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TMI Blog1983 (12) TMI 273X X X X Extracts X X X X X X X X Extracts X X X X ..... who had some congenital abnormality and was almost invalid since birth. Nemkumar, on the other hand, had five sons in all, one of them having been born at the time when Keshrimal was alive. 3. After Keshrimal s death the business at Mandsaur was stated to have been wound up and the family lived at Kamptee. On 9th July, 1968 the said family house at Kamptee was searched by the officers of the Central Excise, Nagpur. The search resulted in the seizure of ten slabs and 9 pieces of gold and 230 gold coins which were lying in a big Godrej iron safe, which safe was inside a Godrej cupboard. The gold, at that time, was valued at ₹ 7,63,200. 4. The officials recorded the statement of Ratanbai and Nemkumar on the following day i.e. on 10th July, 1968. Ratanbai stated that the said gold was the self-earned property of her late husband and she did not know the exact quantity of gold which was there. According to her, the gold had been kept by her in the safe about 8 or 10 years ago and she had all along kept the keys of the same in her possession and had not decided as to whom she would give the gold after her. 5. Nemkumar, on the other hand, in his statement stated that he did ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alleged, she met the aforesaid Munim, Moti Lal. According to Ratanbai, Moti Lal told her, for the first time, while she was at Mandsaur that Keshrimal had left a safe in the house at Mandsaur, which safe had been embedded in the ground in the cellar. This safe was allegedly recovered from the cellar. The safe was opened and the gold and silver was recovered. This is stated to have taken place on 30th June, 1968. According to Ratanbai, the will was in the said safe and she came to know about it at that time. According to her, before she could decide as to whether to distribute the gold in accordance with the will or to keep it with herself and utilise it as she wished, the excise officers came and seized it on 9th July, 1968. She submitted that she was unable to file any declaration before 30th June, 1968 as she did not know about the existence of the gold. 10. Along with the reply, Ratanbai enclosed affidavits of some of the witnesses, as well as a letter from Shri A.A. Patil, in order to establish the genuineness of the will. 11. The Collector thereafter recorded evidence of the parties. By his order dated 15th May, 1970, however, he ordered the confiscation of the gold and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r s order. 14. The revision filed by Ratanbai was dismissed by order dated 3rd May, 1973. The genuineness of the will was not disputed. It was however, held that the gold seized was not the same as that which was mentioned in the will. 15. Sushil Kumar and his four brothers as well as his cousin Surankar Kumar, son of Shantabai then filed in this Court a petition under Article 226 of the Constitution being Civil Writ No. 1014 of 1973. In this writ petition the orders of confiscation were sought to be challenged, and it was further prayed that the confiscated gold should be ordered to be returned. 16. As already noted, the aforesaid writ petition was allowed by T.P.S. Chawla J. by his order dated 3rd November, 1981. The learned single Judge proceeded on the basis that, as held by the Governmental authorities, the will in question was genuine. The necessary corollary which followed from that is that the gold in question belonged to the minor grand-children of Keshrimal. The learned single Judge was of the opinion that in view of new sub-section (1) of Section 71 of the Gold (Control) Act, 1968 the gold in question could not be confiscated. According to the single Judge it wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... )(d) was of general application and the same read as follows :- Save as otherwise provided in this Part, - ............. ............. ............. (d) no person other than a dealer licensed under this Part shall buy or otherwise acquire or agree not buy or otherwise acquire, gold, not being ornament, except - (i) by succession, intestate or testamentary, or (ii) in accordance with a permit granted by the Board in this behalf : Restriction regarding the sale of gold was contained in sub-rule (2)(e) of Rule 126H. The effect of this was that except in the manner provided under Rule 156H(2)(d)(i) and (ii) no person could acquire or buy any primary gold. Rule 126-I required declaration to be made of the possession of gold other than ornaments. The relevant provisions of the said rule are as under :- 126-I. Declaration as to possession of gold require other than ornament. - (1) Every person, not being a dealer required to apply for a licence, or licensed or a refiner licensed under this part, shall, within thirty days from the commencement of this part or within such further period as the Central Government may by notification specify make a declarat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s follows :- Provided further that no person shall, after the expiry of a period of six months from the commencement of the Defence of India (Fourth Amendment) Rules, 1966, acquire any primary gold by succession, intestate or testamentary. The effect of this was that after 1st September, 1967, the primary gold could not even be acquired by succession. 22. As, by virtue of the fourth amendment Rules, acquisition and possession of primary gold had been made illegal, there could obviously be no question of retaining any provision with regard to a declaration being made regarding primary gold. As such, Rule 126-I was also amended. By virtue of the amendment every person was required to make a declaration in respect of any article or ornament, or both, owned by him . Reference, in the said rule, to `gold was deleted for even after declaration primary gold could not be retained. 23. Part XII-A of the Defence of India Rules, 1962 was thereafter repealed and replaced by the Gold (Control) Ordinance, 1968. This Ordinance was promulgated on 29th June, 1968. At the time when the gold was seized this Ordinance was in force. The Ordinance was itself repealed by the Gold (Control ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nistrator may, on sufficient cause being shown allow, a declaration in the prescribed form as to the quantity, description and other prescribed particulars, of article, or any ornament, or both, owned, possessed, held or controlled by him : Provided that no such declaration shall be required to be made where a person who, having owned, possessed, held or controlled any article or ornament before the commencement of this Act, has already made a declaration in relation to that article or ornament, or both : Provided further that nothing in this sub-section shall be construed as enabling any declaration to be made in respect of any gold for which the period prescribed or allowed under the law for the time being in force before the commencement of this Act had expired before such commencement. The other section to which reference has been made during the course of arguments is sub-section (3) of Section 16, which reads as under :- If any person who did not own, possess, hold or control, before the commencement of this Act, any quantity of gold in excess of the quantities specified in sub-section (5), acquires, after such commencement, the ownership (whether by succession, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s behalf. Section 16 makes provision for such declarations to be made. Sub-section (1) of Section 16 makes reference to articles and ornaments only and makes no reference to primary gold. The first proviso to Section 16(1) provides that any declaration already made with regard to article or ornament before the commencement of the Act would continue to be valid, and no further declaration need be made with regard thereto. The second proviso, however, made it clear that the enactment of sub-section (1) of Section 16 could not enable any person to make declaration of `gold , if the period prescribed for such declaration had already expired before the commencement of the Act. 26. It was, however, contended by the learned Counsel for the respondents that under the Gold (Control) Act, 1968 there was no absolute ban on the possession of primary gold. This submission was made on the basis that Section 8(1) in turn says that save as otherwise provided in the Act . In this connection reference was made to Sections 8(6) and 16(11) of the said Act. We are unable to agree with this submission. Under Section 8(6) power is given to the Administrator, in special circumstances and cases, to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. Section 16(11) has also to be read in conjunction with Section 8(1) has also 8(1) does not contemplate the retention of primary gold by the making of any declaration. We are unable to agree that Section 16(11) should be so construed as to permit retention of primary gold merely on declaration being made. Such a construction of Section 16(11) would clearly bring the said provision in conflict with Section 8(1). In our view, neither the language nor the intent of the provisions can possibly persuade us to come to the conclusion that under Section 16(11) primary gold can be retained on making of a declaration. 27. It was also contended on behalf of respondents that Section 16(3) could save the possession of primary gold. This submission must be repelled. Sub-section (3) is attracted where any person, who did not own, possess, hold or control gold before the commencement of the Act acquires, after the commencement, the ownership, possession, custody or control of the gold. In the present case the writ petitioners did own the gold before the commencement of this Act. Therefore, the first part of sub-section (3) will not apply. The petitioners no doubt did not possess, hold or cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rted or sold within six months of 1st March, 1967. We may here observe that we must proceed to decide this case on the basis that the will put forth by Ratanbai was the genuine will. The Department Authorities in their impugned orders had not disputed the genuineness of the will. It is now not open to the appellants to contend that, on the facts and circumstances of the case, we should hold that the will was not genuine. 30. As the possession of primary gold was illegal, we are again in agreement with the learned Single Judge that the declaration filed by Ratanbai on 29th July, 1968 could not be of any avail. There was no provision of law under which any such declaration could be made. That gold had become liable to be confiscated under Section 71(1). Section 7(1), as was originally enacted, read as under :- Any gold in respect of which any provision of this Act or any rule or order made thereunder has been, or is being, or is attempted to be, contravened, shall be liable to confiscation. The Supreme Court in Badri Prasad v. Collector of Central Excise, Sarvodayanagar, Kanpur and Others, A.I.R. 1971 S.C. 1170 held the said section to be unconstitutional. Thereafter by Go ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ean that the confiscation is the result of an act or omission on the part of a person other than the owner. To put it differently, the proviso implies that gold would have been permitted to be retained if a particular act had been performed by a person or that there had been no omission on his part. This is further made clear from the later portion of the proviso wherein it is stated that ..... action.....may be taken against a person who has, by such act or omission, rendered it liable to confiscation . (emphasis added). The aforesaid words leave no manner of doubt that the proviso refers to only that types of gold which becomes liable to be confiscated by reason of an act or omission on the part of a person. As already observed where, as in the present case, under no circumstances could primary gold be retained, then it cannot be said that the primary gold is lost by any person s act or omission. In consequence the proviso will have no application. The primary gold become liable to be confiscated by reason of the various provisions of law. The confiscation is not dependent upon any act or omission on the part of a person. The moment the primary gold became contraband it became l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rights including Article 19 have in any way been violated. Just as a thief cannot retain stolen property with him, similarly contraband articles like, primary gold, cannot be retained by a person in view of the express provision of law which prohibit any such ownership or retention of possession. 35. It was also held by the learned Single Judge that before confiscation could be ordered notice under Section 79 of the Act should have been given to the petitioners in the writ petition, and as this had not been done the order of confiscation was liable to be quashed. Before us also it was contended by the learned Counsel for the respondents that notice under Section 79 should have been issued to the minors through the guardian, but this had not been done in the present case. 36. The relevant portion of Section 79 of the Act is as follows :- 79. Giving of an opportunity to the owner of gold, etc. - No order of adjudication of confiscation or penalty shall be made unless the owner of the gold, conveyance, or animal or other person concerned is given a notice in writing....... Section 79 requires notice to be given to the owner of the gold or other person concerned therewith ..... X X X X Extracts X X X X X X X X Extracts X X X X
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