MAHABIR PRASAD BAJAJ Vs. STATE OF BIHAR

JUDGEMENT

(1.) This case has been referred to the Division Bench by an order of reference dated 13-12-90 for deciding the question as to whether in view of section 6-C (2) of the Essential Commodities (Bihar Amendment) Act, 1977 (Bihar Act 9 of 1978), a person is entitled to interest even in a case where, in fact, the essential commodity was sold and like a case of deemed sale.

(2.) For deciding the said question the factual backgrounds, in short, may be stated : On 5-2-87 3,214 tins of edible oil were seized from the premises of the petitioner and a case under section 7 of the Essential Commodities Act, 1955 (E.C. Act in short) was instituted. Simultaneously confiscation proceeding under section 6-A of the E.C. Act was also initiated and after confiscation order was passed, 1504 tins of edible oil were sold in an auction at Rs. 4,31,000/- and the balance tins were given in zimanama to another person. The petitioner, impugning the orders taking cognizance and refusing to discharge by the criminal Court, moved this Court in Cr. Misc. No. 1478/89 (R) and this Court by order dated 14-8-89 quashed the entire criminal prosecution including the orders impugned. The petitioner moved the appellate authority against the order of confiscation and the said authority, taking into consideration the fact that the criminal prosecution against the petitioner was quashed by the High Court, by its order dated 8-9-89 set aside the order of confiscation passed under section 6-A of the E.C. Act. Allowing the appeal the Appellate Authority directed to return the seized articles and the sale proceeds to the petitioner. The petitioner, thereafter, moved the Collector under the Act with a prayer that the sale proceeds be returned with interest to him at the rate of 18% per annum with effect from 5-6-87. The Collector, by his order dated 8-3-90, passed an order for payment of Rs. 4,31,000/- towards the sale proceeds of 1504 tins of edible oil and Vanaspati but declined to grant interest by observing that the petitioner is at liberty to move the Appellate Authority for the said claim.

(3.) Mr. P. D. Agrawal, counsel appearing on behalf of the petitioner has contended that the Collector has committed an illegality in directing the petitioner to move the Appellate Authority for grant of interest because in view of the provisions as contained in section 6-C (2) of the Bihar Act 9 of 1978 (shortly the Bihar Act) as soon as the order of confiscation was set aside by the Appellate Authority, it was incumbent upon the Collector to return the sale proceeds with interest to the petitioner. According to him when admittedly some of the seized articles were sold in auction and the sale proceeds were deposited in the Government Treasury, on setting aside the order of confiscation by the Appellate Authority, the Collector was bound to follow the provisions as laid down in section 6-C (2) of the E.C. Act and could not have directed the petitioner to move again the Appellate Authority for grant of interest. In support of his contention learned counsel relies on the decisions in the cases of M/s. Rajesh Trading Company v. State of Bihar, reported in 1988 PLJR 463, Shanti Trading Company v. State of Bihar, reported in 1988 PLJR 732 : (1989 Cri LJ (NOC) 18), Jai Kishun Sah v. State of Bihar, reported in 1988 PLJR 606, V. Nagabhushana Rao v. Dist. Revenue Officer, Chilakalapudi, reported in 1979 Cri LJ (NOC) 40, Sri Krishna Oil and General Merchants and Commission Agents, Reavulapalem v. State of Andhra Pradesh, reported in 1984 Cri LJ 173, M/s. Shanker Lal Purnimal v. Commissioner of Civil Supplies, Hyderabad, reported in AIR 1988 AP 352, State of Gujarat v. Mer Parbat, reported in AIR 1991 Gujarat 185, State of M.P. v. Deena Nath, reported in 1994 (2) EFR 197, Shambhu Dayal Agrawal v. State of West Bengal, reported in 1990 (3) SCC 549 and N. Nagendra Rao and Co. v. State of Andhra Pradesh, reported in AIR 1994 SC 2663.