Judgment :- This writ petition coming on for hearing on Tuesday the 11th day of August 1964 and this day upon perusing the petition and the affidavit filed in support thereof the order of the High Court, dated 28-6-1962 and made herein, and the Counter affidavit, filed herein and the records relating to the order in D. A. Dis. No. VIII/10/II/61-Cus. Ad. dated 23-1-1962 on the file of the Respondent herein and comprised in the return of the Respondent to the Writ made by the High Court, and upon hearing the arguments of Mr. S.M. Cassim, Advocate for the petitioner on 11-8-1964 and of Mr. S. Mohan Kumaramangalam and Mr. S.M. Cassim, advo cate for petitioner on 12-8-64 and of Mr. K. Venkataswami for the Additional Government Pleader on behalf of the Respondent on both days the Court made the following Order : - 2.By an order dated January 23, 1962, the Collector of Central Excise, who is the respondent, confiscated certain gold ingots as smuggled gold and imposed a penalty of Rs. 5000/- on the petitioner. The respondent in making that order acted under Section 167(8) of the Sea Customs Act read with Section 8 (1) and 23-A of the Foreign Exchange Regulation Act, 1947, and section 3(2) of the Import and Export (Control) Act, 1947. This petition is to quash the order. 3.On December 18, 1960, the Central Crime Branch Police authorities at Tirunelveli Town apprehended one Mohideen Sahib on suspicion near the Town Bus Service stop opposite to Tirunelveli junction railway station and seized from him four gold ingots weighing 200-0-9 tolas valued at Rs. 26, 195. They also seized from him at the time two motor fuel injection nozzles of foreign origin valued at Rs. 80. He gave a statement to the police that they were entrusted to him by one Ahmed Naina Meracayer of Kayalpattinam for delivery to one Latiff at Madras. Investigation showed that this Latiff was a fictitious name. The petitioner gave a statement on December 22, 1960 to the effect that the gold ingots belonged to him and it was he who asked Ahmed Naina to hand them over to Latiff at Madras, Ahmed Naina Meracayar also had given a statement on January, 28, 1961, affirming that the gold ingots belonged to his uncle Habeeb Mohamed and that he gave them to him for handing over the same to Latiff at Madras. The net effect of the Statements before the police and the department would appear to be that, according to the petitioner, he had the jewels of his wife melted in the shop of Seethu Salt Moosa at Tirunelveli and converted the same into ingots with a view to sell them to finance his proposed business. A receipt was pro duced before the department showing the payment of melting charges to Seethu Salt Moosa. When the matter was argued before the respondent, counsel for the petitioner stated that his client was not in a position to produce any accounts and he could not also substantiate his financial status to such an extent as to be in possession of the gold ingots or that he was running a business which would enable him to command the finance to enable him or his wife to own the jewels of so much worth. After asking for the explanation of the petitioner and giving a hearing to him the respondent noted that Mohideen Sahib had given a contradictory version, that Habeeb Mohammed was financially not so sound as to enable him to command the ingots and had no business from which it could be taken for granted that it was possible for Habeeb Mohammed or his wife to own the jewels of such considerable value and that Habeeb Mohammed himself significantly took no action for nearly a month after the gold ingots had been seized and the fact appeared in newspapers. In the view of the respondent, these facts provided circumstantial evidence for him to be convinced that the gold and motor parts were contraband and had been illicitly imported into this country contrary to the law. He also mentioned in his order that in addition to that Habeeb Mohammed had not satisfactorily explained the origin of the four ingots of gold; the genuineness of the receipt for payment of melting charges was doubtful and the village of Koyalpattinam from where the gold had been taken out was in the sea shore. He also mentioned in his order that in addition to that Habeeb Mohammed had not satisfactorily explained the origin of the four ingots of gold; the genuineness of the receipt for payment of melting charges was doubtful and the village of Koyalpattinam from where the gold had been taken out was in the sea shore. The respondent thought that these facts added further strength to his conclusion on the circumstantial evidence that the gold ingots must have been smuggled.Ist ReaderDatedIst CorrectionDatedIInd ReaderDatedIInd CorrectionDated 4.On behalf of the petitioner it is argued that no presumption as has been enacted in section 178-A of the Sea Customs Act could be invoked by the respondent in this case and that being the case, there was total absence of any evidence to justify his conclusion that the four ingots had been smuggled into this country and that the petitioner was responsible for the smuggling. I may mention that the petitioner himself disclaimed ownership of or association with the two motor fuel injection nozzles which had been seized from Mohideen Sahib along with the four ingots. To appreciate the contention of the petitioner one more fact has to be stated. It would appear that the Central Crime Branch Police authorities at Tirunelveli deposited the gold ingots with the Sub Magistrate at Tirunelveli who, on a requisition apparently by the customs authorities, handed them over to the Deputy Superintendent of Central Excise on December 23, 1960. Mohideen applied to the Sub Magistrate for return of the gold ingots but this petition was dismissed in the first week of December 1961. It is clear therefore that the customs authorities came in possession of the gold ingots not by themselves seizing the same but on a requisition from the Sub-Magistrate. As I said, the seizure of the ingots originally was by the Central Crime Branch Police authorities. Section 178 of the Sea Customs Act provides that anything liable to confiscation under the Act may be seized in any place by any officer of Customs or other person duly employed for the prevention of smuggling. Central Act 21, of 1955 introduced Section 178-A relating to burden of proof. Section 178 of the Sea Customs Act provides that anything liable to confiscation under the Act may be seized in any place by any officer of Customs or other person duly employed for the prevention of smuggling. Central Act 21, of 1955 introduced Section 178-A relating to burden of proof. Sub-section (1) of this section says : 'Where any goods to which this section applies are seized under this act in the reasonable belief that they are smuggled goods, the burden of proving that they are not smuggled goods shall be on the person from whose possession the goods were seized'.Interpreting this section the Supreme Court inGian Chandv. State of Punjab, held that the rule of burden of proof laid down in that sub-section would apply only to a seizure under the Act and that meant a seizure by the Customs authorities acting under the Act and not to a seizure by the police pursuant to their powers under the Code of Criminal Procedure. The argument for the petitioner therefore, is that the seizure in this case of the gold ingots having been made by the Police and not by the Customs authorities under the Act, the principle ofGian Chandv.State of Punjab, will apply to this case. The petitioner is doubtless correct in his contention. It is for the department, therefore, to show, before confiscating the gold ingots, they were smuggled into the country without payment of duty. 5.It is argued that what the respondent had before him were only certain statements made by three or four individuals including the petitioner and the receipt tor payment of melting charges by which it was explained by the petitioner that the gold ingots were not contraband and that, if the explanation was not accepted, it did not follow from it that the gold ingots must necessarily have been smuggled. In support of this contention reliance is placed onAmba Lalv.Union of India, There it was held that where an accused contended that certain goods were imported from Pakistan before the Customs barrier was established, the onus was on the Customs authorities, to prove that they were imported after the barrier was put up and that the mere fact that the accused could not prove that they were imported from Pakistan before the customs barrier was established was not proof of the goods having been smuggled from Pakistan. Describing the nature of the jurisdiction of the customs authorities, the Supreme Court observed (page: 266) :'A Customs officer is not a judicial tribunal and a proceeding before him is not a prosecution. But the relevant provisions of the Sea Customs Act and the Land Customs Act are penal in Character. The appropriate Customs authority is empowered to make an enquiry in respect of an offence alleged to have been committed by a person under the said Acts, summon and examine witnesses, decide whether an offence is committed, make an order of confiscation of the goods in respect of which the offence is committed and impose penalty on the person concerned. To such a situation though the provisions of the Code of Criminal Procedure or the Evi dence Act may not apply except in so far as they are statutorily made applicable, the fundamental principles of criminal jurisprudence and of natural justice must necessarily apply. If so the burden of proof is on the customs authorities and they have to bring home the guilt to the person, alleged to have committed a particular offence under the said Acts by adducing satisfactory evidence to'. 6.The strict rule of burden of proof applicable to criminal prosecutions, namely that the burden is always on the prosecution and it never shifts from it, may not perhaps be strictly applicable to proceedings before the Customs authorities. But that does not mean that the customs authorities are relieved of the necessity to prove by evidence that particular goods which they confiscated, were smuggled goods. A variety of situations might be contemplated. For instance, a person from whom goods have been seized may offer an explanation as to the origin of the goods. If the explanation is not accepted, it does not necessarily follow from it that the goods are smuggled goods. That is not proof of smuggling. The department will still have to establish that they are such goods. In an effort to prove the explanation offered by the person from whom the goods were seized, he may have placed certain evidence which the customs authorities may not accept. That is not proof of smuggling. The department will still have to establish that they are such goods. In an effort to prove the explanation offered by the person from whom the goods were seized, he may have placed certain evidence which the customs authorities may not accept. Even in such a case, it seems to me the Customs authorities cannot proceed on the basis that because an explanation has been offered by the person, but he failed to establish it by his evidence and the same has been accepted, therefore it may be taken for granted that the goods were smuggled. There may be other cases where the person from whom goods have been seized may have admitted that he smuggled them. A question may arise whether in such a case the customs authorities would be entitled to act upon such an admission. Anantanarayan, J inPublic Prosecutor, Madrasv.Mode, 1961 M.W.N. Cr. 79 meant to lay down that the Department would not be entitled to act on such admissions. It would in my view, if I may express it with respect, be going too far and applying rather strictly to the proceeding before the Customs authorities a rule of evidence peculiarly applicable to criminal prosecutions. While on the one hand, it may be stated generally that it is for the Customs authorities to establish that the goods in question are smuggled goods, it is difficult to lay down in general terms the limits for the application of that burden and as to when it is discharged. That is a matter for examination in each case, but in doing that it is well to remember that to such a proceeding before the customs, the rigid rule of burden of proof in criminal prosecutions will not apply or is not called for, but there must be some kind of proof of smuggling.7.In this case the respondent considered that the circumstantial evidence before him proved that the goods were smuggled. What was the circumstantial evidence before him I have already referred to the facts which the respondent deduced on the basis of the statements and materials placed before him by the petitioner to substantiate his explanation. What was the circumstantial evidence before him I have already referred to the facts which the respondent deduced on the basis of the statements and materials placed before him by the petitioner to substantiate his explanation. Assuming that the statements and the explanation furnished by the petitioner were untrue and the receipt for payment of melting charges was a make believe one, assuming also that the petitioner is not a person of such means as one could reasonably expect him or his wife to own jewels or ingots of such high value, does it necessarily follow from these premises that the ingots of gold had been smuggled and that no other conclusion was possible? Suspicion apart, which is not evidence, a finding that the goods were smuggled must be based on proper and legal evidence. Where only circumstantial evidence is relied on, unless it is conclusive on the fact of smuggling, it cannot be taken to be proof of the fact. Supposing for instance in this case the ingots were stolen (not that I hold so) and the petitioner, in order to hide it, gave a false explanation, can it be said that because of that, the gold ingots should necessarily have been smuggled? Clearly the answer should be in the negative. Similarly, there may be other possibilities which may really explain the petitioner's possession of the gold ingots. The circumstantial evidence, even if it can be so described, which the respondent relied on had no more effect than that the explanation offered by the petitioner was false. The circumstantial evidence did not prove that the ingots were smuggled. In my view, therefore, the finding of the respondent that the ingots had been smuggled was not based on any legal evidence. It follows that his order is illegal and invalid. 8.This petition is allowed and the order of the respondent is set aside. No costs.