G.R. Jayakumar and anr. Vs. Collector of Customs and Central - Court Judgment

Excerpt:
1. since both the appeals arise out of a common order of adjudication and relate to one transaction and are interconnected, they are consolidated together and disposed of by a single order. the appeals are directed against the order of the collector of central excise (appeals), madras, referred to supra, confirming the order of the deputy collector of central excise and customs, trichy, dated 20-11-84 imposing a fine of rs. 16.300/- under section 73 in lieu of confiscation of 168.250 gms. of primary gold and 318.300 gms. of gold ornaments, besides a penalty of rs. 5,000/- each on the appellants under sections 74 and 75 of the gold (control) act, 1968, hereinafter referred to as the act.2. officers of the central excise intelligence unit, trichy, on 25-2-1984 searched the business premises of the appellants who are licensed gold dealers at 165, big bazaar street, trichy, and noticed primary gold and gold ornaments weighing 149.600 gms., valued at rs. 23.790/- not accounted for in the statutory accounts. the officers also detected a secret door in the shop connecting the residential premises of appellant venugopal, one of the partners and a search of the residential premises of venugopal resulted in the detection of primary gold and gold ornaments weighing 337.450 gms., valued at rs. 60,741/-, in excess of the declaration furnished by him under the act. the unaccounted gold and ornaments in the business premises as well as in the residence were seized under mahazar attested by witnesses as per law. appellant venugopal on 25-2-1984 gave a statement before the authorities that the gold and ornaments under seizure were not properly accounted for as per the act and he would not be able to give any explanation for the excess of gold and ornaments in the shop as well as in his residence, as his brother appellant jayakumar was looking after the partnership business. appellant venugopal further admitted that he had signed the purchase vouchers on 11th and 13th february, 1984 as well as the issue for manufacture bill book from 22-2-1984 to 24-2-1984 under bill nos. 1587 to 1593. it is in these circumstances, after further investigation and issue of show cause notice, proceedings were instituted against the appellants which ultimately culminated in the impugned order now appealed against.3. the learned consultant for the appellants submits that 68.250 gms.of primary gold and 2.950 gms. of gold ornaments (lady ring) under seizure belong to one rajagopal and in support of this plea the learned consultant placed reliance on a purchase voucher dated 25-2-1984 signed and verified by the inspector of central intelligence unit, one of the officers conducting the search, trichy. it was urged that the said purchase voucher bearing no. 1433 mentions the name of rajagopal and the ornaments entrusted by him which, according to the learned consultant, were melted for purposes of remaking ornaments resulting in primary gold weighing 68.250 gms. regarding ornaments weighing 78.400 gms, it was urged that they belong to one smt. vathsala victor, a teacher, who had entrusted the same for purposes of repair and polishing. it was submitted that in a petition dated 15-3-1984 appellant jayakumar has not only clarified this position but also explained the circumstances in which the excess gold and ornaments were found in the shop and in the residence of his brother appellant venugopal. the learned consultant placed reliance on the claim petition preferred by the owners relating to their respective ornaments viz. by rajagopal dated 1-3-1984 and smt. vathsala victor dated 28-2-1984. it was contended that in terms of section 79 read with the proviso to section 71, no order of confiscation shall be made unless the owner of the gold or ornaments is given a show cause notice and further if it is established that the gold or ornaments under seizure belongs to a third party who has nothing to do with any act of irregularity committed by a dealer, the same shall not be liable for confiscation and the impugned order was assailed as bad in law since no show cause notice was issued to the claimants viz. rajagopal and vathsala victor. it was further contended that in the original order of adjudication the plea of the appellant as set out in the petition dated 15-3-1984 and referred to supra, has not been considered at all and as such the impugned order was assailed as bad in law for non-consideration of the points urged by the appellant. the learned consultant further contended that in respect of the gold and ornaments seized from the residence of appellant venugopal, out of a total quantity of ...100 gms. of primary gold, 64,200 gms. was the resultant of melting family ornaments for making ornaments for the new born child and the balance of 35.800 gms. would represent accumulated remnants returned by goldsmiths on various occasions. regarding the balance of 237.450 gms. of ornaments unaccounted, it was contended that they were returned by two goldsmiths ramachandran and muthukrishnan under voucher no. 1590 dated 25-2-1984 and 1589 dated 25-2-1984 and those ornaments were handed over to the appellant's mother by the said goldsmiths for the purpose of safe custody since appellant jayakumar was away at madrag and appellant venugopal was laid up with ailment, and they were eventually to be accounted for during the course of the day. finally it was urged that non-accountal in the facts and circumstances of the case would only be a technical breach not warranting imposition of fine or penalty.4. the learned dr contended that the plea of the appellant that certain quantity of primary gold is the resultant of melting the ornaments of one rajagopal is not acceptable. he urged that the purchase voucher bearing bill no. 1433 relied upon by the appellant to prove the order placed by the said rajagopal is not relatable to the quantity of excess claimed by the appellant to be the resultant of melting the ornaments given by rajagopal. the learned dr further urged that the purchase voucher merely mentions various ornaments and their weight and the appellants under law should make proper entries the moment they melt the ornaments for purposes of remaking ornaments and the absence of any such record, coupled with the discrepancy in the total weight, would discredit the very purchase voucher relied upon by the appellant. the learned dr further submitted that in respect of the claim by smt.vathsala victor, no such plea at all was putforth by appellant venugopal in his earlier statement dated 25-2-1984 nor by any salesmen of whom one happens to be the very nephew of the appellants. he also contended that when the appellants claim that ornaments weighing 78.400 gms. belong to vathsala victor, it is for them to substantiate such a plea and merely because no show cause notice was specifically given either to the claimants or the plea of the appellants in respect of ownership of rajagopal and vathsala victor was not specifically dealt with in the original order of adjudication, the order would not become bad since the appellants cannot be said to have suffered any prejudice, particularly having regard to the charges of non-accountal under section 55 and non-declaration under section 16 of the act. regarding the quantity of gold and ornaments found in excess and seized from the residence of appellant venugopal, the learned dr submitted that the explanation that 237.450 gms. of ornaments were handed over by goldsmiths ramachandran and muthukrishnan is not tenable because they were neither accounted for in the statutory register as per law nor would receipt of such ornaments in the residential premises other than the place of business is permissible under the provisions of the act.the plea of the appellants regarding melting of family ornaments for making ornaments for a new born child was also assailed as incorrect and untenable as well as the plea regarding 35.800 gms. of primary gold bits.5. i have carefully considered the submissions of the parties herein.in my opinion when the appellants put forth a plea that certain ornaments were received in the shop either for purposes of remaking or repair and were claimed to belong to rajagopal and smt. vathsala victor, such a claim of the appellants in fairness should have been looked into and investigated during investigation and more so, considered in the order of adjudication. in the instant case, notwithstanding the fact that no such plea was put forth by the salesmen or by appellant venugopal at the time of search and seizure, having regard to the fact that a definite plea was urged in the petition of appellant jayakumar dated 15-3-1984 that rajagopal and smt.vathsala victor are owners of certain quantity of gold ornaments under seizure as detailed therein, coupled with the claim petitions of rajagopal and smt. vathsala victor themselves, the authorities in fairness should have examined the claim of the claimants and the plea of the appellant and given a finding thereon. in the adjudication order this aspect of the case base not been considered by the authority at all. the learned dr drew my attention to the fact that this aspect of the case, though not considered in the order of adjudication, has been dealt with in para 4 of the impugned order of appeal. no doubt, the charges levelled against the appellants ^.re under sections 55, 16 and 32 of the act. the only course open to me in this situation is to set aside that portion of the order and remit the matter back for reconsideration or to give the benefit of doubt in favour of the appellants in respect of this part of the case. at this distance of time i do not think any useful purpose would be served if the matter is remitted back. therefore, i set aside that portion of the impugned order relating to the seizure of ornaments claimed by the appellants to be belonging to rajagopal and vathsala victor as set out in the claim petitions of rajagopal and vathsala victor and in the petition of appellant jayakumar dated 15-3-1984. in this respect i should confess there is considerable force in the submission of the learned dr. that the purchase voucher no. 1433/25-2-1984 relied upon by the appellant is not relatable to the quantity of ornaments attributed to the ownership of rajagopal. likewise the fact that neither appellant venugopal nor any of the salesmen in the shop at the time of seizure came forward with a plea that 78.400 gms. of ornaments belonged to vathsala victor is also a. circumstance that would certainly militate against the veracity of such a plea of the appellants. be that as it may, technically inasmuch as the claim put forward by the claimants as well as the plea of the appellant relating to the ownership of rajagopal and vathsala victor not having been considered by the adjudication authority in the order of adjudication, the order of adjudication would suffer from a technical legal infirmity in that regard and so that part of the impugned order will have to be set aside.6. now coming to the plea of the appellants regarding gold and ornaments found in excess and seized from the residence of partner venugopal, i have no hesitation to hold that the plea is an after thought and is utterly incredible. venugopal admittedly is one of the partners and even the plea of ailment put forward by him would not appear to be true, particularly having regard to the fact that he has also been transacting business relating to the shop as evidenced by his admitted signature in the purchase vouchers relating to 11-2-1984 and 13-2-1984 as well as the bill book from 22-2-1984 to 24-2-1984 under bill no. 1587 to 1593. one important factor that has to be taken note of in this context is the statement recorded from appellant venugopal at the earliest opportunity on the day of search by the authorities on 25-2-1984 wherein he has admitted the fact of excess of gold and ornaments found in the shop as well as in his residence unaccounted in the statutory accounts of the business. this statement of venugopal admittedly has not been resiled from till this day and to a specific question from t he bench the learned consultant for the appellants fairly conceded that the statement of venugopal dated 25-2-1984 is true and voluntary. in such a situation i have no doubt in my mind that the appellants have been transacting gold business in their residence as well as in their shop in contravention of the provisions of law without bringing them into account as evidenced by the excess found in the house as well as in the shop. so far as the quantity relating to the claim of rajagopal and vathsala victor is concerned, as i have held earlier, purely on a technical ground inasmuch as the same was not considered by the adjudicating authority in the impugned order, i am constrained to give the benefit of doubt in favour of the appellants and set aside that portion of the order of adjudication. the plea of the appellants that in respect of the ornaments recovered from the residence of appellant venugopal, they were supported by issue vouchers dated 19-1-1984 and 15-2-1984 is not acceptable at all since those voucher books were not presented for the scrutiny of the officers at the time of seizure, and the admitted fact remains that no proper entry was found in respect of the goods in gs 11 and gs 12 statutory registers. likewise, i do not feel persuaded by the plea of the appellants that family ornaments were melted for remaking new ornaments for the new born child in the family and that primary gold in a quantity of 35.800 gms. represented the remnants collected from various goldsmiths on different occasions. therefore, in respect of the entire quantity of gold and ornaments seized from the shop as well as from the residence of appellant venugopal i am of opinion that the appellants are bound to make entries in the statutory registers viz. gs 11 and gs 12 and this admittedly not having been done, i find that the charge of contravention under section 55 of the act has been clearly made out.under section 55(1) of the act, every licensed dealer shall keep a true and complete account of the gold acquired or accepted or otherwise received by him or owned or possessed by him in the prescribed manner and under section 55 (2) of the act, every licensed dealer shall keep a true and complete account of the gold acquired or accepted or otherwise received by him or owned or possessed by him in the prescribed manner and under section 55 (2) of the act, every licensed dealer shall as and when he buys and otherwise acquires or accepts or otherwise receives, or sells, delivers, transfers or otherwise disposes of any gold, enter the same in the accounts referred to in section 55 (1) of the act. the allahabad high court, in the case of l. kashi nath seth v. collector of central excise, allahabad, and ors., air 1972 allahabad 16 (v 59 c 5)-while interpreting section 55(2) of the gold (control) act, 1968, has held : "from the term 'as and when' used in section 55, it is clear that a licensed dealer is required to make entries in the registers contemporaneously when he buys or acquires, sells or transfers gold." it in not disputed before me that no such accounting was done by the appellants in terms of section 55(1) of the act.7. so far as the charge under section 16 is concerned it is the plea of the appellants that they have got time to make a declaration within 30 days from the date of acquisition and it is for the department to prove that no such acquisition was made by the appellants within 30 days is not legally tenable. the appellants were found in possession of gold and ornaments and under law they are statutorily bound to give a declaration in terms of section 16 of the act. it is the plea of the appellants that they have acquired the ornaments within 30 days prior to the date of seizure and such a plea has to be substantiated and proved only by the appellants, and the department cannot be called upon to prove the negative that the appellants did not acquire the gold and ornaments within 30 days prior to the seizure. i therefore in the facts and circumstances of the case hold that the charge under section 16 has been made out on the evidence on record.8. so far as the charge under section 32 is concerned, since a licensed gold dealer under the proviso to section 32 is entitled to possess 400 gms., if he does not employ any artisan and the same is obtained in the process of, or in connection with, the making, manufacturing, preparing or repairing of one or more articles or ornaments, the charge cannot be said to have been proved against the appellants in the context of the evidence available on record. primary gold within permissible limit has been recovered from the appellants who are licensed gold dealers and there is nothing on record to indicate that the primary gold is not the resultant of melting ornaments and was not obtained in process of making, manufacturing or repairing of ornaments. in such a situation, at any rate, the appellants would be entitled to the benefit of doubt and i therefore exonerate the appellants of a charge under section 32 of the act.9. a total quantity of 337.450 gms. of gold and ornaments valued at rs. 60,741/- has been seized from the house of appellant venugopal and 149.600 gms. of gold and ornaments has been seized from the shop of the appellants. since i have already held that in respect of the quantity claimed to be belonging to claimants viz. rajagopal and vathsala victor, the order of confiscation under the impugned order is not legally proper, i am inclined to take that factor into consideration in arriving at the quantum of redemption fine. accordingly i reduce the fine in lieu of confiscation from rs. 16.300/- to rs. 12.150/- (rupees twelve thousand one hundred fifty only). so far as the penalty is concerned, having regard to the background of the case i do not feel persuaded to give any reduction and the same is accordingly confirmed.

Judgment:
1. Since both the appeals arise out of a common order of adjudication and relate to one transaction and are interconnected, they are consolidated together and disposed of by a single order. The appeals are directed against the order of the Collector of Central Excise (Appeals), Madras, referred to supra, confirming the order of the Deputy Collector of Central Excise and Customs, Trichy, dated 20-11-84 imposing a fine of Rs. 16.300/- under Section 73 in lieu of confiscation of 168.250 gms. of primary gold and 318.300 gms. of gold ornaments, besides a penalty of Rs. 5,000/- each on the appellants under Sections 74 and 75 of the Gold (Control) Act, 1968, hereinafter referred to as the Act.

2. Officers of the Central Excise Intelligence Unit, Trichy, on 25-2-1984 searched the business premises of the appellants who are licensed gold dealers at 165, Big Bazaar Street, Trichy, and noticed primary gold and gold ornaments weighing 149.600 gms., valued at Rs. 23.790/- not accounted for in the statutory accounts. The Officers also detected a secret door in the shop connecting the residential premises of appellant Venugopal, one of the partners and a search of the residential premises of Venugopal resulted in the detection of primary gold and gold ornaments weighing 337.450 gms., valued at Rs. 60,741/-, in excess of the declaration furnished by him under the Act. The unaccounted gold and ornaments in the business premises as well as in the residence were seized under mahazar attested by witnesses as per law. Appellant Venugopal on 25-2-1984 gave a statement before the authorities that the gold and ornaments under seizure were not properly accounted for as per the Act and he would not be able to give any explanation for the excess of gold and ornaments in the shop as well as in his residence, as his brother appellant Jayakumar was looking after the partnership business. Appellant Venugopal further admitted that he had signed the purchase vouchers on 11th and 13th February, 1984 as well as the issue for manufacture bill book from 22-2-1984 to 24-2-1984 under bill Nos. 1587 to 1593. It is in these circumstances, after further investigation and issue of show cause notice, proceedings were instituted against the appellants which ultimately culminated in the impugned order now appealed against.

3. The learned consultant for the appellants submits that 68.250 gms.

of primary gold and 2.950 gms. of gold ornaments (lady ring) under seizure belong to one Rajagopal and in support of this plea the learned consultant placed reliance on a purchase voucher dated 25-2-1984 signed and verified by the Inspector of Central Intelligence Unit, one of the officers conducting the search, Trichy. It was urged that the said purchase voucher bearing No. 1433 mentions the name of Rajagopal and the ornaments entrusted by him which, according to the learned consultant, were melted for purposes of remaking ornaments resulting in primary gold weighing 68.250 gms. Regarding ornaments weighing 78.400 gms, it was urged that they belong to one Smt. Vathsala Victor, a teacher, who had entrusted the same for purposes of repair and polishing. It was submitted that in a petition dated 15-3-1984 appellant Jayakumar has not only clarified this position but also explained the circumstances in which the excess gold and ornaments were found in the shop and in the residence of his brother appellant Venugopal. The learned consultant placed reliance on the claim petition preferred by the owners relating to their respective ornaments viz. by Rajagopal dated 1-3-1984 and Smt. Vathsala Victor dated 28-2-1984. It was contended that in terms of Section 79 read with the proviso to Section 71, no order of confiscation shall be made unless the owner of the gold or ornaments is given a show cause notice and further if it is established that the gold or ornaments under seizure belongs to a third party who has nothing to do with any act of irregularity committed by a dealer, the same shall not be liable for confiscation and the impugned order was assailed as bad in law since no show cause notice was issued to the claimants viz. Rajagopal and Vathsala Victor. It was further contended that in the original order of adjudication the plea of the appellant as set out in the petition dated 15-3-1984 and referred to supra, has not been considered at all and as such the impugned order was assailed as bad in law for non-consideration of the points urged by the appellant. The learned consultant further contended that in respect of the gold and ornaments seized from the residence of appellant Venugopal, out of a total quantity of ...100 gms. of primary gold, 64,200 gms. was the resultant of melting family ornaments for making ornaments for the new born child and the balance of 35.800 gms. would represent accumulated remnants returned by goldsmiths on various occasions. Regarding the balance of 237.450 gms. of ornaments unaccounted, it was contended that they were returned by two goldsmiths Ramachandran and Muthukrishnan under voucher No. 1590 dated 25-2-1984 and 1589 dated 25-2-1984 and those ornaments were handed over to the appellant's mother by the said goldsmiths for the purpose of safe custody since appellant Jayakumar was away at Madrag and appellant Venugopal was laid up with ailment, and they were eventually to be accounted for during the course of the day. Finally it was urged that non-accountal in the facts and circumstances of the case would only be a technical breach not warranting imposition of fine or penalty.

4. The learned DR contended that the plea of the appellant that certain quantity of primary gold is the resultant of melting the ornaments of one Rajagopal is not acceptable. He urged that the purchase voucher bearing bill No. 1433 relied upon by the appellant to prove the order placed by the said Rajagopal is not relatable to the quantity of excess claimed by the appellant to be the resultant of melting the ornaments given by Rajagopal. The learned DR further urged that the purchase voucher merely mentions various ornaments and their weight and the appellants under law should make proper entries the moment they melt the ornaments for purposes of remaking ornaments and the absence of any such record, coupled with the discrepancy in the total weight, would discredit the very purchase voucher relied upon by the appellant. The learned DR further submitted that in respect of the claim by Smt.

Vathsala Victor, no such plea at all was putforth by appellant Venugopal in his earlier statement dated 25-2-1984 nor by any salesmen of whom one happens to be the very nephew of the appellants. He also contended that when the appellants claim that ornaments weighing 78.400 gms. belong to Vathsala Victor, it is for them to substantiate such a plea and merely because no show cause notice was specifically given either to the claimants or the plea of the appellants in respect of ownership of Rajagopal and Vathsala Victor was not specifically dealt with in the original order of adjudication, the order would not become bad since the appellants cannot be said to have suffered any prejudice, particularly having regard to the charges of non-accountal under Section 55 and non-declaration under Section 16 of the Act. Regarding the quantity of gold and ornaments found in excess and seized from the residence of appellant Venugopal, the learned DR submitted that the explanation that 237.450 gms. of ornaments were handed over by goldsmiths Ramachandran and Muthukrishnan is not tenable because they were neither accounted for in the statutory register as per law nor would receipt of such ornaments in the residential premises other than the place of business is permissible under the provisions of the Act.

The plea of the appellants regarding melting of family ornaments for making ornaments for a new born child was also assailed as incorrect and untenable as well as the plea regarding 35.800 gms. of primary gold bits.

5. I have carefully considered the submissions of the parties herein.

In my opinion when the appellants put forth a plea that certain ornaments were received in the shop either for purposes of remaking or repair and were claimed to belong to Rajagopal and Smt. Vathsala Victor, such a claim of the appellants in fairness should have been looked into and investigated during investigation and more so, considered in the order of adjudication. In the instant case, notwithstanding the fact that no such plea was put forth by the salesmen or by appellant Venugopal at the time of search and seizure, having regard to the fact that a definite plea was urged in the petition of appellant Jayakumar dated 15-3-1984 that Rajagopal and Smt.

Vathsala Victor are owners of certain quantity of gold ornaments under seizure as detailed therein, coupled with the claim petitions of Rajagopal and Smt. Vathsala Victor themselves, the authorities in fairness should have examined the claim of the claimants and the plea of the appellant and given a finding thereon. In the adjudication order this aspect of the case base not been considered by the authority at all. The learned DR drew my attention to the fact that this aspect of the case, though not considered in the order of adjudication, has been dealt with in para 4 of the impugned order of appeal. No doubt, the charges levelled against the appellants ^.re under Sections 55, 16 and 32 of the Act. The only course open to me in this situation is to set aside that portion of the order and remit the matter back for reconsideration or to give the benefit of doubt in favour of the appellants in respect of this part of the case. At this distance of time I do not think any useful purpose would be served if the matter is remitted back. Therefore, I set aside that portion of the impugned order relating to the seizure of ornaments claimed by the appellants to be belonging to Rajagopal and Vathsala Victor as set out in the claim petitions of Rajagopal and Vathsala Victor and in the petition of appellant Jayakumar dated 15-3-1984. In this respect I should confess there is considerable force in the submission of the learned DR. that the purchase voucher No. 1433/25-2-1984 relied upon by the appellant is not relatable to the quantity of ornaments attributed to the ownership of Rajagopal. Likewise the fact that neither appellant Venugopal nor any of the salesmen in the shop at the time of seizure came forward with a plea that 78.400 gms. of ornaments belonged to Vathsala Victor is also a. circumstance that would certainly militate against the veracity of such a plea of the appellants. Be that as it may, technically inasmuch as the claim put forward by the claimants as well as the plea of the appellant relating to the ownership of Rajagopal and Vathsala Victor not having been considered by the adjudication authority in the order of adjudication, the order of adjudication would suffer from a technical legal infirmity in that regard and so that part of the impugned order will have to be set aside.

6. Now coming to the plea of the appellants regarding gold and ornaments found in excess and seized from the residence of partner Venugopal, I have no hesitation to hold that the plea is an after thought and is utterly incredible. Venugopal admittedly is one of the partners and even the plea of ailment put forward by him would not appear to be true, particularly having regard to the fact that he has also been transacting business relating to the shop as evidenced by his admitted signature in the purchase vouchers relating to 11-2-1984 and 13-2-1984 as well as the bill book from 22-2-1984 to 24-2-1984 under bill No. 1587 to 1593. One important factor that has to be taken note of in this context is the statement recorded from appellant Venugopal at the earliest opportunity on the day of search by the authorities on 25-2-1984 wherein he has admitted the fact of excess of gold and ornaments found in the shop as well as in his residence unaccounted in the statutory accounts of the business. This statement of Venugopal admittedly has not been resiled from till this day and to a specific question from t he Bench the learned consultant for the appellants fairly conceded that the statement of Venugopal dated 25-2-1984 is true and voluntary. In such a situation I have no doubt in my mind that the appellants have been transacting gold business in their residence as well as in their shop in contravention of the provisions of law without bringing them into account as evidenced by the excess found in the house as well as in the shop. So far as the quantity relating to the claim of Rajagopal and Vathsala Victor is concerned, as I have held earlier, purely on a technical ground inasmuch as the same was not considered by the adjudicating authority in the impugned order, I am constrained to give the benefit of doubt in favour of the appellants and set aside that portion of the order of adjudication. The plea of the appellants that in respect of the ornaments recovered from the residence of appellant Venugopal, they were supported by issue vouchers dated 19-1-1984 and 15-2-1984 is not acceptable at all since those voucher books were not presented for the scrutiny of the officers at the time of seizure, and the admitted fact remains that no proper entry was found in respect of the goods in GS 11 and GS 12 statutory registers. Likewise, I do not feel persuaded by the plea of the appellants that family ornaments were melted for remaking new ornaments for the new born child in the family and that primary gold in a quantity of 35.800 gms. represented the remnants collected from various goldsmiths on different occasions. Therefore, in respect of the entire quantity of gold and ornaments seized from the shop as well as from the residence of appellant Venugopal I am of opinion that the appellants are bound to make entries in the statutory registers viz. GS 11 and GS 12 and this admittedly not having been done, I find that the charge of contravention under Section 55 of the Act has been clearly made out.

Under Section 55(1) of the Act, every licensed dealer shall keep a true and complete account of the gold acquired or accepted or otherwise received by him or owned or possessed by him in the prescribed manner and under Section 55 (2) of the Act, every licensed dealer shall keep a true and complete account of the gold acquired or accepted or otherwise received by him or owned or possessed by him in the prescribed manner and under Section 55 (2) of the Act, every licensed dealer shall as and when he buys and otherwise acquires or accepts or otherwise receives, or sells, delivers, transfers or otherwise disposes of any gold, enter the same in the accounts referred to in Section 55 (1) of the Act. The Allahabad High Court, in the case of L. Kashi Nath Seth v. Collector of Central Excise, Allahabad, and Ors., AIR 1972 Allahabad 16 (V 59 C 5)-while interpreting Section 55(2) of the Gold (Control) Act, 1968, has held : "From the term 'as and when' used in Section 55, it is clear that a licensed dealer is required to make entries in the registers contemporaneously when he buys or acquires, sells or transfers gold." It in not disputed before me that no such accounting was done by the appellants in terms of Section 55(1) of the Act.

7. So far as the charge under Section 16 is concerned it is the plea of the appellants that they have got time to make a declaration within 30 days from the date of acquisition and it is for the Department to prove that no such acquisition was made by the appellants within 30 days is not legally tenable. The appellants were found in possession of gold and ornaments and under law they are statutorily bound to give a declaration in terms of Section 16 of the Act. It is the plea of the appellants that they have acquired the ornaments within 30 days prior to the date of seizure and such a plea has to be substantiated and proved only by the appellants, and the Department cannot be called upon to prove the negative that the appellants did not acquire the gold and ornaments within 30 days prior to the seizure. I therefore in the facts and circumstances of the case hold that the charge under Section 16 has been made out on the evidence on record.

8. So far as the charge under Section 32 is concerned, since a licensed gold dealer under the proviso to Section 32 is entitled to possess 400 gms., if he does not employ any artisan and the same is obtained in the process of, or in connection with, the making, manufacturing, preparing or repairing of one or more articles or ornaments, the charge cannot be said to have been proved against the appellants in the context of the evidence available on record. Primary gold within permissible limit has been recovered from the appellants who are licensed gold dealers and there is nothing on record to indicate that the primary gold is not the resultant of melting ornaments and was not obtained in process of making, manufacturing or repairing of ornaments. In such a situation, at any rate, the appellants would be entitled to the benefit of doubt and I therefore exonerate the appellants of a charge under Section 32 of the Act.

9. A total quantity of 337.450 gms. of gold and ornaments valued at Rs. 60,741/- has been seized from the house of appellant Venugopal and 149.600 gms. of gold and ornaments has been seized from the shop of the appellants. Since I have already held that in respect of the quantity claimed to be belonging to claimants viz. Rajagopal and Vathsala Victor, the order of confiscation under the impugned order is not legally proper, I am inclined to take that factor into consideration in arriving at the quantum of redemption fine. Accordingly I reduce the fine in lieu of confiscation from Rs. 16.300/- to Rs. 12.150/- (Rupees twelve thousand one hundred fifty only). So far as the penalty is concerned, having regard to the background of the case I do not feel persuaded to give any reduction and the same is accordingly confirmed.