( 1 ) THIS is a reference made at the instance of Rup Chand Jain (hereinafter referred to as the 'petitioner') against the order of the Collector of Customs. Originally, one question, was referred namely the following :-Whether on the facts and in the circumstances of the case the provisions of Section 123 of the Customs Act, 1962 as applied by the Tribunal in the instant case is available to the department in view of the fact that at the time of hearing the case, the diamonds were not in the list of 'notified Items'?

( 2 ) THEREAFTER upon the application of the petitioner the High Court directed the Tribunal to refer following, two questions, by its Order dated 18-8-1995 :-1. Whether the Tribunal was correct in holding that the applicant failed to discharge the burden of proving that the diamonds in question are not smuggled goods and whether the findings of the Tribunal in this regard is perverse? 2. Whether on the facts and in the circumstances of the case, the Tribunal was correct in upholding the levy of penalty upon the Applicant?

( 3 ) IN this way, we are required to decide the aforesaid three questions, in this reference which arise out of an order dated