GUNVANT Vs. COLLECTOR OF CENTRAL EXCISE

JUDGEMENT

(1.) By this writ petition, the Petitioners have prayed for quashing Show Cause Notice dated 21st July 1980 (Annexure I) issued by the Central Government in purported exercise of powers conferred on them under Section 82 of Gold (Control) Act, 1968, hereinafter referred to as the Act, whereby it is proposed to revise the order dated 13th December 1979 of the Gold Control Administrator by which he set aside the Collector's order dated 10/18th June 1974 confiscating gold bangles found in possession of Petitioner No. 1, and also, imposing a penalty of Rs. 5000.00 each on petitioners 1, 2 and 3.

(2.) The Central Excise Officer Bangalore seized 82 gold bangles on 16th December 1970 from the baggage of Petitioner No. 1. After issuing show cause notice to the Petitioners, the Collector held that the seized gold bangles were not ornaments and that they were primary gold. He ordered them too be confiscated and also imposed penalty on the Petitioners. Appeal against that order was rejected by the Administrator. On a revision petition, the Central Government directed the Administrator that the appeal be heard and decided de novo after examination of the case property in the presence of the Appellants.

(3.) In the meanwhile criminal proceedings were initiated in the Court of Metropolitan Magistrate, Bangalore for punishing Petitioner No. 1 for contravention of Section 8(1) of the Act and for punishing Petitioners Nos. 2 and 3 for abetting Petitioner No. 1. H.L-Acharya (Public Witness 4) was produced as one of the prosecution witnesses. The gold bangles were got tested by him and he issued a certificate Ex.P-6 that the bangles were hurriedly prepared by handling on the die mold, joints were not properly closed and they cannot be worn as they were, and that they were tested by touch stone method and were found to be of 24 carat purity. In his cross-examination, Public Witness 4 deposed that persons belonging to different communities wear different types of ornaments, and that the shape and design of ornaments also differ. He stated that in Bombay, Bijapore, Gulbarga and Gujarat and Bangalore also, people wear gold ornaments of 24 carat purity. According to him, bangles like those involved in the case are worn by woman as ornaments, and in case bangles like that were sold by anybody to him, he will purchase them as ornaments. The Magistrate noticed the contention of the prosecution that gold bangles seized in the case were of 24 carat purity and from the gold of that purity no ornaments are manufactured. After considering the definition of 'primary gold' and 'ornament' in the light of explanation to Section 2(r), and on the basis of testimony of Public Witness 4, the Magistrate found that the bangles are of purity of 24 carats but they are ornaments and that the prosecution failed to prove that the seized bangles are primary gold. Therefore, by order made on 29th March 77 (Annexure F), the Magistrate acquitted the Petitioners and ordered that the seized bangles be returned to Petitioner No. 1. Appeal was preferred against the order of the Magistrate directing return of bangles to the petitioner but not against acquittal. This is clear from the judgment dated 9th December 1977 (Annexure G) of the Additional Sessions Judge, Bangalore City, who reversed the order of the Magistrate directing return of the bangles and allowed the appeal. The High Court of Karnataka did not interfere in revision against the order of the Sessions Judge. Special Leave Petition against it was admitted by the Supreme Court on 22nd January 1979. Later, in view of pendency of the present Writ Petition in this Court, by an order, dated 29th October 1985, the Hon'ble Supreme Court directed the confiscated ornaments to be returned to Petitioner No. 1 on his furnishing bank guarantee for the value of the ornaments. Thus, the criminal proceedings came to an end.