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REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 10824 OF 2018

(Arising out of SLP (C) No. 26686/2016)

SUSHILA N. RUNGTA (D) THR. LRS. Appellant(s)

VERSUS

THE TAX RECOVERY OFFICER-16(2) AND ORS. Respondent(s)

WITH

CIVIL APPEAL NO. 10830 OF 2018

(Arising out of SLP (C) No. 29640/2016)

CIVIL APPEAL NO. 10829 OF 2018

(Arising out of SLP (C) No. 29613/2016)

CIVIL APPEAL NO. 10831 OF 2018

(Arising out of SLP (C) No. 29641/2016)

CIVIL APPEAL NO. 10825 OF 2018

(Arising out of SLP (C) No. 29552/2016)

CIVIL APPEAL NO. 10833 OF 2018

(Arising out of SLP (C) No. 29796/2016)

CIVIL APPEAL NO. 10832 OF 2018

(Arising out of SLP (C) No. 29740/2016)

CIVIL APPEAL NO. 10826 OF 2018

(Arising out of SLP (C) No. 29559/2016)

CIVIL APPEAL NO. 10827 OF 2018

(Arising out of SLP (C) No. 29601/2016)

CIVIL APPEAL NO. 10828 OF 2018

(Arising out of SLP (C) No. 29602/2016)

C.A. No. 723/1973

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J U D G M E N T

R.F. Nariman, J.

Civil Appeal No. 723/1973 :

1) In this appeal, an order dated 03.01.1970 was passed by

the Collector of Central Excise in which, it was ordered as

follows:-

“17. In view of the above-mentioned facts,

the party charged is entitled to the benefit

of the amnesty granted by the Government.

Even though he had initially failed to

declare the gold, time was available to him

up to 31.5.66 to invest the gold into gold

bonds and his intentions would have

materialised but for the fact that seizure of

gold prevented him from tendering the Gold to

the Bank, as it was not in his possession at

that time.

18. While intention to invest the gold in

gold bonds is conceded failure to declare

was, no doubt, there. He was required by law

to declare his gold to the Government. Since

he did not declare this gold, even though he

is given the benefit of the gold bond scheme,

he has rendered himself liable to punishment

for not declaring his gold, at the

appropriate time, as required by law.

19. Considering all the facts and

circumstances of the case and weighing the

merits of the evidence available on record, I

order that the gold shall be released to the

party charged for invest in gold bond in

pursuance of the application tendered by him

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to the State Bank of Indore in 1965.

20. I also order that for failure to

declare the gold in his possession, which

involves contravention of gold control rules,

I impose upon him a penalty of Rs.25,000/-

(Rupees twenty-five thousands only) under

Rule 126-I(16) of the Gold Control Rules,

1962 (Corresponding to Section 74 of the

Gold Control Act, 1968)”

2) Against the aforesaid order, an appeal was dismissed on

08.02.1971. Exercising suo motu powers under the Defence of

India Rules, a show cause notice dated 01.06.1971 was issued

in which it was sought to confiscate the items of gold and

enhance penalty that had been imposed. This show cause notice

was challenged by the grand-father of the present petitioner

in a writ petition that was ultimately dismissed by the Delhi

High Court on 29.09.1972. This appeal is an appeal from the

aforesaid judgment. This Court, on 09.08.1973, passed the

following order:

“Upon hearing the counsel for the parties,

while counsel for Respondent No.3 waiving

notice of motion, the Court directed stay of

all further proceedings in pursuance of the

impugned proceedings dated 01.06.1971 pending

final disposal of this appeal. The Court

allowed C.M.Ps. 3056 and 3058 of 1973”

3) While the stay order of this Court continued, the Gold

Control Act itself was repealed.

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This was effected by two sections, namely,:

1. Short title.- This Act may be called the Gold (Control)

Repeal Act, 1990.

2. Repeal of Act 45 of 1968.- The Gold (Control) Act, 1968 is

hereby repealed.

The statement of objects and reasons for this Act is as

follows:

“Gold control which regulated the domestic

trade and movement of gold within the country

was introduced on 9

th

January, 1963 as part of

the Defence of India Rules. Later on, the Gold

Control Act, 1968 was enacted with the broad

objectives of controlling the production,

manufacture, supply, distribution, use and

possession of and business in gold, ornaments

and articles of gold. The said enactment was

meant to supplement other preventive measures

to make circulation of smuggled gold difficult

and its detection easier by extending the

control over gold beyond the stage of import.

2. Over the past 22 years, the results

achieved under the Act have not been

encouraging and the desired objectives for

which the Act was introduced have not been

achieved due to various socio-economic and

cultural factors in the vast multitude of the

country’s population and the lack of

administrative machinery. On the other hand,

this regressive and purely regulatory Act has

given rise to considerable dissatisfaction in

the minds of the public as it has caused

hardship and harassment to the artisans and

small self-employed goldsmiths who have not

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been able to develop their skills and earn

proper living on account of the rigours which

this Act imposed upon them.

3. Taking these factors into consideration and

the advice of experts who have examined issues

related to this Act, it is proposed to repeal

the Gold (Control) Act, 1968.

4. The Bill seeks to achieve the said object.”

4) What has been argued by Mr. R. Venkataramani, learned

senior counsel appearing on behalf of the appellant, is that

considering that the Gold Control Act itself has been repealed

without a saving clause, Section 6 of the General Clauses Act

would not apply for the reason that the objects and reasons

show that the Act was sought to be repealed without any saving

clause. He relied strongly upon the objects and reasons using

the expression “regressive” and the fact that it has given

rise to considerable dissatisfaction in the minds of the

public as it has caused hardship and harassment to artisans

and small self-employed goldsmiths. Therefore, according to

him, the statement of objects and reasons clearly evinces a

contrary intention as a result of which, nothing will survive

the repeal of this Act. This being so, a show cause notice

which has been upheld by the Delhi High Court would not

survive.

5) On the other hand, Mr. Rupesh Kumar, learned counsel

appearing on behalf of the Revenue, has taken us though the

impugned judgment and has argued that once there is a repeal

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simpliciter, without any savings clause, the whole object of

such a repeal was so that the general rule under Section 6

would apply, as a result of which the law laid down in State

of Punjab vs. Mohar Singh, [1955] 1 SCR 893, would apply.

6) Having heard learned counsel for both sides, we are of

the view that the statement of objects and reasons makes it

clear that over 22 years, the results achieved under the Act

have not been encouraging and the desired objectives for which

the Act has been introduced have failed. Following the advice

of experts, who have examined issues related to the Act, the

objects and reasons goes on further to state that this Act has

proved to be a regressive measure which has caused

considerable dissatisfaction in the minds of the public and

hardship and harassment to artisans and small self-employed

goldsmiths.

7) This being the case, we are of the opinion that the

repeal simpliciter, in the present case, does not attract the

provisions of Section 6 of the General Clauses Act as a

contrary intention is very clearly expressed in the statement

of objects and reasons to the 1990 repeal Act. In this

behalf, it would be apposite to refer to New India Assurance

Co. Ltd. vs. C. Padma and Another , (2003) 7 SCC 713 (para 10)

8) This Court noticed that, in a parallel instance of

simpliciter repeal, Parliament realized the grave injustice

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and injury that had been caused to heirs of LRs of victims of

accidents if their petitions were rejected only on the ground

of limitation. This being the case, this Court found that a

different intention had been expressed and, therefore, Section

6-A of the General Clauses Act would not in that situation

apply.

9) We find a similar situation in the present case. In

point of fact, on going through the impugned judgment, it is

clear that every time an amendment was made to the Defence of

India Rules and/or repeal of the said rules had taken place,

there was always an inbuilt savings clause. In fact, Section

116 of the Gold (Control) Ordinance No.6 of 1968 also made it

clear that it went to the extent, in sub-section 2 thereof, by

saving show cause notices which, ordinarily, are not saved

even if Section 6 were to apply – See M.S. Shivananda vs.

Karnataka State Road Transport Corporation and Others , [1980]

1 SCR 684 following Director of Public Works & Anr. vs. Ho Po

Sang & Ors., [1961] 2 All. ER 721.

10)This being the case, we are of the view that the show

cause notice dated 01.06.1971, which is the subject matter of

this appeal, no longer survives. In this view of the matter,

the appeal is disposed of.

CIVIL APPEAL NO. 10824 OF 2018 (@ SLP (C) No. 26686/2016)

CIVIL APPEAL NO. 10830 OF 2018 (@ SLP (C) No. 29640/2016)

CIVIL APPEAL NO. 10829 OF 2018 (@ SLP (C) No. 29613/2016)

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CIVIL APPEAL NO. 10831 OF 2018 (@ SLP (C) No. 29641/2016)

CIVIL APPEAL NO. 10825 OF 2018 (@ SLP (C) No. 29552/2016)

CIVIL APPEAL NO. 10833 OF 2018 (@ SLP (C) No. 29796/2016)

CIVIL APPEAL NO. 10832 OF 2018 (@ SLP (C) No. 29740/2016)

CIVIL APPEAL NO. 10826 OF 2018 (@ SLP (C) No. 29559/2016)

CIVIL APPEAL NO. 10827 OF 2018 (@ SLP (C) No. 29601/2016)

CIVIL APPEAL NO. 10828 OF 2018 (@ SLP (C) No. 29602/2016)

11)Leave granted.

12)The impugned order records that owing to counsel not

turning up in time, the reference of questions made under the

Wealth Tax Act at that point of time would remain unanswered.

Given the fact that the show cause notice and proceedings

thereafter have now disappeared as a result of the repeal of

the Gold Control Act, we give liberty to both parties to add

to or amend or delete the questions in the Wealth Tax

Reference within a period of eight weeks from today. Once

this is done, the writ petitions will taken up and decided on

their merits. Considering these writ petitions are of 2005,

we request the High Court to hear the same expeditiously.

13) We, therefore, allow the appeals and set aside the common

impugned judgment of the High Court.

.......................... J.

(ROHINTON FALI NARIMAN)

.......................... J.

(NAVIN SINHA)

New Delhi;

October 30, 2018.