SHIVCHAND NANALAL VORA Vs. COLLECTOR OF C EX

JUDGEMENT

(1.) THIS appeal is directed against the order dated 27-1-88 passed by the Collector of Central Excise (Appeals), Madras by which he had upheld the order of the Deputy Collector of Central Excise (Gold), Madras dated 24-7-87 rejecting the application of the appellant herein for the renewal of his gold dealer's licence under Rule 3(ee) and Rule 3(a) of the Gold Control (Licensing of Dealers) Rules, 1969.

(2.) The appellant herein is a gold dealer at Madras. He was granted a gold dealer's licence with effect from 23-7-84. He submitted an application for the renewal of his licence on 18-5-87. The Deputy Collector of Central Excise (Gold), Madras found that this application has been filed after a delay of 5-1/2 months because according to Rule 3(a) of the Gold Control (Licensing of Dealers) Rules, 1969 the renewal application has to be made in the prescribed form atleast one month before the expiry of the period of validity of the licence. It was also seen by the Department that during the validity period of the licence the appellant had not done any business at all from the date of issue of the licence. Therefore, proceedings were initiated by issue of a show cause notice dated 9-6-87 asking him to show cause why the application for renewal should not be rejected for the delayed submission of the application beyond the period prescribed under Rule 3(a) and for not having transacted any business at all in terms of Rule 3(ee) of the Gold Control (Licensing of Dealers) Rules, 1969. On a consideration of the reply thereto the Deputy Collector found that there was no case for the renewal of the licence and rejected the application under the abovesaid Rules. This order was upheld by the Collector (Appeals).

(3.) SHRI Bhatia, the learned Senior Departmental Representative appearing for the Department contended that even though Article 19 of the Constitution embodied the right to trade yet the Article itself contains the provision that it is subject to reasonable restriction as given in Article 19(b) which can be imposed in public interest. The preamble of the Gold (Control) Act, 1968 would show that it is an Act to provide, in the economic and financial interests of the community, for the control of the production, manufacture, supply, distribution use and possession of, and business in gold ornaments and articles of gold and for matters connected therewith. Therefore, the Gold (Control) Act itself is a regulatory enactment relating to trading in gold and the authorities under the Act were empowered to issue licence and renewal thereof subject to certain conditions and the right to do business in gold can only be within the parameters of the conditions under which the licence is issued and renewed under the Act. The learned S.D.R. pointed out that Section 27 of the Gold (Control) Act, 1968 lays down that no person shall commence or carry on business as a dealer unless he holds a valid licence. Therefore, the licence is only an authority under the Act to set up business. In the case of a person who after obtaining the licence has not even set up business and has no turnover at all, like the present case, such a person coming up for renewal of his licence cannot be placed in the same position as in the case of a person who, after taking his licence, had set up business, but did not have sufficient turnover due to lack of business. Therefore, the distinction made in the order of the Collector (Appeals) is not empty or meaningless. The learned SDR also pointed out that if an application for renewal of licence is submitted after the validity of the licence is over, the statutory authorities under the Act who are legally creatures of the statute are barred from condoning the delay and renewing the licence. This is clear from the provisions of Section 27(6)(b) of the Act. Therefore, the non-renewal of such a delayed application is clearly mandatory, according to the learned S.D.R. In this case the licence issued to the appellant has lapsed with effect from 31-12-86 and he applied for its renewal only in May 1987 when the validity of the licence issued to him had already expired. Therefore, there was no need to interfere with the orders of the lower authorities.