CORAM:

HON’BLE DR. RACHNA GUPTA, MEMBER (JUDICIAL)

HON’BLE MR. P.V. SUBBA RAO, MEMBER (TECHNICAL)

DATE OF HEARING: 22.01.2026

DATE OF DECISION: 19.05.2026

FINAL ORDER NO. 50970-50975/2026

DR. RACHNA GUPTA

This order disposes of 6 appeals arising out of the same investigation all the appellants being co-noticees to the show cause notice. The facts, in brief, relevant for the present adjudication are that on the basis of the specific intelligence the officers of Directorate of Revenue Intelligence (DRI), Indore on 08.09.2032, intercepted a white colour Skoda vehicle at Sonway Toll Plaza, Indore. Two persons were seated in the car namely Shri Navanath Chavan s/o Shri Hanamant Chavan and Shri Balasaheb mahadik s/o Shri Bhawsaheb Mahadik. On the search of the said vehicle 3 yellow metal bars wrapped in a newspaper were found concealed in the specially built cavities beneath the rear seat of the Skoda car. None of the occupants could produce any legal documents for purchase of those metal bars, which appeared to be gold. They said that they had received the bars from Shri Suresh Gidde after paying Rs.1,80,60,000/- in cash to him at Pune.

The Government approved assayer M/s. Johari Radhakrishna Khandelwal examined the yellow metal bars and confirmed those to be gold of 99.5% purity totally weighing 3001.980 grams. He assessed the value of the said gold at Rs.1,81,61,979/-. The approver also reported that the bars were made by melting gold bullion and there is no BIS/hallmark thereupon as is required by Indian Bullion Standards. The bars were suspected to be of foreign origin. Pursuant to the assayer’s report, the bars were seized under Section 110 of the Customs Act, 1962 on the reasonable belief that they were smuggled and were of foreign origin. No document qua legal possession thereof was produced by the appellant. The vehicle was also deemed liable for confiscation under Section 115(2) the Customs Act, 1962.

A Show Cause Notice No.09/2023-24 dated 29.02.2024 was served upon the appellants proposing the confiscation of 3 of the gold bars along with the white colour Skoda car in which the bars were found concealed that too in the special cavities made for the purpose under the rear seat of said Skoda car. Penalties were also proposed to be imposed as follows:

(i) Penalty under Section 114AA of the Customs Act, 1962 along with Section 112(b)(i) of the Act on both the occupants of the said car namely Shri Navanath Chavan and Shri Balasaheb Mahadik.

(ii) Penalty under Section 112(b)(i) of the Customs Act, 1962 and under Section 117 of the Act was proposed on Shri Suresh Gidde from whom the gold bars were said to have been purchased who also failed to cooperate with the department during investigation.

(iii) Similar penalties were proposed to be imposed on the other appellants with the same allegations.

The said proposals were confirmed vide Order-in-Original bearing No. 12/2024-25 dated 29.11.2024. Appeal against the said order has been dismissed by the Commissioner (Appeals) by Order in-Appeal No. 326 to 332-2014-25 dated 25.03.2025 which is impugned in these appeals. Being aggrieved, the appellants are before this Tribunal.

We have heard Shri Sujay Kantawala, Shri Ankur Upadhyay, and Shri Vidyadhar S Apte, learned Advocates for the appellant and Shri N.M. Goyal, learned Authorized Representative for the department.

It is submitted on behalf of the appellants that the order under challenge is issued in gross violation of principles of natural justice. In the preliminary reply dated 07.05.2024 and subsequent reply dated 27.05.2024, the occupants of the car, requested for cross examination of the DRI officers. At the stage of personal hearing also, the request was reiterated on behalf of all the co-noticees but the request was not accepted by the original adjudicating authority nor was the opportunity of being heard by virtual mode granted. Though Commissioner (Appeals) allowed hearing through virtual mode but none of the submiss