1988 (9) TMI 313 - AT - Customs

Summary

Issues Involved:
1. Whether the seized gold was refined gold and if melting and refining are part of the same process.
2. Whether the imposition of penalties on both the partnership firm and its partner simultaneously is erroneous.

Detailed Analysis:

Issue 1: Whether the seized gold was refined gold and if melting and refining are part of the same process.

Arguments Presented:
The applicants contended that the findings of the Collector, upheld by the Tribunal, were incorrect. They argued that the seized gold, with a purity of 858.2 fineness, could not be considered refined gold as per Section 2(t) of the Gold (Control) Act, 1968, which specifies refined gold as having a fineness of 995.0. Therefore, they claimed that melting and refining could not be part of the same process.

Tribunal's Analysis:
The Tribunal noted that the seized gold was found in an illegal refinery, and the purity was determined to be 23 carats (which is 95.8% pure). The Tribunal emphasized that melting is an interim process in refining, and refining includes various methods to produce metals of higher purity. It was clarified that gold with a purity of less than 24 carats but more than 9 carats falls under the Gold (Control) Act, 1968. The Tribunal upheld the findings of the adjudicating authority that Murli Das Patel had contravened Sections 8, 11, and 17 of the Gold (Control) Act, 1968, by refining and possessing the seized gold unauthorizedly.

Conclusion:
The Tribunal concluded that there was no mistake apparent from the record regarding the classification of the seized gold and the processes involved. The applicants' argument was seen as an attempt to challenge the Tribunal's findings, for which the remedy lies elsewhere.

Issue 2: Whether the imposition of penalties on both the partnership firm and its partner simultaneously is erroneous.

Arguments Presented:
The applicants argued that imposing penalties on both the partnership firm and its partner simultaneously was erroneous, citing the Calcutta High Court's decision in Tarak Nath v. Union of India and the Supreme Court's decision in Dulichand's case. They claimed that this amounted to punishing the partners twice for the same acts.

Tribunal's Analysis:
The Tribunal reviewed the arguments and previous case laws, including the Supreme Court's decision in Commr. of Income Tax v. V. Angidi Chettiar, which held that a partnership firm is a "person" under Section 3(42) of the General Clauses Act and can be penalized separately from its partners. The Tribunal also referred to other judgments, including those from the Kerala High Court and the Delhi High Court, which supported the imposition of penalties on both the firm and its partners.

The Tribunal noted that separate show cause notices were issued to the firm and its partner, and they were charged separately. The adjudicating authority found both the firm and the partner guilty of separate acts of contravention under the Gold (Control) Act, 1968. The Tribunal emphasized that the penalties were imposed for distinct violations committed by the firm and its partner, and thus, there was no double punishment.

Conclusion:
The Tribunal concluded that imposing penalties on both the partnership firm and its partner was legally permissible and did not amount to double punishment. The application for rectification on this ground was dismissed.

Final Judgment:
The application for rectification was dismissed. The Tribunal found no mistakes apparent from the record that required rectification. The penalties imposed on both the partnership firm and its partner were upheld as legally valid and justified.