1988 (8) TMI 285 - HC - Central Excise

Summary

Issues:
1. Conviction under Section 85 of the Gold (Control) Act, 1968.
2. Interpretation of Section 33 and Section 85 of the Act.
3. Application of presumption under Section 98-B of the Act.
4. Possession, custody, or control of primary gold under Section 85(1)(ii) of the Act.

Detailed Analysis:

1. The two petitioners were convicted under Section 85 of the Gold (Control) Act, 1968, for illegal possession of gold and were sentenced to pay a fine. The conviction was based on the seizure of primary gold and old gold coins from the shop premises. The trial court's decision was modified on appeal, reducing the fine for petitioner No. 1 but confirming the sentence for petitioner No. 2. The petitioners sought revision to quash the conviction.

2. The prosecution alleged that the primary gold and gold coins were illegally stocked in the shop, violating Section 85(1)(ii) of the Act. The courts relied on Section 33, which presumes any gold found in a licensed dealer's premises to be part of their stock-in-trade. The defense argued that the petitioners did not possess the gold knowingly, challenging the sufficiency of evidence to establish their guilt.

3. The defense contended that the presumption under Section 98-B of the Act, regarding the mental state of the accused, must be rebutted beyond reasonable doubt. The burden of proof was on the accused to demonstrate their lack of conscious possession of the gold. The stringent standard required by Section 98-B shifted the burden onto the accused to prove their innocence conclusively.

4. The judgment analyzed the evidence regarding the possession of gold by the petitioners. The defense presented a narrative that the gold belonged to the petitioners' mother and was intended for making ornaments. Witnesses testified that petitioner No. 2 was unaware of the gold being kept in the shop and that others had access to the premises. The defense evidence remained unchallenged, highlighting the lack of conclusive proof of illegal possession by the petitioners.

5. Ultimately, the court found that the prosecution failed to establish the illegal possession of gold by the petitioners under Section 85 of the Act. The order of conviction and sentence was quashed, and the petitioners were acquitted. Additionally, the order of forfeiture of the seized gold was also revoked, entitling the petitioners to the return of the seized items. The judgment emphasized the necessity of meeting the burden of proof beyond a reasonable doubt in criminal prosecutions under the Gold (Control) Act, 1968.