GUNWANTLAL GODAWAT vs UNION OF INDIA CUSTOM AND CENTRAL EXCISE THROUGH COMMISSIONER. Supreme Court, 22-11-2017

JudgeHON'BLE MR. JUSTICE J. CHELAMESWAR, HON'BLE MR. JUSTICE SANJAY KISHAN KAUL
CourtSupreme Court (India)
Date22 November 2017
Parties GUNWANTLAL GODAWATUNION OF INDIA CUSTOM AND CENTRAL EXCISE THROUGH COMMISSIONER
Docket NumberC.A. No.-004711-004712 / 2011
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NOS. 4711-4712 OF 2011
Gunwantlal Godawat … Appellant
Versus
Union of India & Another … Respondents
J U D G M E N T
Chelameswar, J.
1. On 3rd and 4th June, 1965, the residential premises of the
appellant’s father were searched by the officers of the Government
of India in exercise of the authority conferred upon them under
Rule 126L(2) of the Defence of India Rules, 19621 (hereinafter
referred to as “the RULES”). They found 240 kilograms of gold (bars
1 Rule 126L. Power of entry, search, seizure, to obtain information and to take samples.— (2) Any person
authorised by the Central Government by writing in this behalf may—
(a) enter and search any premises, not being a refinery or establishment referred to in sub-rule (1),
vaults, lockers or any other place whether above or below ground;
(b) seize any gold in respect of which he suspects that any provision of this Part has been, or is being,
or is about to be contravened, along with the package, covering or receptacle, if any, in which such gold is
found and thereafter take all measures necessary for their safe custody.
1
Digitally signed by
DEEPAK MANSUKHANI
Date: 2018.05.25
10:00:26 IST
Reason:
Signature Not Verified
etc.) buried in the house and seized it. Proceedings for confiscation
were initiated. Eventually on 24.9.1966, the Collector of Central
Excise and Customs passed an order2 confiscating the seized gold
in exercise of the power under Rule 126M of the RULES on the
ground that the seized gold was held by the appellant in
contravention of Rule 126-I. A penalty of Rs.25 lakhs under Rule
126L(16) of the RULES was also imposed.
2. Aggrieved by the same, an appeal was carried by the
appellant’s father before the Gold Control Administrator which was
dismissed on 6.3.1972. The matter was carried further in a revision
before the Government of India which was also dismissed on
4.6.1979. The decision of the Government of India was challenged
in a writ petition (No.1215/79) before the Rajasthan High Court.
By a judgment and order dated 9.8.1994, the Rajasthan High Court
allowed the writ petition.
3. It appears from the said judgment that two submissions were
made before the High Court, (i) no personal hearing was given by
the Collector to the appellant’s father before the order of
2 ““Gold was required to be declared under Rule 126-I of Defence of India Rules, 1962. It was not declared. I
accordingly order absolute confiscation of 240.040 kgs. of gold, under Rule 126M of said Rules. The iron safe in
which gold was secreted is also confiscated under Rule 126M.
I hold that Shri Chhagan Lal Godavat is guilty of contravention of the provisions of the Rule 126-I of the
Defence of India Rules, 1962. He is liable to a penalty under Rule 126-L (16) of the said Rules. Taking into
consideration the gravity of the offence committed by him and in view of the fact that he hoarded a very huge
quantity of undeclared gold I impose upon him a personal penalty of Rs.25,00,000/- (Twenty five lacs).”
2
confiscation was passed though a show cause notice dated
3.2.1966 was issued proposing confiscation and penalty under
Section 126M and 126L(16) of the RULES respectively, and (ii) An
opportunity to redeem the seized gold was not given.
4. The High Court accepted the submissions and remitted the
matter to the Collector (Central Excise and Customs).
The operative portion of the judgment reads as follows:-
“16. As a sequence the orders passed by the Collector dated
24.9.1966 (Annex.1), the order dated 6.3.1972 passed by the Gold
Control Administrator as well as the order dated 3/4.6.1979
passed by the Special Secretary Finance, Government of India
exercising the power of revision of the Central Government are
quashed and the matter is remitted back to the Collector, Central
Excise and Customs, New Delhi to examine the matter afresh in
the light of the observations made above after affording full
opportunity to the petitioners. The parties are directed to appear
before the Collector, Central Excise and Customs, New Delhi on
1.9.1994 whereafter the Collector shall proceed with the case
afresh and shall dispose of the matter within four months from the
date of receipt of the copy of the order as indicated above. The
matter has already been considerably delayed for over 30 years
and any further delay would amount to denial of justice to the
petitioners. It is further ordered that in the event of the appeal
being filed by the aggrieved party to the Central Excise and Gold
Control Tribunal, the Tribunal shall dispose of the same as
expeditiously as possible preferably within six months from the
date of filing of the appeal.”
5. Pursuant to the remand, by an order dated 9.12.1994, the
Collector once again ordered confiscation of the entire quantity of
(240 kilograms) gold approximately valued at Rs. 11.04 crores with
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