Customs, Excise and Gold Tribunal - Delhi
Ravi Mittal vs Commissioner Of Customs on 9 April, 1999
Equivalent citations: 1999ECR85(TRI.-DELHI), 2000(117)ELT182(TRI-DEL)
ORDER V.K. Agrawal, Member (T)
1. The issue involved in this appeal filed by Shri Ravi Mittal is whether the Ball Bearing purchased by him from the open market, were smuggled ones/illegally imported into the country.
2. Shri Naveen Mullick, the ld. Counsel, submitted that the appellant is a dealer in Ball Bearings; that he had purchased the Ball Bearings through Dalai on cash payment from the open market in Delhi where the Ball Bearings were freely sold and purchased; these goods did not attract the provisions of Section 123 of the Customs Act and accordingly the onus to prove that the Ball Bearings in question were smuggled into the country was on the Department which had not been discharged by the Department. He relied upon the decision in the case of Sethi Bearing Sales Corporation and Anr. v. C.C., New Delhi, Order Nos. A-75 & 76/87-NRB, dated 10-2-1987 in which it was held that "since Bearings though of foreign origin are thus shown to be freely available in the market and in the absence of presumption as to the illegal import of such foreign bearings the Department should have produced some prima facie evidence of the illegal import of the seized bearings before an order of confiscation thereof under Section lll(d) of the Customs Act could be justified". He also relied upon the decision in the case of Hindustan Bearings Corporation v. C.C.E., 1990 (50) E.L.T. 91 (T) wherein it was held that in absence of clear evidence that goods were smuggled, goods cannot be treated as smuggled goods. He also mentioned that the Commissioner had proceeded on presumption alone as is clear from his findings in the impugned order; that the Commissioner has held that absence of any document evidencing the sale and purchase would lead to presumption that goods were not lawfully acquired and the failure to produce documents, details about acquisition or import established the charge of the impugned goods being of smuggled nature. The ld. Advocate submitted that the Tribunal, in Sethi Bearing Sales Corporation case, supra, has held that these circumstances were not sufficient to establish the fact of illicit import.
3. Shri S. Srivastava, learned DR, submitted that the ball bearings were in commercial quantity valued at Rs. 12,95,310.00. The smuggled nature of the goods could be proved by circumstantial evidences. He relied upon the decision in the case of Rajendra M. Kamdar v. Collector of Customs, 1996 (83) E.L.T. 541 (T) in which the Tribunal held that the Department had discharged its initial burden in respect of the ball bearings seized at Howrah Railway Station. The Tribunal also held that since the appellant has failed to disclose the identity of the person from whom he has purchased the goods and since he has not produced any vouchers or bills for the purchase of the same, which facts are within his knowledge, a presumption can be drawn against him that these are smuggled goods and which was stated by him in the statement. The appellant in the present case did not know the names and address of the Dalals from whom he had purchased the ball bearings. He did not have any bill or document showing origin. The learned DR submitted that the burden of proof has shifted from the Department to the appellant. He relied upon the decision in Shah Guman Mal v. State of Andhra Pradesh, 1983 (13) E.L.T. 1631 (S.C.) in which it was held that it is fundamental rule relating to proof in all criminal or quasi-criminal proceedings that the burden of proving that the goods are smuggled goods is on the Department. But in order to appreciate its scope, due regard must be paid to other kindred principles, one of them being that the Department is not required to prove its case with mathematical precision to a demonstrable degree, i.e., it is nothing more than a prudent man's estimate as to the probabilities of the case. The learned DR also mentioned that the Supreme Court, in the case of Collector of Customs v. D. Bhoormull, 1983 (13) E.L.T. 1546 (S.C.) has held that Department would be deemed to have discharged its burden, if it adduces so much evidence, circumstantial or direct, as is sufficient to raise a presumption in its favour with regard to the existence of the fact sought to be proved. Reliance was placed on the decision in the case of Betha Pydiraju v. C.C.E., 1984 (16) E.L.T. 257, in which the Tribunal held that even without applying the statutory presumption under Section 123, the claim of the appellant that he is a bona fide purchaser for value without knowing the goods to be smuggled is legally unsustainable.
4. In reply the learned Advocate submitted that in Kamdar's case, the party had himself admitted the smuggled nature of the goods; that in Guman Mal's case, the goods involved was gold which is mentioned in Section 123 of the Customs Act and as such the ratio of these decisions is not applicable to the facts of the present case. The Department has to establish that these judgments apply to the facts of the present case. He finally submitted that even if the ball bearings are held to be liable for confiscation, the appellant should have been given an option to redeem the same on payment of fine. He also relied upon the decision in Collector of Central Excise v. Decent Dyeing Co., 1990 (45) E.L.T. 201 (S.C.) in which it was held that the burden to prove is not on the buyer who purchased the goods but it is for the Department to prove non-duty paid nature of the goods.
5. We have considered the submissions of both the sides. One of the cardinal principle of prosecution is that the burden of proof is on the prosecutor. In the present case the Department has to lead the evidence to prove that the ball bearings were imported illicitly into the country before these could be confiscated under Section lll(d) of the Customs Act. The learned Counsel has rightly pointed out that ball bearings have not been notified under Section 123 of the Customs Act under which the burden of proof that the goods are not smuggled goods rests on the person from whose possession the goods are seized. It is also not the case of the Department that the import of ball bearings is prohibited and as such it cannot even be presumed that the ball bearings in question must have been brought illegally into the country. The Appellate Tribunal's decision in Sethi Bearing Sales Corporation case, relied upon by the learned Advocate for the appellant, applies on all fours in the present case. This decision was not brought to the attention of the Bench which decided Rajendra M. Kamdar's case, supra. Further as pointed out by the learned Counsel for the appellant in the present case, it was admitted position therein that the ball bearings were smuggled one. This fact coupled with other facts of non-disclosure of identity of purchaser and absence of bills led to a presumption against the appellant in Kamdar's case. This is not so in the present case as at no stage it has been admitted that the goods in question were smuggled goods. Similarly, in Bitha Pydiraju's case, supra, the facts were different inasmuch as the owner of the goods, besides purchasing zips of Japanese make, despatched the same under a deliberate misdeclaration by a false invoice and not claimed the articles for a considerable length of time and gave fictitious names of the consignor firm. We find that the Tribunal in the case of Hindustan Bearing Corporation, 1990 (50) E.L.T. 91 held that the mere fact that the goods were foreign in origin is not sufficient to hold that they are smuggled goods. The circumstances that the consignee firm was fictitious and that the appellants could not name the broker, may at best create suspicion against the appellants. Suspicion however strong, cannot take the place of proof. The Tribunal held in that case that the Department had not discharged the initial burden and the same is not shifted to the appellants that these are not smuggled goods. The Government of India also, while exercising Revisionary Powers under Customs Act had in Re. D.E. Borthwick Order No. 3328/75, dated 11-6-1975 (relied upon by the learned Advocate), released the seized ball bearings observing that the Department had not led any evidence to show that the ball bearings had been smuggled into India. The goods cannot be confiscated under Section lll(d) of the Customs Act merely on suspicion. The burden is initially on the Department to prove that the impugned goods were smuggled into country. Only once such a burden is discharged by the Department, then the burden of proof shifts to the party and not otherwise. The Department, we feel, had not adduced sufficient evidence, circumstantial or direct as to prove the smuggled nature of the goods. Accordingly, we set aside the order passed by the Commissioner of Customs and allow the appeal.