2025(09)LCX0184

Allahabad Tribunal

Nitin Trading Company

Versus

Commissioner of Customs (Preventive)

Customs Appeal No. 70524 of 2022 decided on 25-09-2025

The present appeal has been file

CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
ALLAHABAD

REGIONAL BENCH - COURT NO.I

Customs Appeal No.70524 of 2022

(Arising out of Order-in-Appeal No.486-CUS/APPL/LKO/2022 dated 05.08.2022 passed by Commissioner (Appeals) Customs, CGST & Central Excise, Lucknow)

M/s Nitin Trading Company,             …..Appellant
(215/45, Subhash Marg, near Ram Mandir,
Lucknow, U.P.)

VERSUS

Commissioner of Customs (Preventive),
Lucknow                                     ….Respondent
(5th & 11th Floor, Kendriya Bhawan,
Aliganj, Lucknow-226024)

APPEARANCE:

Shri Anuj Agrawal, Advocate for the Appellant
Shri A. K. Choudhary, Authorized Representative for the Respondent

CORAM: HON’BLE MR. P.K. CHOUDHARY, MEMBER (JUDICIAL)

FINAL ORDER NO.- 70690/2025

DATE OF HEARING : 21.07.2025
DATE OF PRONOUNCEMENT : 25.09.2025

The present appeal has been filed by the Appellant assailing the Order-in-Appeal No.486-CUS/APPL/LKO/2022 dated 05.08.2022 passed by Commissioner (Appeals) Customs, CGST & Central Excise, Lucknow whereby he rejected the appeal before him and upheld the Order-in-Original.

2. Briefly stated, the facts of the case are that a search was conducted by the Officers of Customs (Preventive) Commissionerate, Lucknow on 18.11.2019 in the premises of M/s Chandra Cold Storage, Talkatora Road, Aishbagh, Lucknow. In the course of search, 42 bags of Dry Dates were found weighing 2100 kg. pertaining to M/s Nitin Trading Company. The estimated market value was estimated at Rs.4,20,000/- (Rs.200/- per kg.). The Dry Dates were detained under Section 110 of the Customs Act, 1962. Samples were drawn and the detained goods were handed over to M/s Chandra Cold Storage under Supurdaginama dated 19.11.2019. Further two independent traders were requested i.e. Proprietor of M/s Janta Provision Store and M/s Om Sai Enterprises to check the samples of detained goods and give their opinion about the origin of said goods. They checked the samples of detained goods and opined that the said goods appear to be foreign origin Dry Dates. Their opinion was also submitted in writing. On the basis of the opinion given by both the traders and statement of Shri Chandra Prakash Tiwari, Manager of M/s Chandra Cold Storage, it appeared to the Department that the goods were illegally imported and stored in contravention of the provision of Section 7(1)C read with Notification No.63/94 dated 21.11.1994 and Section 11 of the Act and is liable to be confiscated under Section 111 of the Act. Therefore, the detained Dry Dates were seized under Section 110 of the Act under a Panchnama dated 26.11.2019 and handed over the same to M/s Chandra Cold Storage vide Supurdaginama dated 19.11.2019 with instruction that the said goods should not be tampered and disposed of during the course of investigation/adjudication and shall be produced as and when required by the Department. A Seizure Memo dated 26.11.2019 was also drawn. The samples were sent to M/s Atul Rajasthan Dates Palms Ltd., Rajkiya Paudhshala, Chopasani, Jodhpur, Rajasthan-342008 for testing of the same to ascertain the country of origin of the seized goods. M/s Atul Rajasthan Dates Palms Ltd., vide their letter dated 03.06.2020 intimated that they do not have any expertise or mechanical method to do the testing of Dry Dates. In compliance to the summon issued to M/s Chandra Cold Storage, Shri Vipin Bhandari, Partner appeared in the office on 02.12.2019 and tendered his statement under Section 108 of the Act and stated that he stored Betelnuts, Dry Dates, Cardamom, Red paper and other Kirana related goods in his cold storage. He further stated that he stored the goods only of those firms which are registered in GST and the goods are received in packed condition. He also submitted that before storing the goods he checked the invoice, e-way bill & builty and issued a receipt to the parties and also makes an entry in his stock records. He provided the name, address and other relevant records/information of the parties whose goods were seized under Panchnama dated 26.11.2019. Therefore, Shri Nitin Agrawal, Proprietor of M/s Nitin Trading Company, was summoned to tender the voluntary statement under Section 108 of the Act. Shri Nitin Agrawal appeared on 17.12.2019 and claimed the ownership of the seized goods i.e. 42 bags of Dry Dates weighing 2100 kg. In his statement he submitted that:-

(i) That the seized goods were purchased from Invoice No.JE/NT/004 dated 04.09.2019, issued by M/s Jainam Exports Pvt. Ltd., Andheri East Mumbai-400099 & E-way bill No.261135708726 dated 04.09.2019.

(ii) That he had purchased dry dates imported from Pakistan earlier but after June’19 he did not purchase and sale foreign origin dry dates.

(iii) That on the strength of the above mentioned invoice he purchased 350 bags of Dry Dates on credit of three months and therefore payment of the said goods was not done till the date of statement.

3. Further, whereas the Dry Dates valued at Rs.4,20,000/- was ordered to be released provisionally by the Competent Authority, Customs (Preventive) Commissionerate, Lucknow to its lawful owner on furnishing Bank Guarantee or Security deposit of Rs.1,05,000/- and Execution of Bond for the value/estimated value of the seized goods i.e. Rs.4,20,000/- vide letter issued under C. No. VIII[10]153-Adj./ADC/CP/2019/364 dated 06.02.2019. Whereas the Deputy Commissioner of Customs (Preventive) MPIU-I, M & P Wing, Mumbai vide their letter bearing F. No.MPIU-I/II-Jainam Export/2019-20/2080 dated 26.02.2020 has submitted the follow up report mentioning therein that there is no direct co-relation is found for sale of Dry Dates between M/s Jainam Exports Pvt. Ltd. and M/s Nitin Trading Company. There has been no movement of goods from Mumbai to Lucknow. They also submitted the GST E-way bill report and statement of Shri Anubhav Kumar Jain, Proprietor of M/s Jainam Export Pvt. Ltd., recorded under Section 108 of the Act. In his statement Shri Anubhav Kumar Jain inter alia submitted that:-

(i) M/s Jainam Export Pvt. Ltd., is involved into the business of exports of fresh fruits and vegetables, local trading of Paper Packaging Products and Local sales of Kraft paper. Alongwith this we trade in Medical Equipment’s parts mainly Hearing Aid, within Mumbai.

(ii) I don’t know anything about the sale of Dry Dates to M/s Nitin Trading Company, Lucknow. I have never contacted any person of M/s Nitin Trading Company nor anyone from Nitin Trading Company contacted to me.

(iii) My company nor me has issued the said invoice.

(iv) The goods never came to Mumbai and never transported by our company.

(v) The E-way bill dated 04.09.2019 is generated by using company’s ID and password by Sri Anand Mohnani which was given by me, it is my mistake and I sincerely regret.

(vi) Shri Anand Mohnani had imported these dry dates using M/s Jainam Exports Pvt. Ld. IEC 039815244. For sharing the IEC they entered into agreement in the form of MOU dated 22.07.2019 signed by Anand Mohnani and Shri Anubhav Jain. Shri Anand Mohnani has issued the above said invoice on their company name.

4. Vide the Show Cause Notice dated 20.11.2020 following has been proposed:-

(i) The aforementioned recovered and seized 2100 Kgs foreign origin Dry Dates valued at Rs.4,20,000 (Rs. Four Lacs Twenty Thousand Only), which has been illegally imported into India, in contravention of Sections 7 (1) (c) and 11 of the Customs Act, 1962 read with Notification No.63/94-Cus (NT) dated 21.11.1994, should not be confiscated under Section 111(b) of the Customs Act, 1962.

(ii) Penalty should not be imposed upon M/s Nitin Trading Company, 215/45, Subhash Marg, Near Ram Mandir, Lucknow-226003 under Section 112(b) of the Customs Act, 1962 for illegal import of foreign origin Dry Dates in connivance with M/s Jainam Export Pvt. Ltd.

(iii) Penalty should not be imposed upon M/s Jainam Exports Pvt. Ltd., 204-B, Bajsons Industries Estate Chakala Road, Andheri East Mumbai-400099, under Section 112(b) of the Customs At 1962 for illegal import of foreign origin Dry Dates in connivance with M/s Al saaj General Trading LLC.

(iv) Penalty should not be imposed upon M/s Al saaj General Trading LLC, Al Asbig building, Khalid bin waleed road, Bur Dubai, PO box no.24320, Dubai under Section 112(b) of the Customs Act, 1962 for illegal import of foreign origin Dry Dates in connivance with M/s Jainam Exports Pvt. Ltd.

(v) Penalty should not be imposed upon Solai Trans Carrier, 76/141, Coral Merchant Street, Mannady, Tamilnadu under Section 112(b) of the Customs Act, 1962 for transportation of illegally imported foreign origin Dry Dates in connivance with M/s Jainam Export Pvt. Ltd. and M/s Nitin Trading Co.

(vi) Penalty should not be imposed upon M/s Chandra Cold storage, Talkatora Road, Aishbagh, Lucknow under Section 112(b) of the Customs Act, 1962 for storage of illegally imported foreign origin Dry Dates in connivance with M/s Jainam Export Pvt. Ltd. and M/s Nitin Trading Co. (vii) Penalty should not be imposed upon "To whomsoever it may concern" under Section 112(b) of the Customs Act, 1962 for illegal import, Storage and transportation of foreign origin Dry Dates.

5. Vide the Order-in-Original dated 18.11.2021 following order was passed:-

“ORDER

(a) I order to confiscate the recovered and seized 2100 Kgs. foreign origin Dry Dates valued at Rs.4,20,000 (Rs Four Lacs Twenty Thousand Only), which has been illegally imported into India, in contravention of Sections 7 (1) (c) and 11 of the Customs Act, 1962 read with Notification No.63/94-Cus (NT) dated 21.11.1994 under Section 111(b) of the Customs Act, 1962. However, I give an option to the owner of the goods i.e. Dry Dates to redeem the goods on payment of redemption fine of Rs.1,05,000/- (Rupees One Lakh and five thousand only). Since the amount of Rs. 1,05,000/-(Rupees One Lakh and five thousand only) has already been deposited, I order to appropriate the said amount to the Government Exchequer.

(b) I impose a penalty of Rs.25,000/- (Rupees Twenty five thousand) on M/s Nitin Trading Company, 215/45, Subhash Marg, Near Ram Mandir, Lucknow-226003 under Section 112(b) of the Customs Act, 1962.

(c) I impose a penalty of Rs.25,000/- (Rupees Twenty five thousand) on M/s Jainam Exports Pvt. Ltd., 204-B, Bajsons Industries Estate Chakala Road, Andheri East Mumbai-400099, under Section 112(b) of the Customs Act, 1962.

(d) I impose a penalty of Rs.25,000/- (Rupees Twenty five thousand) on M/s Al saaj General Trading LLC, Al Asbig building, Khalid bin waleed road, Bur Dubai, PO box no.24320, Dubai under Section 112(b) of the Customs Act, 1962.

(e) I impose a penalty of Rs.25,000/- (Rupees Twenty five thousand) on Solai Trans Carrier, 76/141, Coral Merchant Street, Mannady, Tamilnadu under Section 112(b) of the Customs Act, 1962.

(f) I impose a penalty of Rs.25,000/- (Rupees Twenty Five thousand) on M/s Chandra Cold Storage, Talkatora Road, Aishbagh, Lucknow under Section 112(b) of the Customs Act, 1962.”

6. Being aggrieved, M/s Nitin Trading Company filed appeal before the first Appellate Authority. The learned Commissioner (Appeals) vide the impugned Order-in-Appeal, upheld the Order-in-Original. Hence, the present appeal before the Tribunal.

7. Learned Departmental Authorized Representative justified the impugned order and prayed that the appeal filed by the Appellant, being devoid of any merits, may be dismissed.

8. Heard both the sides and perused the appeal records.

9. The dispute in the present case is regarding the country of origin of Dry Dates. I find that nothing has been mentioned in the SCN or the Order-in-Original regarding any enquiry that has been made by the Revenue to ascertain the country of origin of the seized Dry Dates. No reliance can be placed on the testing report of M/s Atul Rajasthan Dates Palms Ltd., Jodhpur since they have mentioned that “they do not have any expertise or mechanical method to do the testing of dry dates.”

10. I further find that the opinion expressed by the two traders namely M/s Janta Provision Store and M/s Om Sai Enterprises that the goods appeared to be of foreign origin has no basis. The grounds for arriving at such a conclusion have not been mentioned. What are the differences between Dry Dates of foreign origin and Dry Dates produced indigenously is not mentioned in the opinion. On the basis of naked eye inspection, the Dry Dates have been declared to be of foreign origin. Such opinion does not carry any evidentiary value. In this regard, reliance is placed on the decision of this Tribunal in the case of Orbital Enterprises vs. Collector of Customs, Calcutta [1990 (46) E.LT. 71 (Tri.-cal.)] where the Tribunal has dealt the evidentiary value of expert’s opinion based on inspection and has observed that such opinion has no evidentiary value. I find that the learned Adjudicating Authority has hopelessly failed in establishing adequate grounds to justify the confiscation of the seized Dry Dates. It was categorically mentioned by Shri Nitin Agrawal, Proprietor of M/s Nitin Trading Company, that the seized goods were purchased vide invoice No.JE/NT/004 dated 04.09.2019 issued by M/s Jainam Exports Pvt. Ltd., Andheri East Mumbai-400099 & E-way bill No.261135708726 dated 04.09.2019. I observe that the entire payments to M/s Jainam Exports Pvt. Ltd., have been made by NEFT/RTGS, photocopies of the Bank statement and Ledger Accounts have been filed before the Bench. It was further submitted that on the strength of the above mentioned invoice, he purchased 350 bags of Dry Dates.

11. It is also submitted that the goods were found at the premises of Chandra Cold storage, detained and seized. The goods were recovered under E-way Bill, Invoice, transport document, GST papers, etc. and there is no allegation that the documents were forged and as such question of confiscation under Section 111 of the Act does not arise and imposition of penalty under Section 112(b) of the Act is also unwarranted.

12. I find that the Department has not established their case against the Appellant with any corroborative evidence. It is also not being brought on record that on what grounds the Department entertained a view that the consignment appeared to be illegally imported and stored contravening the provision of Section 7(1)C read with Notification No.63/94 dated 21.11.1994. I find that the seizure and subsequent confiscation is only on the basis of assumptions and presumptions and no concrete evidence have been brought on record to justify the confiscation of the consignment and imposition of Redemption fine and penalties.

13. It is legally settled that the statement of third parties based on hearsay or assumption or presumption cannot be treated as valid evidence. On the imposition of penalty under Section 112(b) of the Act, the learned Advocate argued that penalty is imposable on a person who acquires possession of or is in any way concerned in carrying, removing, depositing, harbouring, keeping, concealing, selling or purchasing, or in any other manner dealing with any goods which he knows or has reason to believe are liable to confiscation under Section 111. I find that in the present case none of the above has been established against the Appellant to justify the confiscation of the seized goods. Hence, no penalty is imposable on the Appellant under Section 112(b) of the Act. The redemption fine is also set aside.

14. The appeal filed by the Appellant is allowed in the above terms with consequential relief, as per law.

(Order pronounced in open court on - 25.09.2025)

Sd/-          
(P. K. CHOUDHARY)
MEMBER (JUDICIAL)