1986 (3) TMI 91 - HC - Central Excise

Summary

Issues:
Violation of Defence of India Act and Gold Control Rules, 1962; Seizure of gold ornaments; Confiscation and penalty orders; Challenge to show cause notice and subsequent orders.

Analysis:
1. The petitioner, a gold dealer, received a parcel of old gold ornaments on 5th December, 1966, which was later seized by Customs Officers under the Customs Act, 1962.
2. A show cause notice was issued to the petitioner regarding the confiscated gold ornaments, alleging they were made from smuggled gold. The petitioner denied the allegations, stating the purchase was covered by a valid bill.
3. The Assistant Collector of Customs ordered the confiscation of the gold, which was appealed but rejected by the Appellate Collector. However, a revision petition allowed by the Joint Secretary to the Government of India overturned the previous decision.
4. Separately, a show cause notice was issued under the Defence of India (Amendment) Rules, 1963, alleging contravention by the petitioner and another party. The Deputy Collector ordered the confiscation of gold and imposed a penalty, which was upheld in subsequent appeals and revision petitions.
5. The petitioner challenged the orders, arguing that the goods were covered by a bill and the show cause notice was invalid due to the repeal of Defence of India Rules. The Central Government did not address the petitioner's contention regarding the production of the bill before authorities.
6. The High Court quashed the impugned order dated 4th June, 1975, passed by the Joint Secretary, as it did not address the grounds mentioned in the show cause notice. The Court emphasized the importance of informing the petitioner of the case to be defended and ruled in favor of the petitioner, directing the return of the seized gold.

This detailed analysis covers the issues of violation of laws, seizure, confiscation orders, challenges to show cause notices, and subsequent legal proceedings, culminating in the High Court's decision to quash the impugned order and return the confiscated gold to the petitioner.