ORDER
P.C. Jain, Member (T)
1. Brief facts of the case are that on 11-2-1981 around 12O Clock at noon one Shri Anil Gupta one of the appellants herein was apprehended with a gold Rainee (Primary gold) weighing 300.050 gms. and of purity 23.75 carats valued at Rs. 48,382/-. In his first statement recorded from Shri Anil Gupta he stated that this gold was given by his uncle living in Ashok Vihar for getting ornaments made at Kaithal to which place Anil Gupta belonged. Later on, on the same day at night he made another statement that the earlier statement made by him was incorrect and that he brought Rs. 50,000/- from his father for purchasing some primary gold at Delhi; that he purchased the recovered gold from a Dalai in Chandni Chowk and that he was thereafter returning to Kaithal when he was apprehended by the Customs Officers; that this Dalai had been introduced to him on, an earlier visit by one Shri Madal Lal, a certified goldsmith at Kaithal.
Thereafter on 13-2-1981 searches were made at the residential and business premises of Shri Prem Chand Gupta, father of Anil Gupta and at the residential and business premises of Madan Lal, the certified goldsmith. Nothing incriminating was found or recovered from the said premises. However, in the GS-13 account maintained by Shri Madal Lal a shortage of 300.500 gms. gold was found. In his statement tendered on the spot Shri Madan Lal stated that he had received 310.700 gms. of old gold ornaments on 2-2-1981 from Shri Prem Chand for remanufacture. Out of this quantity he had delivered a gold ring weighing 9.900 gms. to Shri Prem Chand on 5-2-1981 and rest weighing 300.500 gms. was received into gold Rainee and was taken to Delhi on 11-2-1981 for cutting of 10 bangles and two sets along with Shri Anil Kumar S/o Shri Prem Chand. At Panipat he missed the bus and Shri Anil Kumar went to Delhi. He also went to Delhi and searched for him but could not locate him. Shri Prem Chand in his statement dated 13-2-1981 also affirmed the statement of Shri Madan Lal. However, there was no document to evidence the transfer of gold Rainee.
Two show cause notices were issued – one in respect of gold apprehended from Anil Gupta at Delhi. This case was decided by Deputy Collector (Gold) Delhi and he has confiscated absolutely the gold recovered from Shri Anil Gupta under Section 71,of the GCA. He has also imposed a penalty of Rs. 5,000/- on him under Section 74 of the said Act.
A show cause notice in respect of the shortage of gold in the GS-13 account maintained by certified goldsmith Shri Madan Lal i.e. improper maintenance of account contravening Section 55 of the GCA, was issued to the said goldsmith. This case was decided by the Deputy Collector of Central Excise, Faridabad and he has upheld the shortage of gold and has imposed a penalty of Rs. 900/-.
Later, in an affidavit dated 19-2-1981 received in the office of the Gold Control authorities in Delhi on 26-2-1981 Shri Anil Gupta stated the facts as per the stand taken by Shri Madan Lal and Shri Prem Chahd in their statements dated 13-2-1981 at Kaithal. He has also stated that these facts were given out by him to the officers on 11-2-1981 but they refused to record these facts and the statement dated 11-2-1981 recorded at night allegedly (recorded’ on 12-2-1981 as per the affidavit) was given under fear and threat and coercion exerted by the officers. Deputy Collector (Gold) in his order-in-original dated 11-3-1982 has found that the entries in the GS-13 register have been made subsequently and as an afterthought to cover up the seizure made at Delhi. Since the stand taken by the defence finally as per affidavit dated 19-2-1981 or as per the statements of Shri Madan Lal and Shri Prem Chand was never mentioned earlier in the first two statements of Shri Anil Gupta recorded immediately after the seizure, he has discarded the defence version and has relied upon the second statement of Anil Gupta that he purchased the primary gold from a local Dalai at Chandni Chowk and thereafter he was proceeding to Kaithal when was apprehended at Interstate Bus Terminus at Delhi.
Learned lower appellate authority by his order-in-appeal disposing of the 4 connected appeals has found that in view of the 3 different and contradictory statements of Anil Gupta the Deputy Collector has rightly concluded that reliance cannot be placed on any of his statement. He has also stated that if Shri Madan Lal, as claimed, was to accompany Anil Gupta, “it is difficult to believe that having decided that it is essential he accompanied Anil Gupta. Madan Lal would have changed his mind on route merely because he missed the bus and went back to Kaithal. The logical course would have been for him to get the next bus”, according to the learned lower appellate authority. That authority has also agreed with the original authority Deputy Collector (Gold) Delhi that the defence claim that the gold Rainee was taken for die-cutting at Delhi is not probable because there are 3 to 4 die-cutters at Kaithal itself.
2. Learned advocate Shri Trilok Kumar appearing for the appellant has stressed that the entire case of the Department rests on the second statement of Shri Anil Gupta which is obviously incorrect in view of the other evidence available on record such as GS-13 register of Shri Madan Lal, entry of receipt of gold ornament by Madan Lal from Prem Chand on 2-2-1981 and corroboration of these facts by Madan Lal and Prem Chand in their statements dated 13-2-1981 and a telegram dated 13-2-1981 from Shri Prem Chand Gupta to the Collector of Central Excise of Delhi which spelt out the facts according to the defence version at the earliest possible time. Once the lower appellate authority had come to conclusion, according to the learned advocate for the appellants, that Anil Gupta is unworthy of credence and his statements cannot be relied upon, the Department’s case based on second evidence also falls down because even that statement also is not worthy of reliance according to the learned lower appellate authority’s own finding. He has also pointed out that during the course of adjudication proceedings before Deputy Collector (Gold) Delhi the appellant had requested for cross-examination of punch witnesses to the recovery of gold from Shri Anil Gupta. Learned advocate pointed out that this is cearly mentioned in para 9 of the order- in-original; “that since the punch witnesses had not been made available for cross-examination he (defence counsel) would be satisfied if the following points are taken due note of and .conceded”. In particular the points taken by the learned advocate before the original authority were that the gold. which was seized was actually brought from goldsmith Madan Lal for the purpose of die-cutting in Delhi and this primary gold was out of the ornaments given by the father of Shri Anil Gupta to the goldsmith. Learned advocate stated that the first statement given by Anil Gupta on 11-2-1981 should be deemed to have been modified to this extent and that the second statement was not at all voluntary and should not be given any credence. Learned advocate emphatically asserted that this concession has already been made during the course of hearing before the original authority at Delhi and yet the said authority went on to give his finding based purely on the second statement of Anil Gupta without taking into account all the relevant and material evidence available on record. Accordingly, the learned advocate has stressed that the order passed by Deputy Collector Delhi is against the conceded facts and therefore bad in law.
3. The learned advocate has also relied upon the finding of the Deputy Collector of Central Excise, Faridabad by which gold to the extent of 300.500 gms. was found short and accordingly a penalty of Rs. 900/- has been imposed on Shri Madan Lal. Learned advocate’s argument here is that once the shortage of gold and thereby improper maintenance of account have been found by the learned authority at Faridabad entries in the GS-13 register cannot be doubted as have been doubted by the Deputy Collector (Gold) Delhi. Both the original orders cannot stand simultaneously.
Next point made by the learned advocate appearing for the appellant is that some of the circumstances, namely existence of 3 to 4 die-cutters at Kaithal or that one could go for die-cutting to Ambala rather than to Delhi as have been mentioned in the original order passed by Deputy Collector (Gold) Delhi were not stated at all in the show cause notice. Therefore, the lower authorities have erred in law in relying upon those circumstances in coming to the finding that the gold seized at Delhi was not brought from Kaithal for die-cutting as per the defence version.
4. Learned SDR, on the other has reiterated the finding of the lower authorities. She has also stated that the conduct of Anil Gupta is highly suspicious inasmuch as he had been giving different versions at different times.
5. I have carefully considered the pleas advanced on both sides. I do agree with the learned SDR that conduct of Anil Gupta is highly suspicious. He has not come out with the facts clearly and has been shifting his stand but can it be said that this circumstantial evidence by itself alone form the basis of confiscation of gold as has been in this case ignoring all other evidence on record? Learned advocate for the appellant has rightly asserted that the other evidence has to be duly taken into account and which evidence has been recorded or found by the various official authorities. Learned Deputy Collector, Faridabad has not doubted the entries made in the GS-13 register and once the authenticity of the entries is accepted explanation of the appellant appears to be very plausible.
Lower appellate authority’s finding to the effect that after Shri Madan Lal had missed the bus at Panipat he should have gone to Delhi ratner than come back is based on erroneous facts. It is clearly stated in the statement of facts in the original order passed by the Deputy Collector of Central Excise, Faridabad that Shri Madan Lal continued his journey to Delhi but he could not locate Anil Gupta. Madan Lal obviously, therefore, has followed the logical course as contemplated by the learned lower appellate authority. I also observe that the telegram dated 13-2-1981 from Shri Prem Chand to the Collector of Central Excise which is on record and stands uncontroverted by the respondent is also a material fact in support of the defence version. Finding of lower authorities, namely Deputy Collector (Gold) and Collector (Appeals), Delhi, to the effect that entries in the GS-13 register could be subsequently manipulated by Madan Lal and Prem Chand in collusion and connivance with one another is merely based on presumption. There was nothing to prevent the investigating authorities to move into the matter quickly and get the residential and business premises of Madan Lal and Prem Chand searched immediately after the seizure at Delhi. Lack of prompt action on the part of the investigating authorities cannot be allowed to be capitalised upon by the lower adjudicating and appellate authorities.
As regards the appeal of Madan Lal against the order passed by Deputy Collector, Central Excise, Faridabad, learned advocate for the appellant has relied upon Section 43 of the Gold (Control) Act, according to which provisions of Section 37 shall apply to a certified goldsmith as they apply to a licensed dealer subject to the modification that every reference therein (Sec. 37) to a licensed dealer shall be construed as a reference to a certified goldsmith. Now Section 37 stipulates that a licensed dealer may, in the course, and for the purpose, of manufacturing or ornaments, send gold to any other dealer who possesses equipment for drawing wires or for die-casting or who is a specialist in stone-setting, engraving, enamelling etc. Further Rule 13 of the Gold Control (Forms, Fees find Miscellaneous Matters) Rules, 1968 stipulates, inter alia that every licensed dealer transferring gold shall at the time of each transaction issue a voucher in relation to such gold and in a case where the transaction relates to sale, delivery, transfer or disposal of gold such voucher shall accompany the gold. It is an undisputed fact that no voucher had been issued by Madan Lal, nor was any voucher available when the gold was recovered from Anil Gupta. Strictly speaking, therefore, the gold under question is liable to be confiscated under Section 71 of the Gold (Control) Act for Breach of Rule 13 of the said Rules. Gold recovered at Delhi, therefore, is confiscated. However, having regard to the fact that the gold was melted out of old gold ornaments delivered by Shri Prem Chand to Shri Madan Lal and is duly entered in the GS-13 register, I give an option to the owner of the gold to redeem it on payment of a fine of Rs. 10,000/-. Penalty on Anil Gupta is reduced from Rs. 5,000/- to Rs. 1,000/-. Penalty imposed on Shri Madan Lal by Deputy Collector, Central Excise, Faridabad and sustained by the lower appellate authority is, however, upheld for a different reason inasmuch as Shri Madan Lal though bound in law to issue a voucher for transfer of gold for die-cutting etc. had not issued the voucher.
7. Appeals are disposed of on the above terms.