CHAGANLAL GAINMULL Vs. COLLECTOR OF CENTRAL EXCISE

JUDGEMENT

(1.) This appeal, by special leave, arises out of and is directed against the judgment dated 22/07/1974 of a division bench of the High court of Madras in Letters Patent Appeal No. 273 of 1972 dismissing, in reversal of the order dated 5/01/1972 of the learned Single Judge of the high court, the W. P. No. 3387 of 1970 filed by the appellant by which appellant assailed certain adjudication proceedings under the Customs act, 1962 culminative in an order of confiscation of certain seized goods. The adjudication proceedings were assailed on the ground that the show cause notice contemplated by S. 124 (a) had not been issued within six months from the date of the seizure of the goods as envisaged by Section 110 (2 of the Act. The High court, in the judgment under appeal, was persuaded to the view that the time limit referred to by S. 110 (2 pertained to the power to retain the seized goods beyond six months and that the issue of the show cause notice under S. 124 (a) beyond six months did not affect or vitiate the power to adjudicate.

(2.) We have heard Sri Sharad Javali, learned Sr. Adv. for the appellant and Sri V. C. Mahajan, learned Sr. Adv. for the revenue. Support for Sri Javalis proposition that a show cause notice under S. 124 (a) cannot be issued after the lapse of six months of the seizure is sought to be drawn entirely from the proviso the sub- section (2 of S. 110. S. 110 deals with the seizure of goods, documents and things. Ss. (1 of that S. says that "if the proper officer has reason to believe that any goods are liable to confiscation under this Act, he may seize such goods". Ss. (2 says that "where any goods are seized under Ss. (1 and no notice in respect thereof is given under clause (a) of S. 124 within six months of the seizure of the goods, the goods shall be returned to the person / from whose possession they were seized".

(3.) It appears to us that the consequence that flows from the failure to issue a show cause notice under S. 124 (a) within the period of six months is limited to what is envisaged in Ss. (2 namely that the goods shall be returned to the person from whose possession they were seized. S. 110 (2, does not prescribe a period of limitation within which a show cause notice is to be issued. But if no action by way of issue of a show cause notice is initiated under S. 124 (a) within the period of six months, stipulated by S. 110 (2 the effect would be that the person from whom the goods were seized would become entitled to their return.