( 1 ) THESE Writ Petitions arise under the Gold Control Rules, 1963 (hereinafter referred to as 'the Rules') made by the Central Government in exercise of the powers conferred by S. 3 of the Defence of India Act,1962. They are directed against two orders of adjudication passed by the Collector of Central Excise, Bangalore (Respondent No. 1 ). confiscating the gold ornaments seized from the residence of the petitioners on search on 27-8-1963 and further levying personal penalties under Rule 126l (16) of the Rules. ( 2 ) THE petitioner in WP. No. 311 of 1970 P. Sadashivachar, who will be referred to as Petitoner 1, and the petitioner in WP. No. 312 of 1970 Babachar, whom we shall refer as Petitioner 2, are partners of a firm of jewellers carrying on business in Mangalore Town under the name and style of canara Jewellers'. The said firm was carrying on business when the rules were brought into force by the Central Government on 9-1-1963. The Rules prohibit the manfacture and sale of gold ornaments of purity exceeding 14 carats. Every dealer who immediately before the commencement of the Rules is registered under any law with respect to Sales Tax was required to make a return as to the gold in his possession or under his control on the date of such commencement. Accordingly the firm 'canara Jewellers' furnished a return on 11-1-63. Although rule 126c prohibited manufacture and sale of gold ornaments of purity exceeding 14 carats, the proviso to the said Rule enabled the existing dealers to sell or otherwise transfer such ornaments as were in their possession on 9-1-1963 within a period of thirty days from the data of the commencement of the Rules. Canara Jewellers' sold some of the gold ornaments or otherwise transferred the same before 9-2-1963. On 9-2-1963 the firm furnished a second return as to its stock position which was verified by the Central Excise authorities. It is relevant to state that the firm 'canara Jewellers' was registered as a 'dealer' under the Mysore Sales tax Act, 1957 and was also asssesed as a firm under the Income Tax Act. The firm 'canara Jewellers' has two places of business in Mangalore town-one in Ganapathi High School Road and the other at Hampankatta. It is relevant to state that the firm 'canara Jewellers' was registered as a 'dealer' under the Mysore Sales tax Act, 1957 and was also asssesed as a firm under the Income Tax Act. The firm 'canara Jewellers' has two places of business in Mangalore town-one in Ganapathi High School Road and the other at Hampankatta. Petitioner 1 is in charge of the business in the premises at Ganapathy high School Road and Petitioner 2 is in charge of the business at Hampankatta. Petitioner 1 and Petitioner 2 have their separate residence in different localities in Mangalore Town. ( 3 ) ON 27-8-1963 the residential houses of both the petitioners were searched by the officers of the Central Excise Department on the ground of alleged contravention of the Rules by Canara Jewellers'. Gold and gold ornaments weighing 1622-600 grams valued at Rs. 12,000 were seized from the residence of petitioner 1. Gold and gold ornaments weighing 1493 grams valued at Rs. 10,000 were seized from the residence of Petitioner 2. Separate show cause notices were issued to the petitioners 1 and 2 by the Assistent collecter of Central Excise Bangalore en 10-1-1964 and 18-1-1964 respectively. The show cause notices are similarly worded and it is sufficient it the material portion of the show cause notice issued to Petitioner 1 is set out. It reads : notic1 to mr. P. sadshigvaohar, Partner, m/s. Canara Jewellers, Mangalore, by RPAD. Where as it appears that Mr. P. Sadashivachar, Partner of m/s. Canara Jewellers, Mangalore has contravened Rules 126f (1) and 126h (1) of the Defence of India (Amendment) Rules 1963 in as much as he had secreted at his residence gold details of which have been given here under and that he had not furnished a return under Rule 126f (1) of the Defence of India (Amendment) Rules in respect of the gold referred to: ( 4 ) THE Petitioners Submitted their explanations separately and they were heard by the 1st respondent. The contentions of the petitioners in brief were, that each of the petitioners individually was not a 'dealer' as defined under the Rules, that they were not individually carrying on any business of manufacture and sale of gold ornaments, that they were not individually licensed as 'dealers' under the Rules and that the gold and gold ornaments seized were the personal or individual properties of 'the respective petitioners and therefore there was no contravention of the Rules. ( 5 ) THE first respondent overruled the contentions of the petitioners except with regard to a few items and ordered confiscation of the seized gold and gold ornaments. He further imposed penalty of Rs. 5,000 on each of the petitioners. The Petitioners however were permitted to redeem the confiscated gold and gold ornaments on payment of fine of Rs. 12,000 in the case of petitioner 1 and Rs. 10,000 in the case of petitioner 2. The order of adjudication made by the first respondent against petitioner 1 is dated 7-6-1965 and that made against petitioner 2 is dt. 1-6-1965. ( 6 ) THE Petitioners preferred separate appeals before the Gold Control administrator (Respondent 2) before whom they urged the same contentions as before the first respondent. The second respondent by separate orders made on 24-6-196g rejected the contentions of the petitioners holding that except with regard to four shirt buttons and a pair of cufflinks seized from petitioner 1, the rest constituted the stock in trade by 'the dealer' and they were not the personal properties belonging to the petitioners. ( 7 ) THE second respondent however reduced the redemption fine in each case to Rs. 5000. He also reduced the personal penalties from Rs. 5000 to 3000. Thereafter, the petitioners took up the matters in revision before the Government of India (Respondent 3 ). Before the third respondent also, they urged the same con'tentions as before the first respondent. The third respondent by separate orders dt. 16-12-1969 rejected the revision petitions agreeing with the view of the second respondent. Having exhausted the remedies available before the statutory authorities under the Rules, the petitioners have approached this Court for relief under Arts. 226 and 227 of the Constitution of India. ( 8 ) LEARNED Counsel for the petitioners Shri Chandra Kumar, urged before us that the adjudication orders are not leagal. Having exhausted the remedies available before the statutory authorities under the Rules, the petitioners have approached this Court for relief under Arts. 226 and 227 of the Constitution of India. ( 8 ) LEARNED Counsel for the petitioners Shri Chandra Kumar, urged before us that the adjudication orders are not leagal. His main contention was that 'the dealer' in the instant case is the firm 'canara Jewellers' which is a legal entity and for the alleged contravention by the said firm adjudication proceedings could be taken against the firm only and that the separate proceedings taken against the individual partners as if he were 'a dealer' is illegal and that no adjudication under, confiscating the. ornaments and levying personal penal-ties could be made in such proceedings. ( 9 ) IN our opinion, the contentoin of the learned Counsel for the petitioners is well founded. Sri B. Ramachandra Rao, learned Sr. Cen Govt. Pleader was unable to explain as to how the partners individually could be proceeded with when the dealer alleged to have contravened the Rules is the firm which under the Rules is a legal entity. The word 'dealer' has been defined in clause (c) of Rule 126a thus: (c) 'dealer' means any person who carries on, directly or otherwise, the business of- (i) making, manufacturing buying, selling, supplying, distributing, melting, processing or converting ornaments. (ii) buying, selling, supplying, distributing melting processing or converting gold for the purpose of making or manufacturing ornaments, whether for cash or for deferred payment, or for commission, remuneration or. other valuable consideration and includes- (i) an undivided Hindu family which carries on such business; and (ii) a local authority, company, society registered under the Societies registration Act, 1860 (21 of 1860) Go-operative Society incorporated under any law witn respect to co-operative societies, club, firm or other association which carries on such business, or (rest omitted as unnecessary ). (underlining (italics) is ours ). It will be seen from the above definition that for the purposes of the rules, a firm is a 'dealer' as under the Income Tax Act, 1961 and the mysore Sales Tax Act, 1957. (underlining (italics) is ours ). It will be seen from the above definition that for the purposes of the rules, a firm is a 'dealer' as under the Income Tax Act, 1961 and the mysore Sales Tax Act, 1957. It is now well settled that both under the income Tax Act as well as under the Sales Tax Act, a firm registered as a 'dealer' is a distindt legal entity notwithstanding the fact that under the Indian Partnership Adt, 1932, the firm is not a person and not an entity but merely a collective name for the individuals who are members of the partnership. Under the Law of Partnership, a firm has no legal existence apart from its partners and it is merely a compendious name to describe its partners. But under the Rules, the position is different. Under the rules, where a firm carries on the business of manufacturing, buying and selling gold ornaments, the firm is the dealer and is a legal entity. The liability to make a return under Rule 126f (1) is on the dealer which in the instant case is 'canara Jewellers'. As already stated, the returns under rule 126f (1) were made by the firm and not by the individual partners. If the firm has contravened the provisions of Rule 126f (1) by failure to make the requisite return, the contravention of the Rule is by the firm and not by the individual partners. ( 10 ) THE contravention alleged in the instant case is the contravention of rule 126f (1) which requires every dealer to make a return of gold and gold ornaments in his possession or control on the date of tha commencement of the Rules and further returns on the dates prescribed. Rule 126h is a corollary to Rule 126f and it states that no dealer who is licensed under the Rules shall have in his possession or under his control gold which has not been included in the return given under Rule 126f (1 ). It was conceded by the learned Central Government Pleader that the petitioners individually were not registered as dealers under the mysore Sales Tax Adt on the date of the commencement of the Rules; they were also not licensed under the Rules at any time. It was conceded by the learned Central Government Pleader that the petitioners individually were not registered as dealers under the mysore Sales Tax Adt on the date of the commencement of the Rules; they were also not licensed under the Rules at any time. The substance of the charge and 'the findings of the first respondent is that gold and gold ornaments seized were the stock in trade of the firm of 'canara Jewellers' who is a licenced dealer under the Rules, that the ornaments in question had been secreted from the business premises and kept in the residences of the partners of the firm and they were not included in the return given by the firm and therefore Rule 126f (1) and Rule 126h (1) were contravened. The relevant adjudication order made by the first respondent against petitioner 1 states as follows ; brief facts of the case. Shri P. Sadashivachar is a partner of the firm in the name and style of M/s. Canara Jewellers Mangalore and he is in charge of the main premises of the above firm situated at ganapathy High School Road. He is a licensed dealer under the Gold control Rules. ( 11 ) THE relevant portion of the adjudication order made by the first respondent against petitioner 2 states as follows: barring item 31 in Box No. 3, I eoneluds that the other items of ornaments seized en 27-8-1966 have been held by Sri P. Babachar in his capacity as a dealer. When the firm is a dealer and the contravention of failure to make a return is by the firm, the offence is by the firm. It is a single offence by the firm under Rule 126f (l) and 126h (1 ). Separate personal penalties have been levied on each of the individual partners as if each individual partner were liable to penalty for contravention of the Rules. In our judgment on the basis of the allegations made in the show cause notices and the facts found by the first respondent, the adjudication proceedings could have been taken only against the firm 'canara Jewellers' and not against its individual partners. In that view, the entire adjudication prodeedings commencing with the show cause notice dt,10-1-1964 against petitioner 1 as per Ext. E in WP. No. 311 of 1970 and the show canse notice dt. 18-1-1964 against petitioner 2 in WP. In that view, the entire adjudication prodeedings commencing with the show cause notice dt,10-1-1964 against petitioner 1 as per Ext. E in WP. No. 311 of 1970 and the show canse notice dt. 18-1-1964 against petitioner 2 in WP. No. 312 of 1970 are clearly illegal and cannot be sustained. In the result, for the reasons stated above, we allow these writ petitions and quash the orders Exts. 'g, 'i' and 'k' made by Respondents 1 to 3 respectively. In the circumtances there will be no order as to costs. --- *** --- .