K. VEERASWAMI, C. J. -
(1.) THE appeals arise from a common order of Kailasam, J. , dismissing the appellant's petitions for direction to the respondent, the collector of Central Excise, Madras, to return to them the goods seized from them. On information from the Collector of Customs and Central Excise, West Bengal at Calcutta, certain quantities of camphor Cassia and cloves consigned by rail and road from Calcutta by jaychandlal Sethia, or Eastern Supply Agency, Calcutta, as the case may be, in january 1965 were intercepted and seized at Madras by prior officers of the customs Department, purporting to so act on a reasonable belief that they were contraband, and liable to action under station 110 of the Customs Act, 1962. After protracted correspondence and delay the respondent intimated in April 1965 that as the concerned cases were being transferred to the Collector of central Excise, West Bengal, Calcutta, further correspondence in respect of them might be addressed to the Superintendent of Customs and Central Excise, divisional Preventing Unit, Calcutta. THE appellants then filed petitions under article 226 of the Constitution, for direction for return of goods to them on the ground that since the seizure of goods was effected within the territorial jurisdiction of the respondent, he alone had jurisdiction to adjudicate under section 122, and not the Collector of Central Excise, Calcutta and that in any case, the respondent had no power to transfer the cases to Calcutta. Kailasam, j. , declined to accept these grounds. In view of this, the writ petition which raises a similar point, has been clubbed with the appeals.
(2.) THE appellants urge : (1) that only the respondent has jurisdiction to adjudicate under section 122; (2)that the proper officer in Madras, could have no reasonable belief that the goods were contraband to warrant their seizure, and that if no notice under section 124 was issued within a period of six months from the date of seizure, the goods ought to be returned; and (3)that in any case, having regard to the nature of the goods, they should be handed to the appellants on payment of their value, or sold in the market immediately as otherwise they were likely to be damaged. Kailasam, J. , examined the first ground, and opined that in the circumstances, the Collector of Customs, Calcutt a had jurisdiction to confiscate goods or impose a penalty as the offence if any, which would entail confiscation or penalty, appeared to have been committed in Calcutta . It is contended that confiscation proceeding under section 122 is in the nature of a proceeding in rem, and any Collector of Customs can exercise the power of confiscation only within the area for which he is appointed. Even as such, seizure and arrest under Chapter XIII of the Act can be resorted to by proper officers within their jurisdiction. It may be granted, it was so held in Sewpujanrai I. Ltd. v. Collector of Customs, that confiscation of goods under the Customs Act is a proceeding in rem, and a penalty enforced against the goods, the confiscation operating directly upon the status of the property confiscated by transfer of its ownership. But this does not, in our opinion, conclude that jurisdiction for adjudication depends necessarily on situs of the goods. Section 3 of the Customs Act, 1962, mentions that classes of officers of customs who are to be appointed for purposes of the Act. By sub-section (1) of section 4, the Central Government is vested with the authority to make appointment of such persons as it thinks fit to be officers of Customs. By the next sub-section, the Central Government may authorise the Board, Collector of customs or a Deputy or Assistant Collector of Customs to appoint officers of customs below the rank of Assistant Collector of Customs. Under section 5 (1)an Officer of Customs may exercise the powers and discharge the duties conferred or imposed on him under the Act, but subject to such conditions and limitations as the Board may impose. Chapter III relates to appointment of customs Ports, Airports, Warehousing stations and the next Chapter, to prohibitions on importation and exportation of goods. Chapter V deals with levy of and exemption from Customs Duties. Chapters VI to XII contain other provisions relating to matters which need not detain us. Chapter XIII is concerned searches, seizure and arrest. Section 110 specifically empowers the proper officer to seize goods if he has reason to believe that they are liable to confiscation under the Act.'proper Officer'is defined in relation to any functions to be performed under the Act, as "the officer of customs who is assigned those functions by the Board or the Collector of Customs" * . Section 111 lists the category of goods brought from a place outside India which are liable to confiscation. Section 112 authorises levy of penalty for improper importation of goods. Section 122 provides for confiscation, and levy of penalty and the officers who would have the pecuniary jurisdiction to do so. Section 124 says that no order of confiscation or imposition of penalty shall be made without notice and opportunity of making representation against it. Under section 126 when any goods are confiscated under the Act, such goods shall vest in the Central Government, and the Officer adjudicating confiscation shall take possession of the confiscated goods. In the notification under section 4, the Government while appointing the Collector of Customs, Calcutta, and Collector of Customs, Madras, defined the territorial jurisdiction of each of them, the former in respect of port of Calcutta, Dum Dum Airport, the area under the jurisdiction of Calcutta, Howrah and South suburban Corporations etc. , and as to the latter having his jurisdiction to the Port of Madras, the meenambakkam Airport and the area under the jurisdiction of the Madras corporation and Saidapet Taluk. But another notification of the Government of india, the Collector of Central Excise, Madras, shall be the Collector of customs within his jurisdiction. It may be seen, therefore that the Collectors of Customs are assigned territorial jurisdictions within the limits of which they can exercise their respective powers under the Act, and also their pecuniary jurisdiction for purposes of adjudication of compensation or levy of penalty. THEre is no indication in any of these statutory provisions the notifications of the Government of India just referred to, that the jurisdiction of the Collectors of Customs would depend upon the situs of the goods at the time of adjudication of confiscation. A proper officer, if he has reason to believe that any goods are liable to confiscation under the Act, is empowered to seize such goods, and his power to do so is assigned by the Board, or the Collector of Customs. That means, the proper officer concerned has to act within the jurisdiction of the Collector who empowers him in respect of the seizure, and that the goods at the time of the seizure should be within the territorial jurisdiction of such Collector. To exercise the power of seizure, however, it is not a requisite that the importation of the offending goods itself must have been within his jurisdiction. Equally we do not think that if the goods have been improperly imported into a particular area within the jurisdiction of a Collector, such goods should continue to have the situs within that area as a condition to his jurisdiction to adjudicate and investigate, or impose a penalty. Section 126 seems to justify the view that to adjudicate confiscation, the officer doing it need not necessarily have seized of the confiscated goods. He can well after adjudicating confiscation take possession of the goods confiscated. Jurisdiction to adjudicate would be with the Collector within whose jurisdiction there has been improper importation of goods, and we are of opinion, that continued existence of the goods within his territorial jurisdiction is not essential for exercise of his jurisdiction to confiscate the offending goods. On that view, Kailasam, J. , was right in holding that the Collector of Customs at Calcutta would have jurisdiction to adjudicate. That being the case, we see nothing illegal, or improper in the respondent referring the matter to the Collector of Customs, Calcutta, for further proceedings.
The second ground of the appellants does not appear to have been urged in that form before Kailasam, J. In any case, in the affidavit in support of the petitions, the legality of the seizure has not been questioned on the ground that the proper officer had no reasonable belief that the goods were contraband. Also we find from the sworn statement of the respondent in his counter-affidavit that he was satisfied that there was a prima facie case as revealed by the investigation at Calcutta. The second ground, therefore, fails.
We see some force in the last contention, because the nature of the goods is such that efflux of time is likely to damage or impair the value of the goods. But we are not inclined to give any directions as to their disposal at this stage. We however, direct that as soon as possible, the goods should either be handed to the appellants or the petitioner on receipt of their value, or be sold and their proceeds realised, whatever might be the ultimate outcome of the adjudication proceedings at Calcutta.
The appeals and the petition are dismissed.;