UNION OF INDIA Vs. ATIABARI TEA CO LTD

JUDGEMENT

(1.) This appeal is directed against a judgment and order of Sinha, J. date3 December 8, 1958, whereby a rule nisi obtained by the respondent in a petition under Article 226 of the Constitution, was made absolute.

(2.) The respondent is the owner of and manages a tea estate known as Atiabari Tea Estate, in the district of Jalpaiguri. Tea from the respondent's garden is sent to Calcutta and sold there, both for export and also for internal consumption, through auction sales held by tea brokers. In July, 1953, the respondent made over to the North Eastern Railway Administration at Garopara, 402 chests of tea containing 42016 Ibs. of black ten, for carriage and delivery to the respondent at Calcutta. The respondent paid the excise duty as required by the Central Excises and Salt Act, before the Lea was removed from the gardens for booking with the railway administration. The railway administration arranged for carriage of the tea through the R. S. N. Co. Ltd. and I. G. N. and Rly. Co Ltd., to Calcutta by river route, part of which was in Eastern Pakistan. The excise department required the respondent to execute a bond and such a bond was executed by the respondent. The bond was addressed to the Collector of Land Customs, Calcutta, and it provided that in consideration of permission granted to the respondent to transport the goods by steamer or rail through Pakistan to places in India, the surety guaranteed to produce and deliver within two months from the dale of despatch, certificates from consignee of due reception of goods by them. There was an undertaking not to divert any goods destined for India en route. There was a further provision that in the ovent of short delivery at the destination in India as compared with the consignments despatched, Surendra Kumac Nag, Manager, Atiabari Tea Estate and Kedarnath Banerjee, Manager, Patka-para Tea Estate, sureties, undertook "to pay duty and/or cess if any such penalty as may be adjudicated by the Customs Collector under the Land Customs Act. after giving an opportunity to the exporter to explain the cause of the short delivery''.

(3.) The consignment of tea was put on board the steamer S. S. Pagan, for carriage to Calcutta. On July 22, 1953, the said steamer was involved in an accident near Jagannathganj, in Eastern Pakistan, as a result of which it sank, with its entire cargo on board, including the said consignment of tea. There was thus a total loss of the goods. By a letter dated October 1, 1953, the respondent informed the Collector or Central Excise, Calcutta, of the loss of the said consignment. Particulars and documents relating to the said loss were called for by the Central Excise Department, The respondent alleges that such documents were furnished. On April 19, 1954, the Inspector of Central Excise, Atiabari Range, demanded payment by the respondent of lis. 7878 as export duty and Rupees 840 as cess. The respondent filed an objection alleging that the goods being lost, no export duty or cess was payable. This objection was rejected, and proceedings were commenced against the respondent for realisation of the alleged dues for export duty and cess. Being aggrieved by these proceedings the respondent moved this Court under Article 226 of the Constitution for the issue of appropriate writs directing the appellants to forbear from giving effect to the notice of demand dated April 19, 1954, and June 8, 1955, together with the one issued on July 2, 1955, and not to enforce realisation of the said sums. A rule nisi was issued, which was made absolute as hereinbefore stated. The appellant has preferred this appeal against this order making the rule nisi absolute.