ORDER
S. Kalyanam, Member
1. The above appeals are filed by the Department and directed against the order of the Collector of Central Excise (Appeals), Madras, dated 9-2-90 exonerating the respondents of the charge under Section 27(7)(b) of the Gold (Control) Act, 1968, the “Act” for short.
2. On prior intelligence, the Central Excise authorities recovered from the residential premises of respondent Assainkutty 308.400 gms. of new gold ornaments and initiated proceedings against the respondents on the ground that K.P. Mohamed, the Managing Partner of M/s. M.P.C. Jewellery, Koduvally, Kerala, was transacting business in gold without accounting for the same in the statutory register and in contravention of law through Assainkutty, the other respondent herein, and the proceedings in respect of the charge of contravention of Section 27(7)(b) and Section 55 of the Act against respondent K.P. Mohamed and the charge of abetment against the other respondent culminated in an order of adjudication at the hands of the Additional Collector of Central Excise, Cochin, dated 27-7-89, who imposed a penalty of Rs. 10,000 on K.P. Mohamed and Rs. 7,500 on Assainkutty besides a fine of Rs. 20,000 in lieu of confiscation of the ornaments in question. The respondents preferred appeals before the lower appellate authority, which were allowed against which the Department has come by way of appeals before the Tribunal.
3. Shri Namasivayam, the learned DR, contended that though the quantity of the ornaments is not much some items are in trade quantities such as 30 ear ornaments and apart from it both the respondents gave inculpatory statements immediately on seizure on 25-1-89 admitting the fact that the ornaments belonged to M/s. M.P.C. Jewellery of which the respondent K.P. Mohamed was Managing Partner and transactions were being done through respondent Assainkutty in contravention of law. The learned DR further urged that the lower appellate authority exonerated the respondents herein on the ground that they retracted their inculpatory statement on the same day, which is not factually correct because though the letter of retraction is dated 25-1-89 it was received by the Department only on 31st January, 1989.
4. S/Shri Pillai and Vasudevan, the learned Consultants for the respondents, contended that the Gold (Control) Act came to be repealed in or about June, 1990 and the quantity of the ornaments is well within the permissible limit of 2,000 gms. for an individual and 4,000 gms. for a family under the Act. Shri Pillai further submitted that after the respondents were let off on 25-1-89 immediately they prepared the letter of retraction and 26-1-89 being a Government holiday (Republic Day) they went to RMS on 26-1-89 to avail of special facilities for registration on public holiday and produced in support of his plea the postal receipt which has also been filed by the respondents. It was urged that the statements having been retracted at the earliest opportunity in the absence of any other corroborative piece of evidence indicating some continuity of transactions earlier between the respondents inter se in contravention of law, the circumstances by themselves would only give rise to a suspicion and the respondents would at any rate be entitled to the benefit of doubt.
5. I have carefully considered the submissions made before me. The question before me is whether the charges of contravention under Section 27(7)(b) and Section 55 of the Act against the respondent K.P. Mohamed and the charges for abetment against the other respondent under the Act have been brought home by the evidence on record. The quantity of the ornaments is only 308.400 gms. and the purity is 22 ct. Under law it is permissible for one to possess gold ornaments of 2,000 gms. in the case of an individual and 4,000 gms. in the case of a family. In the present case no investigation would appear to have been done to find out as to whether in the past there has been any transaction by K.P. Mohamed through Assainkutty in gold in contravention of law. No doubt the respondents gave inculpatory statements immediately on seizure and the statements have been retracted also without much loss of time as early as on 26-1-89 as the postal acknowledgement produced before me would bear out. Since the statements have been retracted, one should look for some kind of corroboration if not corroboration in material particulars, to sustain the charge against the respondent. In the present case in the absence of any evidence about any past transactions between respondent K.P. Mohamed and Assainkutty in contravention of law it would be difficult to find the respondents guilty of the charges of contravention on the evidence available on record as such particularly when the statements have been retracted. The proceedings are penal in nature and it is also a settled proposition of law that an appellate forum would be rather slow to disturb the findings of the lower appellate authority exonerating the persons accused of contravention of penal provisions of law and in the present case, having regard to the fact of earliest retraction, the small quantity of ornamental gold of 22 ct. purity, total absence of evidence with reference to the past transactions between the respondents inter se in contravention of law and also keeping in mind the fact that Gold (Control) Act stands repealed as on date and no licence is required for transacting business in gold, I am inclined to think that the impugned order appealed against does not call for any interference at my hand as an appellate authority. As indicated above, though the circumstances appearing in evidence do engender in my mind a grave suspicion the same can scarcely take the place of proof and, as rightly contended by Shri Pillai the learned Consultant, the respondents would at any rate be entitled to the benefit of doubt arising in their favour in the facts and circumstances of the case. In this view of the matter I uphold the impugned order appealed against and dismiss the appeals.