BHOORMAL PREMCHAND Vs. COLLECTOR OF CUSTOMS MADRAS

JUDGEMENT

(1.) THESE two writ appeals arise out of two writ petitions filed by the appellant to quash the order passed by the Collector of Customs in order No. S. No. 363/27/57 dated 26-3-1958 as illegal, void and inoperative in law and in violation or the fundamental rights granted and guaranteed to the citizens of India under the constitution particularly under Arts. 19 (1) (f) and (g) and 20 (3), or, in the alternative, to issue a writ of mandamus directing the Collector of Customs to return to the petitioner about 305-56 tools of gold wrongfully seized and confiscated by the respondent. When these two writ petitions came up for hearing before Jagadisan J. , he dismissed the petitions on the ground that the appellant failed to make out a case either for the issue of a writ of certiorari or that there were sufficient grounds for the issue of a writ of mandamus directing the Collector of Customs to return the gold to the appellant. The facts that are necessary for the disposal of these two appeals are as follows:

(2.) THE appellant is carrying on a bullion trade under the name and style of "jain jewellers" at No. 111 Avenue Road, Bangalore. In the couse of his business he entered into a contract through telephone on the 6th and 7th of October 1957 with messrs. Amirchand Nagindas, Jewellers, Madras, to sell 305-56 tolas of gold. The appellant informed them through phone that he would send his man with the gold the next morning by train. Accordingly the appellant entrusted the gold with his employee one Ghavarchand to hand it over to his letter-head paper addressed to messrs. Amirchand Nagindas, stating therein that the gold had been dispatched through Ghavarchand and that the amount should be paid at the agreed price to the said person delivering the gold. On 8-10-1957 when the said Ghavarchand alighted at the Madras Central station from the express train from Bangalore at about 4-30 p. m. he was intercepted by the police and on a search of his person it was found that he was carrying a substantial quantity of gold in a piece of cloth tied round his waist. The police officers immediately prepared a mahazar for the seizure. They also seized the letter addressed to Amirchand Nagindas. After he was examined by the police officers at the Central Station he was asked to go away, but the gold and the letter were detained by the police. Subsequently the police passed on the gold and the letter to the Customs authorities for investigation and necessary action under the Sea Customs Act. The appellant interviewed the Assistant Collector of Customs, Preventive Department on the evening of the 9th October 1957 and he made a statement before him in writing wherein he stated, among other things, that in pursuance of a telephonic conversation on 7-10-1957, he entered into a contract with Messrs. Amirchand nagindas to sell gold and informed them that he would be sending the gold through his man for which payment should be made to the bearer at the agreed price. In order to prove that he was in possession of the said gold at the time of the contract he produced his bills, No. 342 dated 28-9-1957 and No. 360 dated 710-1957 issued by Messrs. Hindustan Jewellery Mart, Bangalore, and the total purchase of gold under these two bills came to about 235 goals. When the customs authorities examined Messrs. Amirchand Nagindas, they denied that they had placed any orders with the appellate and pleaded ignorance about the whole transaction. The Customs authorities came to the conclusion that there was reasonable belief to hold that the gold had not been acquired from the sources referred to in the Customs Act and that it had been imported in contravention of S. 19 of the Sea Customs Act, read with S. 8 (1) of the Foreign Exchange Regulation act, and as such it was liable confiscation. They therefore, seized the gold under S. 178 of the Sea Customs Act, and threw the burden of proof on the appellant under s. 178-A of the Sea Customs Act to prove that it was not smuggled gold. Accordingly they issued a memo calling upon him to prove by documentary evidence, within 7 days from the receipt of the said memo, that the gold in detention was not smuggled gold, failing which they would confiscate the gold. The appellant produced all the bill books and his accounts to prove that the purchased the gold from Hindustan Jewellery Mart. The account books showed that at the time of the transaction, he had already a stock of gold in his possession, about 80 tolas which was balance of gold purchased from the Bombay agents, and 235 tolas purchased from the Hindustan Jewellery Mart. Thus in all, he had about 305 tolas of gold at the time of the transaction. In spite of these account books and bills, the customs authorities were not satisfied that the appellant had established that the gold found in the possession of his agent, Ghavarchand, was not smuggled gold. They felt that the account books, at the most, would show that the appellant had acquired roughly about 305 tolas of gold, but "there was no definite means of relating the gold seized in Madras to the gold covered by these records". Thereafter the Customs authorities passed an order that as the appellant had not discharged the burden of proof imposed upon him by S. 178-A of the Sea Customs act, they had no option but to hold that the gold was smuggled and accordingly they confiscated the gold weighing about 305-56 tolas valued at Rs. 275000-40 under S. 167 (8) of the Sea Act read with S. 23-A of the Foreign Exchange regulation Act.

(3.) IT is against this order that the appellant filed the two writ petitions.