PANNA LAL Vs. UNION OF INDIA

JUDGEMENT

(1.) THE facts leading to this writ petition under Article 226 of the Constitution of India in the matter of the Gold Control Act, 1968 are that on 30th May, 1974, in pursuance of an information, the Central Excise and Customs Preventive Party checked Delux Bus No. RRL 294 going from Ajmer to Jodhpur at the Octroi Post, Ajmer-Beawar Road Ajmer. THE petitioner was travelling in the said bus and was spotted out. He was alighted from the bus and was searched in the presence of two independent witnesses which resulted into recovery of 9 pieces of primary gold weighing 463. 430 Grams from the left pocket of pant of the petitioner. THE details of the 9 pieces recovered from the petitioner are given as below:- S. No. Marking on the pieces. Number of pieces. 1. Hiranand MM JPR 9950 4 (two big and 2 small ). 2.C M. Jain Ajmer fine gold 9950. 1 3.Fine Gold Ajmer 9950 1 4. 9950 2 5. B. D. Shankerlal K. L Ajmer 9950 1 Total 9 THE brief case of the petitioner was also searched and 6. 800 Kg of silver in small ingots bearing markings ' Ajmer" Saraf Sangh Kanta Chhap Asli Chandi and Refuse (Keeti) of silver weighing 259. 9 grams and 2 pieces of silver samples weighing 20 grams were also found besides the above mentioned gold and silver. Following documents were also recovered from the possession of the petitioner:- (1) Two tickets of Delux Bus from Ajmer to Jodhpur No. 820875 and 820876. (2) One receipt No. 11195 dated 30th May, 1974 of Dharam Kanta Ajmer. (3) One receipt No. 11215 dated 30th May, 1974 of Dharam Kanta Ajmer. (4) One Bill No. 5777 of Hotel Ratan dated 30th May, 1974. THE raiding party seized the gold under section 66 of the Gold Control Act and the silver under section 110 of the Customs Act, 1962 on a reasonable belief that the gold in question was being carried, possessed /controlled by the said petitioner Pannalal in contravention of section 8 of the Gold Control Act and the silver was in the process of export out of India. THE Raiding Party also seized the brief case and the pant used as containers for the silver and gold. THE documents mentioned above were also seized being relevant with the inquiry proceedings. A separate show cause notice for silver was issued under the Customs Act, 1962 with which I am not concerned in the present writ petition. In the statement dated 30th May, 1974 recorded on the spot, the petitioner deposed that he had brought nine gold ornaments of his wife and got them melted through some agent at Ajmer from unknown Refiners. He was taking the melted gold pieces to his village via Jodhpur. On this material, the Assistant Collector Central Excise, Ajmer issued a notice to show cause to the petitioner on Oct. 26, 1974, to explain to the Deputy Collector, Customs and Central Excise Jaipur within 10 days of the receipt of the memorandum as to why the seized gold should not be confiscated under section 71 of the Gold Control Act and why further penal action should not be taken against him under section 74 of the Gold Control Act. Shri Hiranand, B. D. Shankerlal and M. C. Jain were also called upon to show cause as to why penal action should not be taken against them as they had refined the gold in contravention of section 11 of the Gold Control Act.

(2.) IN reply to the show cause notice the petitioner submitted that his wife had given him old gold ornaments which were got malted by him at Ajmer for the manufacture of new ornaments. The seized 9 pieces of gold were the out come of the old ornaments owned by his wife and were in the process of manufacture of new ornaments. That no notice had been given to his wife who was the owner of those ornaments. The seized gold pieces were not liable to confiscation as the omission had been committed by him without her knowledge. He pleaded ignorance of law and requested for a lenient view. He also requested for personal hearing. As a follow up action Sarv Shri Shankerlal, Ramlal of M/s Manmal Manakchand and Hiranand, all Refiners were also contacted by the Seizing Officers and their statement were also recorded. The above mentioned refiners took the stand that the markings found on the pieces of gold had no connection with them The gold was not refined by them and they had no concern with the gold seized from the petitioner. The learned Deputy Collector Central Excise and Custom Jaipur after taking into consideration the entire record and the submissions made by the parties at the time of investigation, and replies to the show cause notice and submissions made daring the course of personal hearing, held that the stand taken by the petitioner that he got melted the gold ornaments of his wife through a Dalai was false. According to the learned Deputy Collector the petitioner failed to produce the alleged Dalai for obvious reasons. No man parts with his valuable to an unknown person and the petitioner possibly failed to produce the Dalai because of the fact that he did not get gold ornaments of his wife melted, but on the other hand acquired and possessed the primary gold in question through the alleged Dalai who had not come forward having abated the petitioner in acquiring of impugned primary gold other than by lawful means. The learned Deputy Collector also observed that Mohanlal, the father of the petitioner was a certified goldsmith with certificate No. 192 and it was specifically stated by the petitioner in his voluntary statement dated 30th May, 1974 that he had also been working with his father on a shop for the last 2-3 years in manufacturing gold and silver ornaments. Sub-section (3) of section 55 of the Gold Control Act laid down that no gold smith shall either own or have in his possession, custody or control any gold which had not been included in the statutory accounts. It was, therefore, required of them to have entered alleged 9 gold ornaments of the wife of the petitioner in the statutory Register (GS 13) but the same was not done obviously because the alleged gold ornaments were not carried from Sadri to Ajmer for melting. The impugned primary gold was acquired illicitly. The learned Deputy Collector also found that the defence had failed to adduce the evidence of the wife of the petitioner besides having failed to produce the Dalai of Ajmer who got the alleged gold ornaments melted. IN the absence of this vital link having been proved by the defence, it was extremely difficult to place any reliance on the defence. He further observed that on the other hand, the weight of the seized gold was 463. 430 grams which was quite near to the weight of 4 biscuits of gold i. e. 40 Tolas. There is very nominal difference of 2. 17 grams which can be termed as melting loss. It can be said that the petitioner purchase 4 biscuits of gold weighing 40 Tolas and got them melted to destroy material evidence. IN view of the above finding the Deputy Collector held that the petitioner had contravened the provisions of section 8 (1) of the Gold Control Act. The seized gold was thus liable to confiscation under section 71 and the petitioner was liable to penal action under section 74. The Deputy Collector thus vide his order dated 20th July, 1976 Annexure 1 ordered absolute confiscation of 9 pieces of primary gold weighing 463. 430 Grams under section 71 of the Gold Control Act and also imposed a penalty of Rs. 1000/- on the petitioner under section 74 of the said Act. Shri Hiranand Shankerlal and Manakchand were let off since no case had been established against any one of them.

(3.) THE petitioner in the aforesaid circumstances has filed the present writ petition and has prayed to quash the order Annexures 2 and 3 and to give a direction to the non-peti (ioners to release the gold seized from the petitioner.