P.C. Jain, Member (T)

1. Facts in brief as alleged in the show cause notice dated 29.6.1981 commencing the proceedings in this case are as follows:

1.1 The shops of the first appellant, licensed gold dealer were searched by Income Tax authorities of Delhi on 16.6.1980. From shop No. 1734, 3 pcs. of primary gold weighing 59.700 gms. valued at Rs. 7760/- were recovered and seized by the Income Tax authorities as these were not accounted for.

1.2 From the other shop No. 307, Dariba Kalan, Delhi, gold ornaments weighing 923 500 gms. valued at Rs. 52,482/- were recovered and seized as unaccounted for by the Income Tax authorities. The matter was referred by the income Tax authorities to the Collector of Central Excise for enquiry and necessary action under the Gold (Control) Act, 1968.

1.3 The first appellant was summoned by the Supdt. Gold Control (Preventive) New Delhi. Shri Suresh Chand Jain, Partner of the first appellant appeared before the said Supdt. and tendered his statement on 19.2.1981. Be, inter alia, admitted the recovery of the aforesaid primary gold and gold ornaments and stated that these were not accounted for in their G.S. 11 and G.S. 12 registers He also stated that these 3 pcs. of primary gold were given by a lady Smt Dhano Devi, the 2nd appellant herein and meanwhile the Income Tax authorities arrived at their shop. Smt. Dhano Devi was also summoned and in her statement dated 13.4.1981 she admitted that she gave the three pieces of gold to Shri Chander Kumar on 16.6.1980 for making six bangles. She also stated that Chander Kumar Jain did not issue any receipt for this gold. She further stated that this gold was given to her by her late husband 40 years ago and she did not know that keeping of gold was an offence under the Gold (Control) Act. She also admitted of not having informed the Gold Control Officer regarding possession of this gold. She stated that she did not possess any other gold/gold ornaments.

1.4 In his statement Shri Suresh Chand Jain stated about the seized ornaments that some of these ornaments were accounted for in their register of repairs; that the repair register was misplaced somewhere and was not traceable and was also not traceable on 16. 6. 1980 at the time of visit of the Income Tax Officers. He also stated that out of the above said gold ornaments, those mentioned at s. No. 37 of the Valuation Report had been declared by him in form GS. 3 and these were brought by him in his shop for valuation purpose.

1.5 Accordingly, the aforesaid show cause notice was issued to the first appellant for contravention of provisions of Sections 8, 31, 32, 33 and 55 of the Gold (Control) Act, 1968 and Rule 13 of the Gold Control (Forms, Fees & Misc. Matters) Rules, 1968 inasmuch as they acquired, possessed, kept in custody or control the said primary gold weighing 59.700 gms., accepted the primary gold from Smt. Dhano Devi, kept gold ornaments in the licensed premises which was not a part of thair stock-in-trade and did not maintain any account of the gold ornaments weighing 923.500 gms. valued at Rs. 52,482/- for repairs, did not issue a voucher to Smt. Dhano Devi for receipt of the said primary gold.

1.6 The same show cause notice also alleged against the 2nd appellant that she has contravened the provisions of Section 8 ibid inasmuch she possessed, kept in custody or control unauthorisedly the aforesaid primary gold weighing 59.700 gms. valued at Rs. 7760/-.

1.7 The cause was to be shown to the Addl. Collector of Central Excise, New Delhi.

1.8 The adjudication proceedings were going on before the Additional Collector and there had been a substantial exchange of correspondence between the appellants and the adjudicating officer when in 1984 an addendum dated 5.12.1984 to the show cause notice dated 29.6.1981 was issued. The effect of the addendum was that -

(i) instead of the value of gold/gold ornaments at Rs. 60.242/- as shown in the show cause notice dated 29.6.1981 (Rs. 52,482 + Rs. 7760/-) it was show