K. Vinod Chandran, CJ.—Two kilograms of gold, with Swiss markings, indubitably indicating its source from abroad, was seized on prior information received of the transport, based on which, proceedings were taken under the Customs Act, 1962 (for brevity the ‘Act’), culminating in the Order-in-Original (Annexure-B), confiscating and imposing penalties under the Act. The First Appellate Authority reversed the order of the Original Authority. Under Section 129-A(2) of the Act, the Committee of Commissioners directed the Proper Officer to file an appeal to the Appellate Tribunal; in which the Tribunal affirmed the order of the First Appellate Authority. The impugned appeal is filed under Section 130 of the Act, raising the following question of law: —

Whether the Appellate Authority on the basis of facts and evidences and circumstances of the case, has completely erred in its findings and came to conclusion overlooking a number of material facts as well as the judgments cited?

2. Dr. K.N.Singh, learned Additional Solicitor General, appearing for the appellant, argued that the contraband was seized from the body of a person travelling in a train from Howrah to Mumbai; the Howrah-Mumbai Mail Express, when the said person was intercepted and searched at Tatanagar Railway Station. On recovery of the contraband, which did not have any supporting documents, the person was brought to Patna where he had given a sworn statement under Section 108 of the Act, which has an evidentiary value. The statement was retracted later on, when the person was granted bail; which is usual in such cases and this does not affect the evidentiary value of the statement, if the statement, at least in some aspects, are substantiated by other material evidence. The story put forth by the intercepted person was also verified by the customs authorities, and the owner as also the persons who were alleged to have supplied the contraband to the owner, were summoned and examined. The statements made by the various persons examined by the officer under Section 108, were contradictory to each other, thus, putting to peril the explanation offered.

3. The Swiss markings on the gold bars clearly established the source of the contraband, which was from outside the country. It was for the person from whom the contraband was seized and the alleged owner to establish how the contraband entered the country. The mere invoice produced, at best, indicating a transaction within the country, would not absolve the goods from seizure as an imported goods. The First Appellate Authority and the Tribunal failed to notice this important fact and ignored material evidence recovered on investigation, thus, making the order completely perverse. The First Appellate Authority, on erroneous consideration and based on irrelevant facts, arrived at a contrary finding from that of the Proper Officer; the Officer who passed the Order-in-Original. The Tribunal merely referred to the grounds of the First Appellate Authority and extracted them, thus, adopting it without any application of mind.

4. The invoices produced by the alleged owner, though dated earlier to the confiscation, admittedly, there was no consideration paid at that point of time. The consideration was paid only after the seizure and part payments made after the alleged owner was examined on oath. The very explanation offered and the facts disclosed clearly indicate that the invoice was a concocted document. There was nothing to prove the transaction of sale and the transport of the gold from the alleged seller to the purchaser. The seller and the purchaser had no prior transactions, which makes the credit granted doubly suspicious. There was sufficient corroboration for the statement under Section 108 and both the appellate authorities ignored the same. Reliance is placed on Naresh J. Sukhawani vs. Union of India; 1995 Supp (4) SCC 663, Surjeet Singh Chhabra vs. Union of India & Ors., (1997) 1 SCC 508, K.I. Pavunny vs. Asstt. Collector (H