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TMI Blog1989 (6) TMI 206X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellant. The statement of the appellant was recorded. A panchnama was prepared and the gold was seized. A summons dated 11-5-1987 was issued and in response, the appellant and his son appeared before the Superintendent (Preventive), Central Excise, Sitapur on 15-5-1987. The sealed box containing the seized gold ornaments was opened before him and panch witness and itemwise list was prepared. The statement of Sh. Bhavesh Rastogison of the appellant was also recorded on 15-5-1987. A further statement of the appellant was also recorded. In the show cause notice dated 27-10-1987 issued thereafter, the variation in the statement with those of the statements made later were referred and the subsequent statement was taken as an after thought . The show cause further alleged that they contravened the provisions of Sections 8(2) and 27 of the Act inasmuch as they had acquired and possessed thereafter, gold ornaments in trade quantity unauthorisedly and were engaged in the purchase and sale thereof. The appellant submitted his explanation on 30-12-1987 and also in support of his statement produced the following evidence - 1. Cash memo No. 814 dated 20-5-1987 of Bipul Photo Studio, Badri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld jewellery is no proof of an attempt for sale. An attempt for sale is distinct from intention to sell. Intention to sell does not constitute an offence under Section 27(1) of the Act. He further submitted that under Section 8(2) of the Act mere possession of gold ornaments does not constitute as an offence unless there is an offence or contravention of the provisions of the Act. He argued that the ornaments neither had been displayed for sale nor any attempt was made for sale and hence there was no contravention of the provisions of the Act. He relied upon several citations of this Tribunal and those of various High Courts to show that mere possession of gold jewellery was not an offence and suspicion however grave it might be, it cannot assume the place of proof. Shri A.K. Jain submitted that the learned Collector had seriously erred in rejecting the overwhelming evidence of the appellants in the form of the affidavits of the goldsmiths, their extracts of G.S. 13 register, the affidavit of customers, the affidavit of the Panchwitnesses who testified to the fact, the version as given later was also stated by the appellants but the officers had not recorded it. He further submitte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en so inluded". Further Section 16(5) of the Act reads as hereunder - No declaration referred to in sub-section (1) or sub-section (3) shall be required to be made - x x x (b) in relation to any ornaments, or both articles and ornaments, where both articles and ornaments are owned, possessed, held or controlled, unless the total weight of such ornaments or both articles and ornaments, as the case may be, owned, possessed, held or controlled by - (ii) a family, exceed four thousand grammes" Section 27(1) states that - No person shall commence or carry on business as a dealer unless he holds a valid licence . 8. From the reading of these two sections with proviso, it is abundantly clear that there is no prohibition for acquisition, to possess or to control or to buy and accept but save as provided for in the Act. Further, the Act also permits a family to hold total gold ornaments to an extent of 4000 gms. 9. The main charges made out against the appellants are that he did not hold any certificate recognising him as a goldsmith nor a gold dealer s licence to deal in gold and gold ornaments. The appellant had throughout denied the charge that he was a dealer or a go ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y had given any jewellery for remake or repair. The jewellery recovered was not displayed for sale or kept in glass case or exhibited for sale. It had been kept in a sealed box inside an almirah safely which goes merely to show that the appellant had kept the jewellery safely to prevent from any theft. The evidence produced by him cannot be rejected totally on mere technical lapse or error of typing in affidavit of goldsmiths or on such ground unless it is shown that the evidence is so flimsy and shakeable that no reasonable person can believe the veracity of the same. The reasons assigned by the Collecter for rejecting the evidence is on the ground that of dates of return of jewellery as stated by the three goldsmiths is the same day i.e. 3-5-87 which according to Collector is strange. It could be a mere coincident. This cannot be a ground to reject the entire evidence of the appellant. Moreover, even if this evidence is rejected, even than the Department has not produced any evidence to show that he was dealing in gold jewellery. There is nothing on record to show that he had dealt or was dealing in gold jewellery. The contention of the appellant that he had kept the jewellery in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... purity exceeding 14 carats and two packets of gold watches having gold of purity of 18 carats at the relevant period as mentioned in the charge. In Assistant Collector of Central Excise (Preventive), Madras v. K-S-Chandrasekaran (Para 4) Cencus Manual of Gold Control corrected upto 1st January, 1982 Page 589 dated 26-11-1979, it has been held that evidence of actual trading in gold ornaments required to establish contravention of Section 27(1). In Seshmal M.Jain v. Collector of Central Excise, Bangalore reported in [1987 (27) E.L.T. 504] the Tribunal has held that acceptable legal evidence is required to prove a charge under Section 27. However grave suspicion be, cannot take place of proof. In Shri Nunna Venkaterao v. Collector of Central Excise,Guntur reported in [1987 (10) ECR 404 (CEGAT SRB)] has held that mere possession of gold is no contravention or offence. The same is the view taken in the case of Collector of Central Excise, New Delhi v. Subhas Chandra reported in [1987 (12) ECR 157 (CEGAT WRS], it has been held that mere possession of large quantity of gold ornaments even with intention to sell not sufficient. Actual selling and not passive possession is require ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ablished in the facts and circumstances of the case. 16. So far as the contravention of Section 27(1) is concerned, the allegation is that the appellant is carrying on a business as a dealer without a licence under the Gold Control Act. Now, the term business has been held by the various Courts to mean where there are a series of transactions of purchase and sale and a stray incidence of purchase and sale would not indicate that the person concerned was carrying on business. No evidence whatsoever has been brought on record, except the incident in question alone, that the appellants were carrying on business in gold in the aforesaid sense. 17. It is observed that the adjudicating authority has drawn the inference of the appellant indulging in sale and purchase of the gold ornaments from the following circumstances :- (1) Initial statement of Shri Daya Shankar Rastogi on the day of detection indicated that the new gold ornaments under consideration were purchased from some unknown persons. (2) The statement of Shri Bhavnesh Rastogi recorded, even 8 days later, on 15-5-87 indicated that the gold ornaments were purchased from someone against old gold ornaments on accou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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