Illegal Search & Seizure of Gold Ornaments: Relief Granted to Petitioners

The court found the search and seizure of gold ornaments to be illegal, as the Department lacked sufficient material to justify the action under Section 66 of the Gold (Control) Act, 1968. The petitioners, a partnership firm, were granted relief under Article 226 of the Constitution of India, directing the return of their seized gold ornaments from locker No. 64 of a bank branch. The court emphasized the petitioners' entitlement to relief despite the availability of alternative remedies, allowing their application and instructing the respondents to return the gold ornaments promptly.

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Issues Involved:
1. Legality of the search and seizure of gold ornaments.
2. Jurisdiction and power of seizure u/s 66 of the Gold (Control) Act, 1968.
3. Alternative remedy and writ jurisdiction under Article 226 of the Constitution of India.

Summary of Judgment:

1. Legality of the Search and Seizure of Gold Ornaments:
The petitioners sought to quash the proceedings related to the search and seizure of their gold ornaments from locker No. 64 of Allahabad Bank, Rajendra Nagar Branch, and requested the release of the seized gold ornaments. The petitioners, a registered partnership firm dealing in gold, argued that the search and seizure were illegal and an inroad into their fundamental rights. They contended that the power of seizure was exercised without any material and was wholly without jurisdiction.

2. Jurisdiction and Power of Seizure u/s 66 of the Gold (Control) Act, 1968:
The court examined the provisions of the Gold (Control) Act, 1968, particularly Section 66, which allows seizure if a Gold Control Officer has reason to believe that any provision of the Act has been or is being contravened. The court referred to the Allahabad High Court decision in L. Kashinath v. The Collector of Central Excise, Allahabad, which held that the power of seizure must be based on reasonable belief and not on an indiscriminate basis. The court found that the Department had not shown any material to justify the seizure and that the belief of contravention was to be determined only after an enquiry, which is contrary to the provisions of Section 66.

3. Alternative Remedy and Writ Jurisdiction under Article 226 of the Constitution of India:
The respondents argued that the petitioners had an alternative remedy by way of appeal and revision under the Act, making the application premature. However, the court held that if the seizure itself is without jurisdiction, it would be neither proper nor justifiable to ask the petitioners to avail of the alternative remedy. The court relied on several Supreme Court decisions to assert that the petitioners are entitled to relief under Article 226 irrespective of the existence of an alternative remedy.

Conclusion:
The court concluded that the Department had not provided sufficient material to form a reasonable belief that the provisions of the Act had been contravened. The seizure was deemed illegal, and the petitioners were entitled to the return of their gold ornaments. The application was allowed, and the respondents were directed to return the ornaments to the petitioners forthwith. The court also noted that the Department could take any other action permissible under the law, uninfluenced by the observations made in this judgment.

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