Customs, Excise and Gold Tribunal - Delhi
Shri Sudesh Kumar Mittoo And Ors. vs Collector Of Customs And Central Excise on 3 March, 1998
Equivalent citations: 1998(60)ECC596, 1998ECR178(TRI.-DELHI)
JUDGMENT S.L. Peeran, Member (J)
1. The appeals arise from order-in-original dt. 26.2,96 passed by Commissioner of Central Excise (Rajasthan). In the impugned order, the Id. Commissioner has ordered for absolute confiscation of foreign gold pieces weighing 3773.780 gms. valued at Rs. 14,23,355/- seized on 11.1.93 under Section 11(d) of the Customs Act, 1962, alongwith the bag used for concealing foreign marked gold pieces, under Section 118 of the Act. He has also ordered for absolute confiscation of Indian currencies amounting to Rs. 25,100/- under Section 121 of Customs Act.
2. He has imposed personal penalty under Section 112(b) of the Act against the notices in the following manner:
SI No. Name of Notice Amount
1. Shri Gordhan Gamanani Rs. 10,000/- (Rupees ten
thousand only)
2. Shri Sudesh Kumar Rs. 25,000/- (Rupees twenty
Mittoo five thousand only)
3. Shri Vasu Gamanani Rs. 10,000/- (Rupees ten
thousand only)
4. Shri Sandeep Kumar Rs. 2,000/-(Rupees two
thousand only)
5. Shri Ashok Sharma Rs. 2,000/- (Rupees two
thousand only)
6. Shri Kanhaiyalal Rs. 2,000/- (Rupees two
Prop. M/s. T. K. Saraf, thousand only)
Ajmer
7. Shri Harish Kumar Rs. 2,000/- (Rupees two
M/s. Deta Ram Gormal, thousand only)
Ajmer
8. Shri Ramesh Gidwani Rs. 10,000/- (Rupees ten
thousand only)
9. Shri Prem Singh Rs. 10,000/- (Rupees ten
thousand only)
10. Shri Jethmal Rs. 10,000/- (Rupees ten
Stamp Vender thousand only).
In the impugned order, the Id. Commissioner in the finding portion has noted that the case was in performance of a secret information the Custom Officers intercepted Shri Sudesh Kumar Mittoo at the Jaipur Railway Station from a first class compartment of Ahmedabad-Delhi Mail on 10.1.93. The search of a bag carried by him resulted in the recovery of 40 pieces of foreign marked gold patra/pieces. Ld. Commissioner has noted the Counsel's submissions that the recovered gold pieces were out of legally imported foreign marked gold biscuits and Customs duty had been paid on it. Ld. Counsel had stated that Shri Mittoo was a Goldsmith and used to manufacture gold ornaments according to the orders placed by various dealers and used to collect/ return the gold quantity at the time of supply of finished gold ornaments. In this case also, according to him, it is represented before Commissioner that he had correctly/legally procured the gold from the various dealers, who have been made Notice in the show cause notice. It was argued that the paper slips recovered at the time of seizure, represented the description/quantity of gold used/procured for manufacturing of gold ornaments. In support of this contention copies of affidavits of S/Shri Ashok Kumar of M/s. B.R. Saraf, Ajmer, Kanhaiya Lai of M/s. T.K. Saraf, Ajmer, Harish Kumar of M/s. Dale Ram Golu Mai, Ajmer all dt. 27.1.93. The Commissioner has noted that these affidavits indicated that foreign marked gold biscuits were obtained from S/Shri Ramesh Gidwani and Prem Singh duly covered vide baggage receipt No. 15342 dt. 16.6.92 and 39326 dt. 18.10.92 respectively. It was also stated before him that Shri Mittoo was kept under illegal detention by the Customs and the statements were obtained after severe beatings and under mental tension, hence those were not admissible as a piece of evidence. These statements were also retracted immediately after his release. It was submitted that the case against other notices were also on the basis of statement obtained under duress. It is further argued before the Commissioner that Shri Jethmal Verma had deposed that during personal hearing that his statements were recorded under duress and as per the affidavit dt. 9.1.93 of Shri Prem Singh, a copy of which was enclosed by the Counsel, with his fine reply that he had given two foreign marked gold biscuits for manufacturing ornaments to M/s. T.K. Saraf, Ajmer for which a receipt No. 172 dt. 9.1.93 was issued by the later and these two biscuits were out of 42 foreign marked gold biscuits imported on 18.10.92 covered vide B.R. No. 39326 dt. 18.10.92 of Delhi Airport, at the time of returning to India. A copy of the affidavit dt. 25.8.92 of Shri Ramesh Gidwani which indicated that 42 foreign marked gold biscuits were imported and Customs duty was paid vide B.R. No. 15342 dt. 16.6.92 at the time of his return to India and that out of 42 foreign marked gold biscuits, he has given 3 foreign marked gold biscuits to M/s. T.K. Saraf, Ajmer for making ornaments and on return from foreign, he would have collected the same after making payment of repair charges. Ld. Commissioner after recording the statement has held that on going through the statements of S/Shri Ramesh Gidwani and Prem Singh recorded during the course of investigations, both of them had admitted to have brought foreign marked gold biscuits on which necessary Customs duty was paid. He has noted that all of these foreign marked gold biscuits were disposed of at Delhi by Shri Vasu Gamanani and a sum of Rs. 10,000/- was paid to each as remuneration charges. He has noted their admission that their economic condition was not so sound to have purchased such a large quantity of foreign marked gold. Those foreign marked gold biscuit were arranged by S/Shri Vasu Gamanani and Ashok Sharma at Dubai and were disposed of at Delhi by Shri Vasu Gamanani. Ld. Commissioner has noted that these facts have also been corroborated by Shri Vasu Gamanani. Therefore, subsequent affidavits filed by the Counsel according to Commissioner is an after thought and just to get rid of the provisions of the Customs Act. Ld. Commissioner has noted that it has also been corroborated by Shri Jethmal Verma, the Stamp Vendor, in his statements that false entries were made in the stamp vender Register. Moreover, on the perusal of the affidavits, it has been found that the seizure was effected on 10.1.93 but the affidavits were of 27.1.93, which goes to prove that the same have been managed under a legal advice which according to Commissioner cannot be taken on record as a piece of evidence. Ld. Commissioner taken on record as a piece of evidence. Ld. Commissioner has noted that as regards the defence taken by the Advocate that Shri Mittoo was given severe beating and he was in a tense position and, therefore, the statements recorded were not to be treated as voluntary one; the Ld. Commissioner holds that the searches were conducted before Panch Witnesses and there is no evidence to prove that the statements were recorded under duress or under physical threat. He has noted that in the Panchnama dt. 11.1.93, it has been recorded that Shri Sudesh Kumar was having some injury in his leg which was reported to have occurred at Ajmer before boarding the train. Therefore, he has concluded that the fracture of any injury was prior to the seizure case. As regards the medical certificate produced by Shri G.K. Rana for Shri Sudesh Kurnar Mittoo, Id. Commissioner has observed that the same was obtained by a private Doctor of Amritsar which was on 21.1.93. He has noted that Shri Mittoo was apprehended at Jaipur and was released at Jaipur, so he could have obtained the treatment and sick certificate at Government Hospital, Jaipur immediately on his release. But the same was not obtained. Therefore, the Id. Commissioner has concluded that this also goes to prove that the certificate was a managed one. Moreover, no Doctor could have certified that the injuries were inflicted during the beating process by the Customs Department at Jaipur. So far as the admission of Shri Mittoo that foreign marked gold pieces were obtained from different dealers at Ajmer for manufacturing gold ornaments is concerned, he had noted that although they have admitted to have been obtained the foreign marked gold biscuits from Shri Ramesh Gidwani and Prem Singh, covered by referred baggage receipt; however in both the cases 84 foreign marked gold biscuits were brought by Shri Ramesh Gidwani and Shri Prem Singh and those were disposed of at Delhi immediately on their arrival at Delhi through Shri Yasu Gamanani. Therefore, he has concluded that the stand taken that the foreign mark gold biscuits were legally imported and were given to the notices/dealers does not stand to reason and hence he has held that it is clearly proved that the foreign marked gold biscuits given by notices/dealers to Shri Mittoo were smuggled foreign marked gold brought into India in contravention of Section 7C and Section 11 of Customs Act, 1962 read with Section 3(1) & Section 3(2) of Foreign Trade (Development & Regulation) Act, 1992 rendering thereby the same liable for confiscation under Section 11(d) of the Customs Act, 1962. He has held that the notices have also failed to discharge the burden cast upon them under Section 123 of the Customs Act, 1962. As regards the plea that the notices/witnesses were not produced for cross examination, the Id. Commissioner has held that the panch witnesses were offered for cross examination dt. 23.12.92, 16.8.94/25.10.94, 23.11.94, 19.1.95, 8.3.95 and 25.5.95 but the witnesses/noticees did not appear for the cross examination. Therefore, he has concluded that it established that all the noticees had indulged in smuggling of foreign marked gold biscuits as they possessed/disposed of the same illegally and hence were liable for personal penalty under Section 112(b) of the Customs Act. As regards Indian currency of Rs. 25,000/-, Id. Commissioner has observed that the same was also found to be the sale proceeds of contraband gold and that no evidence had been produced by the noticees to show the legal acquisition and possession. He has rejected the stand taken by the noticees that the Indian currency were for labour charges. Hence he has ordered for absolute confiscation under Section 121 of the Customs Act, 1962.
3. We have heard Id. Advocates Shri G.K. Rana and Shri D.K. Rana for the appellant and Shri P.K. Jain, Id. DR for the revenue.
4. Ld. Advocate while reiterated his arguments and submissions made before the Commissioner submitted as follows:
Ld. Advocate submitted Shri S.K. Mittoo is a respectible citizer of India and is engaged in the business of manufacturing the golc ornaments at Amritsar (Punjab). For this purpose he was booking orders from various jewellers etc. and making ornaments as pei their orders. On delivering the ornaments made by him as per the orders, he collected his labour charges and gold used in making ornaments and also gold for making new ornaments. In this way he was doing his business in a legal manner. Most of the jewellers from whom he booked the orders are based in Ajmer. In connectior with his business, in order to book new orders and to make deliver of gold ornaments from the ordres which he had booked earlier he had left Amritsar on 8.1.93 for Ajmer and reached Ajmer or 9.1.93 alongwith Indian currency of Rs. 9,000/- and gold ornaments manufactured as per previous orders to make delivery o the same to various jewellers at Ajmer and to book new orders On 9.1.93 he reached Ajmer and went to the shop of (f) T.K. Sarraf and talked with proprietor Kaniya Lal and delivered 800 grams gold ornaments to him and in return received 851 gms gold which consisted of 3 pattras of gold each weighing 116.640 grms, some gold pieces and some pure gold (ii) then he went to the shop o Dataran Golomal and met with Harishji and delivered 780 grams of gold ornaments as per their orders and received 900.450 grams gold which consisted of 4 pattras of gold, some pieces of gold and some pure gold; (iii) after that the appellant went to M/s. R.R Sarraf and met with Mr. Sandeep Kumar Sharma and delivered gold ornaments weighing 980.790 grams as per their orders and had to receive 1298.450 grams gold from them which included ok balance of 366.750 grams. Shri Sandeep asked him to come or the next day and (iv) thereafter the appellant went to M/s. B.R. Sarraf and met with Ashok Kumar Sharma and delivered 548.47C grams gold ornaments as per their orders and received 2 pattras of gold, some pieces of gold and some old gold in the shape o Dali total weighing 723.880 grams. He has also received his labour charges from the above jewellers. The above jewellers also obtained signatures of Shri S.K. Mittoo on gold issue vouchers regarding issuance of gold to Shri S.K. Mittoo and gave these vouchers to the appellant to carry along with the gold. It is his case that of 10.1.93 he met with Sandeep Kumar Sharma of R.R. Sarraf who gave him 8 pattras of gold, some pieces of gold and some pure gold--total weighing 1298.450 grams. Shri Sandeep Sharma alsc gave him labour charges for making gold ornaments and obtained his signatures on gold issuance vouchers and issued the same to him. He left from Ajmer for Delhi by Ahmedabad Delhi Mail a 8.00 O'clock in the night and the train reached Jaipur at 11.45 PM where the Customs Officers come to his compartment and asked him for gold about which the appellant showed the gold to then on the spot and the vouchers for the gold were also shown which were issued by the jewellers of the Ajmer but according to him the officers kept the vouchers with them. According to him he had also informed the officers that whatever gold and cash he had, was legal but the officers prepared a panchnama on the spot and seized his gold, currency, vouchers and account slips. On this spot itself, the appellant had given his statement regarding producting the vouchers and obtaining gold and labour charges after giving ornaments as per orders from the jewellers of Ajmer but the Customs Officers forcibly took him to the Customs Office and told him that they will show these papers to their superiors and if their superiors had been satisfied then only the appellant will be allowed to go. He was not given the copy of the panchnama and statement also. In the Customs Office, the officers after consulting with some other officers, torned the panchnama, prepared at the Railway Station and called two persons who were known to them, made them witnesses and prepared a new and false panchnama which was neither read over to the appellant nor the appellant was allowed to read it and he was asked to sign the same. When he refused to do so, he was giving servere beatings and torned panchnama and statement prepared at the Railway Station which the appellant was carried and put in his locked room. On 11.1.93, the officers also brought Sandeep Kumar Sharma of R. R. Sarraf and locked him and continuously from 10.1.93 night till 13.1.93, 8 O'clock in the night, the officers gave him continuous beatings, and because of which there was swelling in both his legs and he could not walk. He was forced to sign the papers prepared by the Customs Officers. On 13.1.93, Shri Sandeep Sharma was brought to the residence of Magistrate at 8.30 in the night and after obtaining some orders from Magistrate, he was taken back to Customs Office. On 14.1.93, Shri Sandeep Kumar Sharma was taken by the Customs Officers to the Central Jail. He had made a complaint in Bail application before the Sessions Judge, Jaipur on 16.1.93. He had produced the documents to show the legal import of gold by Ramesh Gidwani and Prem Singh and procurement of gold by the jewellers of Ajmer and issuance of the gold to the appellant by the jewellers of Ajmer were made including the copy of Pass-port, Baggage Receipts, Agreements, gold receipt vouchers and gold issue vouchers. He submits that he was enlarged on bail on 19.1.93. On 25.1.93, he retracted the statement by filing an affidavit before the Collector, Jaipur. He submits that on 27.1.93 the representation and affidavit of Ashok Kumar was submitted to the Collector, Jaipur alongwith the documents including the affidavit of Kahniya Lai, Harish Kumar and Sandeep Kumar Sharma. A telegram dt. 1.4.93 was also sent on behalf of Shri Prem Singh who imported the gold legally after payment of Customs Duty.
5. Ld. Advocate after narrating the sequence of the above matter and also filing a written brief on that aspect, further argued that the vouchers carried by the appellant Shri Mittoo should have been recorded in the panchnama. He" referred to the deposition of Naresh Agarwal in cross-examination, who had stated that the pachnama was written by Vimal Meena, who was his friend. The panchnama was signed at 2.00 A.M. in the night of 10.11.93 and it had not been written by Anil Dhabai. Therefore, it is the contention of the Id. Advocate that the panchnama was prepared later and it is not a reliable document and hence seizure is seriously disputed, as the panch witness is not an independent witness. He pointed out the contradiction between the panch witness statement with that of the statement of Inspector Vimal Meena, who had stated that it was not his writing but it was dictated by Anil Dhabai, Supdt. Customs, who was with him. He agreed that the panchnama referred to seizure of papers from Shri Mittoo but its details were not recorded. Ld. Advocate referring to this deposition submitted that Shri Mittoo had carried the vouchers and invoices to prove the legal import of the seized gold articles which was supported by the affidavit of the dealers.
Arguing further, he submitted that in the show cause notice no doubt had been castigated on the genuineness of stamp paper on which a finding, has been recorded. The stamp vendor who had initially stated about the stamp papers being forged later had resiled his statements, hence his earlier statement loses its evidentiary value. Ld. Advocate states that the earlier statement of jewellers and persons who brought the gold namely Shri Prem Singh were all resiled their statements and hence their subsequent statement alone should be accepted. The Collector's finding that these statement are 'after thought' is not correct as the earlier statements were recorded under duress and threat. Ld. Advocate further stated that ld. Collector has not given detailed findings on the submissions including about the witnesses Anil Dhabai, not being produced for cross-examination.
Ld. Advocate further submits that the seized gold jewellery did not have foreign markings and the same were jewelling with only 77% purity hence as per the list annexed to show cause notice, this aspect is clear and hence absolute confiscation of all the items, is totally unjustifiable.
6. Ld. DR effectively countered all the points raised by the ld. Advocate. He submitted that Shri Mittoo in his first statement itself had spoken about injury to his person. He was limping and carrying medicine and prescriptions on his person. He has produced medical certificate from a doctor who is in Amritsar, who could not have known about the officers dealing with Mittoo, yet the doctor certified that the fracture is due to beating by Customs Officer, which is not a correct one. The panchnama itself stated about Mittoo being found limping when he got down from the train. The officers had recovered one diary and 9 slips, which was has been correctly recorded in the panchnama. There were no other statements recorded. The goldsmith who tested the seized goods has certified that item Nos. 1--39 had 99% purity; only S.No. 40 shows 75% purity Ld. DR pointed out that Sandeep Sharma has not spoken of baggage receipt and has denied ownering at the seized items. He further pointed out that all the jewellers have given letters to Collector on 25.1.93 which are identically worded and hence the manner in which they represented and spoke was contrary to the facts from their unretracted admissions, hence the Collector was prompted to state that the evidence produced is an 'after thought', and at the instance of the legal advice, Ld. DR also stated that Shri S.K. Mittoo did not disclose the name of all the jewellers, when his statement was recorded. Those jewellers even after being aware of the seizure have taken fifteen days put forth their claim. Shri S.K. Mittoo has given detailed statement regarding his business details and other details, which continue to be asserted even now, there is no retraction of those statements. These details could not have been concocted by the Customs Officers. Ld. DR further pointed out that the persons who brought the gold were mere labourers and their affidavit clearly disclosed that fact. Shri Ashok Kumar had contacted them and had sought their services for taking these gold biscuits. Hence according to department, they were carriers and not owners. They had not given the gold to Sarraf & Co. le. to Sandeep Kumar for making jewellery. The date of handing over the jewellery and between the date of Shri S.K. Mittoo taking it for making jewellery, their is a big gap of more than year. Hence the preponderance of improbability exists in the defence of appellants. He also stated that the statement dt. 12.1.93 of Sandeep Sharma is not. in the nature of a retracting one but he has admitted to the smuggled nature of the goods. He admitted about cooking up of documents with the connivance of stamp vendor. He had admitted purchasing gold from Dallas and of not maintaining accounts. He also pointed out that there were only 2 baggage receipts and four jewellers had claimed the same and hence the Collector's finding of the attempt to build "an after thought" story with legal aid is correct one. Regarding the agreement of Shri S.K. Mitto with jewellers, ld. SDR pointed out that this so called agreement has not been signed by jewellers and in business such agreements are not signed. Ld. DR pointed out that Shri Sandeep Sharma in his retraction, does not say anything about baggage receipt or accounts or registers being maintained by him, at the time of raid. He also pointed out to the varying nature of signatures in the stamp register of Ramesh with the ones in the affidavit. He also pointed out that the name of Shri Prem Singh has been entered later, while the paper was purchased by one Kailash. He also questioned as to how Ramesh could retain the gold biscuits when ownership is claimed by Ashok Gamanani and how he could have given the gold to the jewellers. Shri Ramesh has also not come forward to claim the gold. Hence ld. DR submits that it clearly points to the smuggled nature of the gold. Shri Prem Singh and other jewellers have admitted the smuggled nature of the gold biscuits, so also Ashok Gamanani, Vasu Gamanani and Goverdhan financers. He also pointed out that there is no reference to the telegram of Shri Prem Singh of alleged retraction, in any of the retracted statements or about the statement having obtained by force. Ld. DR also pointed out that Goverdhan Gamanani has not retracted from his statements and these statements speaks about the smuggled nature of the gold. Even the affidavits were filed by them after they received the show cause notice. He also pointed out that Shri S.K. Mittoo has not explained the nature of jewelleries to be made and who had booked orders for the same. Hench it shows that the statements are also made up later by them. Ld. DR also pointed out that baggage receipt has not connection with the seized gold. As it would take more than two hours to prepare panchnama, the officer had taken Shri S.K. Mittoo to office and had prepared there and no panchnama was prepared at Railway platform.
Ld. DR relied on the ratio of the following judgments:
1. State of Gujarat v. Shri Mohanlal Jitamalji Porwal and Anr. ,
2. Pukhrqj v. Collector of Central Excise, Madhya Pradesh, Vidarbha and Anr. ,
3. Naresh Sukhawani v. Union of India, 1996 (83) ELT 256 SC,
4. Surjeet Singh Chhabra v. Union of India ,
5. Collector of Customs, Madras and Ors. v. D. Bhoormull ,
6. Kanungo & Co. v. Collector of Customs Calcutta .
7. Ld. Advocate in countered that in Bhoormull's case, the goods had not been claimed and during those days, they were declared as prohibited goods and hence in that context Hon'ble Supreme Court held that the party did not discharge their burden. It is his argument that the facts are different and party had put forth evidence to claim gold which was of legal import. Likewise, Naresh case, Pukhrqj's case and Mohanlal Jitamalji's case are also distinguishable.
8. We has heard both sides of the case and have recorded the facts, findings and arguments at length. The points that arises for consideration is as to whether the seized goods are smuggled goods or whether they had been legally imported and whether the charge of smuggling is proved; whether Indian currency is out of the proceeds of smuggling, if not, should it be ordered for release, whether penalty can be imposed on all the parties?
9. As regards the first question, it is seen from the Annexure 'A' of Panchnama that S. Nos. 1 to 17 in column 2 the description of the seized gold, which has been given as "Pattra drawn from machine of foreign marked gold biscuits". S. Nos. 18 to 32 has description "pieces cut after hammering the foreign marked gold biscuits". S. No. 33 has description "Primary gold in the shape of bangles". S. No. 34 besides this description also has a description "small piece". In S. No. 35 besides these two descriptions there is also description "99.5 written". In respect of S. No. 36 besides these remarks there is also a remark "Blind star marked". S. No. 37 besides this description has also got a remark "NBTH Jaipur Trishul Marked". S.No. 38 has also the same description. S. No. 39 has also got the same description within brackets "Square piece". S. No. 40 has the same description along with the following works in the brackets "In the shape of paper weight". The S. Nos. 1 to 32 shows purity of 99.9% while S. Nos. 33 to 39 shows purity of 99.0% of gold. While at S. No. 40 shows purity of 75.0% of gold. The panchnama mentions about Sudesh Kumar having stated that he has fallen and has sustained some sprain. Some medicines were available for pain and some medicines were procured by the officers. The panchnama stated that the officers questioning him to produce legal documents and bills, Sudesh Kumar had disclosed that he did not have any legal bills or documents and that he had purchased the gold at Ajmer from different dealers in the shape of foreign marked gold biscuits which he got converted into pattras to avoid detection by customs officers and police, through a machine and some pieces were got hammered and court into pieces. This work he got it done at Ajmer. During this process the foreign markings were removed. Panchnama also states about gold being examined and purity tested through Om Prakash Soni, who certified that the gold is of foreign origin and determined the purity of the gold also. Sudesh Kumar had explained about S. Nos. 32 and 40 having lost purity as he got mixed copper in Ajmer as he had to manufacture ornaments from this gold and while S. Nos. 1 to 32 was to sold in market. Sudesh Kumar has challenged this report on the various grounds and has stated that the same was recorded wrongly at about 2.00 A.M. and he did not disclose about some papers have been seized from him. On this, the Commissioner has held that it is an afterthought and no such invoices or papers were filed. They have filed subsequently passport details and duty paying documents for its illicit import. This has been found to be incorrect in view of various reasons which we will determine to be right or wrong. The initial statement of Sudesh Kumar disclosed that the Customs Officers took search of him and his luggage in the presence of two panchas and recovered 3773.780 grams gold and Rs. 25,100/- Indian Currency. He had explained that he had acquired it from R.R. Sarraf, Ajmer and in exchange of this he had given them gold ornaments as per their orders. This transaction was conducted with him by Shri Sandeep Kumar Sharma of R.R. Sarraf. He had stated that his shop is situated in Naya Bazar, Ajmer. His father's name is Rameshwarji and the gold had been procured on 10th January, 1993 in the evening. His reservation in Delhi Mail had been arranged by Shri Sandeep Kumar. He stated that he had not have any legal bill or any other document in connection with this gold. The second statement was recorded on the same date which gives details about his family, about his elder brothers, about his younger brothers and sisters, about his performing business or making ornaments for last 3 to 4 years. He had given the address and names that three artisans were working at his shop. He had given the name of the artisans as well. He had mentioned that he had no fixed quantity of making ornaments. In some months gold ornaments of about 200 grams were made and in some months it may exceed and it depended upon the demand of the customers. He had stated that he had very small work at Amritsar. Most of the ornaments were prepared against orders from Ajmer. He had mentioned that he took orders from R.R. Sarraf, B.R. Sarraf, T.K. Sarraf and Detaram Golomal Sarraf for making ornaments. He had given details about his movements on 8.1.93 and 9.1.93. he had given details of purchase of gold from T.K. Sarraf. From him he had taken 851 grams gold which consisted of 3 Pattras of foreign marked gold biscuits, after delivering 800 grams of gold in exchange. He mentioned about his having been gone to Detaram Golomal and delivering 780 grams ornaments as per their orders. Harishji son of Detarm transacted the business who gave him 900.450 grams gold against ornaments weighing 780 grams. He gave him pattras of 4 gold biscuits and some pieces of foreign gold biscuits and pure gold. He went to shop of R.R. Sarraff where he met Sandeep Kumar Sharma, who is son of Shri Rameshwar Lal Sharma, Proprietor of the shop and who looks after the transactions at the shop. He delivered ornaments weighing 980.790 grams to Shri Sandeep Kumar, as per their orders and he had taken 366.750 gram gold from R.R. Sarraf, as per balance of last amount and he stated that after giving ornaments, he had now to receive 1298.450 gram gold. He was asked to come tomorrow for taking the said gold. Then, he went to B.R. Sarraf, where he met with Ashok Kumar Sharma, who looks after the transactions at the shop. He delivered him 548.470 gram gold ornaments as per their order and in exchange he gave him 2 pattras of foreign gold biscuits and some pieces of foreign gold biscuits and some old gold in the shape of Dali. The total weight of the gold was 723.880 grams. After taking the gold, he went to the residence of Shri Shahji and placed all the golds in the cavity of the bag. He mentioned that Shajhi is 80 years old. In his further statement, he stated that his statement was recorded after producting Sandeep Kumar Sharma by Supdt. Customs (Prev.) Jaipur before him. Shri Sandeep Kumar Sharma recognised him. Sudesh Kumar Mittoo admitted having given him the pattras of 8 gold biscuits on 10.1.93 and apart from this, he had also given some pieces of foreign gold and pure gold. On further examination, he had stated that in this first statement, he had stated that gold was given by R.R. Sarraf which was wrong. He made this mistake. He also mentioned having been taken only 3 orders from the last 2 years in Jaipur. He also mentioned that during last 6 to 7 months, he did not perform any work of Jaipur order. He usually came to Jaipur and some persons were known to him and some relatives. In his further statement recorded on 12.1.93 he admitted the correctness of statements made on 11.1.93 and in the evening of 10.1.93, he admitted having received 1298.450 grams of gold from Shri Sandeep Kumar of M/s. R.R. Sarraf out of which there were 8 gold pattras of foreign biscuits and some foreign gold pieces and pure gold. He had given lot of other details, which could not have been gathered by the officers. He was asked to explain the slips in which account had been written. Slip No. 1 pertains to R.R. Sarraf and the account of Rameshwar Sharma whose son is Sandeep Sharma. He admitted that the account in that slip being old and it did not pertain to this transaction. As regards Slip No. 2 it contain 1298.450 grams written in the name of B.R. Sarraf in the form of pattras of foreign mark gold biscuits and pieces of gold. The slip also referred to 804.690 + 184.000 written on it. He mentioned that out of this 800.000 grams of ornaments, the remaining weight was the old balance. Against this, they had given him 851.000 grams gold. Slip No. 2 also referred to the account of Detaram Golomal, and in which he had given ornaments of gold weighing 1103.110 grams. Out of this, 780.000 gram gold ornaments were given on 9.1.93 and he had returned to him 900.450 grams gold. The remaining gold is still due from them. Slip also contained the account of B.R. Sarraf to whom he had given ornaments of 1168.990 grams gold, out of which 584.470 grams gold ornaments were given on 9.1.93. He mentioned that B.R. Sarraf gave him 723.880 grams gold which included old gold also and the remaining account is still due. The Slip No. 3 and Slip No. 4 contains orders given by T.K. Sarraf and R. R. Sarraf. Slip No. is the patient identity card of K.C. Memorial Eye Hospital which is in his name. Slip No. 6 is the ticket from Amritsar to New Delhi. By this ticket he had travelled. Slip No. 7 is the receipt of additional ticket fare which he paid from Delhi to Rewari. Slip No. 8 is the Bill of a shop Desika which is situated at Bapu Bazar. Slip No. 9 is the Doctor's prescription which he paid from Vrindavan. Slip No. 10 is the pocket telephone diary. He was again examined on 13.1.93 on which date he confirmed that period 11.1.93 and 12.1.93 as correct.
10. The statement of Sandeep Kumar Sharma was recorded on 11.1.93 and 12.1.93. He has given details of his father, his sisters, wife, father-in-law and about his business details including telephone numbers. He mentioned about search carried out in his place and officers not having found any objectionable goods or documents. He also recognised Sudesh Kumar Mittoo and admitted that he had told his name, address and business. On 10.1.93 he had stated in his statement that he had given 8 pattras of foreign marked gold biscuits and some gold pieces. In his further statement, he confirmed his earlier statements given on 9.1.93 and 11.1.93. He admitted having received gold ornaments whose total weight was 980.790 grams. The pure gold of these ornaments came to 931.750 grams, which gold he had given to him. He had also given to him old balance of 366.700 grams of pure gold. He did not have any legal receipt for its procurement and he admitted these goods to be smuggled one. He also mentioned about Sudesh Kumar delivering him and that carrying these goods with foreign marking was risky and therefore, they made pattras out of these biscuits and given to him. He did not give any bill/voucher etc. He stated that he had annual turnover of 20 to 22 lakhs and earned about 1 to 1.25 lakhs in a year. He mentioned that he did not receive any old ornaments. He also mentioned that sometimes he gets ornaments made from Sudesh Kumar and other parties also. He also admitted that he did not give any receipt for the old ornaments which he took and usually did not give any bill for the gold for which they give/sale. He also mentioned about purchasing the ornaments, for which they did not keep any receipt. He mentioned that he knew Sudesh Kumar Mittoo for the past one and a half years who came to shop to purchase new ornaments from him as per their requirements and in return they gave him pure gold. On an average, he comes once in two months. Sandeep Kumar was again examined on 13.1.93 mentioned the details of his college and when he started the business. He mentioned that Sudesh Kumar used to give new jewellery and in return he takes pure gold from them and that they did not keep any written account for this transaction and he could not recollect gold, he took in return. He mentioned that he had purchased 8 biscuits of foreign marked gold through pitamber alias Nari Broker. No written account for the same was kept for purchase and cash payment for the same.
11. On the basis of these statements, the case was made out of procuring foreign marked gold biscuits and the same being transacted by Sudesh Kumar Mittoo. However, on 27.1.93, Shri Ashok Kumar Sharma, Working Partner came up with an application for the Collector claiming the gold and producing baggage receipt by Shri Ramesh Gidwani along with copy of pass port of Rakesh Gidwani and Voucher Nos. 118 and 119 along with affidavit with enclosures. Likewise, Kaniya Lai, Proprietor of M/s. T.K. Sarraf has also come up with an application on the same date along with photocopy of voucher and enclosing his affidavit. There is also an agreement for trust executed by Shri Ramesh Gidwani on Rs. 5/- stamp paper. A similar claim has been filed by Shri Harish Kumar and Shri Detaram Golomal Sarraf, who have claimed the gold on the basis of vouchers received with agreement along with affidavit.
12. Shri Sudesh Kumar Mittoo by his representation dt 25.1.93 to the Collector has given a different version about whole thing and has claimed both the gold and cash on the basis of affidavit and other documents relied by Shri Ramesh Gidwani and Shri Harish Kumar. It is through these documents, they are making out a different case which calls for determination or scrutiny as it has to be seen as to whether these evidence are acceptable and as to whether earlier statements can be relied? It is the case of the appellants that they have retracted from earlier statements and therefore, the claim made by them is a correct and true one. We have to see as to whether these pleas are acceptable or not? The Collector have rejected these pleas on the basis of scrutiny of the evidence and has given a categorical finding that the defence is a made up case as the affidavit and the agreement were found to be a forged one and they had categorically admitting about it in their statements. The stamp vendor, Shri Jethmal Verma in his statement dt.31.3.93 had stated that stamp paper of S. No. 2216 dt. 14.8.92 was sold to Shri Mohan. He confessed that stamp paper from S. No. 2212 to 2218 were sold to Shri Chunni Lai S/o Shri Mool Chand of Ajmer for agreement purpose and admitted false entries in the stamp register. He also stated that stamp paper S. No. 4081 dt.4.1.93 was sold to Shri Prem Singh S/o Shri Moti Singh for the purposes of agreement. But in the stamp register, it was clearly seen that the false entry was also made by him. Actually stamp paper at S. No. 4081 dt. 4.1.93 was sold to one Shri Kishore Kumar Soni S/o Jai Chand Soni for agreement. Likewise, he confirmed that the entry regarding stamp paper of S. No. 4135 dt. 6.1.93 was also false and that the entry in S. Nos. 2355 to 2358 sold to Shri Ramesh Gidwani was false made by him in his stamp register.
13. It is also recorded in the show cause notice that Shri Prem Singh who is supposed to have brought the gold had stated that he went to Dubai in July 1990, where he met Shri Vasu Gamnani. At the time of returning to India, Shri Ashok Gamnani, brother of Shri Vasu Gamnani, met him and asked him to bring 42 gold biscuits to India. He was working for charges of Rs. 20,000/-. He gave him Rs. 10,000/- in advance at Delhi Airport as soon as he came out Shri Vasu Gamnani met him and he took all 42 gold biscuits packet and asked him to wait for sometime. After long time, he came back and told Shri Prem Singh that he had disposed off all the foreign marked biscuits and gave remaining 10,000/-. In his further statement dt. 18.1.93 he stated that Shri Gordhan came to him and asked him to sign two non-judicial stamp papers. He also got his signature on baggage receipt and instructed him not to write that date. He stated that he did not know M/s. T.K. Sarraf and M/s. Deta Ram Golomal nor he gave any type of gold to above firm for making the ornaments as his economic condition was poor.
14. Statements of Shri Gordhan Gamnani who is younger brother of Shri Vasu Deo Gamnani was recorded by the officers on 2.4.93, who confesssed that at Delhi Airport, he took 42 F.M. gold biscuits from Shri Prem Singh and. disposed of all in Delhi on the same day. He also confessed that M/s. T.K. Sarraf and M/s. Detaram Golomal were his good friends. They came to him and asked that one person had been caught by the Customs authorities at Jaipur so they were in need of back dated agreement. Shri Kanhaiya Lai, owner of M/s. T.K. Sarraf brought two stamp papers also. Thereafter, he went to the residence of Shri Prem Singh and obtained his signature on stamp papers and Shri Kanhaiya Lai gave him Rs. 4,000/- for his work.
15. Statement of Shri Ramesh Gidwani was recorded on 1.4.93 and he stated that he came to India on 16.6.92 after stay at Dubai. One person named Shri Ashok who was his neighbour gave him 42 FM gold biscuits and $ 3900 for paying Customs duty in India. As soon as he reached Delhi one person named Shri Vasu met him. Shri Ramesh further stated that he knew Mr. Vasu because he had already met him at Dubai. Shri Vasu took all 42 FM gold biscuits and asked him to wait sometime at Airport. Shri Vasu came back after three hours and told him that he had disposed of all FM gold biscuits. He gave him Rs. 10,000/- as remuneration. Thereafter, they came to Ajmer. Shri Vasu was residing at Gurunanak Colony. He also mentioned that he neither knew M/s. TK Sarraf, M/s. BR Sarraf, M/s. R R Jewellers and Shri Radheyshyam, nor did he give any gold biscuits or gold for sale or for making ornaments to them and that his economic condition was not so sound and that he could himself have purchased such a large quantity of gold.
16. Shri Mohan Bhagchandani in his statement dt. 31.3.93 stated that he had purchased the stamp papers at S. No. 2212 to 2218 in the name of Shri Chunilal S/o Shri Mool Chand, Ajmer, for the purpose of Will, Agreement and Power of Attorney. He did not give any stamp paper to Shri Ramesh Gidwani. He further stated that he purchased the stamps only for Shri Chunilal. He did not know how the name of Shri Ramesh Gidwani appeared at S. No. 2212 to 2218. All these entries had been made by Shri Jethmal Verma.
17. From these statements, it is clear that the jewellers had procured these stamp papers to make agreement to show that gold had been left in their custody by Shri Prem Singh and Shri Ramesh Gidwani, while the truth of the matter is that Shri Prem Singh and Shri Ramesh Gidwani were only carriers who had helped in bringing the gold from Dubai. It is clear from the statements that this gold was also disposed of. Further there is no retraction given by Shri Prem, Shri Ramesh and Shri Mohan, as their statements stands, therefore, the entire story brought out by Shri Sudesh Kumar and the jewellers is totally incorrect and false. In order to prove the retraction they have taken a stand that Shri Sudesh Kumar had injury and that he had been beaten by the officers. This evidence has been countered by the department itself by stating that he was carrying medicines. The officers had also brought medicines for him. Therefore, it cannot be said that injuries are as the result of beationg of the officers. It is also seen that there is no single statement but the statements were recorded on three and more occasions and on all the occasions, Shri Sudesh Kumar as well as Shri Sandeep Kumar have confirmed the correctness of their statements. The subsequent agreement and the demand vouchers produced did not corroborate their statements. Moreover, the stamp vendor himself had admitted that he had not sold the stamp papers to the concerned persons and the entries were false. It is also surprising as to how these agreements could be accepted when Shri Prem and Shri Ramesh did not leave the gold with the jewellers. It is also not believable that such expensive gold, could have been left for such a long period and that the jewellers could not handed over the gold for making the jewellery, when, in fact, Shri Sandeep Kumar had been meeting Shri Sudesh Kumar and transacting business. It is also seen thta all the jewellers have given identical worded claims including the details in the affidavit. It is strange as to how all the jewellers could have had these gold pieces and all could have given similar affidavits and statements which does not appears to be natural. There are number of contradictions and loopholes in the case made out by the jewellers and Shri Sudesh Kumar. Even the affidavit of trust executed by the persons namely, Shri Prem, Shri Harish Kumar and Shri Ramesh does not refer to the earlier statements given by them to the department, wherein they has stated that all the gold, they had brought had been taken away in the Airport by Shri Vasu and the same having been sold. They had stated that they were merely workers and did not have the sound economic conditions to purchase such expensive gold and they had only acted as mere carriers. The subsequent claim filed by Shri Sudesh, Sandeep, Ashok Kumar Sharma and Kanhaiyalal does not inspite confidence for acceptance. Shri Prem Singh and Shri Ramesh who are supposed to have purchased and brought it by voucher receipt did not state in their affidavit on what date they have handed over the gold for making jewellery to the jewellers. However, the affidavit of trust has been executed by Shri Prem Singh on 6.1.93. The affidavit states that he would come in first week of Feb., 1988 to collect the ornaments from them. It is surprising that Shri Prem Singh who has shown voucher receipt No. 39326 dt. 18.10.92 would have handed over the gold on 9.1.93 after a gap of more than one year three months. Furhter there is no signature of the jewellers on the agreement for trust by which the persons are supposed to have left the gold for making jewellery. In view of the fact that Shri Prem Singh, Shri Ramesh, Shri Gordhan Gamnani, Shri Jethmal Verma and Shri Mohan not having resiled from their earlier statements, therefore, the first statement of Shri Sudesh Kumar and Shri Sandeep Kumar are correct and reliable statements. There is no detail retraction and there only a general retraction, which is not acceptable. There is no cause to reject the earlier statements given by them, as fabricated ones and obtained through corrsion. In view of the fact that foreign marked gold brought had already been sold immediately therefore, the admission made in the earlier statements by Shri Sudesh Kumar and Shri Sandeep Kumar about the gold appearing to have foreign marked is required to be accepted. As the baggage receipt is not corroborating with the seized gold and the seized gold being an illicit import their seizure and confiscation is required to be upheld.
18. It was argued that the S. Nos. 39 to 40 only 75% of gold and it cannot be confiscated. They were admitted that they had used the foreign marked gold biscuits and had mixed copper to make jewellery. Therefore, confiscation of the entire SI. Nos. 1 to 40 as of foreign maked gold biscuits and its confiscation is required to be confirmed.
19. As regards the confiscation of Rs. 25,000/- Indian Currency, it is not possible to say that this currency was as a result of transaction of smuggled gold biscuits. Gold biscuits have been sold by the jewellers to Shri Sudesh Kumar. The cash pertained to him and this cash was not out of smuggled gold. Therefore, confiscation of Indian Currency is set aside. It is also seen that the Collector has not given detailed reasoning for confiscation of Indian Currency in terms of reply given by Shri Sudesh Kumar. Therefore, confiscation of Indian Currency is set aside.
20. It is seen that penalty imposed on Shri Gordhan Gamnani is Rs. 10,000/-. Shri Gordhan Gamnani has not filed any appeal. The appeal has been filed by Shri Sudesh Kumar, which has been imposed penalty of Rs. 25,000/-. This penalty amount is very small as against the value of seized gold is Rs. 14,23,355/-, the same is confirmed. The penalty imposed on Shri Sandeep Kumar Sharma, Shri Kanhaiyalal and Shri Harish Kumar is only 2,000/- and hence the same is confirmed.
21. In the result, the order of confiscation of gold is confirmed along with penalties. However, the order of confiscation of Indian Currency is set aside. Ordered accordingly.