Criminal Appeal No 74 of 1971
Appeal by Special Leave from the Judgment and order dated the 25th January 1972 of the Bombay High Court in Criminal Appeal 1025 of 1959
N H Hingoorani and Mrs K Hingoorani for the Appellant
section B Wad and Al
N Shroff for the Respondent
The Judgment of the Court was delivered by V BEG J
The appellant before us by special leave to appeal was convicted under Section 135b ii of the hereinafter referred to as the Act  and sentenced to six months rigorous imprisonment and a fine of Rs 2000  and in default to three months further rigorous imprisonment
Goods in respect of which this offence was found to have been committed were also confiscated
On 21 4 1967 Police Officers of the Anti Corruption and Prohibition Bureau Greater Bombay acting on information received had searched room No 10 at 56 Sheriff Deoji Street Bombay
This room was divided by partitions into three parts
In the central portion the police found the appellant and three other persons
This portion was again sub divided with a locked connecting door fixed in the passage to the sub divided part
This was opened by one of the two Godrej lock keys produced by the appellant from a side pocket of his trousers
Eleven wooden boxes covered with jute cloth and secured by iron strips were found there
On opening them six of them were found to contain cigarette lighters of Imco Triplex Junior  brand Made in Austria
Each of the six boxes were tightly packed with 1200 lighters
The remaining five boxes contained fifty sealed tins of flints for cigarette lighters which bore the following writing Tego Lighter Flints of Superior Quality Made in Germany
On the wooden boxes containing the lighters were found written Dubai and Made in Austria
The five boxes containing flints had the words Dubai and Made in West Germany inscribed on them
A panchnama was prepared before Panchas
A rent receipt in the name of the appellant in respect of room No 10 in this house of which a portion was occupied by the appellant and a bill for the consumption of electricity were also seized from the custody of the appellant together 541 with the Godrej lock and the keys produced by the appellant
Subsequently the seized articles were made over to the inspector of Central Excise and Customs Marine and Prevention Division Bombay on 24 4 1967 under Section 110 of the 
The value of 7200 cigarette lighters was stated as Rs 14400 and of 250 tins of flints as Rs 15000 on which Customs duty of Rs 15840 and Rs 10500 respectively was alleged to be payable
In the complaint filed on 30th October 1968 by the Assistant Collector of Central Excise Marine and Prevention Division Bombay it is alleged that the cigarette lighters and flints were imported into India without an import licence and in contravention of provisions of Government of India Ministry of Commerce  Industry Import Control order No1755 dated 7 12 1955 as amended issued under Section 32 of the Import  Export Control Act 1947 which was to be deemed to be an order passed under Section 11 of the Act
It was submitted that the accused having been concerned in a fraudulent evasion of payment of Rs 26340 as customs duty to the Government had committed offences punishable under Section 135a and b of the Act
The goods were also as a necessary consequence said to be liable to confiscation under Section 111 d of the Act
The appellant had denied being in possession of the offending goods although he had admitted the production of keys from his possession He alleged that the portion of the room from which the goods were recovered was sublet to Dwarumal and Kishen who had kept the goods there
The appellant s explanation had been disbelieved by the trying Magistrate as well as by the High Court
The production of the key which according to the prosecution evidence the appellant had at first refused to produce proved that the portion in which the boxes were kept was in appellant s exclusive possession with all that was contained in it
It is possible that he may have sub let other portions of the partitioned room to other persons but there is no reason to doubt that the appellant was not only in possession of the bodies but knew something about the incriminating nature of their contents
Otherwise why should he at first have refused to produce the key he had  Furthermore the appellant had not given any evidence to show that his sub tenants had placed the boxes there or that there was any reason why he should allow them to use the portion reserved by him for himself
His case rested on his bare assertions in a written statement
Of course no one had come forward to state or allege that the goods found in the circumstances stated above had been imported without payment of duty
The only question raised before us was whether the presumption contained in Section 123 of the Act corresponding to Section 128A of the 
Or any other provision of law would place the onus of proving innocent possession of these goods upon the appellant
Section 123 of the Art reads as follows 123
Burden of proof in certain cases
1 Where any goods to which this section applies are seized under this Act in the reasonable belief that 542 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
2 This section shall apply to gold diamonds manufacturers of gold or diamonds watches and any other class of goods which the Central Government may by notification in the official Gazette specify
lt is true that lighters and flints were notified as provided in Section 1232 in the official Gazette of 26 8 1967
Nevertheless as the provisions of Section 1231 of the Act only lay down a procedural rule they could be applied when the case came up for trial before the Presidency Magistrate who actually decided it on 15 7 1969
Indeed the complaint itself was filed on 30 10 1968
It is immaterial that the appellant was found in possession of the goods on 21 4 1967 There is however another objection to the applicability of Section 1231 of the Act
It is that it would apply only to goods seized under the Act
lt is contended that the goods in respect of which the appellant was prosecuted were not seized under the Act
Reliance was placed for this contention upon Gian Chand  ors
vs the State of Punjab 1 Even if the goods with which we are concerned here were not seized under the Act as provided by Section 111 of the Act it is contended on behalf of the State that Section 106 read with Section 114 of the Evidence Act was sufficient to enable the prosecution to ask the Court to presume that the appellant knew that the goods must have been smuggled or imported in contravention of the law
The appellant had not produced evidence to show that the goods were legally brought into India
Reliance was placed on behalf of the prosecution on Collector of Customs Madras  ors
vs D Bhoormal 2 Ms Kanungo  Co vs The Collector of Customs Calcutta  Ors3 Issardas Daulat Ram  ors
vs the Union of India  Ors4 Anant Gopal Sheorey vs The State of Bombay5
Learned Counsel for the appellant had in his turn relied upon The State of Punjab vs Gian Chand  ors6
He contended that it was necessary for the prosecution to prove 1 that the goods in question were actually smuggled or brought into the country without payment of customs duty at a time when payment of such duty had become obligatory and 2 that the appellant was dealing with them knowing them to be smuggled goods
It was contended that mere possession by the accused of such goods could not enable the prosecution to apply Section 106 of the Evidence Act when the appellant could not know where the goods came from
It was urged that there was no evidence which could enable the appellant to know where the goods came from or when the goods were imported or that duty if leviable was not P d on them
The admissibility and sufficiency of 1 1962 Suppl 1 SCR 364
2  3 AIR 4 1962 Suppl
1 SCR 358
5  6 Criminal Appeal No 195 of 1962 decided by this Court on 2 4 1968
543 the inscriptions on the goods and the writing on boxes in which they were found for proving the place from where they came or when they were imported were questioned
The contention was that even if the appellant is deemed to be in possession with full knowledge of what the goods actually were the Court could not go further and assume them to be smuggled or imported into the country from another country of their assumed origin after a time when the restrictions on their import had been imposed
Unfortunately the appellant did not admit the possession of the goods at all
If he could have succeeded in explaining satisfactorily how he was an innocent receiver of such goods without knowing that they were illegally imported or smuggled he may have had a chance of getting the benefit of doubt The very appearance of the goods and the manner in which they were packed indicated that they were newly manufactured and brought into this country very recently from another country
The inscriptions or them and writing on the boxes were parts of the state in which the goods in unopened boxes were found from which inferences about their origin and recent import could arise
The appellant s conduct including his untruthful denial of their possession indicated consciousness of their smuggled character or means rea
In any case there was some evidence to enable the Courts to come to the conclusion that the goods must have been known to the appellant to be smuggled even if he was not a party to a fraudulent evasion of duty
Consequently the appellant had been convicted only under Section 1351ii of the Act
We do not find sufficient reasons to interfere with this finding of fact or the sentence imposed
It would also follow that the goods were rightly confiscated
Accordingly this appeal is dismissed
VMK Appeal dismissed


Summary:
Section 1231 of the  provided that where any goods to which this section applies are seized under this Act in the reasonable relief 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
On 21 4 1967 Police officers of the Anti Corruption and Prohibition Bureau
Greater Bombay acting on information received had searched room No 10 at 56 Sheriff Deoji Street Bombay
This room was divided by petitions into three parts
In the central portion the police found the appellant and three other persons
This portion was again sub divided with a locked connecting door fixed in the passage to the sub divided part
This was opened by one of the two Godrej lock keys produced by the appellant from a side pocket of his trousers
Eleven wooden boxes covered with jute cloth and secured by iron strips were found there
On opening them
six of them were found to contain cigarette lighters of Imco Triplex Junior brand Made in Austria
Each of the six boxes were tightly packed with 1 200 lighters
The remaining five boxes contained fifty sealed tins of flints for cigarette lighters which bore the Following writing Tego Lighter Flints of Superior Quality Made in Germany inscribed on them
A panchnama was prepared before Panchas
A rent receipt in the name of the appellant in respect of room No 10 in this house of which a portion was occupied by the appellant and a bill for the consumption of electricity were also seized from the custody of the appellant together with the Godrej locks and the keys produced by the appellant
On 30th October
1968 the Assistant Collector of  Central Excise Marine and Prevention Division
Bombay filed a complaint alleging that the appellant had committed offences punishable under Section 135a and b of the 
The appellant had denied being in possession of the offending goods although he had admitted the production of keys from his possession
The trying Presidency Magistrate convicted him under section 135bii of the and sentenced him to six months rigorous imprisonment and a fine of Rs 2000  and in default to three months further rigorous imprisonment
The High Court dismissed his appeal
This appeal has been preferred on the basis of the special leave granted by this Court
It was contended for the appellant that 1 the presumption contained in s1231 of the Act would not place the onus of proving innocent possession of the goods in question upon the appellant and ii the goods in respect of which the appellant was prosecuted were not seized under the Act
Rejecting the contentions and dismissing the appeal
the court  HELD 1 Though lighters and flints were notified provided in Section 1232 in the official Gazette of 26 8 1967 the provisions of Section 1231 which only lay down a procedural rule could be applied when the case came up for
trial before the Presidency Magistrate
He divided it on 15 7 1969
The complaint itself  was filed on 30 10 1968
It is immaterial that the appellant was round in possession of the goods on 21 4 1967
542 B C ii The very appearance of the goods and the manner in which they were packed indicated that they were newly manufactured and brought into this country very recently from another country
The inscriptions on them and writing on the boxes were Parts of the state in which the goods in unopened boxes were found from which inferences about their origin and recent import 540 could arise
The appellant s conduct including his untruthful denial of their h possession indicated consciousness of their smuggled character or means rea
There was some evidence to enable the courts to come to the conclusion that the goods must have been known to the appellant to be smuggled even if he was not party to a fraudulent evasion of duty
543 B D Gian Chand  ors
vs The State of Punjab 1962 Suppl
l SCR 364 Collector of Customs Madras  ors
vs D Bhoormull  Ms Kanungo  Co vs The Collector of Customs Calcutta  ORS
AI R 1972 SC 2136 Issaradas Daulat Ram  ors vs The Union of India  ors 1962 Suppl
1 SCR 358 Gopal Sheorey vs The State of Bombay  and The State of Punjab vs Gian Chand  ors
Criminal Appeal No 195 of 1962 decided by this court on 2 4 1968 referred to