GOPI KISHAN Vs. UNION OF INDIA AND ORS.

JUDGEMENT

(1.) The petitioner filed an application under Articles 226 & 227 of the Constitution of India and obtained a rule nisi from this Court for quashing the order dated 4.8.58 passed by the Collector, Central Excise (Annexure C), appellate order dated 22.2.66 of the Member, Central Board of Excise and Customs (Annexure F) and revisional order dated 15/17.5.67 of Secretary to the Government of India (Annexure G), and for issuance of a writ of mandamus directing the respondents to release to the petitioner 496 tolas and 6 annas of confiscated gold and gold ornaments, the particular of which the petitioner has given in his supplementary affidavit dated 13.11.69. The petitioner is the proprietor of M/S Gopi Kishan & Co. dealing in gold and silver ornaments and bullions at Purani Bazar, one of the quarters of the town of Muzaffarpur. The said firm (shop) is located in the front portion of the house of Smt. Kishuni Devi, mother -in -law of the petitioner who was living in a portion of the house at the rear. The other portion of the house is occupied by one Jasoda Lal, another goldsmith. In still another portion of the house some other tenant was occupying at the relevant time. On 18.2.58 the Superintendent of Central Excise (respondent no. 5) after obtaining a search warrant from the Sub -divisional Magistrate (respondent no. 6) held a search of the shop of the petitioner along with some police officers, and seized 155 tolas 11 annas and 6 pies of gold and guineas, books of account and other records from his shop for which a list was also prepared. After so doing respondent no. 5 put them in the iron safe of the petitioner and after locking the same put a seal over it. On the same date he also put his seals on two other iron safes which were kept in the adjoining room belonging to his mother -in -law. As alleged by the petitioner, they contained her gold ornaments. Between 19th and 25th of February, 1958 respondent no. 5 also checked the bills, vouchers and books of account of the petitioner, which he had seized and came to the conclusion on calculation that on 18.2.58 the petitioner should have had in stock 731 tolas 7 annas and 1 1/2 pies worth of gold. On 25.2.58 respondent no. 5 opened the three iron safes, and found one of the iron safes belonging to his mother -in -law, empty, but in other two iron safes he found 1188 tolas and 7 annas worth of gold ornaments, which were again put into the petitioner's iron safe, and sealed by him. On 1.3.58 respondent no. 5 went to the shop of the petitioner again, opened his iron safe and out of 1188 tolas and 7 annas worth of gold, he released only 722 tolas 1 anna and 7 1/2 pies worth of gold and gold ornaments to the petitioner whereas after preparing a list of remaining 416 tolas 5 annas 4 1/2 pies worth of gold ornaments and guineas, he kept them in the iron safe and sealed it. On 3.3.58 respondent no. 5 took away 416 tolas 5 annas 4 1/2 pies of gold ornaments and guineas which he had kept in the iron safe and seized them in addition to 155 tolas 11 annas and 6 pies of gold and guineas which he had already seized on 18.2.58, total being 572 tolas and 10 1/2 pies. The petitioner on the same date filed an application (Annexure A) before respondent no. 5 that the ornaments of his mother -in -law Kishuni Devi should not be mixed up with those articles which were seized from the custody of the petitioner. Her ornaments, he prayed, should be separately kept and listed but it was not done. He also submitted to respondent no. 5 on the same date an abstract account (Annexure A -1) of all the articles seized. On 13.3.68 the petitioner again represented before respondent no. 5 for the delivery of the articles. It seems that the matter was referred to the Assistant Collector of Central Excise, respondent no. 4, who by letter dated 12.4.58 declined to entertain the prayer for the petitioner. On 13.3.58 the petitioner sent a letter to respondent no. 5 for providing him a copy of the search warrant but by letter dated 24.3.58 respondent no. 5 informed the petitioner that the search warrant in original was returned to the Sub -divisional Magistrate, respondent no. 6, after execution. The petitioner then applied to respondent no. 6 for the same but it was rejected (vide Annexure D).

(2.) On 24.4.58 the petitioner received a notice (Annexure B) from the Collector of Central Excise, respondent no. 3, mentioning therein that there was reason to believe that the gold bar and pieces, gold coins and gold ornaments specified in the notice were brought to India and converted into ornaments without any permission from the Reserve Bank of India in contravention of the provisions of Sec. 8(1) of the Foreign Exchange Regulation Act, 1947 (as amended) read with Government of India's Ministry of Finance Notification No. 12(11) -F -148, dated 25 -8 -48 and No. 12(11) -2(36) E.F. VII/53 dated 5 -2 -1955 and the provisions of Sec. 19 of the Sea Customs Act as applicable by Sec. 23(a) of the said Foreign Exchange Regulation Act. Therefore, the same were liable to be confiscated. The notice also mentioned that the petitioner was liable to a penalty under Sec. 167(8) read with Sec. 19 of the Sea Customs Act and he was directed to show cause within 10 days of its receipt and to produce all evidence, documentary or otherwise, in support of his explanation as required under Sec. 178A of the Sea Customs Act. In response to the said notice cause was shown by the petitioner to respondent no. 3, who by his order dated 4th August, 1958 (signed on 5th August, 1958) after due consideration of the materials produced by the petitioner including his show cause, out of the total 572 tolas 10 1/2 paise of gold and ornaments seized, further released 75 tolas 10 annas 10 1/2 pies and confiscated the balance of 496 tolas 6 annas under Sec. 167(8) of the Sea Customs Act and further gave option to the petitioner to redeem the same on payment of a fine of Rs. 40,000/ - in lieu of the said confiscation within three months from the date of the order. The petitioner did not avail the option given to him; rather aggrieved by the said order he filed an application under Article 226 of the Constitution of India before this Court which was registered as M.J.C. No. 625 of 1958. Similarly, his mother -in -law Srimati Kishuni Devi filed a separate writ application which was registered as M.J.C. No. 623 of 1958, for release of her gold ornaments which were seized. Both these applications were admitted by this Court and when they were placed for hearing, the case of Srimati Kishuni Devi was remanded to the Collector of Central Excise for fresh disposal after giving opportunity to her to establish her claim with respect to gold ornaments claimed by her, whereas the case which was filed by the petitioner was adjourned till the disposal of her case by the Collector. It seems that the Collector after the remand order and after giving opportunity to her, as directed by this Court, dismissed her appeal. Subsequently she filed a revision application before the Under Secretary to the Government of India being aggrieved by the order of the Collector, but that also was rejected. Thereafter the case of the petitioner in M.J.C. 625 of 1958 was listed for hearing on 18.2.65 before R.K. Choudhary, and G.N. Prasad, JJ. Their Lordships were not inclined to allow his application as the petitioner had not exhausted the internal remedies of appeal and revision provided under Ss. 188 and 191 respectively of the Sea Customs Act. Therefore, the petitioner's counsel sought permission to withdraw the application which was allowed by order dated 18 -2 -65 with the above observation (vide Annexure E). Accordingly the petitioner filed an appeal before the Member, Central Board of Excise and Customs, New Delhi, respondent no. 2, who by his order dated 22.2.66 dismissed his appeal on the ground that the appeal was time barred (vide Annexure F). Aggrieved by the said order the petitioner then filed revision to the Union of India through the Secretary to the Government of India, respondent no. 1, who by order dated 15/17 -5 -67 (Annexure G) rejected his revision application. Hence the petitioner filed the present application before this Court.

(3.) Mr. Lal Narain Sinha, appearing on behalf of the petitioner, apart from challenging the orders contained under Annexures C, F and G, assailed the seizure itself made by respondent no. 5. He raised the following points for consideration by this Court: - -