Judgment:
1. The appeals are directed against the Order of the Collector of Customs, Cochin, dated 1-2-1985 'and since a common order of adjudication has been passed by the Collector of Customs, Cochin relating to the provisions under the Customs Act, 1962 as well as Gold (Control) Act, 1968 and as the appellant is one and the same, the above appeals are consolidated and taken together and disposed of by a common order.
2. On 25-7-1983, the Inspector of Special Customs Preventive Unit, Calicut and party checked Bus No. MFF 523 of the Karnataka State Transport Corporation plying between Bangalore and Ernakulam at the bus stand at Calicut. The appellant, an occupant of the bus was examined by the authorities and a search of the appellant resulted in the recovery of two gold slabs kept in the pant pocket. Since the appellant is neither a certified goldsmith nor a licensed gold dealer and since there was no valid permit or document for the possession of the said primary gold bar by the appellant, the gold was seized by the authorities under Mahazar attested by witnesses as per law. The gold was assayed by a certified goldsmith who declared the purity of the same as 24 carat. The appellant gave a statement before the authorities on 27-7-1983 that he purchased 11 gold biscuits of foreign origin from two or three persons not known to him and that he got the biscuits melted into two slabs and got a portion of one of the two slabs and sold it in his native place and was taking the remaining gold to Trichur for sale. It is in these circumstances, proceedings were instituted against the appellant which ultimately resulted in the impugned order, now appealed against.
3. For purposes of convenience, let me first take up the appeal relating to charge against the appellant under the provisions of Customs Act, 1962.
4. The learned counsel, Shri Chanderkumar, submitted that the gold will be liable for confiscation under the provisions of the Customs Act, 1962, hereinafter referred to as the Act, only if the authorities find there is evidence to establish that the gold under seizure is of foreign origin. It is only in such a situation that the presumption under Section 123 of the Customs Act, 1962, would be available to the Department and in the absence of any evidence to show that the gold under seizure is of foreign origin, the impugned order is not legally sustainable. The learned counsel assailed the inculpatory statement recorded by the authorities from the appellant on 27-7-1933 on the ground that the same is neither true nor voluntary and was brought into existence, after he is kept in a state of prolonged custody from the date of seizure, namely 25-7-1983 to 27-7-1983. If the statement of the appellant is eschewed out of consideration, the learned counsel urged that there is no other evidence on record to prove that the gold under seizure is of foreign origin. The learned Departmental Representative submitted that the case of the Department rests on the inculpatory statement of the appellant dated 27-7-1983 to prove the charge levelled against the appellant under the Customs Act. The learned D.R. urged hat merely because there was a time interm of two days, that would not invalidate the statement under law.
5. I have considered the submissions of the parties herein. As rightly contended by the learned Counsel for the appellant, the sheet anchor of the department's case is only the inculpatory confessional statement recorded from the appellant on 27-7-1983. The primary question that would arise for consideration therefore, is whether the statement is true and voluntary meriting acceptance-The fact remains that the seizure was effected on 25-7-1983. A scrutiny of the record regarding the cross-examination of Shri Vijayaraghavan, Superintendent of Customs, on behalf of the appellant on 27-12-1984 reveals that the appellant was only in the custody of the authorities from the time of seizure. If really, the appellant wanted to make a statement, inculpatory in nature and against his interests, it does not stand to reason as to why the same was not recorded, at the earliest opportunity. To a query from the Bench, the learned Departmental Representative sought to clarify the position by submitting that the Inspector awaited the arrival of the Superintendent for recording such a statement. I am afraid, I cannot accede to such an explanation in the context of this case. Since, no valid explanation has been given by the authorities for not recording the statement of the appellant immediately on seizure and when the statement sees the light of the day only on 7-7-1983, it is indeed very doubtful, if such a statement could be a voluntary one. Even if the statements were true, if it is not voluntary, the same will have to be rejected brevi menu. The statement recorded from the appellant after a lapse of two days and more particularly, when he was under the custody or control of the authorities does not inspire confidence in my mind about the voluntary nature of the same. Therefore, I am not inclined to attach any importance to the inculpatory statement recorded from the appellant so far as the confessional part of the same is concerned. Since there is no further tangible evidence to bring home the charge against the appellant under the Customs Act, the impugned order under the Customs Act appealed against is set aside and the appeal allowed.
6. Now, let me take the appeal under the provisions of the Gold (Control) Act. 1968, hereinafter referred to as the Act. The seizure of primary gold from the possession of the appellant, as stated above, is not disputed and is indeed admitted. The purity of the gold has been ascertained to be of 24 carat and this aspect of the case is also proved by the evidence of the goldsmith who actually assayed it.
7. The learned counsel challenges the correctness of the testing of the purity conducted by the goldsmith on the ground that he cannot be called an expert within the meaning of Section 45 of the Evidence Act.
Possession of primary gold by a person who is neither a gold dealer nor a certified goldsmith is an offence under the provisions of Section 8 of the Gold (Control) Act and the same is therefore, liable for confiscation under the Act. The learned counsel contended that inasmuch as various claimants have sworn to an affidavit claiming the gold under seizure in certain quantities, they should have been given a show cause notice under Section 79 of the Act and it was further urged that in terms of the proviso to Section 71, the gold cannot be confiscated. In the instant case, even assuming, for the purpose of arguments that the relatives of the appellant entrusted him with the gold ornament, as contended, there is nothing in evidence on record to prove that the gold under seizure is the resultant of melting the ornaments alleged to have been entrusted by the appellant's relatives. The various affidavits filed on behalf of the appellant would merely show that they entrusted with, the appellant gold ornaments but the most important factor to be established is that the gold under seizure is the resultant of melting those very ornaments, alleged to have been entrusted by the appellant's relatives to the appellant. Excepting the ipse dixit of the appellant, the appellant has not adduced any satisfactory acceptable proof to show that the gold under seizure is the resultant of melting the ornaments enstrusted to him by his relatives. Even in the impugned order, the Collector has adverted to the evidence on record and found that the gold under seizure is not relatable to the ornaments alleged to have been entrusted by the relatives with the appellant. One other important factor, I should like to take note of in this case is the fact that the gold under seizure was of 24 carat purity. The plea of the appellant that the certificate of the evidence of the goldsmith who assayed the gold and found the same to be of 24 carat purity is not legally acceptable as the same would not come within the mischief of Section 45 of the Evidence Act is not legally tenable. A certified goldsmith is a person who is issued a certificate in terms of Gold (Control) Grant of Certificate Rules, 1970, under which only a person who is member of a family of goldsmith and had assisted a goldsmith in his work, as such, for a period of less than one year or a person who possesses adequate skill of a goldsmith could be granted a certificate. When the fact, that a certified goldsmith has assayed the gold and ascertained the purity of gold under seizure as 24 carat purity, has been specifically and expressly set out in the Show Cause Notice issued to the appellant, it is for the appellant to avail himself of an opportunity to cross examine the certified goldsmith to establish that either the test conducted by him is incorrect or that he was not a qualified and certified goldsmith or that the purity of the gold under seizure is not 24 carat purity. The appellant having not done any of these things, it is not open to him to challenge the correctness of the findings of the purity given by a certified goldsmith without basis. It is common knowledge that it would be practically impossible to make ornaments out of 24 ct. purity. Even assuming that certain ornaments can be made of 21 carat purity gold, it does not accord with the probability that all the family members of the appellant's family who allegedly entrusted the appellant with jewellery were wearing ornaments of 24 carat purity which is an unusual feature.
It is also relevant to point out that in none of the affidavits, it is mentioned or said that the ornaments which were given to the appellant were of 24 carat purity. Therefore, from any point of view the fact remains that the vital link between the entrustment of the ornaments and the resultant gold under seizure is missing. In the circumstances, I have no hesitation to hold that the plea of the appellant that he was entrusted with gold ornaments of his family members which were melted into gold bars is not acceptable.
8. So far as the quantum of penalty is concerned, in the facts and circumstances of the case, I reduce the penalty from Rs. 5000/- to Rs.2000/-(Rupees two thousand only). Except for reduction in the quantum of penalty, the appeal is otherwise dismissed.