Hon'ble BHAGWATI, J.—Customs, Excise & Gold (Control) Appellate Tribunal has made this reference for an adjudication of the following questions of laws:- (i) Whether in the matter of imposition of redemption fine, the provisions of Section 73 of erstwhile Gold (Control) Act, 1968 will apply when the gold was neither seized nor confiscated under the Gold (Control Act, 1968. (ii) Whether the quantum of Redemption fine should be related to market value of Gold on the date of seizure or the market value of gold on the date of adjudication by the Commissioner of Customs and Central Excise, Jaipur. 2. Skipping unnecessary details, the facts necessary for the disposal of the reference in nub are stated as under:- 3. Way back in June, 1965, the Officers of the Collectorate of Central Excise and Customs, New Delhi, in pursuance of a secret information, conducted search and seized 240.040 kgs. of Gold from the residence of Chhanganlal Godawat on account of contravention of provisions of Rule 126-I of the erstwhile Defence of India Rules, 1962 (hereinafter referred to as `Rules, 1962'). Break up of 240..40.145 kgs of Gold is (i) Sovereigns of Gold 80.776 kgs; (ii) Passas of Gold 242 Nos., 75.298.300 kgs. (iii) Pieces of Gold bars 5 Nos., 10.975.845, (iv) Gold bars of 1917 and 1992 - 9 Nos., 72.990 kgs. Notice was issued to the respondent to show cause confiscation under Rule 126-M of the `Rules, 1962.' Ultimately, the Collector of Central Excise and Customs, New Delhi absolutely confiscated the goods under Rule 126-M of the `Rules, 1962' and imposed a penalty of Rs. 25 lakhs. Aggrieved with this order, Mr. Godawat filed an appeal before the Gold (Control) Administrator which was rejected. Thereafter, a revision application came to be filed before the Government of India. During the pendency of revision application, Mr. Chhagan Lal Godawat, the owner expired and his legal representatives came on record. However, revision application finally stood dismissed. 25 lakhs. Aggrieved with this order, Mr. Godawat filed an appeal before the Gold (Control) Administrator which was rejected. Thereafter, a revision application came to be filed before the Government of India. During the pendency of revision application, Mr. Chhagan Lal Godawat, the owner expired and his legal representatives came on record. However, revision application finally stood dismissed. Thereafter, a writ petition was filed by the legal representative of Late Chhagan Lal Godawat and this Court disposed of the writ petition on 9.8.1994 (S.B. Civil Writ Petition No. 1215/1979) in the following terms:- "In my considered opinion, the denial of opportunity by the Collector vitiated the entire proceedings and the opportunity provided by the erstwhile Gold Control Administrator as well as by the Special Secretary, Finance exercising the powers of the Central Government was no substitute. As these provisions are stringent in nature and resulting in penal consequences, in my considered opinion, the matter deserves to be reexamined by the Collector, Central Excise & Customs after affording full opportunity to the petitioners in respect of exercise of option for getting the Gold redeemed as well as on the question of imposition of penalty as noticed above in the order. As a sequence the orders passed by the Collector dated 24.9.1996 (Annex. 1), the order dtd. 6.3.1972 passed by the Gold Control Administrator as well as the order dated 3/4.6.1979 passed by the Special Secretary, Finance, Government of India exercising the power of revision of the Central Government are quashed and the matter is remitted back to the Collector, Central Excise & Customs, New Delhi to examine the matter afresh in the light of the observations made above after affording full opportunity to the petitioners. The parties are directed to appear before the Collector, Central Excise and Customs, New Delhi on 1.9.94 whereafter the Collector shall proceed with the case afresh and shall dispose of the matter within four months from the date of receipt of the copy of the order as indicated above. The matter has already been considerably delayed for over 30 years and any further delay would amount to denial of justice to the petitioners. The matter has already been considerably delayed for over 30 years and any further delay would amount to denial of justice to the petitioners. It is further ordered that in the event of the appeal being filed by the aggrieved party to the Central Excise and Gold Control Tribunal, the Tribunal shall dispose of the same as expeditiously as possible preferably within six months from the date of filing of the appeal." 4. Pursuant to the above order of the High Court, Collector Customs passed a revised order of confiscation and gave an option to the parties to redeem Gold on payment of fine of Rs. 2.50 crores based on the value of the Gold at the time of passing adjudging order which was 11.04 crores. The fine was fixed on the basis that at the time of adjudging, the Gold was worth over Rs. 11 crores. This order was challenged before the Appellate Tribunal, New Delhi in Appeal No. C/144/95-NB. There was a schism between the two members in regard to the quantum of redemption fine and finally after hearing by the third member, a majority decision was recorded and the appeal was allowed and the quantum of fine was reduced to Rs. 12.5 lakhs, which was the value of the Gold at the time of seizure. Having found difference of opinion, emerging with regard to the quantum of redemption fine, the Collector filed a reference application under Section 82-B of the Gold (Control) Act, to the Tribunal and the Tribunal made a reference to the Court for an adjudication of the above substantial questions of law as the quantum of fine of Rs. 2.5 crores scaling down to Rs. 12.5 lakhs was massive. The seizure in the instant case was made under the provisions of the Defence of India Rules. The rules were repealed by Gold (Control) Ordinance Act, 1968. Gold (Control) Act itself has been repealed since then. However, appeals pending before the Tribunal under this Act were being disposed of under the provisions of the Act. 5. It is stated in the statement of case that Section 73 of the Gold (Control) Act prescribes a ceiling on the quantum of redemption fine with regard to the value at the time of seizure. However, appeals pending before the Tribunal under this Act were being disposed of under the provisions of the Act. 5. It is stated in the statement of case that Section 73 of the Gold (Control) Act prescribes a ceiling on the quantum of redemption fine with regard to the value at the time of seizure. The most crucial question emerging for determination is whether in the matter of quantification of redemption fine, provisions of Section 73 of the Gold (Control) Act would apply even in a situation where Gold was neither seized nor confiscated under the provisions of Gold (Control) Act. 6. Heard learned counsel for the petitioner as also the learned counsel for the respondent and perused the relevant material available on record. 7. Learned counsel for the respondent has filed the written submissions. At the very outset, learned counsel for the respondent has assailed the relevance of both the questions, in the facts and circumstances of the case, especially, where the reference itself has been made by the Revenue under the provisions of Section 82 of Gold (Control) Act, 1968 and also on the ground that both these questions do not arise from the facts and law applicable in the present case. It is suffice to record that the dispute raised with regard to the relevancy of the reference by the learned counsel for the respondent is totally benefit of the merit as the learned counsel never raised this dispute earlier at any point of time. Learned counsel did not raise this dispute even when he was arguing the case. The reference has been questioned for the first time in the written submissions only, which is found to be devoid of substance and deserves to be abandoned at the threshold. 8. Learned counsel for the respondent has further canvassed that the value of Gold in the normal course of business is ever fluctuating and never stable. Hence, the market value of the goods as on the date of seizure should form basis of determining the quantum of fine which in the instant case is Rs. 12.5 lakhs. Learned counsel has vociferously opposed the market value of Gold on the date when the redemption fine is concluded. He has contended that the market value of Gold is variable factor and the correct legal position would be to take the date of seizure in consideration for determination the redemption fine. 12.5 lakhs. Learned counsel has vociferously opposed the market value of Gold on the date when the redemption fine is concluded. He has contended that the market value of Gold is variable factor and the correct legal position would be to take the date of seizure in consideration for determination the redemption fine. Learned counsel has advanced one alternative argument also that if the value of goods for the purpose of redemption is taken to be the date of adjudication then the same would relate to the date of initial adjudication in the year 1966 and not the year 1995 as the subsequent adjudication in the year 1995 was done in pursuance to the directions of this High Court. Question No. 1 9. Since both the above question of law are inter-related and interdependent, the same are being dealt with together. However, at the cost of repetition, it is stated that the officers of the Collectorate of the Central Excise & Customs, New Delhi organized various raids on the basis of secret information at the residential premises of late Shri Chhangan Lal Godawat situated in the town of Chhoti Chhabari. These raids were carried out from 29.7.1965 to 14.8.1965 and during this raid the Officers of the Department seized 240.040 kgs of Gold on account of contravention of provisions of Rule 126-I of Defence of India Rules, 1962. After seizure of the Gold, it was confiscated also under rule 126-M of the `Rules, 1962' and initially imposed the penalty of Rs. 25 lakhs. In June, 1965, the Gold (Control) Act was not in force. The entire proceedings of seizure and confiscation were carried out under the provisions of Defence of India Rules, 1962. It is pertinent to note that the Defence of India Rules were repealed by Gold (Control) Ordinance, which, in turn, was replaced by Gold (Control) Act, 1968. The Gold (Control) Act itself has been repealed since then. Section 73 of Gold (Control) Act prescribes a ceiling on the quantum of redemption fine with reference to the value at the time of seizure. The Gold (Control) Act itself has been repealed since then. Section 73 of Gold (Control) Act prescribes a ceiling on the quantum of redemption fine with reference to the value at the time of seizure. Section 73 of Gold (Control) Act envisages that: "Whenever any confiscation is authorized by this Act, the Officer adjudging it may, subject t such conditions as may be specified in the order adjudging the confiscation, give to the owner thereof an option to pay in lieu of confiscation such fine, not exceeding the value of the thing in respect of which confiscation is authorized, as the said officer thinks fit." 10. The word `value' has been defined under Section 2(v) of the Gold (Control) Act, 1968 as under:- "(v) "value", in relation to primary gold, article or ornaments, means- (i) when the gold is seized under this Act, the market price of such gold as on the date of the seizure thereof. 11. Thus, in accordance with the provisions of Section 73 of Gold (Control) Act, the officer adjudging the quantum of fine is required to consider the market price of Gold as on the date of the seizure thereof which cannot exceed the value of the seized Gold in respect of which confiscation is authorized. 12. Now the crucial question arises as to whether in the instant case, the provisions of Section 73 of Gold (Control) Act shall apply with regard to the quantification of redemption fine, even in a situation where the Gold was seized and confiscation under the provisions of Defence of India Rules, 1962. For determining this question, it is very relevant to go through Section 116, (Repeal and Saving clause) of Gold (Control) Act, 1968 which reads as under:- "S. 116. Repeal and savings. (1) The Gold (Control) Ordinance, 1968 (6 of 1968), are hereby repealed. For determining this question, it is very relevant to go through Section 116, (Repeal and Saving clause) of Gold (Control) Act, 1968 which reads as under:- "S. 116. Repeal and savings. (1) The Gold (Control) Ordinance, 1968 (6 of 1968), are hereby repealed. (2) Notwithstanding such repeal, anything done or any action taken, including any notification, order or appointment made, direction given, notice, licence or certificate issued, permission: authorisation or exemption granted, confiscation adjudged, penalty or fine imposed, or forfeiture ordered, whether under the Gold (Control) Ordinance, 1968 (6 of 1968) of Part XIIA of the Defence of India Rules, 1962, shall, in so far as it is not inconsistent with the provisions of this Act, be deemed to have been done, taken, made, given, issued, granted, adjudged, imposed or ordered, as the case may be, under the corresponding provision of this Act, as if this Act had commenced on the 29th day of June, 1968." 13. The Sub-section (2) of Section 116 of Gold Control Act tangibly reveals that if the penalty or fine imposed or the confiscation adjudged or forfeiture ordered under the Defence of India Rules, 1962 and if they are not inconsistent with the provisions of Gold (Control) Act, 1968 then they will be deemed to have been done, taken, made, given, issued, granted, adjudged, imposed or ordered as the case may be, under the corresponding orders of the Gold (Control) Act. But if they are inconsistent with the provisions of Gold (Control) Act then the provisions of Gold (Control) Act shall not apply for the seizure and confiscation ordered or confiscation adjudged or penalty of fine imposed under the Defence of India Rules, 1962. Neither in the instant case 240.040 kgs. of Gold was seized and nor confiscated under the provisions of Gold (Control) Act. Hence, the provisions of Section 73 of erstwhile Gold (Control) Act, 1968 will not apply in the matter of adjudging redemption fine. 14. Rule 126-I of Defence of India Rules, 1962 deals with the declaration as to possession of Gold other than ornaments. Sub-rule 11 of Rule 126-I of Rules envisages that any person in possession or control of any Gold, not being ornament, shall be presumed, until the contrary is proved, to be the owner thereof. Rule 126-M of `Rules, 1962' deals with confiscation of Gold seized and its adjudication. Sub-rule 11 of Rule 126-I of Rules envisages that any person in possession or control of any Gold, not being ornament, shall be presumed, until the contrary is proved, to be the owner thereof. Rule 126-M of `Rules, 1962' deals with confiscation of Gold seized and its adjudication. Sub-rule 8(a) of Rule 126-M of Defence of India Rules, 1962 envisages:- 15. This rule makes it clear, that any Gold seized under rule 126-I shall be liable to confiscation and adjudication. If we read sub-rule 8 (a) of Defence of India Rules, 1962 and Section 73 of Gold (Control) Act, 1968 together, we find that the provisions of both the Gold (Control) Act and Defence of India Rules, 1962 with regard to determining the quantum of fine are distinct. Section 73 of Gold (Control) Act provides that the quantum of fine shall not exceed the value of Gold (thing) confiscated and as per Section 2(v), value of Gold shall be the market price of such Gold as on the date of its seizure, whereas, sub-rule 8(a) of `Rules, 1962' provides that the amount of fine in lieu of confiscated Gold shall be as the adjudging officer thinks fit. 16. Thus, with regard to the determination of the quantum of fine in lieu of confiscated Gold, it is held that the provisions of Section 73 of Gold (Control) Act and the sub-rule 8(a) of `Rules, 1962' are inconsistent and in such a situation the provisions of Gold (Control) Act, 1968 will not apply in the instant case when the entire proceedings of seizure and confiscation of Gold were made under the provisions of Defence of India Rules, 1962. Question No. 2 17. Throughout the main thrust of argument of the learned counsel for the respondent has been on the `date' as to whether the quantum of redemption fine should be related to market value of Gold on the date of seizure or its market value on the date of adjudication. The learned counsel has emphasized that it should relate to market value of the Gold on the date of seizure. He has cited many judgments in support thereof. Having gone through all the judgments, we respectfully observed that they are not relevant to the facts and circumstances of the instant case. 18. The learned counsel has emphasized that it should relate to market value of the Gold on the date of seizure. He has cited many judgments in support thereof. Having gone through all the judgments, we respectfully observed that they are not relevant to the facts and circumstances of the instant case. 18. Once it is decided that in the matter of imposition of redemption fine, the provisions of Section 73 of erstwhile Gold (Control) Act, 1968 shall not apply then how can the definition of `value' as given in section 2(v) of Gold (Control) Act can be imported in the instant case for adjudging the quantum of fine. Market value of the Gold on the date of seizure can be taken into consideration only in that event when the provisions of Gold (Control) Act, 1968 are applicable. But once the provisions of Gold (Control) Act, 1968 are abandoned or jettisoned then evidently for adjudging the fine, that date shall be taken into consideration as laid down under Sub-Rule 8(a) of `Rules, 1962'. Under Sub-rule 8(a) of `Rules, 1962', albeit, no specific date is provided for the determination of quantum of fine but its language speaks volumes about it as it is hidden in the rule itself. Now, what shall be the quantum of fine, decision thereof has been left to the adjudging authority and he may adjudge the fine as he thinks fit. Of course, this decision is required to be exercised judiciously in accordance with law or rule as the case may be but not arbitrarily. The words "an option to pay in lieu of confiscation such fine" are very significant and the use of the words "in lieu of' connotes that the fine should be equivalent to the thing or Gold confiscated by the authority. Once the ownership of the seized Gold is established, sub-rule 8(a) of `Rules, 1962' casts a duty on the officer to give an option to the owner of the Gold to pay such fine in lieu of confiscated Gold as the said officer thinks fit. Once the ownership of the seized Gold is established, sub-rule 8(a) of `Rules, 1962' casts a duty on the officer to give an option to the owner of the Gold to pay such fine in lieu of confiscated Gold as the said officer thinks fit. Option is required to be given by the officer and before giving option, the amount of fine is required to be adjudged and this amount of fine, if the owner of the Gold opts to deposit in lieu of confiscated Gold, he can deposit or if he feels that he does not want to deposit, the Gold shall remain confiscated with the Government. That gives us a ground to ruminate as to what should be the amount of fine which could be in lieu of confiscated Gold. 19. Undeniably and undisputedly, it is the date of giving option which is relevant for adjudging the fine and not the date of seizure. It is pertinent to note that rule 126-I of `Rules, 1962' relates to declaration as to possession of Gold other than ornament. One who fails to declare the Gold owned by him, as required under Chapter 5 and on inspection, he is found in possession or control of any Gold, until the contrary is proved, then under Sub-rule 11 of rule 126-I, he shall be presumed to be the owner thereof. Rule 126-M relates to confiscation of Gold seized. The language of Sub-rule 8 of Rule 126-M of `Rules, 1962' categorically envisages that the officer adjudging may give to the owner of the Gold an option to pay in lieu of confiscation such fine as the said officer thinks fit. According to Wiktionary, a wiki based open content dictionary, the meaning of term in lieu of is `Instead, in place of, as substitute for'. This meaning suggests that the redemption fine is the substitute for the market value of the Gold. The words `thinks fit' used in rule 8(a) qualifies the discretion `may give an option' conferred on the officer adjudging. Thus, the word `may' cannot be read as `must' as per the phraseology of the said rule. He may give an option and he may also refrain from giving any option and confiscate the seized Gold. The words `thinks fit' used in rule 8(a) qualifies the discretion `may give an option' conferred on the officer adjudging. Thus, the word `may' cannot be read as `must' as per the phraseology of the said rule. He may give an option and he may also refrain from giving any option and confiscate the seized Gold. However, the amount of fine when adjudged cannot be more than the market value of confiscated Gold at that point of time when the adjudging officer gives an option nor can it be much less than the market value of the Gold on that date. Thus, from both the angles, the market value of the seized Gold has to be taken on that date when the option is given by the officer adjudging it. 20. It is revealed from the material on record that the Collector aptly applied the market price of Gold at the rate of Rs. 4,600 per 10 gms as on December 7, 1994, the date of adjudicating when the option was given by him to the respondent and on this basis, the price of total seized and confiscated Gold 240.040 kgs came to be 11.04 crores and the redemption fine cannot be in any way less than this. 21. Thus, in the ultimate analysis, it is candidly recorded that the quantity of redemption fine should be related to the market value of gold on 7.12.1994 i.e. the date of adjudication when the officer adjudging gave the owner of the Gold an option to pay fine in lieu of confiscation. The amount of fine as adjudged to the tune of Rs. 2.5 crores was totally arbitrary and irrational as it was not based on any sound and lawful reasoning. 22. Pursuant to the reference made by CEGAT as indicated hereinabove, the Union of India through Commissioner, Customes Central Excise, Jaipur also filed a writ petition along with a stay application seeking directions for the respondents not to take any action with respect to getting goods (Gold) from the petitioner department in any manner till the disposal of reference on hand. Pursuant to the reference made by CEGAT as indicated hereinabove, the Union of India through Commissioner, Customes Central Excise, Jaipur also filed a writ petition along with a stay application seeking directions for the respondents not to take any action with respect to getting goods (Gold) from the petitioner department in any manner till the disposal of reference on hand. The Division Bench of this Court in D.B. Civil Stay Application No. 5237/1996 passed the order on May 28, 1997, which reads as under:- "We therefore, vacate the stay order passed on December 20, 1996 staying the operation of the order dated October 30, 1995 passed by the CEGAT and instead direct that the petitioner shall retain only that much quantity of the seized gold which will fetch a sum of Rs. 2,50,00,000/- (Rupees Two Crores, Fifty lacks) @ Rs. 4600/- (Rupees Four thousand six hundred) per 100 (Ten) gms of gold and release and hand over possession of the rest of the quantity of gold to the respondent No. 1 within one month from today. In case the petitioner succeeds and there is any shortfall in the recovery because of fall in price of gold, the respondent No. 1 shall make that good and if the petitioner is dismissed and the order of the CEGAT is maintained the respondent No. 1 shall be entitled to return of the gold permitted to be retained under this order as per the directions of this Court while finally disposing of the matter or thereafter." 23. It appears that the Gold worth Rs. 2.5 crores in compliance of the above order must have been retained and the rest of the Gold might have been released to the respondent No. 1. But in view of the observations made in Para 18, 19, 20 and 21, the respondents are entitled to redeem the confiscated Gold only after paying the redemption fine of Rs. 11.040 crores. 24. In view of above, we deem it just and proper to direct the authorised officer to give an option afresh following above clinching observations to the owner of the Gold asking him to pay the redemption fine in lieu of confiscation. 25. For these reasons, we dispose of both the reference as also the writ petition accordingly.