BAPALAL KHUSHALIDAS GOSALIA Vs. R PRASAD COLLECTOR OF CENTRAL EXCISE BARODA

JUDGEMENT

(1.) This is a petition for the writs of certiorari prohibition and mandamus for quashing the order passed by the first respondent dated October 29 1959 for prohibiting the respondents from enforcing implementing or executing the said order and for directing the first respondent to withdraw and/or cancel the aforesaid order. The impugned order came to be passed in the following circumstances:-

(2.) At all material times the petitioner owned a house called Manju Villasituated at Jorawarnagar. In 1958 and 1959 the petitioner was ordinarily residing at Marmagoa where he was carrying on the business of mining. It was the case of the petitioner that in or about 1946 he purchased two ingots of gold in Bombay from the open market at the rates then prevailing. In or about August 1958 he came to Jorawarnagar where he stayed in his aforesaid bungalow for about twenty to twenty five days and returned thereafter to Marmagoa some time in September 1958 On December 4 1958 the customs authorities visited the said bungalow for making a search thereof pursuant to a search warrant obtained by them under section 172 of the Sea Customs Act VIII of 1878. As the petitioner was absent his munim one Soonderji Nagardas informed the customs authorities that he did not have in his possession all the keys of the bungalow. On the authorities threatening to break open the lock of the bungalow one Chunilal Umedchand undertook to produce the keys as early as possible. Nothing else happened on that day except that the officers sealed the doors of the said bungalow and posted custom guards thereat. By his letter dated December 6 1958 the Assistant Collector of Customs Rajkot informed the petitioner at Marmagoa to appear before him at Surendranagar on December 14 1958 with the keys of the said bungalow as also of the cup-boards safest. therein failing which he was informed that the authorities would break open the bungalow as also the safes cup-boards etc. placed therein. On December 17 1958 the bungalow was searched by the customs authorities and in the purported exercise of their powers enter alia seized two gold ingots weighing about 19 tolas and 14 annas. They also seized certain gold and silver ornaments which according to the petitioner belonged to his wife. After these articles were seized a panchnama was recorded and thereafter the customs authorities left the bungalow. At about 6-15 P.M. on that very day one Amratlal Ratilal Shah made an application on behalf of the petitioner calling upon the Collector of Central Excise Baroda to furnish to the petitioner the statement of reasons for the seizure of the aforesaid articles. On December 27 1958 the Assistant Collector of Customs intimated to the petitioner of the fact of the seizure of the said gold ingots and the ornaments observing that enquiries were being made by the customs in connection with the importation of those articles By that letter the petitioner was called upon to produce before the Assistant Collector of Customs evidence regarding the importation of the ingots and the ornaments seized on December 171958 In reply to the aforesaid letter dated December 17 1958 the Collector of Central Excise Baroda by his letter dated January 8 1959 stated that the seizure of the said articles had been made by the customs authorities under a search warrant issued by a competent Magistrate as the said articles were believed to be dutiable goods and/or prohibited and therefore liable to confiscation. As the petitioner could not leave Marmagoa by reason of certain territorial restrictions then prevailing he was represented by an advocate in the matter of the seizure of the said articles. By his letter dated March 12 1959 the petitioners advocate pointed out to the customs authorities that the two ingots seized by the authorities had not been illegally imported or smuggled into the country and expressly stated that they were not of foreign origin as suspected by them and further that the ornaments seized by them belonged to the petitioners wife. These statements were repeated in a subsequent letter dated April 30 1959 On May 1 1959 the Collector of Central Excise Baroda issued a show cause notice which after reciting the fact of the search on suspicion of the said bungalow on December 17 1958 and the recovery of the said gold ingots and ornaments as a result of the said search stated that the petitioner was prima facie guilty of contravening the provisions of the notification dated August 25 1948 issued under section 8(1) of the Foreign Exchange Regulation Act 1947 read with sec. 19 of the Sea Customs Act and section 23A of the Foreign Exchange Regulation Act 1947 By the said notice the petitioner was called upon to show cause why personal penalty should not be imposed upon him under section 167(8) of the Sea Customs Act and why the aforesaid gold and ornaments should not be confiscated. An annexure enclosed with the show cause notice stated that the said ingots and the ornaments had been kept inside a safe in a box and further that the two bars of gold seized on the occasion of the search bore foreign markings on them namely 10 9999 The annexure further stated that gold with such foreign markings was not sold in the open market and therefore the two ingots constituted smuggled gold. On May 21 1959 the petitioner filed his reply to the said show cause notice wherein he maintained that the two ingots of gold were not of foreign origin that he had purchased those two pieces of gold in the open market more than thirteen years ago and that their seizure was based merely on suspicion and was therefore not justified in law. On August 31 1959 the first respondent held an enquiry at Porbandar where the petitioner was represented by his advocate. At the hearing the petitioners advocate insisted that the two individuals who had signed the panchnama as panchas at the time of the seizure should be examined by the authorities in his presence so that he would have an opportunity to cross-examine them in order to disprove the allegation that the ornaments seized were in the same box in which the said two ingots of gold were kept. This request however was not complied with. By his letter dated October 20 1959 the petitioners advocate placed on record the principal arguments which he had submitted before the adjudicating authority wherein he recorded the fact of the refusal of his request to have the panchas examined in his presence and to let him have the opportunity of cross-examining them. Thereafter on October 29 1959 the first respondent passed the impugned order wherein after reciting the evidence before him as also the six contentions that had been raised by the petitioners advocate before him and his replies thereto he recorded his finding in paragraph 16 thereof. That finding was as follows:--

(3.) The learned Assistant Government Pleader raised a preliminary objection to the petition and the objection was that the Sea Customs Act is a complete code by itself and sets up a machinery for investigation and conduct of an enquiry in respect of offences committed there under and the remedies against the orders passed there under. He contended that that being so the petitioner ought to have exhausted his remedies given to him under the Act before filing this petition and that that not having been done the petition should be dismissed. It is however well settled that where a petitioner challenges the jurisdiction of the adjudicating authority or the validity of the enquiry itself or the impugned order on the ground that there is an ex facie error there under he need not wait until he has exhausted the alternative remedy and therefore can file a petition to set aside the impugned order without having recourse to such alternative remedy. In the present petition the petitioner has challenged amongst other things the validity of the order on the ground that sec. 178A of the Act was wrongly applied by the adjudicating authority without the condition precedent therefore having been satisfied as also the validity of the seizure of the ingots in question on the ground that the seizure was made without the seizing authority having bad a reasonable belief at the time of the seizure that the two ingots in question that were seized were smuggled gold and therefore there was no jurisdiction in the adjudicating authority to cast under section 178A the burden of proof on the petitioner to prove that the two ingots in question were not smuggled gold. The learned Assistant Government Pleader however relied upon the decision in Smt. Ujjam Bai v. State of Uttar Pradesh A. I. R. 1962 S. C. 1921 and contended that the Collector of Customs whose order is challenged had admittedly the authority to hold the enquiry and however erroneous his order may be the petitioner was not entitled to file the present petition without first having recourse to the remedies given to him under the Sea Customs Act. The Supreme Court was in the case of Ujjam v. State of Uttar Pradesh considering the question as to whether a petitioner could challenge before it under Article 32 of the Constitution an order of assessment made by an authority under a taxing statute and it was in connection with that question that it observed that an order of assessment made by an authority under a taxing statute which was intra vires and in the undoubted exercise of his jurisdiction could not be challenged on the sole ground that it was passed on a misconstruction of a provision of the Act or of a notification issued there under nor could the validity of such an order be questioned in a petition under Article 32 of the Constitution and that the proper remedy for correcting an error in such an order was to proceed by way of appeal or if the error was an error apparent on the face of the record then by an application under Article 226 of the Constitution. The Supreme Court then observed that Article 32 guaranteed the right to a constitutional remedy and related only to the enforcement of the rights conferred by Part III of the Constitution. Therefore unless a question of enforcement of a fundamental right arose Article 32 did not apply and there could be no question of the enforcement of a fundamental right if the order challenged was with jurisdiction in spite of the allegation that it was erroneous. It is clear from these observations that the Supreme Court in this decision was considering its jurisdiction under Article 32 and it was only while doing so that it observed that resort to that Article could be had only when a fundamental right was alleged to have been infringed and when a petition was filed for enforcing such a right. The Supreme Court was not concerned with a contention of the type we have nor with a petition of the type we have before us and the decision relied upon by the learned Assistant Government Pleader therefore cannot assist the respondents for the order in question before us is challenged not on the ground only that it is an erroneous order but on the ground that the basis on which the adjudicating authority invoked the presumption under section 178A and threw the burden upon the petitioner of proving that the two ingots in question were not smuggled gold was lacking namely a reasonable belief on the part of the seizing authority that the two ingots were smuggled gold and on the further ground that the enquiry before the first respondent was a quasi-judicial enquiry and yet the adjudicating authority had not followed the principles of natural justice. The preliminary objection raised by the learned Assistant Government Pleader must therefore be rejected.