TMI Blog1956 (11) TMI 31X X X X Extracts X X X X X X X X Extracts X X X X ..... these bales alone, namely, that bearing No. 1202, was found to contain powerloom goods. The others contained handloom goods as regards which there was no prohibition. The Customs authorities thereupon confiscated the said bale No. 1202 but directed that it would be returned to the party on payment of a penalty of ₹ 50. The respondent alleged that he directed his broker Siddique Sahib to pay the said penalty from and out of moneys belonging to him in the agent's hands and expected that in the normal, course the agent would pay the penalty and take back the said bale. He also expected the broker to clear the other six bales. Actually, however, all the said bales including bale No. 1202 continued to remain. on the premises of the Port Trust without being cleared. The penalty of ₹ 50 apparently was not paid by Siddique Sahib. In the first week of July 1948 the said broker Siddique Sahib represented on behalf of the respondent another shipping bill for six bales of piece-goods and it is now admitted that bale No. 1202 was one of them, and along with the other five bales it was despatched. The respondent wrote to the Assistant Collector of Customs, Madras, on 21-1-1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Revenue dismissed the appeal by an order which runs thus : The only persona who stood to gain by shipping the prohibited goods were the exporters. The clearing agent affirms that the second shipping bill for six bales which was filed in accordance with exporters' instructions specifically included the running number of the confiscated bale. The Collector was therefore correct in holding the appellants to be equally culpable. The appellants' contention that the amount of penalty imposable under Section 167, Clause 8 of the Sea Customs Act is ₹ 1,000 is not correct. The Board is also satisfied that in the circumstances of the case the penalty imposed is not excessive. 4. Thereupon the respondent filed the aforesaid W. P. No. 381 of 1953 praying that this Court may be pleased to issue a writ of certiorari or such other appropriate writ to quash the Order of the Collector of Customs as confirmed by the Central Board of Revenue inflicting a penalty of ₹ 10,000, against him. One of tins main grounds urged against the order of the Collector of Customs was that it contravened rules of natural justice in that no hearing or opportunity to be heard was afforded to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... friend of his at Penang to despatch to him 50 bags of inferior quality betel nuts belonging to Radhakrishnan and accordingly the goods were exported to him through his principals, the Arasan Trading Co. The respondent however, did not have the necessary licence to import betel nuts into India from Penang, and stated that he was not aware of the rules and regulations which require a licence. He requested the authorities to take a lenient view. But the customs authorities ordered confiscation of his goods under Section 167 (8) of. the Sea Customs Act read with Section 3 (2) of the Imports and Exports (Central) Act, 1947. The order passed by the Collector of Central Excise, Madras, runs thus: On 21st May 1953, Mr. N. M. Nagarajan of Nagapattinam imported at the Nagapattinam Port 25 bags of red split betel nuts and 25 bags of Lankat whole betel nuts from Penang. As he did not produce the requisite I. T. C. licence, the betel nuts were detained by the Customs Collector, Nagapattinam and the importer was called upon to show cause for importing the betel nuts without an I. T. O. licence. 2. The importer in his reply to the show cause memo issued by the Customs Collector stated t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he preliminary objection with the brief statement that in spite of the appellate order, the validity of the order of the Collector could be challenged in proceedings under Article 226. The learned Judge held that the order of the Collector was vitiated by an assumption which was conceded to be erroneous, namely, that there was a branch of the Arasan Trading Co., at Nagapattinam, The learned Judge observed: To what extent this wrong assumption affected the exercise of his discretion it is not possible for me to gauge or decide. But it would certainly appear to be a case of failure to exercise a jurisdiction vested in him, a jurisdiction to exercise his discretion under Section 183 of the Sea Customs Act, whether the goods should be confiscated or whether a fine in lieu of such, confiscation should be sufficient. Since such a discretion was not exercised at all, 1 think the rule nisi should be made absolute, which would mean that the matter would have to be gone into afresh by the appropriate authority. He therefore allowed the petition. The Collector of Central Excise is the appellant before us. 6. W. A. No. 55 of 1956 : This is an appeal against the Judgment of Rajagopal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at objection was overruled by the learned Judge. He held that the respondent had not been given a real and effective opportunity to defend himself against, the charges made against him in the notice dated 20th January 1953 and there had been, therefore, a violation of the principle of natural Justice. On this finding he set aside the order of the Assistant Collector. The Assistant Collector of Customs. Madras, is the appellant before us. 8. W.A. No. 89 of 1956: This is an appeal against the judgment of Rajagopalan J. in W.P. No. 643 of 1954 filed by the respondents who are a firm of importers and exporters. They exported 75 cwts of coffee seeds to Ceylon from Tuticorin in October 1950. Admittedly the respondents did not obtain the authorisation of the Indian coffee Board as prescribed by Section 20 of the Coffee Market Expansion Act, VII of 1942. Before exporting the Coffee, the respondents sought the advice of the Superintendent of Central Excise, Tuticorin, who informed them on 18-10-1950 that coffee was one of the items released from export control. On a 22-8-1951 the Superintendent of Central Excise, Tuticorin, issued a notice to the respondents why the firm should not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere in the nature of administrative orders not liable to be quashed by writs of certiorari. This question does not appear to have been raised before either Bajagopalan J. or Rajagopala Aiyangar J. He relied upon the ruling of the Calcutta High Court in the Collector Customs v. Shewpujanrai, (Compilation of Judgments in Customs Cases, 1953, compiled by the Central Board of Revenue). The learned Judges in that case discussed the question whether the Collector of Customs while adjudging confiscation or imposing a penalty under the Sea Customs Act is a Person entrusted by statute with judicial or quasi-judicial functions and held that he was not, and therefore neither a writ of certiorari nor a writ of prohibition could lie in respect of such an order. They came to this conclusion partly because of certain Observations of Bhagwati J. in the decision of the Supreme Court in Maqbool Hussain v. State of Bombay. , (A), and partly on a consideration of the nature of the act of the Collector in passing an order of confiscation or an order imposing a penalty. The observations in the Supremo Court Judgment referred to by the learned Judges are as follows: All these provisions go to show th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tor of Customs sought to be quashed; but in their opinion the fourth element was not present and therefore the impugned order was an administrative order. We have carefully considered the several reasons which impelled the learned Judges to take to that view; but with great respect we do not think any of the reasons compels us to hold that the Collector is not under a duty to act judicially in ordering confiscation or imposing a penalty. We cannot agree with the learned Judges that the use of the word adjudge in Sections 182 and 183 of the Sea Customs Act does not Involve the idea of judicial approach. In our opinion, neither the fact that the customs authorities can act on matters which are not legal evidence, nor the fact that they cannot administer oath, nor the fact that the customs authorities need not observe the rules of judicial Process, nor the fact that the customs authorities are not required to hear arguments on law or fact, nor the fact that the appeal and revision provided lie to the customs authorities and the Central Government and not to any judicial authority would have any bearing on the question whether an order of confiscation or penalty is or is not a quasi- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... State and the appellate authority is located in another State. It is not necessary for the purposes of this appeal to decide which High Court would have jurisdiction in such circumstances to issue prerogative writs under Article 226. 12. The learned Advocate-General relied on certain observations in a recent decision of the Supreme Court which he contends are decisive on the point. They occur in Thangal Kunju Musaliar v. Venkatachalam Potti, (D). That case arose out of a writ petition filed in the High Court of Tra-vancore-Cochin for a writ of prohibition or any other appropriate writ or direction prohibiting the income-tax officer on Special Duty, Trivandrum, and the Indian Income-tax Investigation Commission from holding any enquiry into the cases registered as Evasion Cases Nos. 1 and 2 of 1125 (M. E.) on the file of the Income-tax Investigation Commission. Travancore. A preliminary objection to the jurisdiction of the High Court to entertain the writ petition was raised on the ground that the Court was not competent to Issue a writ against the second respondent, that is, the income-tax investigation commission, which being outside the territory of the State was not amen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity, have been infructuous, the High Court concerned had, of necessity to dismiss the petition. Such, however, was not the position in the present petition before the High Court of Travancore-Cochin. There was here not question of merger of any judicial order of respondent 1 (Income-tax Officer) into the judicial order of respondent 2 (Investigation Commission). 13. To understand the scope of these observations it is necessary to refer to the three decisions above-mentioned. In (S) (E), the facts were: On 3-9-1949 the Deputy Custodian of Evacuee Property, Gonda, in the exercise of powers vested in him under the United Provinces Administration of Evacuee Property Ordinance, 1949, declared certain persons to be evacuees and their property to be evacuee property. The petitioners before the High Court claimed to be sub-tenants of the evacuee and were allowed by the Assistant Custodian be remain in possession. The Assistant Custodian subsequently formed the opinion that the petitioner's claim to be subtenants was fictitious and he made a report to that effect to the Deputy Custodian who, on 10th May 1952, passed orders directing the petitioners to be evicted from the property ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll Bench Was as follows: ''In our opinion it is no less clear that we cannot do indirectly what we have no power to do directly. We have no power to set aside the Custodian General's order; it is so far as this Court is concerned, a final order. If we examine the grounds of that order for the purpose, should We find the order to be invalid, of declaring it to be a nullity, we are in effect doing indirectly what We cannot do directly. Until the Custodian General's order be qua-shed or set aside by a Court competent to do so, this Court must deem the order to be a valid order, and there is consequently no material upon the basis of which We can issue the mandamus which the petitioners seek. 15. Reliance was placed before the Pull Bench on two cases of the Rajasthan High Court, one of which was Barkatali v. Custodian General of Evacuee Property of India, (H), Dealing with these cases, the learned Chief justice said : In each of these cases, the order of a subordinate officer within the jurisdiction of the High Court had been confirmed by the higher authority outside the Jurisdiction. The Court in each case held that in these circumstances the real order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was upheld. The learned Judges held that the Nagpur Court did not possess jurisdiction to interfere with the decision of the Appellate Tribunal whose seat was in Bombay, and as no writ could run to the Appellate Tribunal and its decision could not be interfered with, it would be improper to interfere with the order of the Industrial Court because that would be doing indirectly what the Court cannot do directly. The learned Judges also pointed out that by quashing the. order of the Industrial Court only they would be Placing that Court on the thorns of a dilemma. Under the Act the Industrial Court would be bound by the order of the Appellate Tribunal and they would also be bound to give effect to the order of the High Court, In (S) AIR 1955 Pepsu 91 (G), a person was allotted some agricultural land which had been, declared evacuee property but the allotment was cancelled by the Director of Rural Rehabilitation, Patiala. Against the order of the latter, a revision petition was filed before the Custodian General at Delhi; but the petition was dismissed. Thereupon the party filed a writ petition in the High Court. It was contended that as the office of the Custodian. General was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are bound to apply the law as enunciated by the. Supreme Court. It is, therefore, unnecessary to discuss the question as if it were res Integra. We agree with the learned Advocate-General's contention that the general rule is that when an order of an inferior Tribunal is carried up in appeal or revision to a superior tribunal and the superior tribunal passes an order confirming, modifying or reversing the order of the Inferior tribunal and a writ cannot issue from this Court to the superior tribunal because It is not situated within the territorial jurisdiction of this Court, in such a case no writ can equally Issue against an inferior tribunal though situate within the jurisdiction of this Court. 19. Having dealt with the two general questions of law, we shall now deal with each of the appeals and the special contentions raised in each of them. 20. W. A. No. 120 of 1955 : The main, if not the only ground passed upon us in this case was that no notice was issued to the appellant before proceedings were taken to impose the penalty and the appellant was not given an opportunity to show cause why the penalty should not be imposed, and even if it should be imposed, the circ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g disciplinary functions. The London Dock Labour Board, a local Board, purported to delegate those disciplinary functions to the port manager who suspended certain registered dock workers from work and pay. They appealed to the appellate Tribunal set up under the Order; but their appeals were dismissed. It was held by the Court of Appeal that the suspension order by the port manager was unlawful and void because the delegation of disciplinary functions to him was ultra vires. Dealing with the decision of the appellate tribunal Denning L. J., observed thus: So far as the decision of the appeal Tribunal is concerned, it seems to me that, once the port manager's order is found to be a nullity, it follows that the order of the appeal. Tribunal is also nullity. The appeal Tribunal has no original jurisdiction of its own; it cannot itself make a suspension order ; it can only affirm or disaffirm a suspension order which has already been made. If none has been made because it is a nullity, the Tribunal can do nothing. It cannot make something out of nothing any more than anybody else can. We agree with what Rajagopala Aiyangar J., has said in the judgment, under appeal, nam ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on. The finding of the Assistant Collector that the price ruling in the country at the time of export was ₹ 335 per cwt. is a finding of fact, and even if it was erroneous, it would not affect the jurisdiction of the Assistant, collector to pass the order under Section 167 (37) of the Sea Customs Act. The appeal is allowed and W.P. No. 161 of 1954 is dismissed. Here too there will be no order as to costs. 25. W.A.No.89 of 1956: In this case the doctrine of merger can have no application. The appeal filed by the respondent to the Central Board of revenue was rejected in limine. The respondents had not deposited the amount of penalty levied on them, which was a condition precedent for the entertainment of the appeal. The 'principle laid down by the Privy Council in Chandri Abdul Majid v. Jawahir Lal. ILR 36 All. 350: (AIR 1914 PC 66) (M) applies to this case. In that case there was a suit on a mortgage and a decree. The question which arose was as to the date from which the period of limitation would count for an order for making the decree for sale absolute. From the preliminary decree of the High Court there was an appeal to the Privy Council. But that appeal was di ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... payable thereon, or 100 at the election of the Commissioners of Customs. 28. In our opinion, the omission of the words at the election of the Commissioners of Customs makes no difference. We entirely agree with the following observations of Chagla C. J. on this point: In our opinion, our Legislature rightly thought that the words 'at the election of the Commissioner' as mere surplusage in view of the fact that they had used the disjunctive word 'or'. In our opinion, the effect of the language used by our legislature in item (8) is the same as the effect of the language used in the English statute. The word 'or' makes it perfectly clear that the Customs Authorities are given the alternative and it is left to them to impose a penalty which satisfied either the first condition, or the second condition. Therefore, if a penalty does not exceed three times the value of the goods, it is a penalty which in law can be inflicted by the Customs Authorities although that penalty may exceed Rs, 1000. On the other hand, it would be open to the Customs Authorities to fall back upon the second alternative and impose a penalty which may not exceed ₹ 1000, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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