GEMINI METAL WORKS Vs. UNION OF INDIA

JUDGEMENT

(1.) RAMANUJAM, J This writ appeal is directed.against the decision of Mohan, J., in W.P. No. 3554 of 1975 dismissing the writ petition filed by the appellant for the issue of a writ of certiorari to quash the order of the first respondent confirming the order of the second respondent, in appeal subject to reduction of fine, which in turn confirmed, subject to reduction of fine, the original order confiscating the goods under Section 111 of the Customs Act, 1962 and imposing a redemption fine of Rs. 38, 000/- in lieu of confiscation. The circumstances which led to the filing of the said writ petition by the appellant may briefly be noted. The appellant had been issued an actual users' licence to import tin plates waste. The said licence was current upto 30-6-1970. On the basis of an order placed by the appellant with a foreign-seller, goods had been shipped in August, 1970 and they arrived in the Madras harbour in November 1970. Since the goods could not be cleared, unless there was a valid licence to import the same, the appellant applied to the fourth respondent for revalidation of the licence which expired on 30-6-1970. The fourth respondent ordered revalidation of the licence from 12-11-1970 being the date of application to 31-12-1970. Since the licence as revalidated would not enable the petitioner-appellant to clear the goods, as the shipment itself was subsequent to the expiry of the period of the original actual users' licence, the appellant applied to the fourth respondent for revalidation of the licence from 30-6-1970 to 31-12-1970. The fourth respondent by his order dated 26-11-1970 revalidated the licence from 30-6-1970 the date of expiry of the licence upto 31-12-1970. Thereafter the fourth respondent by a communication dated 7-12-1970 called upon the appellant to return the actual users' licence, as revalidated, on information from the. Customs Department that as the entire quantity referred to in the actual users' licence had been imported, there was no question of revalidated the licence subsequent to 30-6-1970. The appellant returned the licence, as required by the fourth respondent and the fourth respondent by order dated 15-12-1970 cancelled the licence without any further notice to the appellant or without giving it any opportunity to put forward its case as against the proposed cancellation. Thereafter based on the cancellation of the actual users' licence on 15-12-1970 by the fourth respondent, the third respondent initiated proceedings against the appellant for violation of the provisions in Section. Ill (d) of the Customs Act, 1962, 196.

(2.) AFTER issuing a show cause notice and after hearing the appellant, the third respondent by his order dated 19-8-1971 directed confiscation of the goods and imposed a redemption fine of Rs. 38, 000/-in lieu of confiscation. The appellant filed an appeal against the said order dated 19-8-1971 to the second respondent, who, by his order dated 8th September, 1972 reduced the fine to Rs. 15, 000/, -taking into account the peculiar facts of the case and also the request of the appellant to reduce the fine, even if the imposition of fine by the original authority was justified. Against the order of the second respondent dated 8-9-1972 the appellant filed an appeal before the first respondent and the first respondent has chosen to reduce the fine further from Rs. 15, 000/- to Rs. 13.200/-by order dated 13-12-1973. The appellant thereafter filed W.P. No. 3554 of 1975 out of which the present writ appeal has arisen questioning the validity of the order of the first respondent dated 13-12-1973, confirming the order of the second respondent dated 8-9-1972, subject to reduction of fine, which in turn confirmed the order of the third respondent dated 19-8-1971 subject to reduction of fine.In the writ petition the appellant's case was that since the order of confiscation and imposition of redemption fine passed by the third respondent on 19-8-1971 is based on the order dated 15-12-1970 passed by the fourth respondent cancelling the licence issued to the appellant and as the order of cancellation of the licence is in violation of not only the principles of natural justice but also the specific Clause 10 of the Imports (Control) Order, 1955, the order passed by the third respondent on 19-8-1971 should be taken to be invalid. With reference to this contention, Mohan J., has found as a fact that no show cause notice was issued to the appellant before the order was issued by the fourth respondent on 15-12-1970 cancelling the licence and that in fact the order dated 15-12-1970 has been passed without giving an opportunity to the appellant to put forward its case and without hearing it. But the learned Judge has proceeded to observe as follows :-

(3.) THE question is, whether the appellant is entitled to attack the validity of the order of cancellation of the licence dated 15-12-1970 collaterally in these proceedings which are directed against the order passed by the first respondent on 13-12-1973. It is well established by now that an order which is found to be void for violation of the principles of natural justice can be attacked in a collateral proceeding initiated on the basis of such void order. A casual reference to the decision of the Supreme Court inNawabkhan Abbaskhanv.State of Gujarat- 1974 AIR(SC) 1479-1480. is sufficient to sustain the above proposition. THE Supreme Court, while meeting the contention that there should be a direct attack against an order said to violate the principles of natural justice and there cannot be an collateral attack, observed-as follows: