1986 (11) TMI 210 - AT - Indian Laws

Summary

Issues:
1. Appeal against order-in-original transferred to Tribunal.
2. Seizure of gold and gold ornaments by Income Tax authorities.
3. Confiscation and penalty imposed under Gold Control Act.
4. Question of law regarding declaration of primary gold.
5. Collector's order on confiscation and penalty challenged.

Analysis:
1. The appeal was transferred to the Tribunal from the Gold Control Administrator following an order-in-original by the Collector of Customs & Central Excise, Pune. The case involved the seizure of gold and gold ornaments by Income Tax authorities, later seized by the Gold Control Officer due to alleged contravention of the Gold Control Act.

2. The Collector ordered the release of a portion of the seized gold to certain family members but imposed confiscation on specific quantities of gold ornaments and primary gold. The appellant challenged the order, questioning the requirement of declaration for primary gold and the proportionality of the fine and penalty imposed.

3. The appellant's representative argued that no declaration was necessary for primary gold under Section 16 of the Gold Control Act. The Collector's decision to confiscate gold ornaments based on a violation of Section 16(1) was deemed legally incorrect. The Tribunal set aside the order of confiscation of gold ornaments.

4. Regarding the fine imposed, the Tribunal acknowledged that the fine amount should be reduced since gold ornaments were not the subject of the offense. The fine in lieu of confiscation was reduced from Rs. 20,000 to Rs. 7,000. The penalty imposed on the appellant was also contested, with the appellant's possession of primary gold being questioned.

5. The Tribunal found that there was a contravention of Section 8(1) of the Gold Control Act regarding possession of primary gold. However, considering the reduction in the quantum of confiscation, the penalty was reduced from Rs. 10,000 to Rs. 4,000. The appeal was allowed in part, with the fine and penalty amounts reduced. The appellant was granted six weeks to redeem the primary gold and convert it into ornaments.