By TIOL News Service

MUMBAI, AUG 24, 2016: THE appellant, a gold dealer registered under the erstwhile Gold (Control) Act, was in March 1983 found to have excess stock of 258.500 gms. (gross) [255.300 gms. (net)]of gold ornaments valued then at Rs.38,630/- at the registered premises and was, accordingly, proceeded against under the Gold (Control) Act, 1968. The excess stock was confiscated with an option to redeem the same on payment of fine of Rs.35,000/-; a penalty of Rs.15,000/- was imposed.All this, by an order dated 24th September 1983 passed by the Additional Collector, Customs & Central Excise, Nagpur.

Having paid the penalty, the appellant sought relief from the CEGAT (as it was known then) but the same was rejected on the ground that relief from the Collector (Appeals) had not been sought for.

The Collector (A),Gold Control Appeals Office, Bombay refused to entertain the same claiming lack of jurisdiction. The Tribunal on 21 st September 1989 remanded the matter with the specific direction to dispose of the matter within six months.

Thereafter, due to restructuring, the appellant found himself within the jurisdiction of Collector of Customs (Appeals), Indore as communicated to him on 16th September 1992. The case file was sent in April 1992 but nothing happened thereafter.

The appellant, who had not exercised the option allowed by the original authority to redeem the gold ornaments, approached the AC, Amravati for doing so and that authority declined to accept the redemption fine as appeal was pending before the first appellate authority. This was conveyed vide F.No. C(CEX)19-07/2012/Prev./6461 dated 10th September 2014.

Against this communication, an appeal was preferred before the Commissioner of Customs (Appeals), Nagpur who dismissed the same for lack of jurisdiction in the absence of an appellate order; nevertheless, he did render a direction to the original authority to proceed as if there was no appeal pending.

The present appeal is filed before the CESTAT seeking relief against the dismissal of the appeal by the first appellate authority.

The Member (T) constituting the Single Member Bench, at the outset, remarked –

"There is considerable satisfaction in disposing off this appeal which has survived long after Parliament rescinded the Gold (Control) Act, 1968. A dispute that has been pending for the last 33 years can now be given a decent burial."

Proceeding further, the Bench observed –

"7. In the context of the desire of the appellant to exercise the option to redeem the confiscated gold there is no pre-requisite that pending appeal should be disposed off. The option is available in the order of an original authority and that option is to be exercised within the time-frame stipulated by that authority. It is seen that the order of 1983 does not prescribe any limit for exercise of this option. Notwithstanding the recourse to appellate remedy under the relevant statute, compliance with the order that has been appealed against cannot be denied. If an aggrieved party chooses to resign itself to the detriment that an impugned order has directed, it is certainly not deniable by any executive authority. To do so is tantamount to distancing of the executive branch of government from the impugned action of the executive. Such a jurisdiction is not vested with the executive. On a perusal of the order of confiscation, it is noticed that there is no time-limit specified for exercise of that option. Exercise of that option cannot, therefore, be denied at any stage and an appeal, even if pending, is not affected by exercise of such option.

8. The Gold (Control) Act of 1968 has ceased to exist in statute books for over two and half decades and a more pragmatic response, even if not specifically provided in the law, is warranted. When the law itself favours the individual, a negative attitude is certainly not called for.

9. … The appellant thereafter submitted a demand draft to the Commissioner of Customs, Central Excise & Service Tax, Wardha whose acceptance of the same was the sole act of redemptory expiation. The pre-requisite for return of confiscated goods has thus been complied with and the physical handing over alone remains to be completed. The consistent stand of the lower authority that the pendency of an appeal precludes the completion of redemption, echoed by Learned Authorised Representative, is no longer tenable."

Holding that it is settled law that any document or grievance caused by Assistant Commissioner is within the jurisdiction of Commissioner (Appeals), the dismissal of appeal was held untenable. Furthermore, the CESTAT held that since the option to redeem confiscated goods has been legally exercised by the appellant, there was no bar to release the same.

The impugned order was modified to direct the Assistant Commissioner to release the confiscated gold within four weeks after confirming that the redemption fine had been paid by appellant.

The Appeal was disposed of.

In passing: The optimism of a healthy mind is indefatigable – Margery Allingham.

(See 2016-TIOL-2172-CESTAT-MUM)