Customs confiscation must be confined to goods proved imported absent evidence of mixing.

Customs authorities seized 1,28,405 kg of maize from the petitioner trader’s premises.

The Additional Commissioner of Customs held the entire quantity to be smuggled, ordered its confiscation, imposed penalties under Sections 112(a), 112(b) and 114AA of the Customs Act, 1962, and fixed a redemption fine under Section 125(1).

The seized stock included maize in bags marked as originating from Argentina, Brazil or Turkey, as well as unbranded or loose maize; an ICAR-National Bureau of Plant Genetic Resources report stated that the samples’ country of origin could not be determined.

Whether the evidence justified treating the entire seized stock as imported maize and confiscating it under Section 111(i) of the Customs Act

Whether penalties under Sections 112(a), 112(b) and 114AA, and a redemption fine under Section 125(1), could be sustained on the basis of the evidence and the quantity of maize found to be imported

The Court considered Section 111(i) of the Customs Act, which provides for confiscation of goods improperly brought into India; Sections 112(a) and 112(b), which provide for penalties in connection with goods liable to confiscation; Section 114AA, concerning knowing or intentional use of a false or incorrect document, statement or declaration; and Section 125(1), under which redemption fine may be imposed in lieu of confiscation.

The Court’s reasoning required evidence supporting the finding that the goods in question were imported: the presence of some imported goods in a stock did not, without evidence of mixing or other proof, establish that the entire stock was imported.

A Section 114AA penalty required a sufficient evidentiary foundation for knowing or intentional use of the relevant document or statement.

The petitioner’s representative’s statements supported the conclusion that the petitioner had acquired the separately identifiable maize described as export-quality Argentina product, premium Brazil popcorn and Turkey-origin product; the Court therefore declined to disturb the finding of importation as to those goods.

However, the order also treated unbranded and loose maize as imported without evidence establishing its foreign origin or that it had been mixed with the marked goods.

The samples’ origin could not be determined, and the goods were separately stored in distinct bags; accordingly, confiscation could not extend to the whole stock.

The Court also found the basis for the Section 114AA penalty inferential rather than supported by tangible and direct evidence, and therefore held that penalty unsustainable.

The Court confined confiscation under Section 111(i) to 53,375 kg of maize identified as Argentina, Brazil or Turkey-origin product, and quashed the order insofar as it covered the remaining unbranded or loose maize.

It quashed the Section 112(a) penalty and set aside the Section 114AA penalty; the matter was remitted to the Additional Commissioner to determine the value of the imported maize for a Section 112(b) penalty and a commensurate redemption fine under Section 125(1), within four weeks of receiving a certified copy of the order.