Mere Concealment Of Gold Not Enough To Prove Customs Duty Evasion: Delhi High Court

The Delhi High Court has upheld the acquittal of a man accused of smuggling gold into India, holding that mere concealment of gold was insufficient to establish fraudulent evasion of customs duty when the passenger was intercepted before he could proceed through customs clearance.

Justice Neena Bansal Krishna dismissed an appeal filed by the Union of India challenging the acquittal of a Mumbai-based passenger who was found carrying 30 gold biscuits weighing 3496.400 grams concealed in a waist belt at Delhi's IGI Airport in 1991.

According to the prosecution, the respondent had arrived from London on a British Airways flight and was intercepted by customs officers after completing immigration formalities. On personal search, officials allegedly recovered 30 gold biscuits concealed in 15 pouches stitched into a waist belt worn beneath his clothes.

The prosecution argued that the respondent had failed to declare the gold and had thereby committed offences under Sections 132 and 135 of the Customs Act, 1962 relating to false declaration and fraudulent evasion of customs duty.

The respondent, however, claimed that he intended to declare the gold through the Red Channel but was apprehended before he could reach the customs clearance stage. He also stated that the gold had been declared at Heathrow Airport in London before departure.

The High Court noted that the customs officer himself admitted during cross-examination that passengers were required to undergo customs clearance only after immigration clearance and that there existed separate Red and Green Channels for such clearance.

The Court observed that the respondent had been intercepted before he could opt for either channel and therefore had not yet reached the stage where a declaration was required to be made.

“In these circumstances, it cannot be said that the Respondent either made any false declaration, as none could be done by him, as he yet had not reached the stage of Customs clearance, due to his prior apprehension,” the Court observed.

While acknowledging that concealment of nearly 3.5 kilograms of gold created suspicion regarding the respondent's intention, the Court held that suspicion alone could not sustain a criminal conviction.

“It can be said that the Respondent may have reached the stage of preparation for committing the offence, but before any act of attempt or commission could have been done, he had been apprehended,” the Court said.

The Court further noted that there was no prohibition on import or export of gold and that at best customs duty could have been imposed on the respondent. However, the prosecution failed to prove beyond reasonable doubt that there was any fraudulent evasion or attempt to evade customs duty.

Accordingly, the High Court upheld the acquittal under Sections 132 and 135 of the Customs Act and dismissed the Union's appeal.

For Petitioner: SPP Pramod Bahuguna, with Advocates Yachi and Debora Daimari.

For Respondent: Advocate Aishwarya Dwivedi.