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TMI Blog2002 (8) TMI 128X X X X Extracts X X X X X X X X Extracts X X X X ..... e present in his vehicle yet proceedings were initiated against him. Show cause notices under Section 115, of the Customs Act, 1962 and under Section 72 of the Gold (Control) Act, 1968 were issued to show cause why the vehicle should not be confiscated for carrying contraband gold. Show cause notice were also issued under Sections 112 and 117 of the Customs Act, 1962 and under Sections 74 and 75 of the Gold (Control) Act as to why a penalty be not imposed upon him and the four persons aforesaid by the Collector, Customs and Central Excise, Meerut. All of them submitted their replies to the show cause notices. Vide his order dated 8th January, 1991, the Collector, Customs and Central Excise, Meerut directed confiscation of (a) 6 Gold biscuits of Foreign origin belonging to Sanjeev Kumar under Section 111(d) of the Customs Act and Section 71 of the Gold (Control) Act, directing release of Bank Draft No. 506710, dated 3rd January, 1989 of Rs. 66,018/- in his favour, (b) 4.044 Kgs. of silver ornaments whose ownership was claimed by Ashok Kumar Agarwal under Section 119 of the Customs Act and Section 71(2) of the Gold (Control) Act, however, permitting him to redeem the confiscated good ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ms in the boxes below his seat. It was nobody's case that any part of contraband gold, etc., belonged to the petitioner or Kishore Kumar, which was seized from the vehicle and the occupants. Admittedly, Sanjeev Kumar was a friend and neighbour of the petitioner (copy of the statement of the petitioner appended as Annexure-4) who had been on the vehicle several times and it could be very naturally expected that he knew about the boxes constructed under the driver's seat and the front side seat which was quite conspicuous in which the driver kept tools, blankets and dresses, etc., when he was sent out for a number of days. Sanjiv Kumar during interrogation gave the name of Anju Kumar, as the person for whom he was carrying gold, and if the petitioner or the driver were in any manner his accomplices he would have disclosed their names also in his statement. Since the vehicle of the petitioner was being used as a private Taxi its absolute confiscation was illegal inasmuch as no opportunity had been given to the petitioner under Section 115(2) Proviso of the Customs Act for its release on payment of fine. The action of seizure was misconceived as neither of clauses (a) to (e) of sub-sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... release of the said car but his request was turned down vide order dated 10th April, 1989 which was intimated to him. (v) Show cause notices dated 12th May, 1989 were issued by the Assistant Collector, Central Excise, Saharanpur. (vi) The matter was adjudged by the Collector, Central Excise, Meerut (copy appended as Annexure C.A-II) and the Maruti car was confiscated after considering all the facts. The Appeal filed by the petitioner before CEGAT, New Delhi against the order of the Collector was dismissed confirming the order of confiscation. Against the order of the Appellate Tribunal the petitioner sought for rectification which plea was considered and rejected vide order dated 15-10-1996 (copy appended as Annexure CA-IV). (vii) The seizure of the vehicle was made under reasonable belief that the same has been used for smuggling and carrying of contraband gold. The seizure and confiscation of the vehicle was strictly as per the provisions of the Customs Act. (viii) The vehicle is registered as a private car and it was used as a private tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by bringing on the record by the petitioner or the petitioner has not come up even with a prayer to quash the Appellate order of the CEGAT, which too has not been impleaded as party Respondent nor its order is sought to be quashed by the petitioner by grant of a writ of Certiorari? (iii) Whether the petitioner has come with clean hands inasmuch as he has suppressed the filing of his earlier writ petition in the year 1989 as disclosed in paragraph 6 of the Counter-Affidavit or its result thereof even during the commencement of hearing of this writ petition before us and has incorrectly relied upon the original Section 115(2) of the Customs Act despite its change (omission) by Finance Act (26 of 1988)? (iv) Whether the statutory Authorities have committed any error of law in passing that order which requires correction by this Court under Article 226 of the Constitution of India? (v) Whether in the peculiar facts and circumstances the petitioner is entitled to any relief from this Court in its exercise of discretionary jurisdiction? Our Findings :- 7.We find that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its perusal we find following observations and findings have been recorded against the petitioner and his driver :- (A) "From the search of said vehicle following items and goods were recovered. (i) One Gold bar of Chinese origin and seven Gold Biscuits of foreign origin kept in a bag and kept concealed in the Silver ornaments placed in a specially made box under driver's seat. (ii) Indian Currency Notes valued at Rs. 1,80,000/- were found concealed in another box specially made under second front seat. The detailed punchnama of recoveries made were drawn in presence of aforesaid two independent witnesses." (B) "The said Shri Kishore Kumar, driver of the said vehicle admitted the recoveries made as per details in the punchnama dated 2-1-89." (C) "The said vehicle used for carrying contraband gold was liable for confiscation under Section 72 of Gold (Control) Act, 1968 read with Section 115 of Customs Act, 1962 and was seized under Section 66 of the Gold (Control) Act, 1968." (D)&nb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... G) "From the spot statement of Shri Kishore Kumar, driver of Maruti Car No. DDC-5513 and the statement dated 24-1-89 of owner of the said vehicle Shri Sudhir Kumar Jain, it appears that all the three persons namely; S/Shri Ashok Kumar Agarwal, Sanjeev Kumar and Sunil Kumar intercepted by the Central Excise Officers at Nanauta travelled in the vehicle from Saharanpur to Delhi on 3-1-89 in the morning and returned back from Delhi to Saharanpur and were intercepted at about 7.45 P.M. in the evening at Nanauta. Two of them were carrying briefcases and one was carrying a bag. The contents of which were not known to the driver. The vehicle was arranged by Shri Sanjeev Kumar from the owner of Shri Sudhir Kumar Jain. However, the spot statement of Shri Sunil Kumar does not indicate such things." (H) "I also find that the driver did not object while the three persons namely; S/Shri Ashok Kumar Agarwal, Sanjeev Kumar and Sunil Kumar boarding the Maruti Car No. DDC-5513 were keeping these goods in these two boxes. Rather he allowed them to keep these things in the boxes for safe keeping. Normally presumption, therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under Section 112 (b)(i) of the Customs Act, 1962 and Rs. 10,000/- (Rupees Ten thousand) only under Sections 74 and 75 of Gold (Control) Act, 1968." (K) "I also impose a personal penalty of Rs. 5,000/- (Rupees Five thousand) only on Shri Kishore Kumar S/o Shri Hari Chand R/o village Khajoori Akbarpur, P.O. Gangelheri, Dist. Saharanpur driver of the Maruti Car No. DDC-5513 under Section 112 (b)(i) of the Customs Act, 1962 and Rs. 1,000/- (Rupees one thousand) only under Sections 74 and 75 of Gold (Control) Act, 1968." 11.From the order of the CEGAT (as contained Annexure-1) it appears that Eight Appeals were filed in all by the petitioner and others. The petitioner has not clarified that which appeal was preferred against the order of confiscation of his vehicle. However, we find that in regard to the penalty imposed on him the CEGAT observed that "in the absence of anything specification to connect Sudhir Kumar with the gold there is no basis for penalty on him" (vide paragraph 6). While rejecting the prayer of the petitioner in regard to confiscation of the vehicle and the penalty imposed on the Driver the CEGAT had observed as follows :- "7 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his agent, if any, and the person in charge of the conveyance or animal and that each of them had taken all reasonable precautions against such use : Provided that where any such conveyance or animal is used for the transport of goods or passengers for hire, the owner of the conveyance or animal shall, notwithstanding the provisions contained in Section 73, be given an option to pay in lieu of confiscation of the conveyance or animal, a fine not exceeding the value of the gold in relation to which the provision of the Act or any rule or order made thereunder has been, or is being, or is about to be, contravened." (Emphasis supplied) 13.Section 115 of the Customs Act, 1962 reads as follows :- "115. Confiscation of conveyances :— (1) The following conveyance shall be liable to confiscation :- (a) any vessel which is or has been within the Indian customs waters, any aircraft which is or has been in India, or any vehicle which is or has been in India, or any vehicle which is or has been in custom area, While constructed, adapted, altered or fitted in any manner for the purpose of concealing goods; (b) &n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated to the Hon'ble Supreme Court) in K.M. Mohammed Ghouse and Company v. The Collector of Central Excise, Madras, (1968) 2 Madras Law Journal 229 Interpreting Section 115 (2) held as follows :- "............Under Section 115(2), the conveyance is liable to be confiscated when it is used as a means of transport in the smuggling of any goods, unless the owner of the conveyance proved that it was so used without the knowledge or connivance of the owner himself, his agent or a person in charge of the conveyance. Though the plea of the owner was that he did not know anything about the smuggling there is no attempt to prove that the smuggling was without the knowledge or connivance of himself or the person in charge of the conveyance, that is, the Tinda Natarajan and the crew Subramaniam. The fact that Tindal Natrajan and Subramaniam were found guilty of smuggling by the Customs Authorities is not disputed. In the circumstances the order of confiscation is right and cannot be questioned." We fully agree with the aforementioned views. 15.It was the Driver who was incharge of the vehicles in question. The CEGAT has recorded a clear finding in his regard which is as follows :- "He was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the vehicle/his agent or the person incharge of the vehicle, which was one of the requirements under Section 115 (2) of the Customs Act, then no case for interference is made out. 22.It cannot be said that non-giving of the express option as contemplated under the proviso to Section 72 of the Gold (Control) Act and to Section 115(2) of the Customs Act has resulted in an illegality when show cause notices were issued under these sections to the petitioner. In any view of the matter he cannot be said to be prejudiced and it is not the case of the petitioner before us that he was ever prepared or is still prepared to pay the fine of the value of the contraband gold and the article brought with the purview of the Gold (Control) Act and the Customs Act as envisaged under Section 72 of the Gold (Control) Act and Section 172 of the Customs Act. Relying upon the ratio decidendi laid down by the Hon'ble Supreme Court in Union of India v. M/s. Mustafa and Najibai Trading Company (supra) we hold that the proviso to Section 115(2) of the Customs Act or proviso to Section 72 of the Gold (Control) Act are not mandatory provisions. The discretionary jurisdiction vested in us should not be exerci ..... X X X X Extracts X X X X X X X X Extracts X X X X
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