PerC.N.B. Nair :

The case involves seizure of 37 bars of silver weighing less than 30 Kgs on 19.9.94 by the Officers attached to Central Preventive Unit, Salem. The seizure was made in the shop of the appellant Shri K.N. Iswaran.

2. Learned Counsel representing the appellant submitted that Shri Iswaran was a jeweller making various ornaments out of silver. In the course of the practice of his profession, he receives silver from various parties, converts them into ornaments and returns them to the principal. He works in the capacity of a job worker in such cases. He also does manufacture of silver ornaments on his own.

3. Ld. Counsel submitted that the entire proceedings were bad inasmuch as the seizure of the goods were in violation of the guidelines issued by the Central Board of Excise Customs to field formations under telex F.No. 394/233/880-CUS. (AS) dated 11.6.90. The Government had directed all field formations that the provisions of Section 123 of the Customs Act, 1962 should not be invoked against persons who are found to be in possession of silver bullion of less than 100 kgs. The exception permitted was in cases where the silver bullion is found to be in the form of bars weighing 30 kgs. (approx.) each, which are being smuggled into the country and also where silver bullion is found to bear foreign markings. Ld. Counsel submitted that in the instant case the weight of individual bars was less than 2 Kgs. and none of them bore any foreign markings. Also proceedings have been confirmed against the appellant by relying on the provisions of Sec. 123 of the Customs Act. Ld. Counsel stressed that there was no positive evidence whatsoever produced during the adjudication proceedings, which would go to indicate the smuggled nature of the goods. He therefore submitted that confiscation of the goods and the penalty imposed were entirely unjustified and against the policy of the Government with regard to investigation of cases involving silver. He also took us through the decision of this Tribunal in the case of Shri N.S. Allaudeen Vs. CC Trichy reported in 2000 (2) ECL 106 wherein in an identical case, the Tribunal set aside the confiscation of the goods inasmuch as the seizure and confiscation were against the guide lines issued by the CBEC under the aforesaid circular. He also drew our attention to the judgment of the High Court of Madras in the case of Salem Shevapet Silver Katcha Exchange Brokers Association Vs. Supdt. of Customs Preventive, Salem reported in 1999 (107) ELT 292 (Mad.). Ld. Counsel explained that in the writ petition filed by the Brokers' Association a complaint had been raised that investigations of customs authorities were causing hardship against the small brokers. The departmental authorities had in their affidavit informed the High Court that Circular dated 11.6.90 of the Govt. had directed that small consignments of silver should not be subjected to seizure and investigation and those directions was being strictly followed by field formations. Upon that assurance, writ petition was disposed of by the High Court. He stressed that proceedings in the present case is clearly against Revenue's assurance given to the High Court.

4. We have heard Learned SDR also who explained that the impugned order has clearly brought out how the investigation in the present case was fully justified.

5. A perusal of the records of the case makes it clear that there is no positive evidence regarding the smuggled nature of the goods under seizure. They bore no foreign markings and they were not in size of 30 Kgs. blocks, the common form in which silver is smuggled into the country. The consignment involved was also small weighing less than 69 Kgs. and value was less than Rs. 5 lakhs. The confiscation has been made taking resort to Section 123 of the Customs Act.

6. Section 123 contains special provisions in respect of smuggling of specified goods. It shifted burden of proof to the possessor of imported goods. Even though,