TMI Blog1973 (11) TMI 42X X X X Extracts X X X X X X X X Extracts X X X X ..... nk. The moneys deposited and the bonds executed by the appellants are really the substituted goods for the purpose of adjudication as to whether there can be any confiscation of goods or imposition of penalty. The parties agreed that the Excise Authorities would retain the securities for the purpose of adjudication proceedings in the event of failure of the appellants in the writ petitions filed by them. Appeal dismissed. - 1109, 1132 and 1133 of 1971 - - - Dated:- 8-11-1973 - A.N. Ray, C.J., K.K. Mathew, Y.V. Chandrachud and P.N. Bhagwati, JJ. [Judgment per : Ray, C.J.]. - These three appeals are by certificate from three judgments of the Bombay High Court. The main judgment is dated 31 August, 1970 in Civil Appeal No. 1133 of 1971. The judgments in the other two appeals are dated 1 September, 1970 following the judgment in Civil Appeal No. 1133 of 1971. 2. In Civil Appeal No. 1133 of 1971 the appellants carry on business inter alia as manufacturers of cotton yarn and cotton fabrics. The first five respondents are the Central Excise Authorities. The 6th respondent is the Bank. Between 11 March, 1963 and 20 March, 1963 the Central Excise Authorities conducted search ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r dated 20 September, 1963 was not within six months of the seizure of the goods, and was, therefore, illegal. Second, the order dated 20 September, 1963 was made without giving an opportunity to the appellants to be heard and was, therefore, in violation of principles of natural justice. 7. Counsel for the appellants relied on the decision of this Court in Assistant Collector of Customs v. Charan Das Malhotra, (1971) 3 SCR 802 = 1983 E.L.T. 1477 in support of the contentions advanced in these appeals. In Malhotra case, (1971) 3 SCR 802 = 1983 E.L.T. 1477 (supra) the Rummaging staff of the Excise Authorities raided the business premises and seized goods on 19 March, 1963. On 6 March, 1964 the Excise Authorities served a notice under Section 124(a) of the Act to show cause why the goods should not be confiscated and penalty should not be imposed. It was contended that because the goods were seized on 19 March, 1963 the initial period of six months provided under Section 110(2) of the Act expired on 19 September, 1963 and Malhotra became entitled to the return of the goods on the ground that no notice to show cause had till then been issued. The Excise Authorities contended on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l deposit with the Collector of Central Excise Government securities of certain value in order to obtain release of quantities of the seized goods in favour of the Bank. In the event of the appellants succeeding in the petition the securities deposited shall be returned. In the event of the appellants failing in the petition the securities shall be retained by the Excise Authorities for the purpose of adjudication proceedings. In the event of the Collector of Central Excise holding that the goods are not liable to confiscation or that the appellants are not personally liable for any penalty or excise duty the said securities shall be returned. The appellants agree and undertake that the securities deposited shall be treated as sale proceeds of the said goods and treated as goods so seized for the purpose of any adjudication proceedings. The appellants further agree that they shall not raise any contention in the adjudication proceedings that the said proceedings will not be valid on the ground that the goods have been released to the appellants and are not available for confiscation or imposition of fine in lieu of confiscation. 12. The appellants pursuant to the consent orders a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... damus directing the release of the goods and the books of accounts. The High Court did not accede to the request of appellants. 17. The two contentions of the appellants in Civil Appeal No. 1109 of 1971 were that the order dated 20 September, 1963 extending the period of giving "show cause" notice was illegal on grounds similar to those in Civil Appeal No. 1133 of 1971. The respondents in Civil Appeal No. 1109 of 1971 repeated the same answers that the ruling in Malhotra's Case (1971) 3 SCR 802 = 1983 E.L.T. 1477 (supra) does not apply by reason of agreement between the appellants and the respondents embodied in similar consent orders in interlocutory proceedings in the High Court. During the pendency of the proceedings in the High Court the appellants deposited with the Excise Authorities between the month of April, 1966 and the month of August 1968 Rs. 3,16,016 and executed bonds for the sum of Rs. 4,44,059. The appellants obtained release of the goods namely 568 bales. The amounts deposited were agreed between the parties to be sale proceeds of the goods and treated as goods as seized for the purpose of adjudication proceedings. 18. The Excise Authorities may under Section 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the consent terms, the goods went out of the province of application of Section 110 of the Act for extension of time for serving a notice. 21. There cannot be any question of violation of principles of natural justice or any lack of opportunity to the appellants to show cause in regard to the order dated 20 September, 1963 extending the time for giving the notice under Section 124 of the Act contemplated in Section 110 of the Act. The appellants themselves asked for release of the goods on depositing moneys and executing bonds representing the value of the goods released. The agreements in the present appeals establish that the parties on consideration of all the facts and circumstances waived notice for extending the time within six months of the seizure of the goods. 22. The Excise Authorities are also right in their contention that the appellants have no locus standi to ask for release of the goods because the Bank was in possession of the goods as the pledgee and the Excise Authorities seized the goods from the possession of the Bank. 23. The moneys deposited and the bonds executed by the appellants are really the substituted goods for the purpose of adjudication as to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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