Custom, Excise & Service Tax Tribunal
Mrs. Kiran L Ghaghda vs Commissioner Of Customs (Airport), ... on 2 September, 2016
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH AT MUMBAI COURT NO. IV Appeal No. C/445/09 (Arising out of Order-in-Original No. Commr/TKG/ADJN/23/2008-09 dated 16.1.2009 passed by the Commissioner of Customs (Airport), Mumbai). For approval and signature: Honble Shri Raju, Member (Technical) ======================================================
1. Whether Press Reporters may be allowed to see : No 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 : Yes CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? 3. Whether their Lordships wish to see the fair copy : Seen of the order? 4. Whether order is to be circulated to the Departmental : Yes authorities? ====================================================== Mrs. Kiran L Ghaghda Appellant Vs. Commissioner of Customs (Airport), Mumbai Respondent Appearance: Shri Anil Balani, Advocate for Appellant Shri V.R. Reddy, AC (AR) for Respondent CORAM: SHRI RAJU, MEMBER (TECHNICAL) Date of Hearing: 23.08.2016 Date of Decision: 02.09.2016 ORDER NO. Per: Raju
The appellant, Mrs. Kiran L Ghaghda, was found carrying cut and polished diamonds and pendants valued at Rs.40,94,244/-. The said goods were confiscated absolutely under section 111(i), (j) and (m) of the Customs Act, 1962. The order of absolute confiscation has been challenged by the appellant in this appeal before Tribunal.
2. The learned Counsel for the appellant argued that the goods are not prohibited and therefore, it is mandatory to give an option for redemption. He produced a Policy of the relevant time to show that the goods were not prohibited at the material time. He relied on the decision of the Hon'ble Supreme Court in the case of Hargovind Das K Joshi Vs. Collector of Customs 1992 (61) ELT 172 (SC) and decision of Hon'ble High Court of Kolkata in the case of Rajaram Bohra Vs. Union of India 2015 (322) ELT 337 (Cal) to argue that option of redemption needs to be extended to the appellant. He further argued that the absolute confiscation has been ordered on the grounds that the appellant was only a carrier and not the owner of the goods. He pointed out that section 125 allows redemption not only to the owner of the goods but also to the person from whose possession the goods have been seized. He further argued that the goods which are freely importable can also be imported as a baggage and for this purpose he relied on the decision of the Tribunal in the case of Irfan Abdul Haque Vs. Commissioner of Customs, Mumbai 2001 (131) ELT 441 (Tri-Mum).
3. Learned AR relied on the impugned order.
4. I have gone through the rival submissions. I find that the cut and polished diamonds and pendants have been absolutely confiscated in exercise of discretion that the Commissioners power as vested in the adjudicating authority. He has observed that in terms of para 2.20 of the Foreign Trade Policy, the goods of commercial nature are not allowed to be imported as part of passenger baggage. He further held that the importer does not hold any Import Export Code. He held that non-fulfillment of the restrictions imposed would bring the goods within the scope of prohibited goods. He specifically relied on the decision of the Tribunal in the case of Molok Boloky 2005 (192) ELT 294 (Tri-Del), wherein absolute confiscation was available.
4.1 I find that in the case of Vijaybhav 2014 (313) ELT 506 (Tri-Mum), a Division Bench of the Tribunal has ordered absolute confiscation of diamonds imported against forged license by observing as follows: -
9.21.?On the other hand we find that the ratio of the decisions of the Apex Court in the case of Garg Woollen Mills (P) Ltd. and that of the Madras High Court in the case of Samynathan Murugesan affirmed by the Supreme Court would be relevant. In the Garg Woollen Mills case, the appellants therein imported synthetic woollen rags and serviceable garments were concealed amongst mutilated garments. The adjudicating authority confiscated the entire consignment absolutely apart from imposing penalties on the appellants. The Tribunal on appeal upheld the confiscation and the appellant approached the Supreme Court and the Honble Apex Court held as follows:-
5Under Section 125 a discretion has been conferred on the officer to give the option to pay fine in lieu of confiscation in cases of goods, the importation or exportation whereof is prohibited under the Act or under any other law for the time being in force but in respect of other goods the officer is obliged to give such an option. In the present case, having regard to the facts and circumstances in which the goods were said to be imported and the patent fraud committed in importing the goods, the Additional Collector has found that the goods had been imported in violation of the provisions of Import (Control) Order, 1955 read with Section 3(i) of the Import and Export (Control) Act, 1947. In the circumstances he considered it appropriate to direct absolute confiscation of the goods which indicates that he did not consider it a fit case for exercise of his discretion to give an option to pay the redemption fine under Section 125 of the Act. The Tribunal also felt that since this was a case in which fraud was involved, the order of the Additional Collector directing absolute confiscation of the goods did not call for any interference. We do not find any reason to take a different view. 9.22?In the Samynathan Murugesan case, the Honble Madras High Court dealt with a case of smuggling of gold concealed in T.V. set and the petitioner did not belong to the class of persons who could bring gold at concessional rate of duty. The gold was absolutely confiscated by the adjudicating authority. On appeal the Tribunal set aside the absolute confiscation and the Revenue challenged the order of the Tribunal before the Honble High Court and the Court held as follows :-
12.?In 1998 (104) E.L.T. 306 (S.C.), the Supreme Court held,
5. Another contention that was urged by Shri Mahabir Singh was that the Additional Collector, as also the Tribunal, have failed to take into consideration the provisions contained in Section 125 of the Act which prescribes that whenever confiscation of any goods is authorised by the Act, the officer adjudging it may, in the case of any goods, the importation or exportation whereof is prohibited under the 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. We do not find any merit in this contention of Mr. Mahabir Singh. Under Section 125 a discretion has been conferred on the officer to give the option to pay fine in lieu of confiscation in cases of goods, the importation or exportation whereof is prohibited under the Act or under any other law for the time being in force but in respect of other goods the officer is obliged to give such an option. In the present case, having regard to the facts and circumstances in which the goods were said to be imported and the patent fraud committed in importing the goods, the Additional Collector has found that the goods had been imported in violation of the provisions of Import (Control) Order, 1955 read with Section 3(i) of the Import and Export (Control) Act, 1947. In the circumstances he considered it appropriate to direct absolute confiscation of the goods which indicates that he did not consider it a fit case for exercise of his discretion to give an option to pay the redemption fine under Section 125 of the Act. The Tribunal also felt that since this was a case in which fraud was involved, the order of the Additional Collector directing absolute confiscation of the goods did not call for any interference. We do not find any reason to take a different view. In the present case too, the concealment had weighed with the Commissioner to order absolute confiscation. He was right, the Tribunal erred. The decision of the Honble High Court was challenged by way of SLP before the Honble Apex Court. While dismissing the petition, the Supreme Court passed the following order :
Applying the ratio of the judgment in the case of Om Prakash Bhatia v. Commissioner of Customs Delhi, reported in 2003 (155) E.L.T. 423 (S.C.), to the facts of the present case, we find that, in the present case, the assessee did not fulfil the basic eligibility criteria, which make the imported item a prohibited goods; hence, we see no reason to interfere with the impugned order. The special leave petition is, accordingly dismissed. [2010 (254) E.L.T. A15 (S.C.)] 9.23?Following the ratio of these decisions and applying the same to the facts of the present case which involve fraud and forgery of huge dimensions and that too, of a repeated nature, we do not find any infirmity in the order of the adjudicating authority in absolutely confiscating rough diamonds weighing 1001.410 carats valued at Rs. 59,26,545 (CIF) seized vide panchnama dated 28-2-2001 imported by M/s. Vijaybhav and rough diamonds weighing 14940 carats valued at Rs. 2,28,08,628/- (CIF) seized vide panchnama dated 28-2-2001 imported by M/s. Deepali Exports under Section 111(d) of the Customs Act, 1962. In the said case also the import was of diamonds on the strength of forged documents. In the instant case, the crime is of higher gravity as the goods have been attempted to be smuggled into India. In the case of Vijaybhav (supra), at least foreign currencies would have gone through official channel but in the instant case, the foreign currencies could not have been gone through the official channel.
4.3 The Hon'ble High Court of Patna in the case of Mohd. Akhtar 2015 (323) ELT 136 (Pat) has upheld the absolute confiscation of gold sought to be smuggled into India. The said decision of Hon'ble High Court has been affirmed by the Hon'ble Supreme Court as reported in 2015 (323) ELT A27 (SC).
5. Relying on the aforesaid decisions of Hon'ble High Court and Hon'ble Supreme Court, I find no merit in the appeal. Accordingly, the appeal is dismissed.
(Pronounced in Court on 02.09.2016) (Raju) Member (Technical) Sinha 5 Appeal No. C/445/09