1986 (9) TMI 246 - AT - Central Excise

Summary

Issues:
- Appeal against imposition of fine and penalty for possession of undeclared gold ornaments.
- Interpretation of Section 16(5) and 16(6) of the Gold Control Act, 1968 regarding the definition of "family" for possession limits.
- Determination of whether the major son of the appellant constituted a separate family for possession limits.
- Consideration of evidence from Wealth Tax Returns in determining family status for possession limits.

Analysis:
The judgment revolves around an appeal challenging the imposition of a fine and penalty for the possession of undeclared gold ornaments. The appellant, represented by Shri J. Jeshtmal, contended that under Section 16(5) of the Gold Control Act, a family is entitled to hold ornaments up to 4000 gms without the need for declaration. The definition of "family" under Section 16(6) includes the husband, wife, and one or more minor children, or any two or more of them. It was argued that the major son of the appellant and his wife constituted a separate family within the Act, entitling them to possess ornaments separately. The adjudicating authority's decision to club the appellant's family with that of the major son was challenged as legally incorrect, supported by evidence from Wealth Tax Returns indicating separate family status.

The learned DR, Shri Vadivelu, countered by stating that there was no evidence to prove the major son constituted a separate family, and as the Kartha of an undivided Hindu family, the appellant had overall control of the seized ornaments. The non-declaration of the excess quantity of 699.500 gms was deemed a contravention under Section 16(1) of the Act. However, the Tribunal, in its analysis, emphasized the statutory definition of "family" under the Act. It clarified that, except for the husband, wife, and minor children, no other individuals could be deemed part of the family under Section 16(6). Therefore, the major son and his wife were considered a separate family from the appellant, each entitled to possess 4000 gms without declaration. The separate Wealth Tax Returns filed by the appellant and his major son further supported the conclusion that they were not part of an undivided Hindu family.

In light of the statutory provisions and the evidence presented, the Tribunal set aside the impugned order, highlighting the incorrect reasoning of the adjudicating authority in treating the appellant and his major son as a single family unit. The judgment underscores the importance of adhering to the specific definitions and provisions outlined in the Gold Control Act, ultimately leading to the decision to overturn the fine and penalty imposed on the appellant.