AGMA NACHIAR DIED Vs. UNION OF INDIA

JUDGEMENT

(1.) THERE are two writ petitions. The first petitioner in W.P.No. 5146 of 1979 is the daughter of one Md. Yousuf Maracair and the petitioner in W.P.No. 863 of 1980 is the son of the very same Md. Yousuf Maracair According to them, on 4-2-1959 the petitioner in W.P.No. 863 of 1980 was gifted with thirty bars of gold and the petitioner in W.P.No. 5146 of 1979 was gifted with ten bars of gold by their father and this is evidenced by a document of even date. Md. Yusuff Maracair died on 2-6-1965. On 17-8-1974, there was a raid by the Central Excise Officers attached to Thiruvarur Range, of the residential premises of both the petitioners and the bars of gold were seized and proceedings under the Gold (Control) Act, 45 of 1968, hereinafter referred to as the Act, were initiated. THERE were issuances of show-cause notices and replies. The first authority, namely, the third respondent passed orders on 26-7-1976, holding that the possession of the bars of gold would come within the mischief of Section 8(1) of the Act and ordered confiscation of the bars of gold under Section 71(1) of the Act. The third respondent exonerated the petitioners from the ambit of Section 16(11) of the Act. THERE were appeals and the appellate authority, the second respondent herein, by a common order, dated 14-10-1977, confirmed the order of the original authority. THERE were further revisions before the first respondent and they were not successful and the revisions were dismissed on 12-7-1979 by the first respondent. The orders of the respondents are being impugned in these two writ petitions.

(2.) MR. M.R. Narayanaswami, learned counsel appearing for the petitioners, took me through the various provisions of the Act and also referred to the preamble to state that no prohibition against holding or possessing gold as such could be spelt out from the scheme of the Act and its provisions and the Act was intended only to provide for the control of the production, manufacture, supply, distribution, use and possession of, and business in, gold, ornaments and articles of gold and the petitioners having had been exonerated of any culpability under Section 16 (ii) of the Act, which generally deals with gold, cannot be lugged in under Section 8(1) of the Act. Certain provisions of the Act, including those dealing with definitions will have to be adverted to for the purpose of deciding the question raised by the learned counsel for the petitioners. Section 2(b) defines 'article' as follows :

(3.) SECTION 8(l)(i) adumbrates an embargo with regard to owning or having possession, custody or control of any primary gold, save as otherwise provided in the Act. This provision will be operative after the coming into force of the Act with effect from 1-9-1968. There is no challenge in these writ petitions of the vires of the provisions of the Act. The definition of 'gold' in SECTION 2(j) takes in 'primary gold', 'article' and 'ornament'. We are not concerned with article or ornament and we are concerned only with primary gold, in the present cases. SECTION 16 speaks about declarations in respect of article of ornament and it does not speak about declarations in respect of primary gold. It is true that in more than one place, the expression 'gold' has been used in SECTION 16. In sub-section (3) of SECTION 16, the expression 'gold' occurs. But, sub-section (3) refers to sub-section (5) which lays down the exempted limit for articles and ornaments and sub-section (3) calls for declarations in respect of acquisitions after the commencement of the Act, of ownership, possession, custody or control of any gold in excess of the quantities specified in sub-section (5). Hence, the 'gold' referred to in sub-section (3) necessarily could have reference to articles and ornaments dealt with under sub-section (5). SECTION 16 by itself does not provide for declarations to be made in respect of primary gold. The only provision which lifts the ban on ownership, possession, custody or control of primary gold adumbrated in SECTION 8(l)(i) is found in SECTION 12, extracted above, and it speaks about inclusion of such primary gold as set out therein in a declaration. The other place where the expression 'gold' occurs in SECTION 16 is in sub-section (ii). But that again speaks about gold which is required to be included in a declaration. In SECTION 16 itself, primary gold is not required to be declared. SECTION 16, as already stated, speaks about declarations in respect of ornaments and articles which also fall within the definition of 'gold' in SECTION 2 (j). It is only in SECTION 12 declaration in respect of primary gold of the categories mentioned therein is contemplated. Hence, If at all SECTION 16 (ii) could have reference to primary gold, it could be only with reference to the primary gold set out in SECTION 12. If no declaration which is required under the provisions of the Act in respect of ownership, possession, custody or control of gold, is obtained, the embargo contemplated therein will be operative. That is how, we have to understand SECTION 16(11). In respect of primary gold other than the one coming under SECTION 12, no declaration is required and, of course, it is of no avail at all. In such a case, the ownership, possession, custody or control or primary gold will come within the mischief of SECTION 8(l)(i) and there is no escape from it. Merely because the petitioners have been exonerated of the charge under SECTION 16(11), it will not make them escape the mischief of SECTION 8(l)(i) which squarely applies to the facts of the present cases. 'Gold' in SECTION 16(11) has reference only to gold which is required to be included in a declaration or further declaration as the case may be. Though 'gold' may take in primary gold, primary gold as such except under SECTION 12, cannot have the benefit of a declaration. In the above view, it is futile to bank upon the fact that the petitioners have been exonerated of the charge under SECTION 16(11) and then advance a theory that SECTION 8(1)(i) cannot be invoked. The ban with regard to primary gold is found in SECTION 8(1)(i). The exception to the ban is found in SECTION 12 and that is permissible by a declaration. It is not the case of the petitioners that the bars of gold held by them will fall under SECTION 12. Hence, there is no escape for the petitioners from SECTION 8(1)(i). The extractions of the various provisions, as done above, though may appear to be elaborate, have been done only to understand the scheme of the said provisions. Learned counsel traced the implications of the previous rules. In my view, there is no need to advert to them, because on and from the date of commencement of the Act, the provisions therein will govern, and no submissions were made before me with regard to the concerned provisions being prospective or retrospective. Mr. T. Somasundaram, learned Additional Central Government Standing Counsel, placed reliance on the pronouncement of a Bench of the High Court of Delhi inVipin Maneklalv.Sushil Kumar 1983 AIR(Delhi) 307) to state that SECTION 8(1)(i) does not contemplate retention of primary gold by the taking of any declaration and SECTION 16 (ii) cannot be so construed as to permit retention of primary gold, merely on a declaration being made. The Bench of the High Court of Delhi in that case was meeting the contention that under the Act there is no absolute ban on the possession of primary gold, because SECTION 8(1) of the Act says that 'save as otherwise provided in this Act". In this connection, reference was made before the Bench to SECTION 8(6) and 16(11) of the Act. The Bench repelled the argument that under SECTION 8(6), the Administrator has got a power to permit retention of the possession of primary gold. SECTION 8(6) reads as follows:" * Notwithstanding anything contained in this section, the Administrator may, if he is of opinion that the special circumstances of any case or class of cases so require, authorise any person or class of persons to buy or otherwise receive, or sell, deliver, transfer or otherwise dispose of, any primary gold or article.' We are not, in the present cases, concerned with SECTION 8(6) at all. The petitioners do not claim that they have obtained any such exemption. Hence, there is no need to go near the reasoning expressed by the Bench of the High Court of Delhi in this behalf. But, there is a discussion of the implications of SECTION 16(11) in the judgment and it indicates that SECTION 8(1) does not contemplate retention of any primary gold by the making of any declaration and SECTION 16(11) could not be so construed as to permit retention of primary gold merely on a declaration being made. The Bench opined that SECTION 16(11), so far as primary gold is concerned, can have reference only to SECTION 12 and to no other section. I have also expressed so by independent reasonings of mine as above, and they enable me to repel the submission, made by the learned counsel for the petitioners that if they escape the scathe of SECTION 16(11), they cannot come within the mischief of SECTION 8(l)(i). SECTION 16(11) operates in a different sphere and though it speaks about gold in general terms, it is specifically qualified when it states 'which is required to be included in a declaration'. The declaration aspect is found in SECTION 16 itself apart from SECTION 12. Hence, the exoneration of the petitioners from SECTION 16(11) cannot lead to their exoneration from SECTION 8(l)(i) of the Act.