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SUPREME COURT OF INDIA
J.M. SHELAT AND C.A. VAIDIALINGAM, JJ.
The Assistant Collector of Customs and Superintendent, Preventive Service Customs, Calcutta and others, Appellant
Versus
Charan Das Malhotra, Respondent.
Civil Appeal No. 1056 of 1967, D/- 19-2-1971.
Advocates appeared
M/s. R. H. Dhebarnd S. P. Nayr, Advocates for Appellants; Mr. S. T. Desai, Sr. Advocate (Mr. P. C. Bhartari, Advocate, and M/s. J. B. Dadachanji and Co., Advocate, with him), for Respondent.
Customs Act,1962 - Section 110,110(1),110(2),124(a) - Defence of India Rules, 1962 - Rules 30 (1) (b) and 30-A (9) - Challenge - Business as a dealer in watches in name and style of Watch Company in Calcutta - In he also used to have another business premises where he carried on same business in name of Waloon Watch Company - That business was wound up in that year and he had stock-in-trade of that business carried on in name of Company - Rummaging staff under appellant raided respondent s business premises and seized watches all of foreign make of these watches however were released on respondent then and there producing vouchers relating to them - Later on more watches were released on September and February on more vouchers having been produced - Case of Customs authorities however was that he was not able to produce documentary evidence in respect of rest of watches And therefore their release was not possible - Whether Collector under that proviso can extend period for giving notice under Section 124 (a) of Act either after initial period of six months or extended period has already expired - whether a sufficient cause has been shown so as to divest a vested right unless he hears parties affected - Even after supplementary affidavits were filed in this case it is extremely doubtful whether a sufficient cause has been shown - Whether under Section 203 of Trinidad Immigration Ordinance - Whether a sufficient ground has been shown to his satisfaction for removal of indentured immigrants - What is procedure which in such a case law will imply when Legislature is silent? - Whether sufficient grounds had been shown to his satisfaction that immigrants indentured on La Glaria estate of appellant should be removed - Whether power is purely administrative requiring no opportunity of being heard or judicial or quasi judicial as in both cases the right to goods beings restored would be involved - Whether initial or extended is affected - Held, Court are not satisfied that as between right of person from whom goods are seized and supposed danger to investigation matter is so weighted down that Court would be compelled to hold that legislature could not possibly have contemplated a judicial approach by Collector when he orders extension of time effect of which would be deprivation of or in any event postponement of right to restoration - In Court view first question must be answered in favour of respondent and therefore Division Bench was right in holding that power under proviso was quasi judicial or at any rate one requiring a judicial approach Consequently an opportunity of being heard ought to have been given to respondent before orders for extension were made - High Court consequently was justified in ordering restoration of watches in question to respondent - Watches having been seized on March period of six months expired on September that if a notice under Section 124 (a) was not given by that time Section 110 (2) imposed a statutory obligation on Customs to return goods to person from whom they were seized - Division Bench observed that seven assuming that first extension which was granted ex parte and without any opportunity to respondent of being heard were to be valid period of four months granted then having expired on January and no order for further extension having admittedly been made it was obligatory on Customs to return watches to respondent - Court observed that dividing line between judicial and administrative functions was thin and gradually evaporating and that functions performed by those doing judicial performed by those doing judicial function and administrative function where rights of citizens are affected to their prejudice had same object namely to do justice and deciding question fairly and justly - In former case there would be express rules of procedure butt object of these rules is only to enable or facilitate to decide fairly and justly - In Court view same principles are attracted in construing phrase on sufficient cause being shown - With regard to nature and sufficiency of cause it is satisfaction of Collector of Customs that provides that ground and justification for an order extending time to complete inquiry - If order of extension is made before expiry of initial period of six months or before expiry of extended period it cannot in Court view be challenged on ground that notice to show cause or opportunity of being heard was not given to party - Appeal dismissed
Judgment
SHELAT, J.:- This appeal, under a certificate, raises two questions. The first is as to the nature of the power of the Collector of Customs under the proviso to the second sub-section of Section 110 of the customs Act, 52 of 1962, and the second is as to whether the Collector under that proviso can extend the period for giving notice under Section 124 (a) of the Act either after the initial period of six months or the extended period has already expired.
2. In 1963, the respondent carried on business as a dealer in watches in the name and style of Wallton Watch Company in Calcutta. In 1955, he also used to have another business premises where he carried on the same business in the name of Waloon Watch Company. That business was wound up in that year and he had the stock-in-trade of that business carried on in the name of Wallton Company.
3. On March 19, 1963, the Rummaging staff under the appellant raided the respondent s business premises and seized 218 watches, all of foreign make, 87 of these watches, however, were released on the respondent then and there producing vouchers relating to them. Later on, 21more watches were released on September 18, 1963 and February 27, 1964 on more vouchers having been produced. The case of the Customs authorities, however, was that he was not able to produce documentary evidence in respect of the rest of the watches,. And therefore, their release was not possible.
4. On March 6, 1964, the appellant served on the respondent a notice under Section 124 (a) to show cause why the rest of the said watches should not be confiscated and personal penalty should not be imposed upon him. Watches imported without licence or on which proper import duty has not been paid are undoubtedly liable to confiscation under s. 111 (d).
5. Section 110, which finds its place in Ch. XIII dealing with searches seizure and arrest, provides for seizure, inter alia, of goods. Under sub-a. (!), if a proper officer has "reason to believe" that any goods are liable to confiscation under the Act, he may seize such goods. Sub-s. (2) reads as follows:
"(2) Where any goods are seized under sub-section (1) and no notice in respect thereof is given under cl. (a) of Section 124 within six months of the seizure of the goods the goods shall be returned to the person from whose possession they were seized:
Provided that the aforesaid period of six months may, on sufficient cause being shown, be extended by the Collector of Customs for a period not exceeding six months."
Section 124 provides that no order confiscating any goods or imposing any penalty the owner of the goods or such person is given a notice in writing informing him of the grounds on which it is proposed to confiscate the goods or to impose a penalty. The section does not lay down any period within which the notice required by it has to be given. The period laid down in Section 110 (2) affects only the seizure of the goods and not the validity of the notice.
6. Since the watches in question were seized on March 19. 1963, the initial period of six months provided under the second sub-section of Section 110 expired on September 19, 1963 and the respondent became entitled to the return of the said watches as no show cause notice had till then been issued to him. But the appellant s case was that an extension for a further period of four months was applied for and was granted by the Collector on September 19, 1963 under his power under the said proviso on the ground that certain inquiries at Bombay and Delhi yet remained to be made. The extended period of four months expired on January 19, 1964 and a further extension of two months was applied for on January 3, 1964. But the Collector passed his orders granting further extension of February 20, 1964, that it to say, about a month after the first extended period had expired.
7. Admittedly, both the extension orders were passed ex parte and without any opportunity of being heard having been given to the respondent. The respo
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