111. Confiscation of improperly imported goods, etc.—The following goods brought from a place
outside India shall be liable to confiscation:—
(a) any goods imported by sea or air which are unloaded or attempted to be unloaded at any place
other than a customs port or customs airport appointed under clause (a) of section 7 for the unloading
of such goods;
(b) any goods imported by land or inland water through any route other than a route specified in a
notification issued under clause (c) of section 7 for the import of such goods;
(c) any dutiable or prohibited goods brought into any bay, gulf, creek or tidal river for the purpose
of being landed at a place other than a customs port;
(d) any goods which are imported or attempted to be imported or are brought within the Indian
customs waters for the purpose of being imported, contrary to any prohibition imposed by or under
this Act or any other law for the time being in force;
(e) any dutiable or prohibited goods found concealed in any manner in any conveyance;
1. Subs. by Act 13 of 2018, s. 92, for the proviso (w.e.f. 28-3-2018).
2. Ins. by Act 29 of 2006, s. 26 (w.e.f. 13-7-2006).
3. Subs. by Act 8 of 2011, s. 47, for ―adjudicating officer‖ (w.e.f. 8-4-2011).
4. Subs. by s. 47, ibid., for ―Commissioner of Customs‖ (w.e.f. 8-4-2011).
75
(f) any dutiable or prohibited goods required to be mentioned under the regulations in an 1
[arrival
manifest or import manifest] or import report which are not so mentioned;
(g) any dutiable or prohibited goods which are unloaded from a conveyance in contravention of
the provisions of section 32, other than goods inadvertently unloaded but included in the record kept
under sub-section (2) of section 45;
(h) any dutiable or prohibited goods unloaded or attempted to be unloaded in contravention of the
provisions of section 33 or section 34;
(i) any dutiable or prohibited goods found concealed in any manner in any package either before
or after the unloading thereof;
(j) any dutiable or prohibited goods removed or attempted to be removed from a customs area or
a warehouse without the permission of the proper officer or contrary to the terms of such permission;
(k) any dutiable or prohibited goods imported by land in respect of which the order permitting
clearance of the goods required to be produced under section 109 is not produced or which do not
correspond in any material particular with the specification contained therein;
(l) any dutiable or prohibited goods which are not included or are in excess of those included in
the entry made under this Act, or in the case of baggage in the declaration made under section 77;
(m)
2
[any goods which do not correspond in respect of value or in any other particular] with the
entry made under this Act or in the case of baggage with the declaration made under section 77 3
[in
respect thereof, or in the case of goods under transhipment, with the declaration
for transhipment referred to in the proviso to sub-section (1) of section 54];
(n) any dutiable or prohibited goods transited with or without transhipment or attempted to be
so transited in contravention of the provisions of Chapter VIII;
(o) any goods exempted, subject to any condition, from duty or any prohibition in respect of the
import thereof under this Act or any other law for the time being in force, in respect of which the
condition is not observed unless the non-observance of the condition was sanctioned by the proper
officer;
4
[(p) any notified goods in relation to which any provisions of Chapter IVA or of any rule made
under this Act for carrying out the purposes of that Chapter have been contravened.]
112. Penalty for improper importation of goods, etc.—Any person,—
(a) who, in relation to any goods, does or omits to do any act which act or omission would render
such goods liable to confiscation under section 111, or abets the doing or omission of such an act, or
(b) who acquires possession of or is in any way concerned in carrying, removing,
depositing, harbouring, keeping, concealing, selling or purchasing, or in any other manner dealing
with any goods which he knows or has reason to believe are liable to confiscation under section 111,
shall be liable,—
(i) in the case of goods in respect of which any prohibition is in force under this Act or any other
law for the time being in force, to a penalty 5
[not exceeding the value of the goods or five thousand
rupees], whichever is the greater;
1. Subs. by Act 13 of 2018, s. 56, for ―import manifest‖ (w.e.f. 28-3-2018).
2. Subs. by Act 36 of 1973, s. 2, for ―any dutiable or prohibited goods which do not correspond in any material particular‖
(w.e.f. 1-9-1973).
3. Subs. by Act 27 of 1999, s. 108, for ―in respect thereof,‖ (w.e.f. 11-5-1999).
4. Ins. by Act 12 of 1969, s. 4 (w.e.f. 3-1-1969).
5. Subs. by Act 14 of 2001, s. 107, for ―not exceeding five times the value of the goods or one thousand rupees‖
(w.e.f. 11-5-2001).
76
1
[(ii) in the case of dutiable goods, other than prohibited goods, subject to the provisions of
section 114A, to a penalty not exceeding ten per cent. of the duty sought to be evaded or five
thousand rupees, whichever is higher:
Provided that where such duty as determined under sub-section (8) of section 28 and the interest
payable thereon under section 28AA is paid within thirty days from the date of communication of the
order of the proper officer determining such duty, the amount of penalty liable to be paid by such
person under this section shall be twenty-five per cent. of the penalty so determined;]
2
[(iii) in the case of goods in respect of which the value stated in the entry made under this Act or
in the case of baggage, in the declaration made under section 77 (in either case hereafter in this
section referred to as the declared value) is higher than the value thereof, to a penalty 3
[not exceeding
the difference between the declared value and the value thereof or five thousand rupees], whichever is
the greater;
(iv) in the case of goods falling both under clauses (i) and (iii), to a penalty 4
[not exceeding the
value of the goods or the difference between the declared value and the value thereof or five thousand
rupees], whichever is the highest;
(v) in the case of goods falling both under clauses (ii) and (iii), to a penalty 5
[not exceeding the
duty sought to be evaded on such goods or the difference between the declared value and the value
thereof or five thousand rupees], whichever is the highest.]
113. Confiscation of goods attempted to be improperly exported, etc.—The following export
goods shall be liable to confiscation:—
(a) any goods attempted to be exported by sea or air from any place other than a customs port or a
customs airport appointed for the loading of such goods;
(b) any goods attempted to be exported by land or inland water through any route other than a
route specified in a notification issued under clause (c) of section 7 for the export of such goods;
(c) any 6
*** goods brought near the land frontier or the coast of India or near any bay, gulf, creek
creek or tidal river for the purpose of being exported from a place other than a land customs station or
a customs port appointed for the loading of such goods;
(d) any goods attempted to be exported or brought within the limits of any customs area for the
purpose of being exported, contrary to any prohibition imposed by or under this Act or any other law
for the time being in force;
(e) any 6
*** goods found concealed in a package which is brought within the limits of a customs
area for the purpose of exportation;
(f) any 6
*** goods which are loaded or attempted to be loaded in contravention of the provisions
of section 33 or section 34;
(g) any 6
*** goods loaded or attempted to be loaded on any conveyance, or water-borne, or
attempted to be water-borne for being loaded on any vessel, the eventual destination of which is a
place outside India, without the permission of the proper officer;
(h) any 6
*** goods which are not included or are in excess of those included in the entry made
under this Act, or in the case of baggage in the declaration made under section 77;
1. Subs. by Act 20 of 2015, s. 83, for sub-clause (ii) (w.e.f. 14-5-2015).
2. Ins. by Act 36 of 1973, s. 3 (w.e.f. 1-9-1973).
3. Subs. by Act 14 of 2001, s. 107, for ―not exceeding five times the difference between the declared value and the value thereof
or one thousand rupees‖ (w.e.f. 11-5-2001).
4. Subs. by s. 107, ibid., for ―not exceeding five times the value of the goods or five times the difference between the declared
value and the value thereof or one thousand rupees‖ (w.e.f. 11-5-2001).
5. Subs. by s. 107, ibid., for ―not exceeding five times the duty sought to be evaded on such goods or five times the difference
between the declared value and the value thereof or one thousand rupees‖ (w.e.f. 11-5-2001).
6. The words ―dutiable or prohibited‖ omitted by Act 32 of 2003, s. 116 (w.e.f. 14-5-2003).
77
1
[(i) any goods entered for exportation which do not correspond in respect of value or in any
material particular with the entry made under this Act or in the case of baggage with the declaration
made under section 77;]
2
[(ii) any goods entered for exportation under claim for drawback which do not correspond in any
material particular with any information furnished by the exporter or manufacturer under this Act in
relation to the fixation of rate of drawback under section 75;]
(j) any goods on which import duty has not been paid and which are entered for exportation under
a claim for drawback under section 74;
(k) any goods cleared for exportation 3
*** which are not loaded for exportation on account of any
wilful act, negligence or default of the exporter, his agent or employee, or which after having been
loaded for exportation are unloaded without the permission of the proper officer;
4
[(l) any specified goods in relation to which any provisions of Chapter IVB or of any rule made
under this Act for carrying out the purposes of that Chapter have been contravened.]
114. Penalty for attempt to export goods improperly, etc.—Any person who, in relation to any
goods, does or omits to do any act which act or omission would render such goods liable to confiscation
under section 113, or abets the doing or omission of such an act, shall be liable,—
(i) in the case of goods in respect of which any prohibition is in force under this Act or any other
law for the time being in force, to a penalty 5
[not exceeding three times the value of the goods as
declared by the exporter or the value as determined under this Act], whichever is the greater;
6
[(ii) in the case of dutiable goods, other than prohibited goods, subject to the provisions of
section 114A, to a penalty not exceeding ten per cent. of the duty sought to be evaded or five
thousand rupees, whichever is higher:
Provided that where such duty as determined under sub-section (8) of section 28 and the interest
payable thereon under section 28AA is paid within thirty days from the date of communication of the
order of the proper officer determining such duty, the amount of penalty liable to be paid by such
person under this section shall be twenty-five per cent. of the penalty so determined;]
7
[(iii) in the case of any other goods, to a penalty not exceeding the value of the goods, as
declared by the exporter or the value as determined under this Act, whichever is the greater.]
8
[114A. Penalty for short-levy or non-levy of duty in certain cases.—Where the duty has not been
been levied or has been short-levied or the interest has not been charged or paid or has been part paid or
the duty or interest has been erroneously refunded by reason of collusion or any wilful mis-statement or
suppression of facts, the person who is liable to pay the duty or interest, as the case may be, as determined
under 9
[sub-section (8) of section 28] shall, also be liable to pay a penalty equal to the duty or interest so
determined:]
10[Provided that where such duty or interest, as the case may be, as determined under 9
[sub-section (8)
of section 28], and the interest payable thereon under section 11[28AA], is paid within thirty days from the
date of the communication of the order of the proper officer determining such duty, the amount of penalty
1. Subs. by Act 32 of 2003, s. 116, for clause (i) (w.e.f. 14-5-2003).
2. Ins. by Act 49 of 1991, s. 120 (w.e.f. 27-9-1991).
3. The words ―under a claim for drawback‖ omitted by Act 32 of 2003, s. 116 (w.e.f. 14-5-2003).
4. Ins. by Act 12 of 1969, s. 5 (w.e.f. 3-1-1969).
5. Subs. by Act 32 of 2003, s. 117, for ―not exceeding the value of the goods or five thousand rupees‖ (w.e.f. 14-5-2003).
6. Subs. by Act 20 of 2015, s. 84, for clause (ii) (w.e.f. 14-5-2015).
7. Subs. by Act 32 of 2003, s. 117, for clause (iii) (w.e.f. 14-5-2003).
8. Ins. by Act 33 of 1996, s. 64 (w.e.f. 28-9-1996).
9. Subs. by Act 8 of 2011, s. 48, for ―sub-section (2) of section 28‖ (w.e.f. 8-4-2011).
10. Subs. by Act 10 of 2000, s. 85, for the first and second provisos (w.e.f. 12-5-2000).
11. Subs. by Act 8 of 2011, s. 48, for ―28AB‖ (w.e.f. 8-4-2011).
78
liable to be paid by such person under this section shall be twenty-five per cent. of the duty or interest, as
the case may be, so determined:
Provided further that the benefit of reduced penalty under the first proviso shall be available subject
to the condition that the amount of penalty so determined has also been paid within the period of thirty
days referred to in that proviso:
Provided also that where the duty or interest determined to be payable is reduced or increased by the
Commissioner (Appeals), the Appellate Tribunal or, as the case may be, the court, then, for the purposes
of this section, the duty or interest as reduced or increased, as the case may be, shall be taken into
account:
Provided also that in a case where the duty or interest determined to be payable is increased by the
Commissioner (Appeals), the Appellate Tribunal or, as the case may be, the court, then, the benefit of
reduced penalty under the first proviso shall be available if the amount of the duty or the interest so
increased, along with the interest payable thereon under section 1
[28AA], and twenty-five per cent. of the
consequential increase in penalty have also been paid within thirty days of the communication of the
order by which such increase in the duty or interest takes effect:
Provided also that where any penalty has been levied under this section, no penalty shall be levied
under section 112 or section 114.]
Explanation.—For the removal of doubts, it is hereby declared that—
(i) the provisions of this section shall also apply to cases in which the order determining the duty
or interest under 2
[sub-section (8) of section 28] relates to notices issued prior to the date on which
the Finance Act, 2000 (10 of 2000) receives the assent of the President;
(ii) any amount paid to the credit of the Central Government prior to the date of communication
of the order referred to in the first proviso or the fourth proviso shall be adjusted against the total
amount due from such person.]
3
[114AA. Penalty for use of false and incorrect material.—If a person knowingly or intentionally
makes, signs or uses, or causes to be made, signed or used, any declaration, statement or document which
is false or incorrect in any material particular, in the transaction of any business for the purposes of this
Act, shall be liable to a penalty not exceeding five times the value of goods.]
115. Confiscation of conveyances.—(1) The following conveyances shall be liable to
confiscation:—
(a) any vessel which is or has been within the Indian customs waters, any aircraft which is or has
been in India, or any vehicle which is or has been in a customs area, while constructed, adapted,
altered or fitted in any manner for the purpose of concealing goods;
(b) any conveyance from which the whole or any part of the goods is thrown overboard, staved or
destroyed so as to prevent seizure by an officer of customs;
(c) any conveyance which having been required to stop or land under section 106 fails to do so,
except for good and sufficient cause;
(d) any conveyance from which any warehoused goods cleared for exportation, or any other
goods cleared for exportation under a claim for drawback, are unloaded, without the permission of the
proper officer;
(e) any conveyance carrying imported goods which has entered India and is afterwards found
with the whole or substantial portion of such goods missing, unless the master of the vessel or aircraft
is able to account for the loss of, or deficiency in, the goods.
1. Subs. by Act 8 of 2011, s. 48, for ―28AB‖ (w.e.f. 8-4-2011).
2. Subs. by s. 48, ibid., for ―sub-section (2) of section 28‖ (w.e.f. 8-4-2011).
3. Ins. by Act 29 of 2006, s. 27 (w.e.f. 13-7-2006).
79
(2) Any conveyance or animal used as a means of transport in the smuggling of any goods or in the
carriage of any smuggled goods shall be liable to confiscation, unless the owner of the conveyance or
animal proves that it was so used without the knowledge or connivance of the owner himself, his agent, if
any, and the person in charge of the conveyance or animal 1
***:
Provided that where any such conveyance is used for the carriage of goods or passengers for hire, the
owner of any conveyance shall be given an option to pay in lieu of the confiscation of the conveyance a
fine not exceeding the market price of the goods which are sought to be smuggled or the smuggled goods,
as the case may be.
Explanation.—In this section, ―market price‖ means market price at the date when the goods are
seized.
116. Penalty for not accounting for goods.—If any goods loaded in a conveyance for importation
into India, or any goods transhipped under the provisions of this Act or coastal goods carried in a
conveyance, are not unloaded at their place of destination in India, or if the quantity unloaded is short of
the quantity to be unloaded at that destination, and if the failure to unload or the deficiency is not
accounted for to the satisfaction of the 2
[Assistant Commissioner of Customs or Deputy Commissioner of
Customs], the person-in-charge of the conveyance shall be liable,—
(a) in the case of goods loaded in a conveyance for importation into India or goods transhipped
under the provisions of this Act, to a penalty not exceeding twice the amount of duty that would have
been chargeable on the goods not unloaded or the deficient goods, as the case may be, had such goods
been imported;
(b) in the case of coastal goods, to a penalty not exceeding twice the amount of export duty that
would have been chargeable on the goods not unloaded or the deficient goods, as the case may be,
had such goods been exported.
117. Penalties for contravention, etc., not expressly mentioned.—Any person who contravenes
any provision of this Act or abets any such contravention or who fails to comply with any provision of
this Act with which it was his duty to comply, where no express penalty is elsewhere provided for such
contravention or failure, shall be liable to a penalty not exceeding 3
[one lakh rupees].
118. Confiscation of packages and their contents.—(a) Where any goods imported in a package are
liable to confiscation, the package and any other goods imported in that package shall also be liable to
confiscation.
(b) Where any goods are brought in a package within the limits of a customs area for the purpose of
exportation and are liable to confiscation, the package and any other goods contained therein shall also be
liable to confiscation.
119. Confiscation of goods used for concealing smuggled goods.—Any goods used for concealing
smuggled goods shall also be liable to confiscation.
Explanation.—In this section, ―goods‖ does not include a conveyance used as a means of transport.
120. Confiscation of smuggled goods notwithstanding any change in form, etc.—(1) Smuggled
goods may be confiscated notwithstanding any change in their form.
(2) Where smuggled goods are mixed with other goods in such manner that the smuggled goods
cannot be separated from such other goods, the whole of the goods shall be liable to confiscation:
Provided that where the owner of such goods proves that he had no knowledge or reason to believe
that they included any smuggled goods, only such part of the goods the value of which is equal to the
value of the smuggled goods shall be liable to confiscation.
1. The words ―and that each of them had taken all such precautions against such use as are for the time being specified in the
rules‖ omitted by Act 26 of 1988, s. 79 (w.e.f. 13-5-1988).
2. Subs. by Act 27 of 1999, s. 100, for ―Assistant Commissioner of Customs‖ (w.e.f. 11-5-1999).
3. Subs. by Act 18 of 2008, s. 70, for ―ten thousand rupees‖ (w.e.f. 10-5-2008).
80
121. Confiscation of sale-proceeds of smuggled goods.—Where any smuggled goods are sold by a
person having knowledge or reason to believe that the goods are smuggled goods, the sale-proceeds
thereof shall be liable to confiscation.
122. Adjudication of confiscations and penalties.—In every case under this Chapter in which
anything is liable to confiscation or any person is liable to a penalty, such confiscation or penalty may be
adjudged,—
(a) without limit, by a 1
[Principal Commissioner of Customs or Commissioner of Customs] or
a
2
[Joint Commissioner of Customs];
3
[(b) up to such limit, by such officers, as the Board may, by notification, specify;]
4
[122A. Adjudication Procedure.—(1) The adjudicating authority shall, in any proceeding under
this Chapter or any other provision of this Act, give an opportunity of being heard to a party in a
proceeding, if the party so desires.
(2) The adjudicating authority may, if sufficient cause is shown at any stage of proceeding referred to
in sub-section (1), grant time, from time to time, to the parties or any of them and adjourn the hearing for
reasons to be recorded in writing:
Provided that no such adjournment shall be granted more than three times to a party during the
proceeding.]
123. Burden of proof in certain cases.—5
[(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—
(a) in a case where such seizure is made from the possession of any person,—
(i) on the person from whose possession the goods were seized; and
(ii) if any person, other than the person from whose possession the goods were seized, claims
to be the owner thereof, also on such other person;
(b) in any other case, on the person, if any, who claims to be the owner of the goods so seized.]
(2) This section shall apply to gold, 6
[and manufactures thereof], watches, and any other class of
goods which the Central Government may by notification in the Official Gazette specify.
1. Subs. by Act 25 of 2014, s. 78, for ―Commissioner of Customs‖ (w.e.f. 6-8-2014).
2. Subs. by Act 27 of 1999, s. 100, for ―Deputy Commissioner of Customs‖ (w.e.f. 11-5-1999).
3. Subs. by Act 13 of 2018, s. 93, for clauses (b) and (c) (w.e.f. 28-3-2018).
4. Ins. by Act 23 of 2004, s. 67 (w.e.f. 10-9-2004).
5. Subs. by Act 36 of 1973, s. 4, for sub-section (1) (w.e.f. 1-9-1973).
6. Subs. by Act 40 of 1989, s. 2, for ―, diamonds, manufactures of gold or diamonds‖ (w.e.f. 26-10-1989).
81
124. Issue of show cause notice before confiscation of goods, etc.—No order confiscating any
goods or imposing any penalty on any person shall be made under this Chapter unless the owner of the
goods or such person—
(a) is given a notice in 1
[writing with the prior approval of the officer of Customs not below the
rank of 2
[an Assistant Commissioner of Customs], informing] him of the grounds on which it is
proposed to confiscate the goods or to impose a penalty;
(b) is given an opportunity of making a representation in writing within such reasonable time as
may be specified in the notice against the grounds of confiscation or imposition of penalty mentioned
therein; and
(c) is given a reasonable opportunity of being heard in the matter:
Provided that the notice referred to in clause (a) and the representation referred to in clause (b)
may, at the request of the person concerned be oral.
3
[Provided further that notwithstanding issue of notice under this section, the proper officer may
issue a supplementary notice under such circumstances and in such manner as may be prescribed.]
125. Option to pay fine in lieu of confiscation.—(1) Whenever confiscation of any goods
is authorised by this Act, the officer adjudging it may, in the case of any goods, the importation or
exportation whereof is prohibited under this Act or under any other law for the time being in force, and
shall, in the case of any other goods, give to the owner of the goods 4
[or, where such owner is not known,
the person from whose possession or custody such goods have been seized,] an option to pay in lieu of
confiscation such fine as the said officer thinks fit:
5
[Provided that where the proceedings are deemed to be concluded under the proviso to
sub-section (2) of section 28 or under clause (i) of sub-section (6) of that section in respect of the goods
which are not prohibited or restricted, the provisions of this section shall not apply:
Provided further that], without prejudice to the provisions of the proviso to sub-section (2) of section
115, such fine shall not exceed the market price of the goods confiscated, less in the case of imported
goods the duty chargeable thereon.
6
[(2) Where any fine in lieu of confiscation of goods is imposed under sub-section (1), the owner of
such goods or the person referred to in sub-section (1), shall, in addition, be liable to any duty and charges
payable in respect of such goods.]
7
[(3) Where the fine imposed under sub-section (1) is not paid within a period of one hundred and
twenty days from the date of option given thereunder, such option shall become void, unless an appeal
against such order is pending.
Explanation.—For removal of doubts, it is hereby declared that in cases where an order under
sub-section (1) has been passed before the date on which the Finance Bill, 2018 receives the assent of the
President and no appeal is pending against such order as on that date, the option under said sub-section
may be exercised within a period of one hundred and twenty days from the date on which such assent is
received.]
126. On confiscation, property to vest in Central Government.—(1) When any goods are
confiscated under this Act, such goods shall thereupon vest in the Central Government.
(2) The officer adjudging confiscation shall take and hold possession of the confiscated goods.
1. Subs. by Act 29 of 2006, s. 28, for ―writing informing‖ (w.e.f. 13-7-2006).
2. Subs. by Act 8 of 2011, s. 49, for ―a Deputy Commissioner of Customs‖ (w.e.f. 8-4-2011).
3. The proviso ins. by Act 13 of 2018, s. 94 (w.e.f. 28-3-2018).
4. Ins. by Act 80 of 1985, s. 9 (w.e.f. 27-12-1985).
5. Subs. by Act 13 of 2018, s. 95, for ―Provided that‖ (w.e.f. 28-3-2018).
6. Subs. by Act 80 of 1985, s. 9, for sub-section (2) (w.e.f. 27-12-1985).
7. Ins. by Act 13 of 2018, s. 95 (w.e.f. 28-3-2018).
82
127. Award of confiscation or penalty by customs officers not to interfere with other
punishments.—The award of any confiscation or penalty under this Act by an officer of customs shall
not prevent the infliction of any punishment to which the person affected thereby is liable under the
provisions of Chapter XVI of this Act or under any other law.