1. Seizure and confiscation of jewellery from a tourist passing through the Green Channel — Challenge to show-cause notice and confiscation order under the Customs Act and Baggage Rules. (Para 2 )
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2017 Supreme(SC) 753
SUPREME COURT OF INDIA
R.K. Agrawal, Prafulla C. Pant, JJ.
Directorate of Revenue Intelligence – Appellants
Versus
Pushpa Lekhumal Tolani – Respondents
Civil Appeal No. 4403 of 2010
Decided On : 18-08-2017
Advocates Appeared:
For the Appellants :- B. Krishna Prasad, Advocate.
For the Respondents:- T.V. Ratnam, Advocate.
For the Appellants :- B. Krishna Prasad, Advocate.
For the Respondents:- T.V. Ratnam, Advocate.
IMPORTANT POINTS
Gold and jewellary are freely importable items.
Passing through green channel itself is declaration of there being no dutiable goods, more so when there is no attempt to conceal the goods.
Intention of using the goods as personal effects and taking them out of India cannot be termed as smuggling.
High Court should avoid passing remarks against officials.
Headnote:(a) Customs Act, 1962 – Section 77 and 80 r/w rule 7, Baggage Rules, 1998 – Respondent travelling as tourist carrying jewellary in her hand baggage and passing through green channel – No attempt to conceal the personal effects – Passing through green chamnnel itself declaration of no dutiable goods – Section 77 not applicable – Items costing Rs. 25 lakhs and not Rs. 1.27 crores as claimed by appellant – Items whether old or new immaterial – Items meant for personal use of respondent and her parents living in Indonesia where she intended to go from India – No intention of smuggling the items in India – Gold and jewellary being freely importable items, section 80 does not apply – Goods being bona fide jewellery of the respondent for her personal use and intended to be taken out of India, were not dutiable under rule 7 r/w Appendix E (2) – No error in impugned judgment. (Para 10, 11, 13)
(b) Administration of justice – Judicial propriety – Remarks made by High Court against appellant – Liable to be expunged. (Para 12)
Facts of the case:
On 19.11.2002, the officers of the Directorate of Revenue Intelligence (DRI), Hqrs. Office, New Delhi, intercepted the respondent and asked whether she has any dutiable item to declare to which she replied in negative. A search was conducted and 28 packages containing 44 items of jewellery worth Rs. 1.27 crores were recovered from two hand bags. She was remanded to judicial custody where she remained till 26.11.2002.
On 12.12.2002, a show-cause notice was issued to the respondent asking her to show-cause as to why the seized goods should not be confiscated under the Act. On 14.08.2003, the competent authority, passed a detailed order confiscating absolutely the new articles valued at Rs. 86,52,765/-, confiscation of seized jewellery worth Rs. 40,47,235/- with redemption clause on payment of fine of Rs. 3,00,000/- and penalty to the tune of Rs. 15,00,000/-. Vide order dated 27.09.2004, Additional Chief Metropolitan Magistrate, New Delhi, found the respondent guilty under Sections 132 and 135(1)(a) of the Act and sentenced to undergo imprisonment for the period already undergone and imposed a fine of Rs. 6 lakhs.
(c) Being aggrieved by the show-cause notice dated 12.12.2002 and order dated 14.08.2003, the respondent herein filed Writ Petition before the High Court. The Division Bench of the High Court allowed the writ petition and quashed the show-cause notice and order dated 14.08.2003 and directed for release of the goods. In view of the aforesaid judgment, the appeal filed by the respondent herein against the conviction passed by the Additional Chief Metropolitan Magistrate was allowed by the Additional Sessions Judge vide order dated 11.04.2007.
Aggrieved by the decision of the High Court, the appellant filed a review petition which was also dismissed.
Finding of the Court:
There is no error in the impugned judgment.
Result: Appeal dismissed.
Act Referred
Legal Category Hierarchy
Table of Contents
2. Whether high-value, newly purchased jewellery constitutes personal effects under Baggage Rules and whether passing through the Green Channel without declaration constitutes smuggling. (Para 5 , 6 )
3. Green Channel passage is an implicit declaration; bona fide jewellery for personal use is duty-free; newness or high value does not automatically disqualify items as personal effects. (Para 8 , 9 , 10 , 11 )
4. Bona fide personal jewellery brought by a tourist for personal use and intended for re-export is not dutiable, regardless of its value or newness. (Para 9 , 11 )
5. Appeal dismissed; High Court's orders quashing the show-cause notice and confiscation order upheld; strictures against the appellant expunged. (Para 12 , 13 )
6. Does passing through the Green Channel constitute a failure to declare dutiable goods?
No. Passing through the Green Channel is considered an implicit declaration that the passenger has no dutiable or prohibited articles, in accordance with the International Convention on the Simplification and Harmonization of Customs Procedures. (Para 9 , 11 )
7. Can newly purchased or high-value jewellery be classified as used personal effects for duty-free import by tourists?
Yes. Bona fide jewellery for personal use is duty-free. Newness is irrelevant unless goods are prima facie new in original packaging, and high monetary value does not rebut the status of personal effects. (Para 8 , 9 , 10 , 11 )
8. Is it permissible for a tourist to bring high-value jewellery into India if it is intended to be taken out of the country?
Yes. Foreign tourists are allowed to bring jewellery of substantial value into India provided it is meant to be taken out with them, and such imports are not liable to import duty. (Para 9 )
JUDGMENT
R.K. Agrawal, J.
The present appeal has been filed against the final judgments and orders dated 13.09.2006 and 04.09.2009 passed by the Division Bench of the High Court of Delhi in W.P. (C) No. 6633 of 2003 and Review Petition No. 335 of 2009 respectively whereby the High Court allowed the writ petition filed by the respondent herein while dismissing the review petition.
2. Brief facts:
(a) On 19.11.2002, on the basis of specific intelligence tip off to the effect that one lady named Ms. Pushpa Lekhumal Tolani-the respondent herein, who was scheduled to arrive at IGI Airport from London, would be carrying gold and diamond jewellery and other valuable goods concealed in her bags and would pass through the Green Channel without the payment of the customs duty, the officers of the Directorate of Revenue Intelligence (DRI), Hqrs. Office, New Delhi, kept a watch on her and as soon as she was about to cross the exit gate after passing through the Green Channel, she was intercepted and was asked whether she has any dutiable item to declare to which she replied in negative. A search was conducted under Section 102 of the Customs Act, 1962 (hereinafter referred to as `the Act') and 28 packages containing 44 items of jewellery worth Rs. 1.27 crores were recovered from two hand bags. On the very same day, the respondent was produced before the Additional Chief Judicial Magistrate and was remanded to judicial custody and she remained there till 26.11.2002.
(b) On 12.12.2002, a show-cause notice was issued to the respondent by the then Assistant Director, Directorate of Revenue Intelligence, asking her to show-cause as to why the seized goods should not be confiscated under the Act. On 14.08.2003, the competent authority, passed a detailed order confiscating absolutely the new articles valued at Rs. 86,52,765/-, confiscation of seized jewellery worth Rs. 40,47,235/- with redemption clause on payment of fine of Rs. 3,00,000/- and penalty to the tune of Rs. 15,00,000/-. Vide order dated 27.09.2004, Additional Chief Metropolitan Magistrate, New Delhi, found the respondent guilty under Sections 132 and 135(1)(a) of the Act and sentenced to undergo imprisonment for the period already undergone and imposed a fine of Rs. 6 lakhs.
(c) Being aggrieved by the show-cause notice dated 12.12.2002 and order dated 14.08.2003, the respondent herein filed Writ Petition (C) No. 6633 of 2003 before the High Court of Delhi. The Division Bench of the High Court, vide order dated 13.09.2006 allowed the writ petition and quashed the show-cause notice and order dated 14.08.2003 and directed for release of the goods. In view of the aforesaid judgment, the appeal filed by the respondent herein against the conviction passed by the Additional Chief Metropolitan Magistrate was allowed by the Additional Sessions Judge vide order dated 11.04.2007.
(d) Aggrieved by the decision of the High Court, the appellant filed a review petition being No. 335 of 2009. The Division Bench of the High Court, vide order dated 04.09.2009, dismissed the said review petition.
(e) Aggrieved by the orders dated 13.09.2006 and 04.09.2009, the appellant has preferred this appeal by way of special leave.
3. Heard the arguments advanced by Mr. Ranjit Kumar, learned Solicitor General for the appellant and Mr. Sidharth Luthra, learned senior counsel for the respondent and perused the records.
Point(s) for consideration:
4. The only point for consideration before this Court is whether in the present facts and circumstances of the case, the show-cause notice dated 12.12.2002 and order dated 14.08.2003 are liable to be quashed or not?
Rival contentions:
5. Learned Solicitor General, appearing on behalf of the appellant-DRI, contended that many of the items seized like gold and diamond studded tie pins, tie clips, metal collar etc., which cannot be used by a lady, cannot be termed as personal effects under the Baggage Rules, 1998. Similarly, the articles which are newly purchased as evidenced by the i
