1989 (5) TMI 216 - AT - Central Excise

Issues Involved:
1. Confiscation of seized gold ornaments.
2. Imposition of redemption fine and penalty.
3. Validity of the appellant's defense regarding the acquisition of gold ornaments.
4. Compliance with Section 55 and Section 36 of the Gold (Control) Act.
5. Evaluation of evidence and statements provided by the appellant and related parties.
6. Determination of the quantum of redemption fine and penalty.

Issue-wise Detailed Analysis:

1. Confiscation of Seized Gold Ornaments:
The appellant challenged the confiscation of 67 pieces of gold ornaments weighing 1133.100 grams found in excess during a raid on 6-4-1985. The gold was seized due to the appellant's failure to provide documentary evidence of its acquisition, leading to its confiscation under the Gold (Control) Act.

2. Imposition of Redemption Fine and Penalty:
The appellant was given an option to redeem the confiscated gold ornaments upon payment of a redemption fine of Rs. 1,50,000/- and was also imposed a penalty of Rs. 40,000/-. The appellant contested these penalties, arguing that the failure to issue a receipt voucher or make entries in the statutory records was a technical breach.

3. Validity of the Appellant's Defense:
The appellant claimed that the excess gold ornaments were received from M/s. New B.K. Jewellers under Issue Voucher No. 4 dated 5-4-1985, which his father forgot to inform him about due to an urgent trip to Amritsar. The defense was supported by statements from the appellant's father and Shri Kimti Lal of M/s. New B.K. Jewellers. However, the adjudicating authority and the tribunal found this defense unconvincing, noting inconsistencies and improbabilities in the appellant's narrative.

4. Compliance with Section 55 and Section 36 of the Gold (Control) Act:
The tribunal noted that the appellant failed to enter the excess gold ornaments in the statutory records as required under Section 55 and did not issue a receipt voucher as mandated by Section 36 of the Gold (Control) Act. These breaches were not disputed by the appellant, who instead sought leniency based on the circumstances of the acquisition.

5. Evaluation of Evidence and Statements:
The tribunal scrutinized the statements and evidence provided by the appellant, his father, and Shri Kimti Lal. It found the appellant's explanation for the non-accountal of the gold ornaments and the subsequent production of the issue voucher unconvincing. The tribunal highlighted discrepancies in the appellant's statements and the improbability of the defense narrative, ultimately rejecting the appellant's version of events.

6. Determination of the Quantum of Redemption Fine and Penalty:
The tribunal was divided on the appropriate quantum of redemption fine and penalty. One member upheld the original penalties, while another member argued for a reduction, citing similar cases where leniency was granted for technical breaches. The third member agreed with the latter, reducing the redemption fine to Rs. 25,000/- and the penalty to Rs. 10,000/-.

Final Judgment:
The appeal was partially allowed, with the tribunal upholding the confiscation of the gold ornaments but reducing the redemption fine to Rs. 25,000/- and the penalty to Rs. 10,000/-. The decision was based on the majority opinion, taking into account the circumstances and the need for the appellant to be vigilant in future compliance with the Gold (Control) Act.

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