1987 (2) TMI 183 - AT - Central Excise

Summary

Issues:
1. Rejection of application for gold dealers license based on past penalty and educational background.
2. Interpretation of Rules regarding issuance of gold dealers license.
3. Consideration of minor discrepancies in maintaining accounts.
4. Applicability of the expression "shall have regard to" in Rule 2 of the Gold Control Act.
5. Comparison with previous legal judgments regarding license issuance during pending adjudication proceedings.

Analysis:
The judgment by the Appellate Tribunal CEGAT, New Delhi involved the rejection of an application for a gold dealers license. The rejection was based on two main grounds. Firstly, the appellant had been penalized in 1979 for improper maintenance of accounts, leading to the adjudicating authority deeming the appellant ineligible for a license under Rule 2(e)(i) of the Gold Control (Licensing of Dealers) Rules, 1969. Secondly, the authority found the appellant's educational background insufficient to fulfill the conditions under Rule 2(f) proviso (b) to discharge obligations as a licensed dealer. The discrepancies in the appellant's account maintenance were highlighted as reasons for this decision.

The appellant argued that the penalty in 1979 was minor and should not permanently bar him from obtaining a license. The appellant's consultant emphasized a positive approach should be adopted in granting licenses as per Rule 2(f) provisos. They argued that minor discrepancies should not disqualify the appellant, as human errors are common even among existing licensed dealers who do not face revocation for similar issues.

The tribunal agreed with the appellant's arguments, stating that the provisos in Rule 2(f) should be interpreted positively, and minor discrepancies in account maintenance should not prevent the appellant from receiving a license. The tribunal also discussed the interpretation of the expression "shall have regard to" in Rule 2 of the Gold Control Act, highlighting a similar interpretation upheld by the Calcutta High Court. The tribunal distinguished a previous judgment regarding license issuance during pending adjudication proceedings, emphasizing that a past penalty for a minor offense should not hinder the appellant's license approval.

Conclusively, the tribunal allowed the appeal, directing the grant of a gold dealers license to the appellant based on the positive interpretation of rules and the insignificance of past penalties for minor offenses.