The Customs, Excise and Service Tax Appellate Tribunal, Ahmedabad set aside absolute confiscation of two foreign‑marked gold bars seized in domestic transit, as GST invoices and stock records shifted the burden to the Department.

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Ahmedabad has held that when foreign‑marked gold seized in domestic transit is backed by invoices generated through the GST system and matching stock records, the onus shifts to the Department to verify the supply chain before treating the gold as smuggled [V. Navinchandra Hirachand Malji Jewellers & Co v. Commissioner of Customs (Appeals) & Ors., 2026-juristway.com-3427-CESTAT(Ahmedabad)-Customs].

Somesh Arora, Member (Judicial), decided the jeweller’s appeal and that of its authorised signatory. Two gold bars of 200 grams bearing the Argor‑Heraeus SA refinery mark were seized on 7 Jun 2023 while being carried by a courier (angadiya). The authorities ordered absolute confiscation, and penalties of ₹1,75,000 were imposed under Sections 112(b) and 117 of the Customs Act, 1962.

Section 123 places on the person in possession the burden of proving that gold seized in the reasonable belief that it is smuggled is not smuggled. The Revenue argued that the foreign marks triggered the presumption, that domestic purchase invoices did not prove lawful import, and that the signatory admitted under Section 108 that no import documents were obtained.

The Tribunal found that the invoices were generated through the GST system, carried matching 999 purity, and were not alleged to be for goods never supplied. The courier’s own statement to the Directorate of Revenue Intelligence confirmed that he received delivery challans and invoices with the bars, establishing the link to the supplier. The Department had neither recorded the supplier’s statement nor verified at its end.

It also noted that gold bullion, though restricted, is lawfully available through authorised channels such as banks and the GIFT City. In the face of this documentary evidence, the Department could not be said to have had a reasonable belief that the gold was smuggled.

Both appeals were allowed.

2026-juristway.com-3427-CESTAT(Ahmedabad)-Customs