Principal Commissioner Of vs Mr. Rakheeb Ulla Baig
2021 Latest Caselaw 5912 Kant

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     IN THE HIGH COURT OF KARNATAKA AT BENGALURU

        DATED THIS THE 10TH DAY OF DECEMBER, 2021

                          PRESENT

           THE HON'BLE MRS. JUSTICE S.SUJATHA
                            AND

       THE HON'BLE MR. JUSTICE S.VISHWAJITH SHETTY

                    C.S.T.A.No.7/2020
                            c/w
                    C.S.T.A.No.11/2020

In CSTA No.7/2020

BETWEEN:

The Commissioner of Customs,
Bangalore, C.R.Building,
Queens Road,
Bangalore-560001.                            ... APPELLANT

(By Sri Deshpande Amit Anand, Adv.)

AND:

1.     Shri Ismail Ibrahim
       S/o Shri Ibrahim,
       Old No.98, New No.60,
       Taiyappa Mudali Street,
       Seven Wells Channai-600001.

2.     Shri Sudharshan Ashok Kumar
       S/o Shri Ashok Kumar, No.12/27,
       West Chetty Street South,
       Avanimoolaveethi,
       Madurai,
       Tamilnadu-625001.                 ... RESPONDENTS

(By Sri P.Prasad, Adv.)
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In CSTA No.11/2020

BETWEEN:

Principal Commissioner of
Customs, ACC & Airport
Commissionerate,
Kempegowda International,
Airport,
Bangalore-560300.                      ... APPELLANT

(By Sri Deshpande Amit Anand, Adv.)

AND:

Mr. Rakheeb Ulla Baig
S/o Siral Ulla Baig,
No.114, 5th cross,
Teachers colony,
Kadrenahalli cross, BSk,
2nd stage, Bengaluru-560070.           ... RESPONDENT

(By Sri Nagaraja.M.S. Adv.)

     CSTA No.7/2020 is filed under Section 130 of the
Customs Act, praying to set aside the final order No.20526-
20527/2019 dated 02.07.2019 vide Annexure-A passed by
the Customs, Excise and Service Tax Appellate Tribunal,
South Zonal Bench, Bengaluru vide Annexure-A.

       CSTA No.11/2020 is filed under Section 130(A) of the
Customs Act, praying to set aside the impugned final order
No.20300/2019      dated       29.03.2019     in    Appeal
No.C/21918/2018-SM by allowing this appeal with exemplary
costs.

      These appeals coming on for Further Arguments, this
day, Vishwajith Shetty J., delivered the following:
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                          JUDGMENT

1. These two appeals have been admitted to consider

the following substantial question of law:

"Whether the Tribunal lacked inherent jurisdiction to entertain the appeal filed by the respondents in view of the specific bar under Section 129A and 129DD of the Customs Act, 1962, and therefore, the appeal before the Tribunal was not maintainable?"

2. The facts of the case as revealed from the records

are, the respondents in these two appeals were intercepted

on credible information that they are likely to arrive at

Kempegwoda International Airport, Bengaluru, and

smuggle gold by way of concealment on person and are

not likely to declare the same to the customs authorities on

their arrival. On verification, the DRI Officers found that

the respondents were carrying smuggled gold, and

thereafter, the gold was seized from the respondents under

a mahazar and their voluntary statement was also

recorded. Subsequently, show cause notices were issued to

the respondents by the competent DRI officer, to show

cause why the seized gold should not be confiscated under

Section 111 of the Customs Act, 1962 (for short, 'the Act')

and why penalty should not be imposed under Sections

112 & 114-AA of the Act, to which the respondents had

filed a reply to the same and subsequently inquiry was held

by the Joint Commissioner of Customs, Kempegowda

International Airport, Bengaluru, and the order in original

was issued on 27.12.2016 ordering confiscation of gold

seized from the respondents and also imposing penalty

under Sections 112 & 114-AA of the Act. Being aggrieved

by the same, the respondents had filed appeals before the

Commissioner of Customs (Appeals) and the said appeals

were partly allowed setting aside the penalty imposed

under Section 114-AA of the Act. Being aggrieved by the

same, the respondents had filed appeal before the

Appellate Tribunal. The appeal filed by the respondents in

CSTA No.7/2020 was partly allowed and the Appellate

Tribunal while upholding the order of confiscation had

reduced the penalty imposed under Section 112 of the Act

and dropped the penalty imposed under Section 114-AA of

the Act. In so far as the appeal filed by the respondents in

CSTA No.11/2020 is concerned, the Appellate Tribunal

allowed the appeal and directed the release of seized gold

items on payment of applicable customs duty. Being

aggrieved by these two orders passed by the Appellate

Tribunal, the appellant is before this Court.

3. These two appeals are filed only questioning the

jurisdiction of the Appellate Tribunal and the impugned

orders are not questioned on its merits.

4. Learned Counsel for the appellant has contended that

since the gold seized is required to be considered as a

baggage claim, the appeal before the Appellate Tribunal

was not maintainable under Section 129-A of the Act, and

on the other hand, the respondents ought to have availed

the remedy available under Section 129-DD of the Act.

5. From the material on record, it is seen that after the

gold items were seized from the respondents, the show

cause notice was issued to them considering the seized

items as smuggled goods and action was proposed under

Section 111 of the Act for confiscation of seized goods and

penalty was proposed under Sections 112 & 114-AA of the

Act. Further, in the order in original, a categorical finding

has been given by the competent authority that the goods

brought by the respondents do not qualify as bonafide

baggage, and as such, the goods cannot be allowed to be

brought as baggage and would be deemed to be improper

importation, and therefore, the goods are liable for

confiscation under Section 111 of the Act. Therefore, it is

very clear that the seized goods/items of the respondents

were considered as smuggled goods/items at the time of

issuing the show cause notice as well as while passing the

order in original. It is under these circumstances, an order

of confiscation has been passed under Section 111 of the

Act, and consequently, the penalty has been levied under

Sections 112 & 114-AA of the Act. In the appeal filed by

the respondents before the Tribunal, the appellant herein

had not raised any objection with regard to the

maintainability of the appeal and had participated in the

proceedings and contested the case on merits.

6. Be that as it may, since there is a specific finding in

the order in original that the seized goods/items of the

respondents do not qualify as bona fide baggage, and on

the other hand, they were considered as smuggled

goods/items, there is no justification on the part of the

appellant herein to now contend that the seized

goods/items fall under the definition 'baggage goods', and

therefore, the appeal under Section 129-A of the Act was

not maintainable before the Tribunal, and on the other

hand, the respondents ought to have availed the remedy

as provided under Section 129-DD of the Act. The bar

under the proviso to Section 129-A(1) is only against any

order passed under Section 129(1)(b) if such order relates

to any goods imported or exported as baggage. The said

bar would not apply in the case on hand as the seized

goods are held to be smuggled goods and not bonafide

baggage.

7. Under the circumstances, we are of the considered

view that the appeals filed by the respondents before the

Tribunal under Section 129-A of the Act were maintainable,

and accordingly, the substantial question of law is

answered against the appellant and in favour of the

respondents. The appeals are accordingly dismissed.

Sd/-

JUDGE

Sd/-

JUDGE

KK