KANAYIALAL Vs. COLLECTOR OF CUSTOMS
LAWS(CE)-1986-9-11
CUSTOMS EXCISE AND GOLD(CONTROL) APPELLATE TRIBUNAL
Decided on September 25,1986

Appellant
VERSUS
Respondents

JUDGEMENT

K.S.Venkataramani, - (1.)SHRI Kanayialal, Proprietor of M/s. R.K. Radio Sales and Services, Bangalore, has preferred this appeal against the Order dated 19-2-1986 passed by the Collector of Customs (Appeals), Madras, by which the Collector (Appeals), had upheld the order of confiscation of certain foreign goods from the shop of the appellant.
(2.)On 29-3-1984, the Customs staff of Bangalore Collectorate searched the shop of the appellant and recovered electronic goods such as National Panasonic Radio Cassette Recorders, Sanyo Radio Cassette Recorders and Unisef Cassette Tap Recorders etc., of foreign origin, valued at Rs. 31,700/- for action under the Customs Act, 1962. In a statement, following the seizure, the appellant said that one Sikh gentleman 'Sardarji' claiming, himself to be representative of a tape recorder manufacturer approached him a fortnight before the seizure and offered for sale the goods under seizure on credit basis which offer had been accepted by him. He placed the order for the goods which were duly received and delivery was taken about three days prior to the seizure. He said that he did not have any receipts and that he would produce the documents alongwith the invoices, the next day. He further stated that the goods were of Japanese origin but the markings had been erased. This was his explanation regarding the National Panasonic Cassette Recorder and Sanyo Radio Cassette Recorders. In respect of the Unisef Model TU 506 N and Model AF-52, here also the markings were erased and he said that these had been purchased from M/s. Pawan Electronics, New Delhi for which the Invoice No. 004015 dated 19-12-1983 was produced. Invoice for Model 52F was promised later. In a further letter dated 10-7-1984, the appellant said that the goods seized from his shop were of all Indian origin which had been purchased by taking a bank loan. Show Cause Notice was issued to the appellant and to the supplier M/s. Pawan Electronics. In a statement obtained on 19-6-1984, the Proprietor of M/s. Pawan Electronics, New Delhi, had said that he had sold Cassette Recorders TU 50 UNISEF to the appellant under Invoice No. 004015. He further said that these had been purchased by him from M/s. Nirmal Electronics of Delhi under a Bill No. 388 dated 30-7-1983. The goods sold to the appellant were of Indian origin. The reply to the Show Cause Notice furnished by M/s. Pawan Electronics was to the effect that the goods sold by them to the appellant were not those mentioned in the Mahazar relating to the seizure of the goods on 29-3-1984. It was also stated that the Import Policy for the period 1984 and earlier allowed the import of components of tape recorders to Actual Users. The appellant in his reply to the show cause notice pleaded that he was a radio mechanic dealing in radio and electronic goods and that the goods under seizure were covered by the bills produced by him. During the adjudication proceedings, the goods were also examined by an Electronics Engineer of M/s. British Physical Laboratories, Bangalore, whose services were obtained by the Department and also by one businessman in electronics goods who was produced by the appellant as his witness. The BPL's engineer Shri Venkateswar, on examination of the goods, could only say that although the parts of the items were imported, it could not be asserted whether the goods were assembled in India or were those which' have been imported as fully finished goods into India. On the other hand, Shri T.L. Nagaraj, the defence witness was categorical that the goods were of Indian origin. The Deputy Collector, however, held that the appellant's claim that the goods were of Indian origin had not been established because it was found that the bills produced by him did not relate to the goods and the suppliers had also denied that the goods described in the mahazar were those supplied by them. The Deputy Collector also placed reliance on the original statement of the appellant showing receipt of the goods two weeks prior to the day of seizure which again made the bills produced by him as un-relatable because of the difference in time. She discarded the opinion given by both the experts and held that the charge was proved even on the basis of the documentary evidence itself. She also observed that the appellant had not been able to show that the goods were manufactured in India. The Deputy Collector ordered confiscation of the goods fixing a redemption fine of Rs. 15,000/-. A personal penalty of Rs. 5,000/- was also imposed.
The appeal against this order was rejected by the Collector (Appeals), Madras, who pointed out that the National Panasonic Cassette Recorders and Sanyo Cassette Recorders being notified items and in the absence of any documentary evidence about their licit import, confiscation was in order. Moreover, the markings of foreign origin had been found to be erased. The appellant had also failed in respect of these goods to discharge the obligation cast upon him under Section 123 of the Customs Act, 1962 to show that the goods are not contraband. The Collector (Appeals) however, gave relief in the matter of personal penalty which was reduced from Rs. 5,000/- to Rs. 2,000/-.

(3.)THE learned counsel, Shri Jeshtmal, represented the appellant in the hearing. He contended that the Department had failed to establish the foreign origin of the goods. THE appellant was a dealer in radios and dealt with only Indian goods. THE suppliers, M/s. Pawan Electronics, New Delhi, had also said that they had sold only Indian goods to the appellant. THE erasures of the markings of country of origin on the goods had also been explained during the adjudication proceedings as this was usually the practice even at the time of Customs clearance when component parts are imported. THE Counsel pointed out that the BPL's engineer, who had been called by the Department had not given a categorical opinion that the goods are of foreign origin whereas the expert produced by the appellant had clearly opined that the goods, because of certain aspects of workmanship, were only of Indian origin. This opinion ought to have been accepted by the Deputy Collector. THE Collector (Appeals) had also not given any independent finding for considering the goods as of foreign origin. THE Counsel also referred to another case of M/s. Malhotra Radio House, Bangalore, where electronic goods worth Rs. 51,300/- were ordered to be released after seizure and issue of show cause notice by the Deputy Collector.


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