1976 (9) TMI 176 - SC - Customs

all the three panchas are now not traceable in spite of great efforts was not challenged in cross-examination-no adverse inference can be drawn against the prosecution.

Summary

Issues Involved:
1. Legality of the search and seizure of gold.
2. Admissibility and reliability of evidence, particularly the testimony of Inspector Tilwe.
3. Applicability of the Gold Control Rules, 1963 to smuggled gold.
4. Appropriateness of the sentence imposed on the appellant.

Detailed Analysis:

1. Legality of the Search and Seizure of Gold:
The appellant was tried for offenses under clauses (a) and (b) of Section 135 read with Section 135(ii) of the Customs Act, 1962, and Rule 126H(2)(d) read with Rule 126P(2)(iv) of the Gold Control Rules, 1963. The prosecution's case was that on 7th September 1965, Inspector Tilwe received information about the appellant carrying smuggled gold. The appellant was searched at Victoria Terminus Station, where gold biscuits were found concealed in his shoes and the handle of a basket. The gold was seized under a Panchanama Ex. X, which was witnessed by three panchas. The appellant's defense was that the gold belonged to Dwarkaprasad, not him.

2. Admissibility and Reliability of Evidence:
The conviction of the appellant rested solely on the evidence of Inspector Tilwe, as the three panchas could not be traced for examination. The statement of Inspector Tilwe that "all the three panchas are now not traceable in spite of great efforts" was not challenged in cross-examination. The Presidency Magistrate and the High Court found the evidence of Inspector Tilwe satisfactory and convincing. The appellant's defense that the seized gold was found from Dwarkaprasad and not him was not accepted. The court found no reason to disbelieve Inspector Tilwe, as there was no plausible reason for him to falsely implicate the appellant.

3. Applicability of the Gold Control Rules, 1963 to Smuggled Gold:
The appellant contended that the Gold Control Rules, 1963 apply only to legal or non-smuggled gold and not to smuggled gold. The court rejected this argument, stating that the definition of 'gold' in Rule 126A(c) includes any kind of gold, whether smuggled or non-smuggled. The court emphasized that the restrictions imposed by the Gold Control Rules, 1963 would be frustrated if smuggled gold were excluded from their ambit. The court cited various rules, such as Rule 126B, Rule 126C, Rule 126I, and Rule 126D, to illustrate that the Gold Control Rules, 1963 apply equally to smuggled gold. The court disagreed with a contrary decision by the Calcutta High Court in Aravinda Mohan Sinha v. Prohlad Chand Samenta, holding that the Gold Control Rules, 1963 are applicable to both smuggled and non-smuggled gold.

4. Appropriateness of the Sentence Imposed on the Appellant:
The appellant was initially sentenced to rigorous imprisonment for two months and a fine of Rs. 500 for each of the two offenses. The High Court enhanced the sentence to six months imprisonment but imposed a heavy fine of Rs. 3,000 for each offense. The Supreme Court confirmed the conviction and the sentence of imprisonment but reduced the fine from Rs. 3,000 to Rs. 500 for each offense. The court took into account that the appellant was a carrier of gold for a firm in Kanpur and was driven by economic necessity. The court concluded that the sentence of imprisonment would be a sufficient deterrent and that reducing the fine would meet the ends of justice.

Conclusion:
The Supreme Court confirmed the appellant's conviction and the sentence of imprisonment but reduced the fine from Rs. 3,000 to Rs. 500 for each offense. The appeal was allowed to this limited extent.