Custom, Excise & Service Tax Tribunal
Abubaker Haji Qasim vs Commissioner Of Customs (Airport) ... on 31 October, 2014
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH AT MUMBAI COURT NO. Appeal No. C/211/2007-Mum. (Arising out of Order-in-Original No. COMMR/PVR/ADJN/20/2006-07 dt.31.10.2006 passed by the Commissioner of Customs, Mumbai ) For approval and signature: Honble Mr. P.S. Pruthi, Member (Technical) ============================================================
1. Whether Press Reporters may be allowed to see :
the Order for publication as per Rule 27 of the
CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the :
CESTAT (Procedure) Rules, 1982 for publication
in any authoritative report or not?
3. Whether Their Lordships wish to see the fair copy :
of the Order?
4. Whether Order is to be circulated to the Departmental :
authorities?
=============================================================
Abubaker Haji Qasim
:
Appellant
VS
Commissioner of Customs (Airport) Mumbai
:
Respondent
Appearance
Ms. Deepali Kamble, Advocate for Appellant
Shri D.D. Joshi Superintendent, (A.R) for respondent
CORAM:
Mr. P.S. Pruthi, Member (Technical)
Date of hearing : 31/10/2014
Date of decision : /2014
ORDER NO.
The appeal is against the impugned order passed against the appellant. Shri Abubaker Haji Qasim, confiscating foreign currency equivalent to Indian Rs.32,87,673/- and imposing penalty on Rs.5 lakhs under Section 114(i) of the Customs Act, 1962.
2. The facts of the case are that on prior intelligence, officers of DRI detained the passenger Shri Abubaker Haji Qasim at Mumbai Air Port on 20.5.2005, who had already checked in for a flight to Singapore . On enquiry, the appellant admitted that he was carrying about 75,000 US$ in his checked-in baggage and the same was not declared by him to Customs. Therefore the passenger was off loaded and examination of his checked in baggage resulted in discovery of foreign currency namely US$, Hongkong $ and Singapore $ all equivalent to Rs.32,87,673/-. Panchanama was drawn and the said currency was seized under the provisions of the Customs Act. Further, enquiries and investigations were undertaken and statements of the passenger were recorded under Section 108 of the Customs Act, on 21.5.2005, 3.6.2005, 7.6.2005 and 22.7.2005. It was admitted by the passenger that he had visited foreign countries, particularly Dubai, a few times from Mumbai & Ahmedabad. His tickets were bought by one Shri Wali Mohammed as confirmed by the travel agency M/s. Arcadia Travels Pvt. Ltd. During these visits, he illegally took foreign currency and smuggled into India goods such as textile needles and pharmaceuticals etc. without declaring them to Customs at Ahmedabad Air Port and without paying duty on them. Shri Qasim was arrested. His statements were recorded by DRI on the above mentioned dates, but he kept retracting the same before the Honble Additional Chief Metropolitan Magistrate, Mumbai. The Co-noticee in the adjudication order, Shri Wali Mohammed, could not be traced out till the passing of the adjudication order.
3. Heard both sides.
4. The Ld. Counsel stated that currency is not notified under Section 125 of the Customs Act, 1962, which allows option to redeem the goods on payment of redemption fine. She also stated that the statements were recorded by DRI under duress and were retracted before the Additional Metropolitan Magistrate, Mumbai. The said currency was given by his brother and due to lack of knowledge the passenger could not declare the same at the time of bringing it into India and while taking it out of India. She referred to the affidavit given by his brother Shri Abdul Karim Haji Kassam dt. 7.1.2014 in Houston, Texas, U.S.A. stating that the money belongs to the brother. Pleading for release of currency on payment of redemption fine she relied on
(i) Felix Dores Fernandes Vs. C.C. 2000 (118) ELT -539-Tribunal
(ii) Kishin Shewaram Loungini Vs. C.C. 2002 (140) ELT -225 (Tri-Mumbai)
(iii) Halithu Ibrahim Vs. C.C. 2005 (183) ELT -307-Tri-Chennai It was stated in the grounds of appeal that as per Tribunals order in the case of Poonolly Vs. C.C. [2005 (192) ELT-263 (Tri-Chennai)], only currency in excess of US$ 25000 (as permitted by RBI) is liable for confiscation. Therefore, according to her, penalty is also not legally sustainable.
5. The Ld. AR referred to the facts contained in the adjudication order pointing out the circumstances under which the passenger was apprehended, the detection of concealed currency, the confessional statements given by him repeatedly and voluntarily in his own handwriting, even after retraction, the statement of the travel agent indicating that the ticket was purchased by Shri Wali Mohammed and revealing that Shri Wali Mohammed financed the foreign currency under seizure.
6. I have carefully gone through the facts of the case and the rival contentions of both sides. Certain facts are not in dispute particularly the seizure of large amount of foreign currency from the checked in baggage of the appellant which was not declared by him to the Customs. The Ld. Counsel has tried to pass the act of smuggling as a bona fide mistake due to lack of knowledge and has called it a technical and procedural lapse. I note that Sections 113(d)and 113 (e) of the Customs Act render those goods involved in such lapses, liable to confiscation when they are attempted to be exported or brought within the limitation of any Customs area for the purpose of being exported contrary to any prohibition imposed by or under this Act or under any other law for the time being in force. The undisputed facts of this case are that the goods had not only been brought into the Customs area for being exported but had also been checked in as checked in baggage. And the goods had to be off loaded on the basis of information/intelligence with DRI. This cannot be anything but a case of attempt to export goods contrary to any prohibition under a law and in this case the prohibition is laid down in the Foreign Exchange Management Act (FEMA), 1999 read with the Foreign Exchange Management (Export and Import of Currency) Regulation 2000. Regulations 5 and 7 are as under:
5.
Prohibition on export and import of foreign currency :-
Except as otherwise provided in these regulations, no person shall, without the general or special permission of the Reserve Bank, export or send out of India, or import or bring into India, any foreign currency.
7. Export of foreign exchange and currency notes :-
(1)An authorised person may send out of India foreign currency acquired in normal course of business, (2)
i) any person may take or send out of India, -
ii) foreign exchange obtained by him by drawal from an authorised person in accordance with the provisions of the Act or the rules or regulations or directions made or issued thereunder ;
3) any person may take out of India, -
(i) foreign exchange possessed by him in accordance with the Foreign Exchange Management (Possession and Retention of Foreign Currency) Regulations, 2000 ;
4)
(ii) unspent foreign exchange brought back by him to India while returning from travel abroad and retained in accordance with the Foreign Exchange Management (Possession and Retention of Foreign Currency) Regulations, 2000 ;
Any per resident outside India may take out of India unspent foreign exchange no exceedingly the amount brought in by him and declared in accordance with the proviso to clause (b) of Regulation 6, on his arrival in India.
No evidence has been brought forth by the appellant to establish that the foreign exchange possessed by him was obtained in accordance with Regulation 7(3)(i) or that it was obtained by him under as unspent foreign exchange in terms of or any other Regulation 7 (3) (ii) provisions of the said Act or the Regulations. Further, Regulation 7(4) provides that any person resident out side India may take out of India unspent foreign exchange not exceeding the amount brought in by him and declared. The appellant is not resident out side India. Therefore, this provision does not help him. The facts read with the law stated above clearly point to a deliberate act of attempt to smuggle foreign currency for export. This conclusion is strengthened by the fact that the currency was contained in one brown colour sealed envelope placed in the checked in baggage which is a trolley bag. That is, the passenger attempted to export currency concealed in baggage and had brought it into the limitation of the Customs area in violation of Section 113(e) of the Customs Act.
6.1. The plea of the Ld. Counsel that the currency belongs to appellants brother in US turns out to be a rather weak defense. Firstly, there is no convincing explanation as to how this currency said to be given by his brother was brought into the country by the appellant in such large amount i.e. more than 70000 US$. The affidavit is dated 1.7.2014 i.e. more than 9 years after the date of the incidence. The question arises why claimant did not turn up to claim the currency in these 9 years. Even assuming the Affidavit to be true, although such affidavits cannot be accepted at face value without backing of the any legal supporting document in India, it still does not help the applicant. If he had brought in 75000$, into the country the same was not declared at the time of import, thereby again making the same liable to confiscation under Section 113 of the Customs Act read with provisions of FEMA. Moreover, the appellant has now changed his story after taking the defense under his statements dt. 4.5.2003 that the money was raised by him from his savings and various other sources. In his statements he also confessed to the fact that he was making trips abroad and indulging in smuggling during these trips. The independent statement of Shri Virendra Mehta, Jt. Managing Director to M/s. Arcadia Travel Pvt. Ltd. also provides proof that one person namely Shri Wali Mohammed was purchasing the tickets for the appellant as well as towards the purchase of foreign currency. The fact that the appellant kept giving confessional statements after retracting them only strengthen my view that his was a deliberate act of commission. In this statements he claimed the ownership of the foreign currency. The affidavit of his brother after 9 years is not credible evidence. In any case as stated above, even if the statement of the brother is true an equally serious act of violation of Customs Act read with FEMA is committed by the appellant by import of such huge amount of currency of more than 70000 US$ brought into India it legally and the same would be liable to confiscation.. From the circumstances and the legal provisions there is no doubt that the appellant indulged in the act of smuggling of foreign currency making it liable to confiscation under Section 113 of the Customs Act.
6.2. A plea has been taken that since currency is not a prohibited item, an option must be given under Section 125 of the Customs Act to pay fine in lieu of confiscation. Section 125(1) is extracted below for convenience:
125.Option to pay fine in lieu of confiscation.
(1) Whenever confiscation of any goods is authorized by this Act, the officer adjudging it may, in the case of any goods, the importation or exportation whereof is prohibited under this Act or under any other law for the time being in force, and shall, in the case of any other goods, give to the owner of the goods [or, where such owner is not known, the person from whose possession or custody such goods have been seized,] an option to pay in lieu of confiscation such fine as the said officer thinks fit.
Whether the currency can be absolutely confiscated has already been decided by the Larger Bench in the case of Peringatil Hamza vide order No. M/1280/14/CSTB/C-I d. 23.6.2014 wherein it held that In case a person attempted to export Indian Currency outside India without permission of RBI more than Rs.5,000/- or Rs.10,000/- (as the case may be) in that case the Indian currency can be absolutely confiscated and it is discretion of the proper officer in the facts and circumstances of the case be allowed to redeem on payment of redemption fine and imposition of penalty.
Even otherwise an appreciation of Section 125 leads me to this very conclusion. The Section states that where the importation or exportation is prohibited under the Act or any other law, the officer adjudicating the case may give to the owner of the goods an option to pay fine in lieu of confiscation. The para 6 of Foreign Exchange Regulations (supra) only permit an amount of 5000$ to be brought into the country without making any declaration. And at the time of export unspent foreign exchange may be taken out of India. Any amount exceeding 5000$ which is attempted to be taken out of India has to be possessed in accordance with para 7 (3) (i) and 3 (ii) of FEMA Regulations. It has not even been proved by the appellant that he was in legal position of 5000$ what to talk about 70000$. Thus, the possession of such huge amount of foreign currency is prohibited under FEMA Regulations and the option to redeem the same under Section 125 is not there. Even if one extends the argument that the verdict of the larger bench related to a case of Indian currency, I find that in the present case the appellant does not deserve my discretion to give an option to pay fine in lieu of confiscation.
6.3 The case laws of 2012 (276) ELT 129 (GOI), MD Kalim Ansari Vs. Commissioner of Customs (Prev.), Calcutta 2004 (178) E.L.T. 573 (Tri.-Kolkata), Azizur Rahaman Vs. Commissioner of Customs (Prev.), Kolkata 2012 (285) E.L.T. 401 (Tri.Kolkata) cited during the hearing do not come to the aid of the appellant. In the last cited case above it was held that I find that the common principle runs through the aforesaid decisions is that when a statement furnished under Section 108 of the Customs Act before the Customs Authorities, the said statements no doubt is admissible as evidence, but when there is a subsequent retraction of the said statements then the weight of the said evidence is considerably reduced and there is a necessity for looking at corroboration of the said evidences. In other words, the statement furnished by the persons may not lose its evidentiary value but a conclusion cannot be arrived at solely based on the said statements unless corroborated by other material particulars.
In the present case, the act of smuggling is not established through statements only. It is established through a series of facts and events namely non declaration, detection of currency in a packet contained in a suitcase already checked in, repeated statements of appellant, the circumstantial evidence in the form of statement of M/s. Arcadia etc. The case is also established strictly within the parameters of law laid down under the FEMA Regulation and the export attempt of currency exceeding 70000$ cannot be explained by way of a the trivial argument of bona fide mistake. In view of the totality of circumstances and the evidentiary value of facts, the appellant does not deserve an option to release the goods on payment of redemption fine. His clear active role in the act of smuggling also does not deserve mitigation of the penalty imposed.
9. Order is disposed of in the above terms. The appeal is rejected and order-in-original is upheld.
(Pronounced court on /11/2014)
(P. S. Pruthi)
Member (Technical)
Sm
??
??
??
??
12