GUNS from a city firing range were found in the possession of "criminal elements" warranting a cancellation of its licence, court documents allege.

Marksman Training Systems Pty Ltd - which surrendered several firearms during a voluntary police audit on Monday - is appealing the decision to cancel its Firearms Dealer's Licence and Firearms Licence in the District Court, claiming the decision was based on errors of fact and law.

In its statement of claim, which lists 26 grounds of appeal, the business asserts Chief Inspector Paul Ralphs of SA Police's firearms branch erred in holding that the cancellation of the licence was "justifiable in the public interest".

It claims Chief Insp Ralphs made prejudged decisions against the business and failed to take into account the circumstance that a "rogue employee ... may well have been responsible for the missing firearms".

The business asserts Chief Insp Ralphs erred in holding that it "acted inappropriately or improperly" by conducting its own investigations into possible missing firearms.

The licences were cancelled following two voluntary audits in 2009 and 2011.

A letter from Chief Insp Ralphs, detailing the reasons for his decision, states the audits revealed that there were "many" firearms that were unaccounted for but were subsequently located following "considerable toing and froing" between the police and the Marksman's dealership.

He states 10 firearms were still missing and three were found by police "in the hands of criminal elements".

One of the missing firearms, a Phoenix Arms pistol, was located loaded and hidden in a computer printer in September last year during a search of a residence by SAPOL's Crime Gangs Task Force.

A Beretta pistol was located loaded in the rangehood of an outside barbecue during another raid in August last year.

An Astra pistol was found loaded in the pants of the girlfriend of Dylan Jessen, a Finks member.

"I and the community are very concerned about unlicensed persons being in possession of firearms; particularly those being serious offenders whose actions are a clear risk to community safety," Chief Insp Ralphs states.

"Marksman agrees it cannot account for a number of firearms, particularly handguns, which are often the preferred choice of firearm for serious offenders."

Chief Insp Ralphs stated that firearms would be easy to check on a daily basis and the likelihood of mistakes and thefts would be identified quickly.

"Great care should be taken to ensure that firearms do not find their way into the general community," he states.

"Negligent dealers can be a conduit for the diversion of firearms into criminal hands and the community needs to be safeguarded from this."

Marksman refutes the allegation of negligence.

Chief Insp Ralphs states Marksman claims the remaining missing firearms and the three found by SAPOL went missing during a former employee's time with the business and that he was responsible for the loss.

EDITOR'S NOTE: A report on Monday described the presence of police at the Marksman premises as a "raid". Adelaidenow accepts that it was instead a voluntary audit.

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