Partly allowed

Gulab Gupta S/O Sri Harihar Gupta v. Lucknow Prev

CESTAT12 Aug 2025C/70688/2024

Case brief

AI extract

What is this about?

The Tribunal upheld the confiscation of smuggled peas under Section 111(b) and seized vehicles under Section 115(2) of the Customs Act, 1962, relying on Section 108 statements and Supreme Court precedents. However, it set aside the penalty imposed under Section 112(b) due to lack of established mens rea.

What did the court decide?

Confiscation of smuggled peas and vehicles upheld; penalty under Section 112(b) set aside.

Gulab Gupta S/O Sri Harihar Gupta vs Lucknow Prev — Customs and Excise | CESTAT (2025)

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CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL ALLAHABAD

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REGIONAL BENCH - COURT No. II

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Customs Appeal No.70688 of 2024

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(Arising out of Order-in-Appeal No.232-CUS/APPL/LKO/2024 dated 22/03/2024 passed by Commissioner (Appeals) Customs, Central Excise & Service Tax, Lucknow)

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Mr. Gulab Gupta S/o

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Shri Harihar Gupta, ….Appellant

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(Village- Sabaya Siswa, Maharajganj, UP)

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VERSUS

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Commissioner of Customs (Pre.), Lucknow ….Respondent

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(7^th Floor, Apratyaksh Kar Bhawan, Vibhuti Khand, Gomti Nagar, Lucknow-226024)

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APPEARANCE:

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None for the Appellant

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Shri Santosh Kumar, Authorised Representative for the Respondent

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CORAM: HON’BLE MR. SANJIV SRIVASTAVA, MEMBER (TECHNICAL)

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FINAL ORDER NO.70857/2025

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DATE OF HEARING : 12 August, 2025 DATE OF DECISION : 12 August, 2025

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SANJIV SRIVASTAVA:

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This appeal is directed against Order-in-Appeal No.232CUS/APPL/LKO/2024 dated 22/03/2024 passed by Commissioner (Appeals) Customs, Central Excise & Service Tax, Lucknow. By the impugned order Commissioner (Appeals) has rejected the appeal of the appellant and uphold the Order-in-Original, wherein following has been held:-

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“ अदेश

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(i) उपरोक्त ऄभिग्रहीत मटर बजन 17375.00 ककग्रा. मूल्य रु. 6,95,000/-

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( छः लाख पचानवे हजार मात्र) , सीमा शुल्क ऄभधभनयम 1962 की धारा 111 (b) के ऄंतगगत ऄभधहरण ककये जाने का अदेश देता हूँ उक्त ऄभिग्रभहत मटर को रु. 1,00,000/- ( एक लाख मात्र) भवमोचन शुल्क Redemption fine तथा सीमा

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Customs Appeal No.70688 of 2024

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शुल्क रु. 4,36,113/- ( चार लाख छतीस हजार एक सौ तेरह मात्र) जमा करने के पश्चात् उक्त ऄभिग्रभहत वस्तुओं के भवभधक स्वामी को भवमोभचत करने का भवकल्प देता है। चूंकक उक्त ऄभिग्रभहत बस्तुओं की सामभयक उन्मुभक्त अदेश संख्या 05/21-22 कदनांक 12/08/2022 के तहत उपयुगक्त प्रभतिूभत , सीमा शुल्क और ऄभिग्रभहत बस्तुओं के मूल्य के cjkcj cU/k i= nsus ds i”pkr~ iwoZ esa gh dh tk pqdh gS vr% bldh lkef;d mUeqfDr ds le; रखी गयी कुरा धरोहर राभत रु. 5,36,113/( ikap yk[k NRrhl gtkj ,d lkS तेरह मात्र ) का आ s lh ऄभधभनयम कक धारा 126 के ऄंतगगत सरकार के पक्ष में समायोभजत ककये जाने का अदेश देता है।

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(ii ) भपकऄप रभज० सं० यू०पी० 56 एण्टी- 0759 गीजर मू Y; रु. 5,60,000/( पाच लाख साठ हजार मात्र) का सीमा शुल्क ऄभधभनयम 1962 की धारा 115 (2) के ऄंतगगत ऄभधहरण ककये जाने का अदेश देता हूँ एवं उक्त ऄभिभहत बाहन को रु. 56,000/- ( छप्पन हजार मात्र) भवमो pu “kqYd Redemption fine जमा करने के पश्चात् उक्त ऄभिग्रभहत बाहुन के भवभधक स्वामी को भवमोभचत करने का भवकल्प देता हूँ। चूंकक उक्त ऄभिवभहत वर् ण त बाहुन की सामभयक उन्मुभक्तः अदेश संख्या 05/21-22 कदनांक 12/08/2022 के तहत उपयुगक्त प्रभतिूभत और ऄभिग्रभहत वस्तुओं के मूल्य के बराबर बन्ध पत्र देने के पश्चात् पूवग में ही कक जा चुकी है ऄतः आसकी सामभयक उन्मुभक्त के समय रखी गयी धरोहर राभश रु. 56,000/( छप्पन हजार मात्र) को आसी ऄभधभनयम कक धारा 126 के ऄंतगगत सरकार के पक्ष में समायोभजत ककये जाने का अदेश देता है।

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(iii) भपकऄप रभज० सं० पू०पी० 56 ए०टी०- 1559 सीजर मूल्य रु. 6,00,000/- ( छः लाख मात्र) का सीमा शुल्क ऄभधभनयम 1962 की धारा 115 (2) के ऄंतगगत ऄभधहरण ककये जाने का अदेश देता हूँ एवं उक्त ऄभिग्रभहत वाहन को रु. 50,000/- ( साठ हजार मात्र) भवमोचन शुन्त Redemption fine जमा करने के पश्चात् उक्त ऄभिग्रभहत वाहन के भवभधत स्वामी को भवमोभचत् करने का भवकल्प देता हूँ। च ू कक उक्त ऄभिग्रभहत वर् ण त वाहन की सामभयक उन्मुभक्त अदेश संख्या 05/21-22 कदनांक 12/08/2022 के तहत उपयुगक्त प्रभतिूभत और ऄभिग्रभहत वस्तुओं के मूल्य के बराबर बन्ध पत्र देने के पश्चात् पूवग में ही कक जा चुकी है ऄतः आसकी सामभयक उन्मुभक्त के समय रखी गयी धरोहर राभश रु. 60,000/( साठ हजार मात्र) को आसी ऄभधभनयम कक धारा 126 के ऄंतगगत सरकार के पक्ष में समायोभजत ककये जाने का अदेश देता हूँ।

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(iv) ट्रक रभज० सं० यू०पी० 53 डी०टी० 8117 सीजर मूल्य रु. 13,00,000/( तेरह लाख मात्र) का सीमा शुल्क ऄभधभनयम 1962 की धारा 115 (2) के ऄंतगगत ऄभधहरण ककये जाने का अदेश देता हूँ एवं उक्त ऄभिग्रभहत वाहन को रु.

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Customs Appeal No.70688 of 2024

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1,30,000/- ( एक लाख तीस हजार मात्र) भवमोचन शुल्क Redemption fine जमा करने के पश्चात् उक्त ऄभिग्रभहत बाहन के भवभधक स्वामी कोभवमोभचत करने का भवकल्प देता हूँ। चूंकक उक्त ऄभिग्रभहत वर् ण त वाहन की सामभयक उन्मुभक्त अदेश संख्या 05/21-22 कदनांक 12/08/2022 के तहत उपयुगक्त प्रभतिूभत और ऄभिग्रभहत वस्तुओं के मूल्य के बराबर ब U ध पत्र देने के पश्चात् पूवग में ही कक जा चुकी है ऄतः आसकी सामभयक उन्मुभक्त के समय रखी गयी धरोहर राभश रु. 1,30,000/( एक लाख तीस हजार मात्र) को आसी ऄभधभनयम कक धारा 126 के ऄंतगगत सरकार के पक्ष में समायोभजत ककये जाने का अदेश देता हूँ।

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(v) भपकऄप रभज० सं० पू०पी० 56 ए०टी०- 0424 सीजर मूल्य रु. 5,50,000/- ( पांच लाख पचास हजार मात्र) का सीमा शुल्क ऄभधभनयम 1962 की धारा 115 (2) के ऄंतगगत ऄभधहरण ककये जाने का अदेश देता हूँ एवं उक्त ऄभिग्रभहत वाहन को रु. 55,000/- ( पचपन हजार मात्र) भवमोचन शुल्क Redemption fine जमा करने के पश्चात् उक्त ऄभिग्रभहत बाहुन के भवभधक स्वामी को भवमोभचत करने का भवकल्प देता हूँ। चूंकक उक्त ऄभिग्रभहत वर् ण त वाहन की सामभयक उन्मुभक्त अदेश संख्या 05/21-22 कदनांक 12/08/2022 के तहत उपयुगक्त प्रभतिूभत और ऄभिग्रभहत वस्तुओं के मूल्य के बराबर बन्ध पत्र देने के पश्चात् पूवग में ही कक जा चुकी है ऄतः आसकी सामभयक उन्मुभक्त के समय रखी गयी धरोहर राभश रु. 55,000/- ( पचपन हजार मात्र) को आसी ऄभधभनयम कक धारा 126 के ऄंतगगत सरकार के पक्ष में समायोभजत ककये जाने का अदेश देता है।

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(vi) भपकऄप रभज० सं० यू०पी० 56 ए०टी०- 1082 सीजर मूल्य रु. 5,70,000/- ( पांच लाख सत्तर हजार मात्र) का सीमा शुल्क ऄभधभनयम 1962 की धारा 115 (2) के ऄंतगगत ऄभधहरण ककये जाने का अदेश देता हूँ एवं उक्त ऄभिग्रभहत बाहुन को रु. 57,000/- ( सत्तावन हुजार मात्र) भवमोचन शुल्क Redemption fine जमा करने के पश्चात् उक्त ऄभिग्रभहत वाहन के भवभधक स्वामी को भवमोभचत करने का भवकल्प देता हूँ। चूंकक उक्त ऄभिग्रभहत वर् ण त वाहन की सामभयक उन्मुभक्त अदेश संख्या 05/21-22 कदनांक 12/08/2022 के तहत उपयुगक्त प्रभतिूभत और ऄभिग्रभहत वस्तुओं के मूल्य के बराबर बन्ध पत्र देने के पश्चात् पूवग में ही कक जा चुकी है ऄतः आसकी सामभयक उन्मुभक्त के समय रखी गयी धरोहर राभश रु. 57,000/- ( सत्तावन हजार मात्र) को आसी ऄभधभनयम कक धारा 126 के ऄंतगगत सरकार के पक्ष में समायोभजत ककये जाने का अदेश देता है।

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(vii) में श्री राजेश पुत्र श्री सवगजीत , भनवासी ग्राम बरगदवा , नगर पंचायत भनच ykSy , भजला- महाराजगंज , वाहन चालक , सीमा शुल्क ऄभधभनयम 1962 की

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धारा 112 (b) के ऄंतगगत रु. 50,000/- ( पचास हजार मात्र) की शाभस्त लगाये जाने का अदेश देता है।

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(vii) मैं श्री शह uokt vyh iq= Jh xqytkj vyh fuoklh&xkze ftyk egjktxat , okgu pkyd lhek “kqYd vf/kfu;e 1962 dh /kkjk 112(b) ds varxZr रु. 50,000/- ( पचास हजार मात्र) की शाभस्त लगाये जाने का अदेश देता है।

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(ix) मैं िी आभततयाज ऄहम n पुत्र Lo- fcfLeYykg] भन oklh बाबा ft ला कुशीनगर , गोदाम स्वामी सीमा शु Yd ऄभधभनयम 1962 की धारा 112 (b) के ऄंतगगत रु. 50,000/- ( पचास हजार मात्र) की शाभस्त लगाये जाने का अदेश है। (x) मैं श्री कैलाश पुत्र श्री लल्लन भनवासी 165, िेभवया देउरहा , भजला महाराजगंज , बाहन स्वामी एवं चालक सीमा शुल्क ऄभधभनयम 1962 की धारा 112 (b) के ऄंतगगत रु. 50,000/- ( पचास हजार मात्र) की शाभस्त लगाये जाने का अदेश देता हूँ।

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(xi) मैं श्री सतेन्र यादव पुत्र श्री प्रिु भनवासी ग्राम ऄलवररया , पोस्ट ओडवभनया , भन pykSy भजला महाराजगंज , वाहन चालक , सीमा शुल्क ऄभधभनयम 1962 की धारा 112 (b) के ऄतगगत रु. 50,000/- ( पचास हजार मात्र) की शाभस्त लगाये जाने का अदेश देता है।

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(xii) में श्री गुलाब गुप्ता पुत्र श्री हररहर यादव भनवासी ग्राम सवय , भजला महाराजगंज , okgu स्वामी सीमा शुल्क ऄभधभनयम 1962 की धारा 112 (b) के ऄंतगगत रु. 3,00,000/- ( तीन लाख मात्र) की शाभस्त लगाये जाने का अदेश देता है।

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(xiii) में श्री राजेंर यादव पुत्र श्री कमल यादव , भनवासी ग्राम व पोस्ट fNrkSuk] भज yk महाराज xat , okgu स्वामी एवं चालक सीमा शुल्क ऄभधभनयम 1962 की धारा 112 (b) के varxZr रु. 50,000/-( पचास हजार मात्र) की शाभस्त लगाये जाने का अदेश देता है।

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(xiv) मैं श्री महेश यादव पुत्र श्री कमल यादव , भनवासी ग्राम लोभहया नगर वाडग 11 भजला महाराजगंज , वाहन स्वामी सीमा शुल्क ऄभधभनयम 1962 की धारा 112 (b) के ऄंतगग r र. 50,000/- ( पचास हजार मात्र) की शाभस्त लगाये जाने का अदेश देता है।

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(xv) मैं श्री vkyksd कुमार गुप्ता पुत्र श्री बनारसी लाल गुप्ता , भनवासी गहौरा बाजार , भजला महाराजगंज , वाहन स्वामी सीमा शुल्क ऄभधभनयम 1962 की धारा

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112 (b) के ऄंतगगत रु 50,000/- ( पचास हजार मात्र) की शाभस्त लगाये जाने का अदेश देता है।

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(xvi) मैं श्री बनारसी लाल गुप्ता पुत्र श्री राम औतार , भनवासी राहौर बाजार , भजला महाराजगंज , प्रभतभनभध वाहन तवामी सीमा शुल्क ऄभधभनयम 1962 की धारा 112 (b) के ऄंतगगत रु. 50,000/-( पचास हजार मात्र) की शाभन्त लगाये जाने का अदेश देता है।

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(xvii) मैं श्री fxfjtknsoh iRuh Jh vkseizdk”k , भनवासी rkjkeaMy fl)kFkZ ,UDyso ftyk xksj[kiqj वाहन Lok मी सीमा शुल्क ऄभधभनयम 1962 की धारा 112 (b) के ऄंतगगत रु. 50,000/-( पचास हजार मात्र) की शाभन्त लगाये जाने का अदेश देता है। “

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1.2 Though the order in original is in respect of number of persons, it appears that none person other than the appellant had filed any appeal before the first appellate authority as the impugned order disposes of only one appeal that was filed by the appellant. Further I do not find other appeal filed in these proceedings leading to confiscation of allegedly smuggled peas and imposition of penalty on many appellant.

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2.1 On 02.08.2021, the police officers of Khadda Police Station intercepted five drivers alongwith trucks/pickups loaded with 695 sacks of smuggled peas totally weighing 17,375 Kg. valued at Rs. 42,75,000/- illegally being imported from Nepal to India through off routes and handed over to the officers of the Customs (P) Division, Gorakhpur. The drivers of the trucks in their respective statements recorded under Section 108 of the Customs Act, 1962 stated that the owner of the said peas in the appellant. They stated that the said peas were brought into India from Nepal illegally in Pickups and were being loaded in trucks on the direction of the appellant when the police intercepted them.

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2.2 Appellant in his statement dated 07.08.2021 recorded under Section 108 of the Customs Act, 1962 accepted that he is the owner of the seized peas and the said peas were brought

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from Nepal but he does not have any valid document in respect of import of seized goods.

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2.3 Thus, on a reasonable belief that the recovered peas was illegally brought into India through unauthorized routes in violation to the provisions of Notification No. 63/94(N.T.) dated 21.11.1994 under Section 7(1)(c) of the Customs Act, 1962, the same are liable for confiscation under Section 111(b) Customs Act, 1962 and vehicles loaded with said goods were also liable for confiscation under Section 115(2) of the Act and the same were seized under Section 110 of the Act.

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2.4 After inquiry, a show cause notice was issued to the appellant alongwith other related persons proposing therein confiscation of the said seized goods along with the seized vehicles under Section 111(b) and 115(2) of the Act respectively. Penalties were also proposed to be imposed on the appellant and related persons under Section 112 of the Act. 2.5 The said show cause notice was adjudicated as per the Order-in-Original dated 31.01.2023 referred in para-1 above. 2.6 Aggrieved appellant have filed appeal before the Commissioner (Appeal), which have been disposed off as per the impugned order.

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2.7 Aggrieved appellants have filed this appeal.

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3.1 During the hearing I observe that the notice send to the appellant has been returned undelivered and the notice copy send to the Advocate on record has not been returned back, ‘presumably delivered’. Inspite of notice, appellant is absent on call. I have heard the learned Authorised Representative appearing for the revenue.

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4.1 I have considered the impugned order along with the submissions made in appeal and during the course of arguments. 4.2 Impugned order records the findings as follows:-

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“5.2 From the records, I find that the recovery of the smuggled peas from the vehicle No. UP-31/AT-3854 has not

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been disputed as all the drivers of the intercepted trucks in their respective statements recorded under Section 108 of the Customs Act, 1962 have categorically admitted that owner of the seized peas is the appellant and the seized peas was of foreign origin and illegally brought into India through off routes in violation to the provisions of the Customs Act, 1962 and they never shown retraction from their statements. The appellant also in his statement dated 07.08.2021 recorded under Section 108 of the Customs Act, 1962 accepted that ownership of the seized peas the said peas was brought into India on his direction through off routes from Nepal into India without any valid documents.

¶64

5.3 I would also like to refer to a judgment of Hon'ble Supreme Court of India in this regard passed in the case of 'Naresh J. Sukhawani Vs. Union of India 1995 (11) TMI 106 SUPREME COURT OF INDIA wherein Hon'ble Supreme Court ruled that"-It must be remembered that the statement made before the Customs officials is not a statement recorded under Section 161 of the Criminal Procedure Code, 1973. Therefore, it is a material piece of evidence petitioner in the contravention inasmuch as Mr. Dudani's statement clearly inculpates not only himself but also the petitioner. It can, therefore, be used as substantive evidence connecting the petitioner with the contravention by exporting foreign currency out of India. Therefore, we do not think that there is any illegality in the order of confiscation of foreign currency and imposition of penalty. There is no ground warranting reduction of fine." collected by Customs officials under Section 108 of the Customs Act. That material incriminates the petitioner inculpating him in the contravention of the provisions of the Customs Act. The material can certainly be used to connect the

¶65

Thus, in view of statements of the appellant and the drivers of the seized vehicles recorded under Section 108 of the Customs Act, 1962, it is apparent that the appellant is the

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owner of seized peas which was illegally brought into India from Nepal through off routes in violation to the provisions of the Customs Act, 1962. Thus, I find that the appellant has committed an offence for which the goods were rightly ordered for confiscation and imposed penalty upon the appellant.

¶69

5.4 Also, the appellant has contended that he had legally imported the said goods from Nepal under proper import documents. In this context, I find that however the appellant has claiming that he legally imported the said peas but he has failed to produce the import documents in respect of said import either at the time of adjudication proceedings or before me in the instant appeal. Thus, the said contention of appellant is not sustainable.

¶70

5.5 In view of above, I find that the adjudicating authority has rightly ordered for confiscation of the said goods and vehicle and imposed penalty upon the appellant for violation of the provisions of the Act to which I do not wish to interfere.

¶71

5.6 Thus, in view of above, I hold the impugned order as legal and proper and reject the appeal filed by the appellant.”

¶72

4.3 Appellant has challenging the impugned order stated following grounds:

¶73

8- Because in the above case it is a humble request that the applicant is owner of confiscate of Indian peas. The statement of the applicant was recorded under Section 108 by Customs, Gorakhpur on 07.8.2021. In relation to the said statement, the applicant states that the said peas were purchased from regional farmers and traders and some goods were sent to Customs, Division Nautanwa. Provisional release of dry green peas seeded from small traders was done. The applicant/pea owner had purchased the said green dry peas which are as follows-

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Sr. no	Name of the goods owner	weight =	date of release
1	Ajay son of Shri Sudama	2625 Kg/ Dry Green Peas	27.7.2021
2	Ved Prakash Pandey	3000 kg/dry green peas	28.7 2021
3	Manoj Yadav son of Vechai	3000 Kg./ Dry Green Peas	28.7.2021
4	Virendra son of Shri Shivmangal	4450 Kg./ Dry Green Peas	30.7.2021
5	Ashish s/o Shri Chokat	15000 Kg/ Dry Green Peas	31.7.2021
6	Arvind s/o Shri Sukhram	2890 Kg/ Dry Green Peas	01.8.2021
	Total weight =	17465 Kg

¶78

10- Because dry green peas of the applicant were caught by the police officers of P.S. Khadda on 03.8.2021 and while catching the peas, all the above purchased forms were shown to the concerned police officers but it has been revealed by the police of Khadda Police Station that they said We are showing the goods as Nepal peas on our records and all of you have to mention in your statement that the said peas were brought from Nepal, failing which we will send you to jail. Applicant police station-Khadda, District Kushinagar due to fear of police, fear of going to jail and seized the peas.

¶79

11- Because the applicant Provisional release for peas had given a wrong statement at that time due to fear, panic and fear. The applicant was under a lot of pressure at that time and the applicant was apprehensive that if the applicant took the names of all the people who had purchased seasonal immunity peas from small traders, then the Customs would include them all in the said case, hence the applicant Could not mention the correct facts in the statement given on 07.8.2021. Whereas in the said seized 17375 kg of Indian peas were purchased from local traders and farmers.

¶80

12- Because in the above circumstances, the statement given by the applicant/pea owner dated 07.8.2021 is refuted and the details of legal peas purchased by the applicant/pea owner are being submitted by attaching it with this application. In view of the above, it is a humble

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request to you to kindly drop the seizure of 17375 kg of peas of the applicant.

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13- Because the appellant is reputed trader of grain with its own shop situated at Sabaya Dhala Siswa District. Maharajganj Appellant has his own godown along with his shop and appellant is generally purchasing rice and wheat at his shop from local farmers and supplied that grains to the others big markets in UP like Kanpur and Lucknow Mandi. Appellant had purchased the seized green pea at his shop from some local vendors who had received the seized green pea from the office of Customs Preventive Division Nautanwa after paying redemption fine and personal penalty imposed on seized green pea before few days of the seizure of seized green pea and appellant had also received the copy of release order from that vendors and appellant had mad cash payment regarding aforesaid purchase. After the purchase of said green pea appellant had shifted the seized green pea to his another godown situated at Khadda for sorting and packing before forwarding it to the nearest market of Gopalganj Bihar for sale on seized vehicles and suddenly Police Staff of the P /S Khadda came to the godown of appellant and seized the same in suspicion of smuggled goods without any reason and at that appellant was in Lucknow for his treatment and appellant staff had showed the papers of Customs Division Nautanwa related to the seized goods to the police officers but they did not considered that documents and handed over this case to the Customs Division Gorakhpur Appellant had also submitted the documents of purchase and release orders of Customs Division Nautanwa through advocate on the email of Customs Division Gorakhpur but the officers of Customs Division Gorakhpur did not acknowledge that documents and forcibly recorded the statement of appellant , drivers and owners of seized vehicles and made the case of smuggled green pea . Later on appellant had submitted

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these facts ad papers before adjudicating authority but the adjudicating authority had conformed the version the Customs Division Gorakhpur.

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14- Because the conduct of the respondent authority is open violation of the provisions of the Customs Act 1962 and open harassment of the legal trade of the appellant.

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15- Because the respondent authorities "Reason to believe that the seized Areca-nuts are of foreign origin and liable for confiscation under the provision of Customs Act 1962 is baseless and not correct in the eye of law.

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16- Because the order in original regarding. appellant consignment is not sustainable and failed place reliance tc prove it corrects.

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17- Because the case of respondent is fully based on assumption and presumption.

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18- Because the reason to believe for confiscating the goods is statutory requirement which is totally absent in the present case.

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19- Because the respondent authorities have miserably failed to discharge their onus to prove under section 111 of the Customs Act in case of non-notified goods.

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20- Because the respondent authorities cannot act under the Customs Act over a non-notified item and that too, in a non- notified area.

¶95

21- Because the applicability of the Customs Act and the jurisdiction of the respondent authorities are under challenge.

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22- Because the seizure has been done not on any personal reason to believe of the seizing officer, rather it is based upon the belief of the local traders.

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23- That the reason to believe for confiscating the goods is statutory requirement which is totally absent in the present case.

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24- Because the respondent authorities have miserably failed to discharge their to prove under section 111 of the onus Customs Act in case of non-notified goods.

¶101

25- Because the respondent authorities cannot act under the Customs Act over a non-notified item and that too, in a non- notified area and green pea is not notified under the provisions of section 123 Customs Act 1962.

¶102

26- Because when the very seizure itself is challenged, there is no requirement for the petitioner to submit to the jurisdiction of the Custom authorities

¶103

27- Because at any rate the order in appeal is not sustainable in the eve of law and may be set aside and cash security deposited at the time of provisional release may be returned back to the appellant and personal penalty imposed on the appellant may also be returned back to the appellant

¶104

28- Because the show cause notice was not issued and not -served to the appellant within specified time limit.

¶105

4.3 I find that the goods under confiscation were intercepted by the police officers of Police Station Khadda, on 02.08.2021 along with two persons namely Shri Rajesh Sarvajeet R/o Village Bargadba, Nagar Panchayat Nichlol District Maharajganj and Shri Shanabaz Ali S/o Shri Gulzar Ali R/o Village Sikathiya Pipra Bazar, Nichlol Maharajganj. Details of the vehicles and the peas intercepted from each vehicle is reproduced bellow

¶106

S	Vehicle	No	Pea	s Smuggled from	Nepal
No	Number	Value	Bags	Weight ‘Kgs	Value
1	UP56AT-1082	570000	120	3000	120000
2	UP56AT-0424	550000	120	3000	120000
3	UP56AT-0759	560000	120	3000	120000
4	UP56AT-1559	600000	95	2375	95000
5	UP53DT-8117	1300000	240	6000	240000
	Total	3580000	695	17375	695000

¶107

Both the persons intercepted along with the peas admitted in their statement recorded under Section 108 that the impugned pea loaded in these Vehicle was the pea smuggled from Nepal

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through unauthorized routes and was loaded in their vehicles by the Appellant from a godown located in Lakhuwa Lukhai Khadda. On the basis of the above and under reasonable belief that the impugned peas were illegally brought into India, the peas were put under seizure. The vehicles used for transportation were also seized. During the course of investigations statement of the appellant and many other persons were recorded under Section 108 of Customs Act, 1962. As per the jist recorded in order in original appellant has in his statement recorded 07.08.2021 stated as follows:

¶111

“उक्त बयान में बताया कि अकिग्रहीत िुल 695 बोरी मटर िा वह स्वामी है। उक्त मटर िो उसने नेपाल िे नवल पंरासी बाजार से रू0 30/- प्रकत कि०ग्रा० िी दर से खरीदा था और उसे मजदरों िे द्वारा िई बार में िारत में झुलनीपुर में लािर कपिअप वाहनों िे द्वारा लखुवा लखुईं बड्डा स्थित थ्री इस्थियाज िे मिान में किराय पर कलये गये गोदाम में इिट्ठा किया था, कजसिा उसिे पास खरीद एबं आयात 'से सम्बस्थित िोई िी वैध िागजात नहीं है। उसने 240 बोरी मटर जो पहले से मंगािर उक्त गोदाम में रखवाया था, वहीं मटर टरि रज०मं०य्ूूपी० 53 डी०टी०-8117 पर लोड हो रहा था तथा पिडे गये उक्त चारो कपिअप में लोड मटर उसी टरि में लोड होना शेष था वह उक्त मटर िो लाि पर बेचने िे उद्देश्य से गीडा, गोरखपुर ले जाता और वहां पर िनबेकसंग एजेन्ों िे माध्यम से उसे जहां िी ज्यादा रेट कमलता उक्त माल िो वहीं पर बेच देता उसने उक्त गोदाम िो कदनांि 25.07.2021 िो रू. 5000/. प्रकत माह किराये पर मौस्थखि रूप से कलया था, कजसिा िोई एग्रीमेन् नहीं किया गया था। पुकलस अकथिाररयों द्वारा छापा मारे जाने िे दौरान उनिी तकबयत खराब होने िे िारण उन्ोंने ही श्नी इस्थियाज से गोदाम खोलिर टरि में माल लोड िरवाने िे कलये िहा था। आगे उसने यह िीं स्वीिार किया है कि उसे इस बात िी जानिारी है कि नेपाल से अबैध मागग से तस्करी िर मटर िो िारत में जािर अकधि दाम पर बेचना सीमा शुल्क अकधकनयम िे प्रावधानों िा उल्लघन एवं दण्डनीय अपराध है।“

¶112

After completion of investigations the show cause notice was issued to the appellant and others proposing confiscation of seized peas and the seized vehicles. Though the show cause notice was issued to number of persons other than the appellant but none of them except appellant filed any reply or attended the personal hearing. After considering the submissions the

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order in original referred in para 1 above was passed. None other than appellant filed any appeal except for the appellant before Commissioner (Appeal) except the appellant.

¶116

4.5 In absence of any challenge by any other person who was involved in the handling and transportation of the illicitly imported peas, I am not in position to admit the challenge made by the appellant in respect of the confiscation of peas. It would lead to situation where the vehicles used for transporting the illicitly sized peas are held liable for confiscation, and the impugned peas are contrarily held not liable for confiscation. Impugned order takes note of all the statements recorded under Section 108 of Customs Act, 1962 whose evidentiary value has been upheld by the Hon’ble Supreme Court in series of decisions as follows:

¶117

Surjit Singh Chabbra [1997 (89) E.L.T. 646 (S.C.)]

¶118

Naresh J Sukhwani [1996 (83) E.L.T. 258 (S.C.)]

¶119

K I Pavunny [1997 (90) E.L.T. 241 (S.C)]

¶120

It is also noted that none of the statement was retracted by any person including the appellant, nor have been discredited by way of cross examination in any proceedings.

¶121

4.6 Impugned order also records that the appellant has taken contrary stands in respect of the seized peas even in the reply filed to the show cause notice. On one hand appellant states that the seized peas are imported peas for which there are valid documents and on the other hand it is stated that the seized peas were procured by the appellant from local farmers. Thus by relying on the decision of the Hon’ble Supreme Court in case of System and Components (P) Ltd. [2004 (165) ELT 136 (SC)] the seized peas were held liable for confiscation under Section 111 (b) of the Customs Act, 1962. After confiscation the peas have been allowed to be released against redemption fine of Rs 1,00,000/-.

¶122

4.6 Peas are grown in huge quantity in India and in the appellant have in his initial statement claimed to have purchased the same from local farmers. Appellant has in his sought to show

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that he purchased the said pea from the local farmers, and have given some details in para 9 of the appeal reproduced above. However the details given do not tally with the details of the peas under seizure. The from the table in para 9 of the appeal it is evident that appellant has claimed to purchase 30,965 Kgs of peas from 6 persons. However except for bald assertion nothing concrete has been stated no document in respect of purchase has been purchased, nor any document in respect of the payments made has been placed on record. I do not find much support from the said submission.

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4.7 Now coming to the penalty imposed upon the appellant upon the appellant under Section 112 (b) of the Customs Act, 1962. I find that the said section becomes applicable only when mens-rea in the actions of appellant could have been established. Neither the impugned order nor the order-in-original record any finding to establish mens-rea on the behalf of the appellant. Appellant is trader engaged in sale and purchase of ‘Kirana’. I have upheld the confiscation of the seized peas for the reason that non other than appellant has challenged anything recorded during the investigation at anytime. But that go on to prove the existence of mens-rea on the part of the appellant, which would lead to imposition of penalty upon him under Section 112 (b). Thus I set aside the penalty imposed upon the appellant under section 112 (b).

¶127

4.8 Thus in absence of any appeal filed by any other person, involved in the case while I uphold the order of confiscation of peas, I set aside the penalty imposed upon the appellant

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5.1 Appeal is partly allowed.

¶129

(Operative part of the order pronounced in open court)

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(SANJIV SRIVASTAVA) MEMBER (TECHNICAL)

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akp

Gulab Gupta S/O Sri Harihar Gupta v. Lucknow Prev

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Gulab Gupta S/O Sri Harihar Gupta v. Lucknow Prev

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