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TMI Blog1986 (8) TMI 241X X X X Extracts X X X X X X X X Extracts X X X X ..... nts to it to prove their ownership thereof as well as the transgression of the provisions of the Act without their knowledge or connivance, in terms of the proviso to the said Section? (ii) Whether the notice contemplated in Section 79 of the Gold (Control) Act, 1968, has, necessarily, to be issued to the claimants so as to enable them to "estbalish to the satisfaction of the officer ajudging the confiscation" that the gold sought to be confiscated belonged "to a person other than the person who has, by any act or omission rendered it liable to be confiscated" in terms of the proviso to Section 71? 3. The undisputed facts in brief are - (A) Notice to show cause, dated 7-10-1982 was issued to the appellant alleging, inter alia, that :- (i) on a surprise visit to the appellant's premises on 3-9-1982, a quantity of 1645.200 grams in 203 pieces of new gold ornaments of 22/23-1/2 carats purity valued at Rs.2,68,167/- was found in excess of the recorded balance in the statutory accounts; (ii) one of the partners of the appellant admitted, in a statement that very day, the recovery of the aforesaid quantity and stated that it was their stock-in-trade; (iii) subsequently, in a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted, 8-9-1982; and (ii) three affidavits from the three ladies claiming that ornaments in fourteen pieces weighing 398 grams were given to the aforesaid Shri Prem Narain Gupta; (D) In adjudication it was held that the authenticity of the voucher of M/s. Talwar Jewellers was not questioned. Nevertheless, the existence and veracity of the voucher depends upon the attendant circumstances. In the surrounding circumstances, however, the eixstence of the said voucher at the material time was highly improbable and claim put forward in the letter, dated 8-9-1982 was an after-thought. Similarly, the affidavits filed by the three ladies do not carry any conviction. Accordingly, the gold ornaments being in all 1645.200 grams was liable to confiscation under Section 71 of the Gold (Control) Act, 1968, subject to a redemption of payment of a fine of Rs.75,000/- only. A penalty in sum of Rs.10,000/-was imposed additionally under Section 74 of the Act. (E) After a hearing in the Tribunal there was a difference between the two Members who heard the case on the following points :- (i) Whether the order for confiscation of gold in terms of Section 71 of the Gold (Control) Act, 1968, was ill ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he adjudicating officer. (iv) The satisfaction of the adjudicating officer to the effect that the gold was neither owned by Talwar Brothers nor the three ladies swearing the affidavit was passed on cogent and logical reasoning. The Learned Member (Judicial) had not adverted to the merits of this evidence, but has been swayed by the wording of Sections 71 and 79 which with all respect arise for consideration only on certain facts having been established. (v) The proviso to Section 71 not having been attracted, the confiscation of the gold ornaments cannot be treated as illegal for failure to afford an opportunity to the alleged owners. (vi) Nor does Section 79 of the Act apply in the circumstances of the case, since there were no claimants before the adjudicating authority. (vii) There is insufficient evidence from the record itself to disprove he ownership of M/s. Talwar Jewellers in regard to 192 pieces of gold ornaments. So also the affidavits sworn by the three ladies stand disproved from the facts obtained on record. (viii) The order of confiscation of the seized gold ornaments is fully sustainable. (ix) Since it has not been established that gold orname ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gold was seized disclaims the owner ship thereof and asserts that the gold belonged to someone else. (e) While it may be that, in terms of S.99 of the Act, the initial presumption is that the person in possession, custody or control of any gold is the owner thereof, it is not an irrebuttable presumption. The provision itself makes it clear that the presumption arises unless the contrary is proved. (f) The affidavits of the three ladies and the sale voucher (of M/s. Talwar Bros.), whose authenticity had, according to the adjudication officer, not been questioned, are sufficient to shift the onus to the Respondent to disprove the same. Reliance on apparent improbabilities without affording any opportunity to the persons concerned to explain them does not discharge that onus. (g) Satisfaction that the gold belonged to the person from whom it was seized and to none else cannot be reached, in the circumstances, unless the onus that had shifted onto the Revenue is discharged. The discharge of that onus cannot take place and an effective and complete adjudication of the primary question of title possible in the absence of those who appear to be the owners in the ligh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of the gold ornaments seized. They do not at all appear to be owners to me on the evidence adduced in rebuttal of the central excise presumption. "Owners" such as these are quite common and, as a rule, appear on the scene whenever unaccounted gold ornaments are seized for violation of the gold control laws. It does not take much to see that these "owners" were unknown to the person from whom the goods are seized or, at any rate, their "ownership" was unknown to him, till well after the moment of seizure. No dispassionate perusal of the events of this cause from the time of the arrival of the central excise officers at the jewellery shop of M/s. Ramji Lal Kundan Lal can fail to detect one granting flaw: that the partners were hiding the truth about the excess and about a whole lot of things; and, furthermore, that the people they subsequently presented as owners, were not in truth the owners, but people they prevailed upon to make the claims they did in order to frustrate the law. All these claims of ownership are false and untrustworthy. 8. There can be a question of law only if the owners appear at least genuine on the face of the record and the adjudicator fails to adjudi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dvocate, accompanied by Shri V. Sridharan, Chartered Accountant, and the respondent by Shri Rakesh Bhatia, S.D.R. 15. Although the order recorded by learned Judicial Member sets out all the facts, which he termed as 'undisputed'; a brief resume of the facts, as found by the Tribunal, will facilitate disposal of this Reference Application. The order of the Tribunal, dated 4-6-1985 is based on my order of the same date, recorded by me as a Third Member, on a reference having been made in terms of Section 81-B of the Gold (Control) Act, 1968 read with Section 129-C(5) of the Customs Act, 1962; with the result that the final order of the Tribunal is, in fact, on the basis of the majority opinion. Although the learned Judicial Member, who was originally a Member of the Bench giving rise to the points of difference, signed the order for the purpose of issuance but, obviously, he does not fully endorse the views contained therein. This explains the reservations expressed by him in paragraph-5 of his reference order, and which he has found as to be the reasons justifying Reference Application of the party. 16. I must say, with all respects to the learned Member, that herein lie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Paragraphs 24 to 35, it was held vide Paragraph 36 that - "For all the foregoing reasons, my conclusion would be that, on the facts of this case, proviso to Section 71 of the Act would not come into operation and, as such, the confiscation of the gold ornaments cannot be treated as illegal, for failure to afford opportunity to the alleged owners." 18. Similarly, on the question of applicability of Section 79 of the Act, the findings are recorded in Paragraphs 37, 38 and 39 to the effect that - "Para 37. I can only add that Section 79 of the Act, in the circumstances of this case, does not arise for consideration for the short reason that there were no claimants (emphasis added) before the adjudicating authority. 'Claim' according to ordinary dictionary meaning, means: 'to demand as a right' and 'a claimant' : 'one who makes a claim' - Chambers Twentieth Century Dictionary, Sixth Reprint 1981." "Para 38. Apart from the dictionary meaning, even the meaning attached to this expression by way of judicial interpretation is: 'Right, e.g., lay claim to' - Aiyar's Judicial Dictionary, 9th Edition, at page 218 - and 'claimant' has again been defined as 'one who makes a claim'. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny show cause notice and, thus, there were 'claimants' in real sense of the term. This has already been noticed in Paragraph 30 of my order, recorded as Third Member, which is the basis of the Tribunal's Order. 22. On the facts of this case, therefore, no question of law arises for reference to the Tribunal. I am fortified in my view from a judgment of the Supreme Court to the effect that only question of law, arising out of questions of fact found by the Tribunal, can be subject-matter of reference to the High Court. This proposition, amongst others, was propounded by their Lordships of the Supreme Court in the case of 'Sree Meenakshi Mills Limited v. Commissioner of Income-Tax, Madras, reported as '1957(31)I.T.R. 28', where it was held that, in the case of pure questions of fact, an inference from the facts is as much a question of fact as the evidence of the facts, and, further that, a finding on a question of fact is open to attack, as erroneous in law, only where there is no evidence to support it or if it is perverse, (emphasis added). It is not even applicant's case that any such position prevails in the present case. Their Lordships further emphasised that the questio ..... 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