KANYALAL CHANDRAKUMAR Vs. UNION OF INDIA (UOI) REPRESENTED BY THE JOINT SECRETARY TO THE GOVERNMENT OF INDIA, MINISTRY OF FINANCE, DEPARTMENT OF REVENUE AND INSURANCE

JUDGEMENT

(1.) The petitioner herein is a proprietors concern doing pawn -broker's business at No. 60, Wallajah Road, Woriyur, Tiruchirapalli. The said business premises was searched by the Officers of the Central Excise on 14th February, 1970, and unaccounted primary gold, gold coins and new and old ornaments in all weighing 1531.300 grams were seized for action under the Gold (Control) Act. The case was adjudicated by the Deputy Collector of Central Excise, Tiruchi on 3rd September, 1970, and the gold under seizure was confiscated subject to the redemption on payment of a fine of Rs. 5,000. A penalty of Rs. 2,500 was also imposed on the petitioner. In pursuance of the said order of adjudication, the primary gold, the gold ornaments and gold coins weighing in all 1531.300 grams were released to the petitioner on 23rd September, 1970, on payment of the redemption fine on 27th January, i971. However, the petitioner filed an appeal before the Collector of Central Excise, who by an order, dated 22nd April, 1972, rejected the same. Against the rejection of the appeal, the petitioner filed a revision petition to the Government of India, who by an order dated 12th February, 1974, rejected the revision petition. The petitioner thereafter approached this Court for the issue of a writ of certiorari quashing the said order, dated 12th February, 1974, affirming the order of adjudication.

(2.) The petitioner's case is that the authorities cannot invoke Sec. 6(2) of the Gold (Control) Act, 1968 (hereinafter referred to as the Act) in this case, and therefore, the order of confiscation passed by the initial authority and affirmed by the appellate and revisional authorities cannot be sustained in law. It is the further case of the petitioner that there is no material in this case to indicate that the petitioner is carrying on business as a dealer without a valid licence issued on behalf of the Administrator, that therefore, there is no violation of Sec. 27 of the Act and that as such the petitioner cannot be proceeded with for violation of the said section. As regards the alleged violation of Sec. 8 of the Act for being in unauthorised possession of primary gold, the petitioner would say that the primary gold, possessed by it was only of a small quantity and therefore, the possession of such small and negligible quantity should be ignored. The question is whether the above contentions of the petitioner could be accepted.

(3.) According to the petitioner, the gold ornaments and gold coins seized from its business premises belong to one of the family members of the partners of the petitioner firm, that they have not come into its possession in the course of the pawn -broker's business, that therefore, the petitioner is not liable to keep any account with regard to those jewels and coins and that the mere fact that the petitioner has not kept any account for those jewels and coins will not lead to the inference that the petitioner has got those gold ornaments and coins in the course of its pawn - broker's business or as a dealer doing business in gold. It is also submitted by the learned Counsel for the petitioner that Sec. 6(2) of the Act will come into play only when directions are given by the Administrator calling for certain returns as to the receipt or sale of hypothecated gold under Sec. 6(1) of the Act, that in this case there having been no direction by the Administrator to the petitioner to file its returns under Sec. 6(1), the petitioner is not liable to account for the gold ornaments and gold coins seized from its possession, under Sec. 6(2) of the Act, According to the petitioner only when the Administrator calls for a return in relation to the receipt and sale of hypothecated gold under Sec. 6(1), he may authorise any Gold Control Officer to inspect any pawnbroker's premises and call upon the pawnbroker to account for the gold or gold ornaments found to be in excess of the stock referred to in his accounts or in the returns. Thus it is the contention of the learned Counsel for the petitioner that it is only after the return is furnished by the pawn -broker as per the direction given under Sec. 6(1) of the Act, the Administrator can invoke the machinery contemplated under Sec. 6(2) of the Act.