TMI Blog1995 (3) TMI 166X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee at Chhoti Sadri, Rajasthan, in the month of August, 1965. During the course of search operations 9295 kgs. of silver bars and coins were found burried under the earth. Some of the silver bars found during the search operations had foreign markings. The silver found by the Central Excise authorities during the search operations was handed over to the District Collector, Chittorgarh, who initiated proceedings under the Indian Treasure Trove Act and declared the said silver to be a 'Treasure' and vide his order, dt. 7th Aug., 1972, forfeited the entire silver to the Government of Rajasthan. Against that order, an appeal was filed by the assessee before the Board of Revenue, Ajmer. The Central Excise authorities had also filed an appeal against that order. The appeal filed by the Central Excise Department was in respect of the silver bars weighing 2888 kgs., which had foreign markings. The Central Excise authorities had suspected that the said silver had been smuggled into the country. Both the appeals were decided by the Board of Revenue on 22nd May, 1975 and it was held that the silver found during the search operation is covered by the provisions of the Indian Treasure Trove ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... accordance with the provisions of the Indian Customs Act, 1962. The orders of the customs authorities are still awaited and thus no decision in respect of the said silver favourable to the assessee is available. Thus, it was argued that at least the discount in respect of the fair market value of this silver should be allowed. In support of his submission, the learned counsel had referred to the decision of the Calcutta High Court in Murari Mohan Dutta vs. CWT (1993) 114 CTR (Cal) 449 : (1993) 200 ITR 226 (Cal). 5. The learned counsel for the assessee had also submitted that in its order, dt. 7th March, 1994 the Tribunal while adopting the full value of the entire silver had placed reliance on the decision of the Madhya Pradesh High Court in the assessee's own case reported in CWT vs. Meghji Girdharilal (1988) 73 CTR (MP) 59 : (1989) 176 ITR 63 (MP). It was submitted that the facts of that case are clearly distinguishable. In that case the assets were not seized or confiscated whereas the facts obtaining in these appeals are different. 6. The submissions of the assessee were opposed by the learned Departmental Representative. He has submitted that the assessee was the owner of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for which the assessee had acquired Gold Bonds. The remaining 123 kgs. of gold was never returned to the assessee. On the other hand, Ganpatlal and others had refused to return the same. Therefore, on 9th Dec., 1965, Shri Gunvantlal had lodged a report for the offence of breach of trust under s. 406 of IPC at police station, Chhoti Sadri. During investigation of the case on 16th Dec., 1965 Ganpatlal took the police to his place and 44 pcs. of gold slabs weighing 57 kgs. were found burried at two different places. This gold was kept in the district treasury at Chittorgarh. The police submitted a charge-sheet and the said persons and one Balwant Singh were arrested. During trial, Balwant Singh was murdered and the case proceeded against Ganpatlal and Hiralal. These two persons were convicted by the Addl. Asstt. Sessions Judge, Udaipur, vide his order, dt. 11th Jan., 1975. The convicts had preferred appeal against their conviction, which was disposed of on 7th Aug., 1978, by the Addl. Sessions Judge, Udaipur, and the accused were acquitted of the charge framed against them. The Addl. Sessions Judge did not believe the assessee's story and observed that the fact of finding 51 gold bar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... very point had been considered by the Tribunal in its order, dt. 7th Oct., 1994 and the assessee's case was not accepted. We see no reasons to take a different view. We, therefore, uphold the action of the Revenue authorities on the point. 12. The next issue relates to the deduction of Rs. 25 lacs being the penalty imposed by the Collector, Central Excise. As already stated above, during the search conducted by the Central Excise authorities, a large quantity of gold was found from the premises of the assessee. The Excise authorities were of the opinion that the assessee had contravened the provisions of r. 126L of the Defence of India Rules, 1962 in respect of that gold and, therefore, vide its order, dt. 24th Sept., 1966 the Collector of Central Excise, Delhi, had levied the penalty of Rs. 25 lacs. The amount of penalty was not paid by the assessee. However, the levy of penalty was challenged in further proceedings. The deduction of the amount of penalty was claimed in the assessment proceedings. The claim was rejected by the AO as also by the CIT(A). 13. The learned counsel for the assessee has stated that in its order, dt. 7th Oct., 1994 the Tribunal had accepted the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X
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