9911796707
TMI Blog2009 (6) TMI 660X X X X Extracts X X X X X X X X Extracts X X X X ..... Collectorate of Central Excise and Customs, New Delhi, in pursuance of a secret information, conducted search and seized 240.040 kgs. of Gold from the residence of Chhaganlal Godawat on account of contravention of provisions of Rule 126-I of the erstwhile Defence of India Rules, 1962 (hereinafter referred to as 'Rules, 1962'). Break up of 240.040.145 kgs of Gold is (i) Sovereigns of Gold 80.776 kgs; (ii) Passas of Gold 242 Nos., 75.298.300 kgs. (iii) Pieces of Gold bars 5 Nos., 10.975.845, (iv) Gold bars of 1917 and 1992 - 9 Nos., 72.990 kgs. Notice was issued to the respondent to show cause confiscation under Rule 126-M of the 'Rules, 1962'. Ultimately, the Collector of Central Excise and Customs, New Delhi absolutely confiscated the goods under Rule 126-M of the 'Rules, 1962' and imposed a penalty of Rs. 25 lakhs. Aggrieved with this order, Mr. Godawat filed an appeal before the Gold (Control) Administrator which was rejected. Thereafter, a revision application came to be filed before the Government of India. During the pendency of revision application, Mr. Chhagan Lal Godawat, the owner expired and his legal representatives came on record. However, revision application finally ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng order which was 11.04 crores. The fine was fixed on the basis that at the time of adjudging, the Gold was worth over Rs. 11 crores. This order was challenged before the Appellate Tribunal, New Delhi in Appeal No. C/144/95-NB. There was a schism between the two members in regard to the quantum of redemption fine and finally after hearing by the third member, a majority decision was recorded and the the appeal was allowed and the quantum of fine was reduced to Rs. 12.5 lakhs, which was the value of the Gold at the time of seizure. Having found difference of opinion, emerging with regard to the quantum of redemption fine, the Collector filed a reference application under Section 82-B of the Gold (Control) Act, to the Tribunal and the Tribunal made a reference to the court for an adjudication of the above substantial questions of law as the quantum of fine of Rs. 2.5 crores scaling down to Rs. 12.5 lakhs was massive. The seizure in the instant case was made under the provisions of the Defence of India Rules. The rules were repealed by Gold (Control) Ordinance, which in turn, was replaced by the Gold (Control) Act, 1968. Gold (Control) Act itself has been repealed since then. However ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at if the value of goods for the purpose of redemption is taken to be the date of adjudication then the same would relate to the date of initial adjudication in the year 1966 and not the year 1995 as the subsequent adjudication in the year 1995 was done in pursuance to the directions of this High Court. Question No. 1. 9. Since both the above questions of law are inter-related and inter-dependent, the same are being dealt with together. However, at the cost of repetition, it is stated that the Officers of the Collectorate of the Central Excise & Customs, New Delhi organized various raids on the basis of secret information at the residential premise of late Shri Chhagan Lal Godawat situated in the town of Chhoti Chhabari. These raids were carried out from 29-7-1965 to 14-8-1965 and during this raid the Officers of the Department seized 240.040 kgs of Gold on account of contravention of provisions of Rule 126-I of Defence of India Rules, 1962. After seizure of the Gold, it was confiscated also under Rule 126-M of the 'Rules, 1962' and initially imposed the penalty of Rs. 25 lakhs. In June, 1965, the Gold (Control) Act was not in force. The entire proceedings of seizure and con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , whether under the Gold (Control) Ordinance, 1968 (6 of 1968), of Part XIIA of the Defence of India Rules, 1962, shall, in so far as it is not inconsistent with the provisions of this Act, be deemed to have been done, taken, made, given, issued, granted, adjudged, imposed or ordered, as the case may be, under the corresponding provision of this Act, as if this Act had commenced on the 29th day of June, 1968." (Emphasis supplied) 13. The Sub-section (2) of Section 116 of Gold Control Act tangibly reveals that if the penalty or fine imposed or the confiscation adjudged or forfeiture ordered under the Defence of India Rules, 1962 and if they are not inconsistent with the provisions of Gold (Control) Act, 1968 then they will be deemed to have been done, taken, made, given, issued, granted, adjudged, imposed or ordered as the case may be, under the corresponding orders of the Gold (Control) Act. But if they are inconsistent with the provisions of Gold (Control) Act then the provisions of Gold (Control) Act shall not apply for the seizure ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the provisions of Defence of India Rules, 1962. Question No. 2 17. Throughout the main thrust of argument of the learned counsel for the respondent has been on the 'date' as to whether the quantum of redemption fine should be related to market value of Gold on the date of seizure or its market value on the date of adjudication. The learned counsel has emphasized that it should relate to market value of the Gold on the date of seizure. He has cited many judgments in support thereof. Having gone through all the judgments, we respectfully observe that they are not relevant to the facts and circumstances of the instant case. 18. Once it is decided that in the matter of imposition of redemption fine, the provisions of Section 73 of erstwhile Gold (Control) Act, 1968 shall not apply then how can the definition of 'value' as given in Section 2(v) of Gold (Control) Act can be imported in the instant case for adjudging the quantum of fine. Market value of the Gold on the date of seizure can be taken into consideration only in that event when the provisions of Gold (Control) Act, 1968 are applicable. But once the provisions of Gold (Control) Act, 1968 are abandoned or jettisone ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n lieu of is 'Instead, in place of, as a substitute for'. This meaning suggests that the redemption fine is the substitute for the market value of the Gold. The words 'thinks fit' used in Rule 8(a) qualifies the discretion 'may give an option' conferred on the officer adjudging. Thus, the word 'may' cannot be read as 'must' as per the phraseology of the said rule. He may give an option and he may also refrain from giving any option and confiscate the seized Gold. However, the amount of fine when adjudged cannot be more than the market value of confiscated Gold at that point of time when the adjudging officer gives an option nor can it be much less than the market value of the Gold on that date. Thus, from both the angles, the market value of the seized Gold has to be taken on that date when the option is given by the officer adjudging it. 20. It is revealed from the material on record that the Collector aptly applied the market price of Gold at the rate of Rs. 4,600 per 10 gms as on December 7, 1994, the date of adjudicating when the option was given by him to the respondent and on this basis, the price of total seized and confiscated Gold 240.040 kgs came to be 11.04 crores ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
