1994 (11) TMI 138 - HC - Customs

Summary

Issues Involved:
1. Violation of principles of natural justice and Regulation 23.
2. Non-supply of documents and statements relied upon by the Enquiry Officer.
3. Validity of the suspension order dated 17-5-1994.
4. Alternative remedy by way of appeal under the Customs Act, 1962.

Detailed Analysis:

1. Violation of Principles of Natural Justice and Regulation 23:

The petitioner challenged the revocation of his Licence by the Collector of Customs, arguing that the impugned order was passed in violation of the principles of natural justice and Regulation 23. The court noted that Regulation 23 requires compliance with the principles of natural justice, including providing the affected party an opportunity to be heard. The Enquiry Officer had relied on statements from various persons without giving the petitioner an opportunity to cross-examine them, which was a violation of Regulation 23(3) and (4). The court held that both the enquiry report and the order dated 19th August 1994 could not be sustained due to this violation.

2. Non-Supply of Documents and Statements:

The petitioner contended that the Enquiry Officer did not provide copies of the statements of various persons relied upon in the show cause notice. The court found that the Enquiry Officer had indeed relied on these statements without giving the petitioner an opportunity to cross-examine the individuals who made them. The Collector, too, relied on these statements without making them available to the petitioner. The court emphasized that the petitioner should have been provided with these statements before any reliance was placed on them, thereby nullifying the enquiry report and the final order.

3. Validity of the Suspension Order Dated 17-5-1994:

The petitioner argued that the suspension order dated 17-5-1994 should fall along with the impugned order. The court referred to the Supreme Court's decision in H.L. Mehra v. Union of India, which dealt with the suspension of a government servant. The court distinguished this case, stating that the suspension order in the current case was based on pending proceedings, not a completed enquiry. Since the impugned order and the enquiry report were nullities, the suspension order continued to be operative, as the basis for the suspension (pending proceedings) survived.

4. Alternative Remedy by Way of Appeal:

The respondents argued that the writ petition should not be entertained as the petitioner had an alternative remedy by way of an appeal under Section 129B of the Customs Act, 1962. The court rejected this preliminary objection, stating that the existence of an alternative remedy does not debar the court from entertaining the writ application under Article 226, especially when an order is challenged on the ground of violation of principles of natural justice.

Conclusion:

The court set aside and quashed the enquiry report dated 16th August 1994 and the order dated 19th August 1994. It clarified that the enquiry proceedings would revive from the stage of the hearing before the Enquiry Officer, who must supply copies of all relevant documents and produce persons for cross-examination. The proceedings were to be completed within four weeks from the date of communication of the order, and the suspension order would continue for this period. The writ application was disposed of without any order as to costs.