Decided on August 04,1986



S.Kalyanam, - (1.)THE appeals are directed against the order of the Additional Collector of Customs and Central Excise, Hyderabad dated 25-2-1985 imposing a penalty of Rs. 11,000/- on appellant Devi Reddy Mohan Reddy and Rs. 10,000/- on appellant Nagireddy Rajagopala Reddy and Rs. 11,000/- against appellant Hastimal under the provisions of the Customs Act, 1962 (hereinafter referred to as the 'ACT').
(2.)On 13-3-1983 the Sub-Inspector of Police, Indukurpet, Nellore District, Andhra Pradesh seized goods of foreign origin such as, Car Stereo Speakers, Car Stereo Tape Players, Tape Recorders, Stereo Cassette Recorders etc., along with Indian textiles and biri leaves, concealed under a haystack in the fields of Sureddy Chengaiah of Koratur village, Indukurpet Taluk, Nellore District. On 15-3-1983 the same Sub-Inspector of Police seized from a tomato field of one Tummala Sudhakar of Koratur village, one gunny bag containing foreign textiles. Again on 21-3-1983, the officers of the Customs and Central Excise, Nellore searched the premises of one Moinullah Khan at Door No. 18/738, Pedda Bazar, Nellore and recovered a stereo car radio recorder as well as Indian made lunghis bearing the trade label of 'Barakath of Best Lunghi Co., 57, Mannady Street, Madras'. The first two seizures aforesaid were handed over by the Police to the Superintendent of Central Excise, Preventive, Nellore on 17-3-1983. All the appellants when examined by the authorities gave statements totally disclaiming the goods in question or any connection thereto. Investigation by the Central Excise officers revealed that statements recorded by police officers on seizure of the goods from the haystack and tomato field referred to above revealed that appellant Mohan Reddy was keeping guard over the goods recovered from the haystack. It is in these circumstances after further investigation proceedings were instituted against the appellants resulting in the present impugned order now appealed against.
Shri Habibullah Badsha, the learned counsel appearing for the appellants Mohan Reddy and Rajagopala Ready, at the outset submitted that there is absolutely no ray of evidence in the entire records connecting his clients with the goods under seizure. The learned counsel assailed the impugned order as legally untenable on the ground that the adjudicating authority invoked the statutory presumption against the appellants in terms of Section 123 of the Act, which according to the learned counsel, would not have any application at all in the facts of the present case. The learned counsel further submitted that the two seizures - one from the haystack and another from the tomato field - are from the open ground and were actually effected by the police authorities and, therefore, the goods cannot be said to have been seized from the possession of the appellants so as to come within the mischief and ambit of Section 123 of the Act. Regarding the seizure effected from the house of Moinullah Khan on 21-3-1983 the learned counsel urged that his clients Mohan Reddy and Rajagopala Reddy have not been in any way implicated by anybody with reference to the same. The learned counsel also further urged that under law clubbing an entirely unconnected seizure at Nellore on 21-3-1983 with the seizures effected on various dates from various places namely, one dated 13-3-1983 from the haystack in the field of Sureddy Chengaiah and the other from a tomato field on 15-3-1983 of one Sudhakar, is illegal and would result in clear prejudice to the appellants.

(3.)SHRI Srinivasan, the learned counsel for the appellant, Hastimal, submitted that there is absolutely no evidence on record connecting appellant Hastimal with the house bearing Door No. 18/738, Pedda Bazar, Nellore under the custody of one Basheer Ahamed wherefrom Indian made lunghis and a stereo radio cassette recorder are reported to have been recovered by the authorities.

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