1. M/s Kantilal Nanalal Kansara of Nadiad and their partner Shri Mohanlal Ranchhoddas Kansara have tiled these appeals against the order No. 6(Gold)/82 dt.l8J. 82 of the Deputy Collector of Central Excise, Ahmedabad a-s confirmed by the Order No. S/49-35/82 GC (Ahd) S/49-34/82GC(Ahd.) dt. 15.11.82 of the Collector of Customs (Appeals) Bombay, under which 169.100 gms. of primary gold recovered from Shri Mohanlal Ranchlioddas Kansara on 2.7,81 in the shop of M/s. Kantilal Nanalal Kansara was confiscated and penalties of Rs. 2000/- had been imposed on the firm and its partner. Since both these appeals under Section 81 of the Gold Control Act arise out of the same orders of the lower authorities, both these appeals have been heard simultaneously and the common order is being passed in the matter.
2. The appellants admitted the recovery of gold from the pocket of Shri M.R. Kansara on 2.7.81. The primary gold was in 2 pieces and in the statement recorded from Shri M.R. Kansara under Section 63 of the Gold Control Act on the same day, he has deposed that he had melted his deceased wife's gold ornaments weighing 19.0.000 gms. as per her wish, and he wanted to distribute the geld proportionately according to the wish of the mother to the seven daughters. It has been further argued that the purity of gold given in the Panchnama as 23 cts. is only a presumption of the ranch witnesses and the gold had not been tested. It is therefore possible that the purity is not of high degree. The appellants admit their offence and plead ignorance of law as the excuse. They further point out that no investigation was carried out by the Central Excise officers and the findings of the Deputy Collector of Central Excise and the Collector of Customs (Appeals) as regards the contravention of Sees. 8,11,17 & 26 are not based on any other evidence. In the aforesaid circumstances the appellants plead that the order of absolute confiscation of gold and penalties on the firm and partner is very harsh. They therefore, request for mercy.
3. Shri Krishan Kumar for the department has generally defended the orders of the lower authorities.
4. We have examined the submissions on both the sides. So far as the firm of M/s. Kantilal Nanalal Kansara is concerned, there is no evidence to show that the firm acquired or possessed primary gold under Section 8 of the Gold Control Act, 1U68. The mere fact that one partner, even if the managing partner, has melted the gold in the premises of the firm, would not make the firm liable to the contravention of Section 8, especially when the partner concerned has accepted the guilt himself. I, therefore, find that the contravention of Section 8 by M/s. Kantilal Nanalal Kansara is not proved As regards the charge of contravention of Section 11 against the same firm, there is no evidence that the firm had accepted gold for the purpose of making, manufacturing articles or ornaments. The statement of Shri Mohanlal R. Kansara on the other hand admits that he wanted the ornaments to be manufactured by another person, as he was not knowing the art of manufacturing the ornaments. Apart from this statement, there is no evidence, that the department should hold that Section 11 has been violated by M/s. Kantilal N. Kansara. Similarly, there is also no evidence regarding the infringement of Section 17 by the firm. The lower authorities have merely gone on the basis of assumption and prtsumption which cannot take the place of evidence. The learned Collector of Customs (Appeals) has presumed that refining of silver would have yielded certain quantity of gold, and therefore the firm has violated Section 17. There is no evidence to substantiate this presumption. Accordingly, we find that the contravention of Section 17 by the firm is not established. Finally the firm has been charged with not keeping the record of gold recovered from refining of silver. Here also if the firm had not recovered any gold and the onus to prove the same is on the department, no contravention of (his Section can be held as proved. In the aforesaid view, we and that the firm of M/s. K.N.Kansara is not guilty of any contravention of any of the provisions of Gold Control Act, and hence the order of penalty of Rs. 2000/- levied on the appellant is bad. The same is set aside and the amount of Rs. 2000/- paid by the appellants is ordered to be refunded.
5. As regards the appeal of Shri Mohanlal Ranchhoddaa Kansara it is seen that he has accepted the contravention of Section 8. This charge is accordingly sustainable. However, while, examining the appeal of M/s. KJV, Kansara, we have teen that the contravention of Section 11, 17 & 26 have not been established. We hold the same view with regard to the appeal of Shri MR. Kansara. Therefore, we are only left with an offence under Section 8 of the Gold Control Act by Shri M.R. Kansara, Shri Kansara has admitted this offence, but explained the reasons for melting the gold ornaments. Considering this we find that there is a lot of force in the plea of Shri M R. Kansara about the reasons which lead him to melt the gold ornaments of his deceased wife for the purpose distributing the same amongst the 7 daughters. Shri Kansara is not a literate person, and therefore, the ignorance of law is also plausible. Considering these facts we find that the orders, of the lower authorities are very harsh, and they require considerable mitigation in the interest of justice. In our view a token fine in lieu of confiscation of gold would servo the ends of justice. Accordingly, we direct that' 169.100 gms. of gold seized from Shri M.R. Kansara be allowed to be redeemed by him on payment of fine of Rs. 2500/-. On redemption he is permitted to convert the primary gold into ornaments within 3 months from the date of redemption by getting the ornaments made through a licenced dealer. The penalty of Rs. 2G00/- on Shri M.R.Kansara is also ordered to be refunded. Thus the two appeals are allowed to the extent as indicated above.