COLLECTOR OF C EX Vs. C N VAMANA PRABHU

JUDGEMENT

(1.) THE appeals filed by the Collector of Central Excise, Cochin are directed against the order of the Collector of Central Excise (Appeals), Madras dated 11-5-1987.

(2.) The Income Tax authorities conducted a search in the residence of the respondents herein and also the respondents' locker at Mattanchery, Ernakulam District on 21-8-1974. During the course of the search seized 24 round gold pieces of bangles totally weighing 1440 gms. The Income Tax authorities having regard to the weight and purity of the bangles in question made over the same to the Central Excise Department namely the Gold Control authorities. The Gold Control authorities took up further investigation of the matter and effected seizure of the same and issued Show Cause Notice to the respondents herein alleging that the respondents were in possession of gold articles, without having filed declaration and thereby committed contravention of Section 8(iii) read with Section 16 of the Gold (Control) Act, 1968, the 'Act' for short. The proceedings resulted in the order of confiscation of the gold bangles in question with an option to redeem the same on payment of fine of Rs. 30,000/-, besides imposing a penalty of Rs. 1,000/- on the respondent herein in an order of adjudication passed by the Additional Collector, Cochin against which an appeal was filed by the respondent before the Gold Control Administrator. The Gold Control Administrator set aside the order of adjudication and remanded the case to the original authority for consideration of the question as to whether the bangles under seizure were really ornaments or primary gold. The Additional Collector, Cochin by his order dated 28-11-1980 took the view that the bangles were primary gold and imposed a redemption fine of Rs. 25,000/- besides a penalty of Rs. 500/- each on the appellants, which was set aside by the Collector (Appeals) in his impugned order against which the Department has filed the appeals before the Tribunal.

(3.) SHRI Rajasekharan Nair, the learned Counsel appearing for the respondents contended that once the Department has proceeded to make the allegation in the show cause notice that what had been seized was only articles which had not been declared by the respondent as per law, neither the Department nor the appellate authority for that matter can change this stand during appellate stage to the detriment of the respondents. The learned Counsel contended that if initially the allegation of the Department in the show cause notice that the bangles were articles is accepted, then the respondents would not be guilty of contravention of Section 16(3) and 8 (iii) of the Gold Control Act, 1968 which was the only contravention alleged in the show cause notice. The learned Counsel further stated that the appellate authority cannot improve the case for the Department for the first time and remand the issue for consideration of the same as such a course is not permissible in law.