Unaccounted gold in licensed premises attracts confiscation and penalty; administrative amnesty instructions cannot override statutory contravention.

Unaccounted gold and gold ornaments found in a licensed dealer's premises, though kept in a shop marked briefcase and shown by the evidence to be held for sale, were treated as stock in trade acquired and retained in contravention of the accounting and acquisition provisions of the Gold (Control) Act, 1968, so confiscation was upheld. The dealer and his power of attorney holder were also held liable to penalty because the contravention was proved against both, but the redemption fine and penalties were reduced as excessive. The claimed benefit of Finance Ministry amnesty instructions was rejected because the scheme was administrative, limited to voluntary disclosure, and did not override the Act or apply to goods found on search.

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Issues: (i) whether the seized gold and gold ornaments found in the licensed premises of a gold dealer, though not entered in the statutory accounts, were liable to confiscation as unaccounted stock in trade; (ii) whether the dealer and his power of attorney holder were liable to penalty under the Gold (Control) Act, 1968; and (iii) whether the claimed benefit of the Finance Ministry amnesty instructions could be invoked to avoid confiscation or penalty.

Issue (i): whether the seized gold and gold ornaments found in the licensed premises of a gold dealer, though not entered in the statutory accounts, were liable to confiscation as unaccounted stock in trade.

Analysis: The gold and ornaments were admittedly found in the licensed premises, were not accounted for, and were recovered from a briefcase marked with the shop name. The statements of the power of attorney holder, a relative assisting in the business, and the proprietor showed that the articles had been kept in the shop for sale and that old ornaments had been purchased and remanufactured into new ornaments. The governing provisions required a licensed dealer to account for such acquisitions and purchases, and the articles were held to form part of the dealer's stock in trade kept in contravention of law.

Conclusion: The confiscation was upheld and the challenge failed.

Issue (ii): whether the dealer and his power of attorney holder were liable to penalty under the Gold (Control) Act, 1968.

Analysis: The evidence established that the proprietor was not a detached owner unaware of the goods, but a participant in the transactions through which the ornaments were acquired, remanufactured and kept for sale. The power of attorney holder was in charge of the business, and the proprietor was held bound by acts done in the course of managing the licensed premises. On those facts, the contravention was treated as proved against both appellants and the penalty provisions were attracted. At the same time, the quantum of penalty and fine was found excessive having regard to the purity and value of the gold and ornaments.

Conclusion: Liability to penalty was affirmed, but the amounts were reduced.

Issue (iii): whether the claimed benefit of the Finance Ministry amnesty instructions could be invoked to avoid confiscation or penalty.

Analysis: The amnesty relied upon was treated as administrative instruction and not as a statutory direction binding on the quasi-judicial authority. It was also confined to voluntary disclosure situations and did not cover gold and ornaments unearthed on search of licensed premises. The clarificatory material relating to the scheme indicated that immunity was unavailable where the premises had been searched, and no statutory notification extending such immunity to the present contraventions was shown.

Conclusion: The amnesty claim was rejected and gave no relief.

Final Conclusion: The contravention findings and confiscation were sustained, the claimed amnesty benefit was denied, and only the monetary reliefs were modified by reducing the redemption fine and penalties.

Ratio Decidendi: Unaccounted gold and ornaments found in a licensed dealer's premises and kept for sale in contravention of the accounting and acquisition provisions are liable to confiscation and penalty, while non-statutory administrative amnesty instructions do not bind a quasi-judicial authority or override the Act.

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