1986 (7) TMI 291 - HC - Central Excise

Summary

Issues:
Challenge to the legality of an order under the Gold (Control) Act, 1968 regarding contravention of provisions by petitioners, ownership of seized gold ornaments, and validity of penalties imposed.

Analysis:
The petitioners challenged the legality of an order passed by the Government of India under the Gold (Control) Act, 1968, alleging contravention of provisions. The petitioners, including a shop owner and certified goldsmiths, were accused of conducting business without a valid license. The authorities seized gold ornaments and primary gold from the shop premises, leading to a series of legal proceedings. The Deputy Collector of Customs found the shop owner guilty, confiscating the items and imposing penalties, while the certified goldsmiths were acquitted. The petitioners appealed, but the Collector of Customs upheld the decision. Subsequently, the Government of India revised the order, reducing the fine imposed on the shop owner. The petitioners then filed a petition challenging this revisional order under Article 226 of the Constitution of India.

The primary issue revolved around whether the shop owner contravened Section 27(1) of the Act by conducting business without a valid license. The legal definition of a "dealer" under the Act was crucial, encompassing various activities related to gold dealings. The authorities found that the seized gold ornaments belonged to the shop owner based on evidence, despite claims that they belonged to the certified goldsmiths. Statements from the shop owner and the goldsmiths, along with surrounding circumstances, indicated that the shop owner had control over the gold ornaments. The shop owner's explanation that the gold was held for safekeeping was deemed implausible given the business context. The court upheld the authorities' conclusion that the shop owner contravened the Act by engaging in gold dealings without a valid license, leading to the dismissal of the petition.

In conclusion, the court discharged the rule, upholding the revisional order and finding no grounds for the petitioners' challenge. No costs were awarded in the case.