RAFIQ, J. - (1.) UNDER challenge in this writ petition are seizure memo dated 18-12-1993, confiscation order passed in relation thereto by the Commissioner Customs & Central Excise, Jaipur dated 27/30-10-1995 and the order of the Customs, Excise and Gold (Control) Appellate Tribunal, New Delhi (in short, "tribunal") dated 26-12-1997 whereby the said Tribunal while dismissing the appeal of the petitioner upheld the aforementioned order of the Commissioner.
(2.) FACTUAL matrix of the case is that the Customs officials of Udaipur and Jodhpur range jointly conducted search of the shop and residential premises of the petitioner and prepared a Panchnama/seizure Memo and seized eight foreign marked gold biscuits, 1067 US Dollars, 15 Singapore Dollars and Indian Currency worth Rs. 11]10]000/ -. Statement of the petitioner under Section 108 of the Customs Act 1962 (for short, "act") was recorded on 19-12-1993. A show cause notice dated 3-6-1994 was issued to the petitioner as to why (a) eight gold biscuits under Section 111 (b), (b) foreign currency notes under Section 111 (d), (c) Indian Currency notes and (d) other material be not confiscated under Section 119 (1) of the Act and penalty should not be imposed on him in respect of each of the above three under Section 112 (b) of the Act. The petitioner submitted reply to the show cause notice on 3-2-1995. Commissioner, Central Excise & Customs, Jaipur upon consideration of the entire material on record and explanation putforth by the petitioner, passed the final adjudication order on 27/30-10-1995 thereby confiscating the aforesaid articles and imposing Rs. 20]000/- as penalty upon the petitioner and one Ashok Suri. Feeling aggrieved thereby, the petitioner preferred an appeal before the Tribunal which vide its order dated 13-1-1998 while upholding the order in original passed by the Commissioner dismissed the appeal. Hence, the writ petition. We have heard Mr. Rajendra Prasad, learned counsel for the petitioner and Mr. Tej Prakash Sharma, learned counsel for the respondents. Mr. Rajendra Prasad, learned counsel for the petitioner argued that the Commissioner gravely erred in passing the order of confiscation inasmuch as, the said order is not based on any reliable evidence or any cogent material. Recovery of eight gold biscuits having foreign marks as such does not conclusively prove that they were brought in India without paying the requisite custom duty. Seizure by itself does not substitute the proof of the fact that such biscuits were smuggled. Mr. Rajendra Prasad argued that under Section 105 of the Act the power to search can be exercised only if a duly empowered officer of the customs had the reason to believe that any goods liable to confiscation are secreted in a place. In that event, he may authorise any officer of customs to search or may himself search such place. It was argued that the said power can be exercised by an officer of the rank of Assistant Collector. The Superintendent of Customs who actually conducted the search had no authority to do so inasmuch as the notification dated 31-1-1970 referred to in the impugned order by the Tribunal did not confer any such power on respondent No. 4. The authorities had no reason to believe in the meaning of Section 123 of the Act that seized articles were smuggled goods. Unless the authorities proves so by cogent evidence, no presumption under Section 123 of the Act could be drawn. No information was actually received nor any such information was brought on record either to substantiate the fact. Mr. Rajendra Prasad further argued that the customs authorities had acted in a most arbitrary manner in that the petitioner was made to sign the statement recorded u/s. 108 of the Act under fear of physical pain. Such statement recorded on 19-12-1993 was retracted by the petitioner on the very next day on 20-12-1993. Confession in the statement about seized articles being related to smuggling was wrongly attributed to the petitioner. Statement of the petitioner was recorded while he was in custody of the respondents and such statement being in the nature of confession, could not be relied and acted upon as against the petitioner. The statement having been recorded under the fear of physical pain was not a voluntary statement and, therefore, being hit by Section 24 of the Evidence Act, 1872 was inadmissible in evidence. It was argued that the petitioner apart from running the STD, was dealing in the exchange of mutilated currency notes and it was in connection of his this business that the Indian currency notes were found in his premises. Indian currency was not a notified item under sub-section (2) of Section 123 of the Act and therefore no presumption under Section 123 of the Act for that article could arise. The petitioner produced ledger and cash book in which cash was duly accounted for and it was also shown in the return of the relevant period filed before the authorities of Income-tax Department. Authorities below have erred in drawing presumption in an arbitrary manner that the Indian currency was the sale proceeds of the smuggled gold biscuits and such inference was wholly unfounded and baseless.
(3.) AS regards the Gold biscuits of foreign marking, it was submitted that the authorities below have arbitrarily disbelieved the explanation offered by the petitioner in a most perfunctory manner. Eight gold biscuits which were seized from his premises were of M/s. AShish Jewellers and the petitioner would have only earned Rs. 100/- per biscuit as profit for getting the work of Kundan done on them. These gold biscuits were delivered to the petitioner by Mr. AShok Suri of M/s. AShish Jewellers who had received such gold biscuits from K. N. Babu from Dubai against a valid baggage receipt which was produced. Entry to this effect was made in the stock register of M/s. AShish Jewellers which document was also produced. As regards 1067 US Dollars and 15 Singapore Dollars, it was argued that they belonged to one Shankardas Vadhwani. His affidavit to this effect was filed before the Commissioner. It was explained by the petitioner to the custom authorities that the said Mr. Shankardas Vadhwani was an N. R. I. who originally belonged to Ajmer and on his return from Dubai, he had entrusted those U. S. Dollars for their safe custody to the petitioner. It was therefore submitted that the writ petition may be allowed in terms of the prayers aforesaid. ;