any sale of smuggled gold and to that extent, the Order - in -Original impugned itself is contradictory.