2013 (9) TMI 833 - HC - Customs

Confiscation of Goods u/s 71 of the Gold (Control) Act Penalty Redemption Fine Held that - The Petitioner was himself to blame in not paying the redemption fine within a period of three months from the date of the order of Tribunal or at least within a reasonable period after passing of the said order - The option of redemption was granted to the Petitioner which he failed to exercise within a reasonable period - About two decades have elapsed since the order of the Tribunal and the filing of the present Petition and by no stretch of imagination can this be regarded as a reasonable period - The Superintendent of Customs (Preventive), Gold Control, by a letter had informed the Petitioner that the Commissioner of Customs had ordered absolute confiscation of gold ornaments - The gold being vested absolutely in the Union Government, no fault can be found in the action that was pursued of selling of confiscated property - the prayer for the return of the gold ornaments or in the alternative, for the payment of sale proceeds, cannot be acceded to.

Issues:
1. Confiscation and penalty imposed on gold ornaments and crude gold chains.
2. Challenge to the communication rejecting the representation for release of gold ornaments.
3. Failure to pay redemption fine and penalty within a reasonable period.
4. Violation of principles of natural justice in the disposal of confiscated goods.
5. Request for return of gold ornaments or payment of sale proceeds with interest.

Analysis:

1. The judgment pertains to the confiscation and penalty imposed on gold ornaments and crude gold chains by the Collector of Customs. The Collector confiscated the gold ornaments weighing 1038 gms and imposed a penalty of Rs. 50,000/- on the petitioner. Additionally, absolute confiscation of two crude gold chains weighing 1172 gms with a penalty of Rs. 40,000/- was ordered. The Tribunal upheld the confiscation of the crude gold chains and reduced the redemption fine on gold ornaments to Rs. 60,000/- while setting aside the penalty imposed on the petitioner.

2. The petitioner challenged the communication rejecting the representation for the release of gold ornaments dated 16 December, 2011, by the Commissioner of Customs. The petitioner sought the return of the gold ornaments or alternatively, payment of the sale proceeds with interest through proceedings under Article 226 of the Constitution.

3. The petitioner failed to pay the redemption fine within a reasonable period despite multiple opportunities. The Assistant Commissioner of Customs stated that the petitioner did not exercise the option of payment even after more than 15 years from the Tribunal's order. The confiscated goods were eventually sold in October 2010 as the ownership vested with the Government, leading to the rejection of the petitioner's claim for return of the gold ornaments or sale proceeds.

4. The petitioner alleged a violation of natural justice as he was not heard before the gold was sold in 2010. However, the court found that the petitioner was at fault for not paying the redemption fine within a reasonable period, with the Superintendent of Customs confirming the order of absolute confiscation due to the petitioner's delay in payment.

5. Ultimately, the court dismissed the petition, ruling that since the gold was vested absolutely in the Union Government and sold as confiscated property, the petitioner's request for the return of the gold ornaments or sale proceeds with interest could not be granted. The court found no merit in the petition and accordingly dismissed it.

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