CHELAMESWAR, J. - (1.) On 3rd and 4th June, 1965, the residential premises of the appellant's father were searched by the officers of the Government of India in exercise of the authority conferred upon them under Rule 126L(2) of the Defence of India Rules, 1962[1*] (hereinafter referred to as "the RULES"). They found 240 kilograms of gold (bars etc.) buried in the house and seized it. Proceedings for confiscation were initiated. Eventually on 24.9.1966, the Collector of Central Excise and Customs passed an order[2*] confiscating the seized gold in exercise of the power under Rule 126M of the RULES on the ground that the seized gold was held by the appellant in contravention of Rule 126-I. A penalty of Rs. 25 lakhs under Rule 126L(16) of the RULES was also imposed. [1* Rule 126L. Power of entry, search, seizure, to obtain information and to take samples.- (2) Any person authorised by the Central Government by writing in this behalf may- (a) enter and search any premises, not being a refinery or establishment referred to in sub-rule (1), vaults, lockers or any other place whether above or below ground; (b) seize any gold in respect of which he suspects that any provision of this Part has been, or is being, or is about to be contravened, along with the package, covering or receptacle, if any, in which such gold is found and thereafter take all measures necessary for their safe custody.] [2* "Gold was required to be declared under Rule 126-I of Defence of India Rules, 1962. It was not declared. I accordingly order absolute confiscation of 240.040 kgs. of gold, under Rule 126M of said Rules. The iron safe in which gold was secreted is also confiscated under Rule 126M. I hold that Shri Chhagan Lal Godavat is guilty of contravention of the provisions of the Rule 126-I of the Defence of India Rules, 1962. He is liable to a penalty under Rule 126-L (16) of the said Rules. Taking into consideration the gravity of the offence committed by him and in view of the fact that he hoarded a very huge quantity of undeclared gold I impose upon him a personal penalty of Rs. 25,00,000/- (Twenty five lacs)."]
(2.) Aggrieved by the same, an appeal was carried by the appellant's father before the Gold Control Administrator which was dismissed on 6.3.1972. The matter was carried further in a revision before the Government of India which was also dismissed on 4.6.1979. The decision of the Government of India was challenged in a writ petition (No.1215/79) before the Rajasthan High Court. By a judgment and order dated 9.8.1994, the Rajasthan High Court allowed the writ petition.
(3.) It appears from the said judgment that two submissions were made before the High Court, (i) no personal hearing was given by the Collector to the appellant's father before the order of confiscation was passed though a show cause notice dated 3.2.1966 was issued proposing confiscation and penalty under Section 126M and 126L(16) of the RULES respectively, and (ii) An opportunity to redeem the seized gold was not given.;