1987 (1) TMI 374 - AT - Customs

Summary

Issues:
Imposition of personal penalty under the Gold Control Act for shortage of gold ornaments in the appellant's business premises.

Detailed Analysis:
The judgment pertains to an appeal against the imposition of a personal penalty of Rs. 5000 on a partner of an appellant firm for a shortage of gold ornaments found during an inspection. The appellant contended that mere non-accountal of the gold ornaments in the statutory records should not lead to liability under Section 74 of the Gold Control Act, suggesting that Section 75, with a maximum penalty of Rs. 1000, should apply instead. However, the tribunal rejected this argument, emphasizing the requirements under Section 55 of the Gold Control Act and Rule 13, which mandate accurate record-keeping and issuance of vouchers for gold transactions by licensed dealers.

The tribunal noted that the shortage of gold ornaments and the absence of valid vouchers were undisputed facts. The appellant's defense that some employees may have made errors in transactions was deemed insufficient. The tribunal clarified that liability for confiscation under Section 71 of the Act is incurred based on contravention of statutory provisions, irrespective of actual confiscation of the gold. The judgment highlighted the distinction between confiscation and penalty imposition, citing the Supreme Court's stance on the matter.

The tribunal dismissed the appellant's argument that the burden was on the department to prove the manner of disposal of the short gold ornaments, stating that once the shortage was acknowledged, it was the appellant's responsibility to demonstrate compliance with record-keeping requirements. Additionally, the tribunal rejected the contention that the penalty should have been under Section 75, citing a Supreme Court decision that penalties are justified for deliberate defiance of statutory obligations. The tribunal concluded that the appeal lacked merit and upheld the imposition of the personal penalty under Section 74 of the Gold Control Act, dismissing the appeal.