" (1) Appeal No. C/30330/2024 CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL HYDERABAD REGIONAL BENCH - COURT NO. – I Single Member Bench Customs Appeal No. 30330 of 2024 (Arising out of Order-in-Appeal No.HYD-CUS-000-APP-087 to 90 & 116-23-24 (APP-I), dated 29.11.2023 passed by Commissioner of Customs & Central Tax (Appeals-I), Hyderabad) Mohammed Abdul Razzak .. APPELLANT H.No. 11-5-334, Flat No. G1, G2, Noor Jahan Residency, Red Hills, Khairatabad, Hyderabad, Telangana – 500 004. VERSUS Principal Commissioner of Customs .. RESPONDENT Hyderabad - Customs GST Bhavan, L.B. Stadium Road, Basheerbagh, Hyderabad, Telangana – 500 004. APPEARANCE: Shri C.S. Srinivas, CA for the Appellant. Shri A. Rangadham, Authorised Representatives for the Respondent. CORAM: HON’BLE Mr. A.K. JYOTISHI, MEMBER (TECHNICAL) FINAL ORDER No. A/30382/2024 Date of Hearing:16.10.2024 Date of Decision:16.10.2024 [ORDER PER: A.K. JYOTISHI] Mohammed Abdul Razzak, Proprietor of M/s Iqbal Jewellers (hereinafter referred to as appellant) have come in appeal against the Order-in-Appeal dated 29.11.2023, whereby, the Commissioner (Appeals) has interalia, upheld the order dated 24.06.2022 passed by the Original Adjudicating Authority against the appellant. The appellants had filed appeal before the Commissioner (Appeals) vide Appeal No. 188/2022-Cus. Commissioner (Appeals) vide impugned order passed a common order dated 29.11.2023, which also included the appeal of the appellant. (2) Appeal No. C/30330/2024 2. The case, in brief, is that the Officers of Customs Department intercepted certain consignment being shipped by courier agencies at Domestic Terminal Air Cargo Complex, Hyderabad on 03.10.2020 under reasonable belief that the consignments were carrying foreign marked gold bars and therefore the same were liable for confiscation. On further detailed examination of the said consignment, it was observed by them that the Courier Company was carrying consignments from different persons to different destinations and on opening said consignments it was found containing gold bars/gold jewellery etc. On further verification with the help of assayer they found that certain consignments/packets were carrying 24 carat gold, which Department felt was of foreign origin and therefore smuggled in nature. Therefore, under reasonable belief that the said foreign mark gold bars, jewellery etc., were contravening the provisions of Customs Act and CGST At 2017, said goods were seized. Subsequent investigations were carried out and on conclusion of investigation, show cause notices dated 01.04.2021 were issued to many people, including the present appellant, asking them to explain as to why gold bars of foreign origin weighing 377.08 gms should not be confiscated and why penalty should not be imposed on them. The Original Authority, by way of common order dated 24.06.2022, adjudicated the matter covering various persons including the present appellant. 4. After going through evidence on record and submissions of the appellants, inter alia, the Original Authority held as under: “32. In view of the above, I observe that the jewellers could not present their case in substantial terms as to how they have procured the gold from their sellers and could not produce the proper and relevant documents. Further, they could not produce documents evidencing the mode of transport of the gold said to have been purchased. Further, it is observed that vide their letters and also during personal hearing submissions they have not tried to (3) Appeal No. C/30330/2024 establish through documentary proof that the gold under seizure is not imported goods.” 5. Learned CA for the appellant has mainly contested on the ground that firstly, the test report of the assayer relied upon by the Department itself gives a disclaimer that they are not in a position to say whether the gold is of foreign origin or otherwise even though the Department has alleged the said gold of being foreign origin. Therefore, there is no sufficient evidence for the Department to hold this view that it was of foreign origin based on the said report. He has further argued that in the course of recording of the statement dated 17.11.2020 appellant has clearly stated that the gold jewellery was being purchased from one M/s Parshva Jewellers, Zaveri Bazar, Mumbai which they sell from their shop at Mehdipatnam across the counter to end use customers. He has also stated that in the present issue he has converted the old and used jewellery into 24 carat gold through melter Mr Sachin of Sachin Gold Testing Laboratory, Mehdipatnam and was sending the same to M/s Parshva Jewellers, Zaveri Bazar, Mumbai. Thus, the appellant had clearly given the source of procurement of said 24 carat gold as also the reasons for its being sent to Mumbai. Admittedly, Department has not carried any further verification to check the veracity of these claims. 6. Learned CA for the appellant further submits that the entire reason to believe that it was gold of foreign origin is based on the assayer’s report which itself is not categorical about the goods being of foreign origin. Therefore, the reasonable belief to presume that the gold was of foreign origin is not correct and it should not have seized as such. Moreover, Section 123 could also not have been made applicable because there was no reasonable belief that impugned gold was foreign origin or smuggled in (4) Appeal No. C/30330/2024 nature. He has further submitted that he had reasonably explained to the investigating authority and Adjudicating Authority about the source of procurement and the legitimate transaction of gold, which has not been duly appreciated or rebutted by them and the show cause notice has been disposed off in a cryptic and bald manner. 7. On the other hand, Leaned AR submits that in this case, Section 123 of the Customs Act, 1962, has been rightly invoked and therefore the burden of proof is on the appellant to establish that the confiscated gold were not of smuggled nature or liable for confiscation. He also submits that the submissions of the Learned CA about bringing to the notice of Department, the documents like invoice covering the consignment being sent to Mumbai as also the procurement of gold etc., were never shown to the Department as asserted by the appellants and therefore the appellants have not been able to discharge the burden of proof and therefore the gold were rightly liable for confiscation and the appellant is also liable for penalty. 8. Heard both the sides and perused the records. 9. I find that the entire case is based on interception of certain consignments in the Air Cargo Complex, Hyderabad which were being carried by the Courier companies. In the case of the appellant also it is apparent from the record that there has not been any document produced by the courier company or the representative of the appellant at the time of seizure. However, what is apparent is that a statement dated 17.11.2020 was recorded under Section 108 of Customs Act which clearly reveals that the appellants have explained both the source of procurement of the seized gold and also the transfer of the said consignment to M/s Parshwa Jewellers, (5) Appeal No. C/30330/2024 Mumbai. This assertion of the appellant has not been duly appreciated or effectively refuted by the Original Adjudicating Authority. 10. I find that the entire case has been decided by the Adjudicating Authority in a very cryptic manner without going into detail as far as the defence taken by the appellant is concerned. One of the major point which appellants have claimed is that the gold in question was procured from legitimate source and was being sent as a legitimate business transaction. This aspect has not been adequately dealt with by the Adjudicating Authority and a very cryptic remark has been made at para 31(ii) “Mr Mohammad Abdul Razzak also not submitted any documentary evidence”. Therefore, order appears to have been passed in a bald manner, without following principles of natural justice. The Adjudicating Authority should have examined all the documents, evidence and its authenticity with regard to the claim of appellant that the gold were procured from legitimate source and was going to a legitimate source, before coming to the conclusion that the said gold were foreign origin and that appellants were not able to discharge the onus of proof that it was not. 11. In the impugned order, the Commissioner (Appeals) has found no reasons to disagree with observations made by Original Authority at para 36 holding invoices and documents produced being created one and afterthought to cover up them illicit act of processing foreign gold. He also observed that Assessee has certified it as foreign gold. Whereas, as discussed in foregoing paras, evidence given under statement could not be brushed aside that being sufficient evidence to the contrary and therefore, Commissioner (Appeals) has also not given detailed reasons as to why Original Adjudicating Authority observation was correct. (6) Appeal No. C/30330/2024 12. When a serious charge of smuggling being levelled, the evidence has to be carefully and duly evaluated and the concerned person should be accorded all reasonable opportunities to defend his case and therefore by way of speaking order the matter should be decided. In the present case, the impugned order clearly lacks this aspect denying the effective defence to the appellant. However, it is also made clear that I have not expressed any view on the merits of the case. 13. Therefore, in the interest of justice and having regards to the facts of the case, the matter is remanded back to the Original Adjudicating Authority with the above observations. The Adjudicating Authority should decide this matter by way of speaking order within a period of 3 months subject to appellants providing necessary documents and appearing for personal hearing on the date(s) fixed by the Adjudicating Authority. The order of Commissioner (Appeals) to the extent it deals with appeal filed by the appellant before him (Appeal No. 188/2022-Cus), is set aside. 14. Appeal allowed by way of remand to Original Adjudicating Authority. (Dictated and Pronounced in open court) (A.K. JYOTISHI) MEMBER (TECHNICAL) jaya "