Case Law Details
Bhagwati Jewellers Vs Directorate Of Enforcement (Rajasthan High Court)
Introduction: In a recent ruling, the Rajasthan High Court has addressed a significant legal matter involving Bhagwati Jewellers and the Directorate of Enforcement. The case revolves around the seizure of gold bullion and other goods during a search operation conducted by the official respondents. The petitioners, in this case, are seeking the release of the seized items, asserting that they are engaged in the legitimate trade of gold bullion and are duly registered under the VAT/Goods and Service Tax Act (GST). This article provides an in-depth analysis of the case, the arguments presented by both parties, and the court’s final judgment.
Background of the Case: The Enforcement Directorate conducted a search operation at the business premises of Bhagwati Jewellers, during which they seized 3773.52 grams of gold bullion, along with electronic devices, mobile phones, and hard disks. The petitioners claim that the seized gold bullion is part of their stock in trade and should not have been seized.
Petitioners’ Arguments: The petitioners filed a writ petition, contending that they are registered under the VAT/GST Act and that the seized gold bullion is legally part of their stock in trade. They allege that despite making representations to the authorities, their request to release the seized goods was ignored. The petitioners argue that the law does not permit the seizure of stock-in-trade and that they are entitled to have the goods returned.
Respondents’ Response: In their reply, the respondents raised the issue of adjudication under the Foreign Exchange Management Act (FEMA) and alleged that the petitioners were not cooperating in the ongoing investigation. They also claimed that the search operation was based on information about smuggled gold transactions.
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