Kewal Krishan Vs. State of Punjab
 INSC 86 (6 March 1962)
06/03/1962 KAPUR, J.L.
AIYYAR, T.L. VENKATARAMA
CITATION: 1967 AIR 737 1962 SCR (3) 613
Sea Customs--Goods seized in reasonable
belief that they are smuggled--Burden of proof--If on person from whose
possession goods are seized--Constitutionality of statutory provison--The Sea
Customs Act, 1878 (8 of 1878), ss.167(81), 178A--Foreign Exchange Regulation
Act,1947 (7 of 1947),s.23A.
The appellant was searched by a Customs
Official and some bars of gold were found tied round his waist. Out of those
bars some were of base metal and the rest of pure gold which borne foreign
markes. The appellant had no permit from the Reserve Bank of India to import the gold. He was prosecuted and convicted under s. 167(81) of the Sea
Customs Act. He brought an appeal to the Supreme Court by Special leave.
Held, that s. 178A of the Sea Customs Act,
1878, is constitutional.
The contension that before the presumption
under s.178A of the Sea Customs Act could be raised the prosecution had to
prove that the gold was of foreign origin was rejected and held that s. 178A
provides that when the goods are seized in the reasonable belief that they are
smuggled goods the onus is on the accused to show that they are not smuggled.
Collector of Customs, Madras v. Nathella
Sampathu Chetty (1962) 3 S.C.R. p.786 followed.
CRIMINAL APPELLATE JURISDICTION: Criminal
Appeal No. 126 of 1959.
Appeal by special leave from the judgment and
order dated June 19, 1959, of the Punjab High Court in Criminal Revision No.
144 of 1959.
R. L. Kohli, for the appellant.
G. C. Mathur and P. D. Menon, for the
1962. March 6. The Judgment of the Court was
delivered by KAPUR, J.-This is an appeal by special leave against the judgment
and order of the High Court of the Punjab and raises the constitutionality of
s.178A of the Sea Customs Act., 1878 (Act 8 of 1878), which has been held by
this Court to be constitutional in the Collector of Castoms, Madras v. Nathella
At the time, of arguments before us a further
point was raised that in order that s.178A of the Sea Customs Act may become
applicable, the prosecution must further prove that the goods which were sought
to be affected by the order of the Customs Officer were goods of foreign origin
and there must be evidence in support of the reasonableness of the belief of
the Customs Officer that the goods were smuggled goods. The question now sought
to be raised was not agitated in any of the courts below.
The appellant on February 11, 1958, when he
was sitting in a third class compartment of the Amritsa Kalka train standing on
Platform No. 5 of the Amrsar Railway Station, was searched by a Customs
Official and some bars of gold were found tied round his waist. These gold bars
were seized and a recovery memo wits prepared, Out of these gold (1)  3.
615 bars four were of base metal and the rest
were of pure gold some bearing the stamp of Johmon Mathey & Co. Ltd.,
999-10 tolas and 2-1/4 bars bore marks of N.M. Rothschild & Sons 10 tol as
(990-0). No permit from the the Reserve Bank to import this gold was produced
by the appellant. Under the Foreign Exchange Regulation Act, 1917, the
importation of gold without such permit is prohibited and such contravention is
punishable under s.23-A of the said Act read with s.167(81) of the Sea Customs
The appellant was prosecuted under s.23A of
the Foreign Exchange Regulation Act and 167(81) of the Sea Customs Act and his
defence was that he was not in possession of the gold bars which were taken
from an attache case left by a stranger under the seat where he (the appellant)
was sitting. The Additional District Magistrate held the offence to be proved
and convicted the appellant of the offence and sentenced him to one year's
rigorous imprisonment. An appeal to the Sessions Judge resulted in the
reduction of the sentence to 8 months' rigorous imprisonment. On revision to
the High Court the sentence was reduced to six months' rigorous imprisonment.
The appellant has come in appeal by special leave.
The trial court accepted the testimony of the
Customs Officials and held that the defence of the appellant was false and that
gold worth Rs. 14,000/was found in his possession. The learned Sessions Judge
in appeal also accepted the testimony of the Customs Officials and held the
defence to be false and came to the conclusion that the gold was found in
possession of the appellant. In the High Court the same plea was taken and was
For the first time in this Court it is
contended that before the presumption under s.178A can be made applicable, it
must be proved by the prosecution that the goods were of foreign origin, i.e.
had beep 616 imported from abroad and only then does the presumption under s.
178A arise which relates only to the question of Customs duty having been paid.
In other words the contention comes to this that the prosecution must first
prove that the goods in dispute in a particular case have been imported from a
foreign country and once that is proved the onus then will be on the person in
whose possession the goods are found that he had paid the Customs duty. Apart
from the fact that this question has never been raised, that is not the effect
of s.178A of the Sea Customs Act which provides:"178A. (1) 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
(2) This section shall apply to gold, gold
manufactures, diamonds and other precious stones, cigaretters and cosmetics and
any other goods which the Central Government may, by notification in the
Official Gazette, specify in this behalf.
(3) Every notification issued under sub
section (2) shall be laid before both Houses of Parliament as soon as may be
after it is issued".
Two Customs officers appeared as witnesses,
Inspector Satnam Singh and Deputy Superintendent A.N. Kapur, the former is an
Inspector of Land Customs and the latter a Deputy Superintendent of Customs.
There is nothing to indicate in their cross-examination that the officers did
not have a reasonable belief that the goods were smuggled goods and the question
that the officers did not have reasonable belief is not suggested either from
the cross-examination of these witnesses of from the findings 617 of the courts
below. Even in his statement of case it is contended that the mere existence of
stamp of foreign companies on gold does not necessarily prove that the gold is
of foreign origin. It might be put on spurious gold which may be of Indian
origin. In our opinion apart from the fact that this question has not been
raised, it is quite clear that what s.178A of the Sea Customs Act provides is
that when the goods are seized in the reasonable belief that they are smuggled
goods then the burden of proving that they are not smuggled goods is on the
person from whose possession the goods are seized. The onus is on him to show
that the goods are not smuggled, that is, not of foreign origin on which duty
is not paid. The onus is not on the prosecution to show that the goods are not,
of Indian origin. That appears to be the view taken in the Collector of
Customs, Madras v. Nathella Sampathu Chetty (1) where at the learned Judges
observed : "We are therefore of opinion (1) that section 178A was
constitutionally valid, (2) that the rule as to the burden of proof enacted by
that section applies to a contravention of a notification under section 8(1) of
the Foreign Exchanges Regulation Act 1947 by virtue of its being deemed to be a
contravention of a notification on under section 19 of the Sea Customs Act, (3)
that the preliminary requirement of section 178A that the officer seizing
should entertain ,'a reasonable belief' that the goods seized were
smuggled" was satisfied in the present case." In our opinion there is
no merit in this appeal and it is dismissed. The appellant will surrender to
(1)  3 S.C.R. 786.