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TMI Blog1988 (10) TMI 207X X X X Extracts X X X X X X X X Extracts X X X X ..... penalty under Section 74 of the Gold (Control) Act. Hence we have clubbed both these appeals and heard together and hence this common order. 3. The subject of challenge in both the appeals is the imposition of penalty of Rs. one lakh under the Customs Act and imposition of penalty of Rs. one lakh under the Gold (Control) Act. 4. The material facts required for the disposal of these appeals lie in a small compass. On specific intelligence that one Shri Gopal Geharimal Mehta (to be hereinafter referred to as Gopal ) was transporting foreign marked as well as indigenous gold from Udaipur to Ahmedabad in his Fiat Car bearing No. GTI 6020, the officers of the Customs Division of Ahmedabad kept a watch during the early hours of 13-12-1977 on the Ahmedabad Himmatnagar Highway and on the approach of the car, they intercepted the same near Noroda Railway Crossing. They found Gopal and four others in the car. After preliminary questioning the car along with the occupants were taken to the Assistant Collector of Customs at Paldi, Ahmedabad for a detailed search and examination. In the presence of the panchas, the personal search of the five persons was carried out. The search resulted in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the previous consignment of smuggled gold supplied to him by Prem for disposal at Ahmedabad. 6. During the course of investigation a search of residential premise of the brother G.G. Mehta was carried out. It resulted in the recovery of primary gold weighing 23.800 gms from an old trunk. In his further statement dated 22-12-1977 Shri G.G. Mehta identified the photograph of Prem. In his statement dated 24-12-1977, Shri Gopal inter alia stated that he purchased the car bearing No. GTI 6020 on payment of Rs. 15,000/- out of which he had received Rs. 10,000/- from his father-in-law and Rs. 5,000/-from his wife. In his statement recorded on 29-12-1977, Shri Gopal confirmed all his previous statement made to the Intelligence Officer. 7. The statement of the appellant Prem Narayan Daulatram Verma was recorded on 3-3-1979. He denied his acquaintance with Shri Gopal G. Mehta or with any merchant of Ahmedabad. He denied the connection with the seized gold. He further denied that he had any talk on telephone with Shri G.G. Mehta of Udaipur nor he received any trunk call on the phone installed in his father s shop at Delhi from Shri G.G. Mehta. 8. After the completion of the investig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... TI 6020 on 13-12-1977. They further stated that they are not in any way concerned with the said gold or the said car or the Indian currency which was seized from the said car. 13. In the light of the facts stated above, the 27 bars of foreign marked gold weighing 270 tolas which, were imported into India contrary to the prohibitions stated in the show cause notice are liable for confiscation under Section 111(d) of the Customs Act, 1962....." Thereafter the learned Collector ordered confiscation of the foreign marked gold, the Fiat car as well as the Indian currency. Thus by implication, the Collector has accepted the present appellant s plea that he was in no way concerned with the seized gold, Fiat car and the Indian currency. That being so in a subsequent proceeding, the Collector cannot impose penalty on the appellant either under Section 112 of the Customs Act or under Section 74 of the Gold Control Act. Thirdly, Shri Harbans Singh urged that even though the Collector is supposed to have passed two different orders under the two different Acts, there is no clear finding as to the possession of primary gold by the appellant and therefore no penalty under Section 74 of the Go ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellant could not have been the supplier of the gold since he was the resident of Delhi and had a shop only at Delhi. Lastly, he urged that the residential premises as well as the shop premises of the appellant was searched; nothing incriminating was recovered, not even primary gold with the two markings spoken to by Gopal Mehta were found. In the said circumstances, the Collector was wholly unjustified in imposing the penalty on the appellant. Finally, he urged that the Collector did not discuss the evidence, he has totally ignored the cross-examination part of Gopal Mehta. He had not considered the defence put forward by the appellant and the entire finding of the Collector is based on presumption and assumption and therefore he prayed that the penalties on the appellant under both the Acts may be set aside. 14. Shri Arya, the learned SDR for the Collector, however, supported the order of the Collector. He contended that immediately after Shri Gopal Mehta was apprehended he had come with the statement that the gold belonged to the present appellant. There was no reason for Gopal Mehta to falsely implicate the appellant and therefore the Collector was justified in relying ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Collector is required to discuss in his order as to the acts or omission of each of the person on whom he had imposed the penalty which act or omission render the seized gold liable to confiscation. We have carefully gone through the Collector s orders. We are not able to find any discussion of the evidence against the appellant. From the order of the Collector, it is clear that he had accepted the statement of Shri Gopal Mehta recorded on 13-12-1977 and 14-12-1977. His finding was to the effect that the earlier statement of Gopal Mehta was voluntary and his subsequent statement, namely, statement made in the reply and during the course of the adjudication proceedings cannot be accepted. The learned Collector, however, failed to notice that it is not sufficient if the statement of a person is voluntary in order to impose penalty on others. It is necessary to establish that that statement is true and reliable. The truthfulness and reliability of the statement requires to be judged in the light of other evidence as well as in the light of the proved circumstances. The learned Collector made no efforts to test the reliability of the statement made by Shri Gopal Mehta. He proceeded ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... admitted that gold under seizure was not purchased by him from Delhi and it was not given to him by any person residing at Delhi. He does not know any person by name Prem or Daulatram. These answers were given during the adjudication proceedings and the adjudicating authority did not put any question to Shri Mehta and his attention was not even drawn to the earlier statement of his dated 13-12-1977 and 14-12-1977 wherein he had categorically stated that the gold belonged to one Prem. The Collector cannot totally ignored the answers given in the cross-examination. He has to give cogent reasons as to why he would not accept the answers given in the cross-examination. There was neither allegation nor proof that Gopal Mehta was won over by the present appellant. According to the statement of Shri Gopal Mehta on previous occasion also he was receiving gold from the appellant. But then no efforts were made to verify that statement of Gopal Mehta. 20. Having regard to the contradictory statement made by Shri Gopal Mehta not only during the course of investigation but also during the personal hearing, it is hazardous to rely on his uncorroborated statement particularly having regard to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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