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TMI Blog1985 (11) TMI 167X X X X Extracts X X X X X X X X Extracts X X X X ..... ms House, Madras, searched the Jain Temple at Pozhal near Red Hills, Madras and recovered 8 silver bars weighing 19.197 Kgs., valued at Rs. 19,858.92 from a gunny covered tin kept in the locker of the temple. On the gunnuy cover, the name of Ukchand Ranka (the petitioner in these writ petitions) was found written. In the statement given by Shri Kesarimal, Manager of the Jain Temple, on the day of recovery, he stated that the devotees of the temple used to be allowed to keep their things in the lockers and that owning to pressure of work, he was unable to recollect who had left the recovered silver bars in the locker. Since the recovered silver was not covered by any transport voucher or other document, the preventive staff seized the silver bars under a mahazar. Thereafter, the case was transferred to the Superintendent, Gold Control Unit, Madras I Division for taking appropriate further action. By letter dated 2-12-1974, Shri Himmatmal Mardia, Advocate appearing for the petitioner, addressed the Customs House, Madras, claiming that the seized silver bars belonged to his client Sri Ukchand Ranka and required the Customs authorities to let him know the provision of law under which t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... age and illness and that it will take two months for him to return to Madras and requested that a date may be fixed in September 1975. It was also mentioned that an appeal against the order extending the time for the issue of a show cause notice under Section 110(2) of the Customs Act had also been preferred and requested that further proceedings may not be taken till the appeal was disposed of. Thereupon, the second respondent herein, by his letter, dated 18-9-1975 addressed to the counsel, directed the petitioner to appear before the Superintendent, Gold Control Unit, Madras, on 25-9-1975. The counsel was also informed that no further postponement would be granted. To this, the counsel for the petitioner replied on 24-9-1975 to the effect that he did not know the correct place as well as the address of the petitioner who had claimed ownership of the seized silver bars and therefore, it would not be possible for him to contact the petitioner before 25-9-1975. The Superintendent was also requested to intimate the petitioner the next date four weeks in advance with a copy to him. A show cause notice was issued on 14-10-1975 charging the petitioner under Section 11-J, K and L of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Customs Act. A penalty of Rs. 1,000/- was also imposed on the petitioner under Section 114 of the Customs Act. Aggrieved by this, the petitioner preferred an appeal before the Appellate Collector of Customs, Madras. Meanwhile, the Collector of Central Excise, Madras-34, in the exercise of powers conferred under Section 130 of the Act read with notification 101-Customs dated, 1-7-1964 called for the records relating to the order passed by the first respondent on 9-4-1976 for examination and revision. On an examination of the proceedings of the first respondent, the Collector of Central Excise, Madras-34, felt that a case for revision was made out and accordingly issued a show cause notice, dated 31-5-1976 to the petitioner and Shri Kesarimull endorsing also a copy to the counsel for the petitioner. The petitioner in his reply stated that whatever had been stated by him earlier in the replies through counsel, dated 27-10-1975, 16-2-1974 and 14-10-1975 may be treated as part and parcel of his reply and that the entire correspondence may also be taken into account. Before the Collector of Central Excise, Madras-34, the petitioner challenged the powers vested in him to revise cases a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 81. 2. It will be convenient to deal with W.P. No. 11520 of 1981 first. In the affidavit filed in support of the challenge to the notifications referred to earlier, it is stated that the vesting of powers of revision in the Collector of Central Excise is absolute and excessive without any safeguard against misuse. The notification No. 101-Customs dated, 1-7-196 t was also challenged on the ground that unbridled suo motu powers of revision had been conferred. In paragraph 12 of the common counter affidavit filed by the respondents, it was stated that the power of revision was exercised by virtue of express provision in Section 130 of the Customs Act, 1962 and that was also subject to checks and therefore, the review power cannot be characterised to be arbitrary or unbridled power. It was also further pointed out that consequent upon the creation of an Appellate Tribunal for Customs, Central Excise and Gold Control, Section 130 of the Customs Act had undergone an amendment and the impugned notification had also become redundant and had been rescinded as well and therefore, there is no need to strike down a notification not in force. 3. There is no dispute that under Section 152 o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 11-J, K and L of the Act are reasonable restrictions imposed in public interest and that there is no total ban on either owning, possessing or transporting silver bullion and coins, but that it had to be done after complying with certain statutory requirements and formalities. The learned counsel therefore maintained that the Notification No. 7, Customs, dated 3-1-1969 did not suffer from any infirmity. 5. It has to be mentioned that the power of the Central Government under Section 11-I of the Act to specify the goods was not disputed by the learned counsel for the petitioner. Therefore, the only question that arises is whether there is any justification for the complaint of the petitioner that the restrictions are unreasonable and affect rights to own and possess property or there is no reasonable nexus between the imposition of restrictions and the avowed object viz., illegal export of silver bullion and coins. The impugned notification indicates the circumstances under which the notification came to be issued. The magnitude of illegal export of silver bullion and coins is stated to be the reason for taking special measures to check such illegal export and to facilitate de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rchased by the petitioner on 8-1-1971 for Rs. 11,112.36 as shown by the production of bill for the purchase and therefore, the petitioner cannot be held to have contravened Sections 11-J, K and L of the Act. On the other hand, the learned Additional Central Government Standing counsel submitted that the seizure of the silver was effected on 30-10-1974 and it was then valued at Rs. 19,948.82 and there being no other material placed by the petitioner to show the value of the silver seized on 30-10-1974, the petitioner is not entitled to claim that even in 1974, its value should be taken as on 8-1-1971. 7. There is no dispute that the value of the silver seized was arrived at Rs. 19,948.82 on the basis of the value prevalent on the date of the seizure. Indeed, it is seen from the files that the seizure report mentions this value. If, according to the petitioner, the value of the seized silver was something different from that given by the Customs Department, then, it is for the petitioner to have placed adequate materials in support thereof. Admittedly, between the date when the silver was purchased by the petitioner on 8-1-1971 and the date of seizure viz., 30-10-1974, more than th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the proceedings relating to the search and seizure as well as subsequent proceedings are invalid and fundamentally bad. 9. The learned counsel for the petitioner next contended that the Preventive Officers could not have entertained a reasonable belief that the silver was liable to confiscation at the time of seizure and therefore, the seizure was vitiated. Reliance in this connection was placed by the learned counsel for the petitioner upon certain decisions as well. On the other hand, the learned Additional Central Government Standing Counsel pointed out that the place of storage had not been notified and there was no material to establish any permitted transport and no documents were also available to support the ownership of the silver bars at the time of search and that therefore, the officers bona fide entertained a reasonable belief that the goods were liable to be confiscated - Reliance was also placed by the learned counsel upon the statement of Shri Kesari mull to the effect that though the name of Ukchand Ranka was written, there was nobody in the temple of that name and that there were no documents to support the ownership of the silver or possession of the same. 10 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the conclusions arrived at, there has been a reference to the available materials and the order cannot, therefore, be characterised as one not based on materials. Equally, I do not see how the first respondent s order can be said to be one without jurisdiction. There is nothing to indicate that the order passed by the first respondent is without jurisdiction or is otherwise unsupportable. This contention of the learned counsel for the petitioner is therefore rejected. 12. The learned counsel for the petitioner next contended that the levy of penalty under Section 114 of the Act is not sustainable as an overt act is contemplated and the petitioner has not been found to have committed any such act. On the other hand, the learned Additional Central Government Standing Counsel pointed out that even according to the petitioner, there has been a violation of Section 11-K and L of the Act with reference to specified goods under Chapter IV-B of the Act and therefore, the goods were liable to be confiscated under Section 113(1) of the Act and the omission on the part of the petitioner to obtain a transfer voucher under Section 11-K and maintain an account under Section 11-L would suffice ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of bill as was 19.197 Kgs. Admittedly, no accounts had been maintained by the petitioner with reference to the silver owned or possessed after 3-1-1969. There has therefore been a violation of Section 11-J (2) and Section 11-K and L of the Act. Such violation would attract Section 113(1) of the Act rendering the person who had omitted to do the things enjoined upon him under Section 11-J to L liable to the levy of penalty under Section 114 of the Act. It is therefore, not necessary that there should be any overt act attributable to the petitioner before penalty can be levied. It is, therefore, not possible to accept this contention of the learned counsel for the petitioner. 13. The learned counsel for the petitioner next contended that the burden is on the Customs Department to establish violations of the provisions of the Act and that not having been done, the petitioner cannot be subjected to any penalty. Even in the letter written by the counsel for the petitioner referred to earlier, there is an admitted violation of sub-section 11-K and L of the Act. Where it is so admitted, it is unnecessary to prove anything further. There is therefore no substance in this contention of t ..... 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