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5.8 To attract Section 123, the goods must be smuggled goods. The term 'smuggled goods' means goods of foreign origin and imported from abroad. In the present case, there is no dispute that the goods are of foreign origin. As already

4|Page C/10090,10328/2016-SM discussed, the defacing of serial number on the gold bar itself indicates that it is smuggled gold. The appellants who claim the gold to have been legally procured have to produce documents evidencing payment of duty as well as documents evidencing their legal ownership/possession. At the time of booking the parcel, the appellants have not furnished the required documents for transportation of imported goods. The invoices produced by them appear to be concocted and afterthought as established by the department. When the serial number of the gold bar has been defaced and no documents have been furnished for transportation of the goods from Chennai to Kolkata while booking the parcel and the invoices being under the shadow of doubt, the case put up by the appellants that they have purchased the gold in a legal manner fails. The appellants have not been able to discharge their burden of proof required under Section 123 of Customs Act, 1962. The decisions relied by the Learned Counsel for appellants have no relevancy or applicability to the facts of the present case."

11. This Court has considered the facts as well as the legal position submitted by both the sides in this regard. It is clear that at the relevant time, the foreign marked gold was not the prohibited item it was the rather restricted. This is the reason that the same has been released on payment of redemption fine of Rs. 2,00,000/- along with Customs Duty of Rs. 3,23,163/- and the penalty of Rs. 1,00,000/- imposed on the other appellant. While the appellants are not claiming that the gold was not of the foreign origin but they have produced a Bill of Entry of import, the same by Kotak Mahindra Bank and have claimed the purchase, to be legitimate and also duly indicated the same to be reflected in books of accounts and also in the challan while sending and receiving back the gold biscuits from the job worker who could not do the work due to his workers being not available. 11.1 The second appellant i.e. Shri. Hitesh Patel was considered Angadia involved and therefore has been subjected to penalty under Section 112(b). The department has directed confiscation despite Bill of Entry having been only on the ground that out of the 4 digits and credit Suisse ect., mentioned on the biscuits, two last numbers on the biscuits were non readable while the earlier two digits of the four on the biscuits were quit readable. The adjudicating authority has therefore considering that the burden of proof has 14 | P a g e C/10090,10328/2016-SM not been discharged upheld confiscation though has imposed nominal penalty while releasing the gold. This Court has considered the fact that last two numbers were not visible has been held against the party which considered this finding to be based on assumption and presumption. This Court finds that even if the department nurtured a doubt despite the import documents having been produced, it should have at least done some further investigation to linked or otherwise the gold biscuits with the import made by the Kotak Mahindra Bank. Instead of this no statement even of the accused (now appellant) has been recorded in the matter and neither has it been brought on record as to why last two numbers became invisible to the department. There is nothing on record to show if the same was erased with the malicious intention and if so they by whom? It is also not on record as to whether such lack of visibility of last two number was on account of any rubbing or corrosion over a period of time. Further the moment, gold is found accounted for the documents (like) Bill of Entry produced, the onus gets shifted on the department, as held in following case law.  U.O.I Vs. Imtiaz Iqbal Pothiwala reported in 2019 (365) ELT 167 (Bom.)  Ana Jamil Vs. C.C (P) Shillong reported in 2016 (342) ELT 248 (Tri.Kal,)  Ashok K. Agarwal Vs. U.O.I-2016 (342) ELT 232 (Cal.)  S. Ramki Vs. PRINCIPAL COMMISSIONER OF CUSTOMS, CHENNAI-III as reported in 2020 (372) ELT 372 (Tri-Chandigarh)  Rajesh Verma Vs. C.C. as reported in 2021 (378) ELT 502 (Chandigarh) 15 | P a g e C/10090,10328/2016-SM Therefore, the production of any documents shifts onus on department. This was correct position in law even at the time, when foreign marked gold was a notified item under Section 123 of the Customs Act, 1962. 11.2 Further it is also seen that while releasing the gold biscuits in the form in which it was seized by the department no melting has been directed as per records. The vital question therefore arises that if the gold biscuit was seized in the form in which it was liable to seizure, then why not at the time of ordering its release the same was directed to be released under supervised melting to prevent the possibility of its being resold the market in the form of smuggled gold is removed. Again this Court is of the view that the matching of first two digits in figure running in thousand also by preponderance of probability shows that the gold was not smuggled, as not only last two digits of the tens were found (each lacking of visibility) but also the receipt of its import by Kotak Mahindra Bank was matching with the first two numbers. The Biscuit was very much of Credit Suisse and matching in other details. The probability that a smuggler will be able to procure the documents i.e. Bill of Entry of import by scheduled bank and that too of the same agency of credit to easy and that two of the matching in first to important digits out of four from smuggling channels is rather remote. Therefore, the onus was clearly shifted on production of the Bill of Entry on the department which has miserably failed in establishing that the gold biscuit was from smuggling channels and the Bill of Entry despite existence of so many co-related details was not of the seized biscuit. Therefore the submission made by the party that department's case is based on rather suspicion and is based on assumption and presumption carries weight in the light of factual peculiarities of the case. Department has relied upon the decision of RAVI NAKHAT VS. COMMISSIONER OF CUSTOMS, CHENNAI-II. 2022 (380) ELT 205 (Tri. Chennai)- to say that when serial number is erased in foreign marked gold and no documents evidencing its legal 16 | P a g e C/10090,10328/2016-SM procurement and payment duty is produced, then department was justified in holding that appellant had no right to claim redemption of gold. This case is clearly distinguishable as department was given the Bill of Entry in this case and goods were directed to be released after due consideration by the lower authority. And even onus has shifted on the departments. 11.3 The finding as above is again fortified by the ruling in 2019 (369) ELT 688 (Tri-Ahm.)- DHANISHTAH GOLD Vs. CC, AHMEDABAD, wherein, it was indicated non recording of statement of the relevant person after production of any proof of legitimate acquisition shifted onus on the department. Further in 2009 (248) ELT 141 (Cal.)-COMMISSIONER OF CUSTOMS (PREV) VS. PUNI DHAPA LOKESWARA RAO, HON'BLE CALCUTTA HIGH COURT held that if the preponderance of probability is not in favour of Customs authorities, the department cannot be said to have proved that gold seized was smuggled into India. In the instant case, therefore, the production of Bill of Entry which in higher probability related to the gold biscuits seized, the non recording of any statement of the relevant persons by the department coupled with finding being based on assumption and presumption makes the confiscation bad in law in the facts of this case.