Smuggled Gold Falls Within Prohibited Goods Under Customs Act: Calcutta HC

Gopal Saha Vs Union of India & Anr. (Calcutta High Court)

Summary: The Calcutta High Court decided four connected appeals arising from a common judgment dated April 27, 2016 concerning confiscation of 272 pieces of gold weighing 36.856 kgs and valued at Rs. 10.07 crores. The first two appeals, APO 139 of 2018 and APO 140 of 2018, were filed by writ petitioners Gopal Saha and Ajgar Seikh, while Customs filed APO 143 of 2018 and APO 144 of 2018. The Directorate of Revenue Intelligence had issued a show cause notice dated October 3, 2013 under Section 124 of the Customs Act, 1962. The Commissioner of Customs (Preventive), by adjudication order dated November 24, 2015, confiscated the seized gold under Section 111(b) and imposed penalty of Rs. 10.07 crores on each writ petitioner under Section 112.

The writ petitioners challenged the adjudication order despite having a statutory appellate remedy under Section 129A. The learned Single Judge held that gold was not prohibited goods, set aside the penalty imposed under Section 112(i) and remanded the matter for the limited purpose of imposing such other quantum of penalty as might be permissible. The Division Bench therefore considered principally whether gold was a prohibited item within the meaning of the Customs Act, 1962 and whether the Adjudicating Authority was correct in imposing penalty under Section 112(i).