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High Court Of Calcutta
CHITTATOSH MUKHERJEE, SUSANTA CHATTERJI
UNION OF INDIA - Appellant
Versus
SHAMBHUNATH KARMAKAR - Respondent
F. M. A. T. 494 Of 1986
Decided On : 07/17/1986
GOLD CONTROL ACT - CONFISCATION OF GOLD - RETURN OF GOLD OR PAYMENT OF MARKET PRICE - GOLD CONTROL ACT, 1968 - DEFENCE OF INDIA RULES, 1962 - CENTRAL EXCISES AND SALT ACT, 1944 - SEIZURE OF GOLD - CONFISCATION ORDER - RECONSIDERATION - RETURN OF GOLD OR PAYMENT OF MARKET PRICE.
Fact of the Case:
In 1963, the Central Excise Authorities seized gold and gold ornaments from Sambhunath Karmakar for contravening the Defence of India (Amendment) Rules, 1963. The Collector of Central Excise ordered the confiscation of the seized gold under the Defence of India Rules, 1962. Sambhunath Karmakar challenged the confiscation order in the High Court and was acquitted. He then filed a writ petition seeking the return of the seized gold or payment of its market price. The Collector of Central Excise, in 1985, set aside the confiscation order and directed the return of the seized gold. The Union of India appealed against this order.
Finding of the Court:
The High Court held that the Collector of Central Excise had jurisdiction to reconsider the confiscation order and to direct the return of the seized gold or its value. The court also held that the owner of the seized gold was entitled to receive the market price of the gold as on the date the Collector of Central Excise set aside the confiscation order, i.e., 6th May 1985.
Issues: 1. Whether the Collector of Central Excise had jurisdiction to reconsider the confiscation order and to direct the return of the seized gold or its value? 2. Whether the owner of the seized gold was entitled to receive the market price of the gold as on the date the Collector of Central Excise set aside the confiscation order?
Ratio Decidendi: 1. The High Court held that the Collector of Central Excise had jurisdiction to reconsider the confiscation order and to direct the return of the seized gold or its value based on the following reasons: - The Collector of Central Excise had already set aside the confiscation order. - The owner of the seized gold had a cause of action for the return of the gold on the date the confiscation order was set aside. - The appellants did not plead that the seized gold had been disposed of due to the tortuous act of any government servant. - There was no evidence about the date on which the confiscation order was enforced. - The seized gold had not been sold to a third party for value. - The appellants claimed that the Government continued to hold the melted gold in some form or other, and therefore, the Government was bound to return the said gold or its value on the date the Collector of Central Excise set aside the confiscation order. 2. The High Court held that the owner of the seized gold was entitled to receive the market price of the gold as on the date the Collector of Central Excise set aside the confiscation order based on the following reasons: - The confiscation order had been set aside. - In equity and law, the status quo ante prior to the passing of the confiscation order ought to be restored. - On the date the confiscation order was set aside, the Government's obligation to return the seized gold had accrued.
Final Decision: The High Court dismissed the appeal filed by the Union of India and upheld the order of the trial court directing the appellants to either return to the owner a quantity equivalent to the gold seized or pay the market price of such gold as on the date of passing of the reconsideration order of the Collector, Central Excise, i.e., 6th May 1985.
( 1 ) THE Union of India and others have preferred this appeal under Clause 15 of the Letters Patent against the judgment dated 20th January, 1986 of Ajit Kumar Sengupta, J. disposing of the writ application filed by Sambhunath Karmakar (since deceased), who was the predecessor-in-interest of the present respondents 1 (a) to 1 (h ). The learned Trial Judge has directed the Union of India and its officers either to return to the writ petitioner equivalent quantity of gold seized on 26th April, 1973 or to pay the market price of such gold as on the date of the order of the Collector, Central Excise, Calcutta dated 6th May, 1985.
( 2 ) THE present case has a chequerd history and for better appreciation of the points involved, we set out the salient facts of the case. On 26th April 1963 the Gold Control Officers attached to the Central Excise Collectorate, Calcutta had searched the premises of Sambhunath Karmakar and brothers of Ghatal and had recovered : (i) primary gold weighing 252. 960 gms of 22 carat purity, (ii) 17h. 472 gms. of new ornaments of 22 carat purity and (iii) 38. 636 gms of old ornaments of 22 carat purity In the seizure list total value of the said gold was stated to be Rs. 16552. 50. Thereafter the Superintendent of Central Excise, Gold Control, Calcutta served a notice upon said Sambhunath Karmakar to show cause why the said seized gold under Rules 126c, 126f, 126g and 126h of the Defence of India (Amendment) Rules, 1963 should not be confiscated. The petitioner, Sambhunath Karmakar had shown cause. On 10th January, 1964 the Collector of Central Excise ordered that the said primary gold, new ornaments and old ornaments of gold be confiscated under the Rule 126m of the Defence of India Rules, 1962 for contravention of Rules 126c, 126f, 126g and 126m of the said Rules. Sambhunath Karmakar, did not, however, prefer any appeal against the said confiscation order to the Administrator, Gold Control, Ministry of Finance (Department of Revenue), New Delhi.
( 3 ) THE petitioner Sambhunath Karmakar (since deceased) was also prosecuted in the criminal court for having contravened Rules 126f (IXii) and 126p (2) (iv) of the Defence of India (Amendment) Rules 1963 in respect of the gold including gold ornaments seized from him on 26th April, 1963. On 31st July, 1965 the learned Magistrate, Ghatal convicted and sentenced him to undergo imprisonment for one month. Sambhunath Karmakar preferred a criminal revision petition in this court. On 20th January 1966 R. N. Dutt and T. P. Mukherjee, JJ made absolute the Rule obtained by Sambhunath Karmakar, set aside the order of conviction and sentence passed and acquitted him.
( 4 ) ON April 1, 1966 Sambhunath Karmakar made an application to the Collector, Central Excise, Calcutta annexing a copy of the said High Court order acquitting him. He prayed that the gold seized from him on 26th April, 1963 be returned. On 7th May, 1966 the Collector had rejected the said prayer for return of gold on the ground that there was no provision in law and therefore he was unable to reconsider his order for confiscation. Sambhunath Karmakar thereupon filed a writ application challenging the said order of the learned Collector. According to the Central Excise Authorities after the confiscation order was passed gold seized from Sambhunath Karmakar had been sent to the Mint of the Government of India at Calcutta and the same had been melted. On 5th July 1973 Sambhunath was allowed to withdraw his writ petition with liberty to file a fresh one. Accordingly, he filed a fresh writ petition adding the Mint as a party. On August 11, 1977 Amiya Kumar Mookerjee, J. disposed of Civil Rule No. 2022 (W) of 1973 issued upon the said writ petition of Sambhunath Karmakar. In his judgment the learned Judge recorded that the learned advocate appearing on behalf of the Central Excise Authorities did not object to the proposal made on behalf of the petitioner that for ends of justice the pe
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