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TMI Blog2015 (9) TMI 146X X X X Extracts X X X X X X X X Extracts X X X X ..... is illegal and they are to be returned to petitioner as prayed for and rejection of petitioner's claim is bad in law. 3. The factual matrix which has given rise to filing of this writ petition can be crystallised as under: The Directorate of Revenue Intelligence ('DRI' for short) on receipt of specific intelligence input that one Sri.K.Abdulla Kunhi Abdul Rahaman, resident of Kannikkad House, No.05/386, Alampady, Kallakkatta Post, Kasargode District would be arriving at Bengaluru by Air India Flight No.A1 994 on 16.09.2013 and would attempt to smuggle gold without payment of applicable customs duty, had intercepted said passenger namely petitioner herein while he was attempting to exit himself through Green Channel of customs area and on verification of travel documents by the DRI Authorities it was found that petitioner was a holder of Indian Passport on whom they had specific intelligence input and on examination of baggage, which was carried by petitioner and on same being scanned, it was found from his personal search that two chits were recovered from his upper shirt pocket revealing two other persons by name Sri.Haneefa and Sri.Abdul Khader were traveling along ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to return the seized goods on the ground that show cause notice was not issued within six (6) months from date of confiscation, a reply is said to have been furnished by third respondent vide Annexure-F intimating the petitioner that Show Cause Notice issued on 13.03.2014 is within the period of six months as per Section 110(2) of the Act and petitioner was called upon to reply to the Show Cause Notice to the adjudicating authority as mentioned in the Show Cause Notice. 6. It is the contention of learned counsel appearing for petitioner that Show Cause Notice issued under Section 110(2) of the Act dated 13.03.2014 ought to have been served on the petitioner within six months from the date of seizure (16.09.2013) and show cause notice was factually received by the petitioner on 17.03.2014 as evidenced from the postal seal found in Annexures-B and C and as such, prescribed period of six months namely period stipulated under Sub-section (2) of Section 110 of the Act being violated petitioner would be entitled to seek for return of seized goods and as such it is contended that petitioner is entitled for relief sought for in the writ petition. 7. He would elaborate his submission by c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther hand a show cause notice is issued within the period of six months or the extended period of six months (12 months in all) the remedy available to such person is to reply to such Show Cause Notice and such person would not get an automatic right to seek for return of the goods if such show cause notice is issued in accordance with subsection (2) of Section 110 of the Act. Hence, he prays for dismissal of the writ petition. 9. Having heard the learned Advocates appearing for the parties and on perusal of the records, this Court is of the considered view that question which arises for consideration in this Writ Petition is with regard to validity of show cause notice dated 13.03.2014 issued to petitioner under Section 110(2) of the Customs Act, 1962 and validity of communication dated 5.6.2014- Annexure-F. 10. The relevant provisions of Customs Act, which have bearing on this issue in question which requires to be noticed namely, Sections 110, 123, 124(a) and 153 and as such they are extracted herein below: 110. Seizure of goods, documents and things - (1) If the proper officer has reason to believe that any goods are liable to confiscation under this Act, he may seize such g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uggled goods shall be- (a) in a case where such seizure is made from the possession of any person,- (i) on the person from whose possession the goods were seized; and (ii) if any person, other than the person from whose possession the goods were seized, claims to be the owner thereof, also on such other person; (b) in any other case, on the person, if any, who claims to be the owner of the goods so seized. (2) This section shall apply to gold and manufactures thereof watches, and any other class of goods which the Central Government may by notification in the Official Gazette, specify. 124. Issue of show cause notice before confiscation of goods, etc.-No order confiscating any goods or imposing any penalty on any person shall be made under this Chapter unless the owner of the goods or such person- (a) is given a notice in writing with the prior approval of the officer of customs not below the rank of a Deputy Commissioner of Customs, informing] him of the grounds on which it is proposed to confiscate the goods or to impose a penalty; (b) is given an opportunity of making a representation in writing within such reasonable time as may be specified in the notice against the gr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder clause (a) of Section 124 within the time prescribed under Section 110(2). The consequence of non-initiation of proceedings within the time set out in the Section would result in return of the goods from whom they were seized. It would indicate that failure to show cause under clause (a) of Section 124 of the Act within the prescribed time of six (6) months will only result in obligation on the part of the proper officer to return the goods to the person from whose possession they were seized. There is nothing in Section 110 of the Act which would indicate that a fetter or limitation is imposed upon the power of the competent authority to initiate proceedings under Section 124 of the Act. On the other hand, Section 124 is a substantive provision relating to confiscation of goods and imposition of penalty. Under Section 124 of the Act issue of Show Cause Notice prior to the passing of an order of confiscation or imposition of penalty is mandatory. The language employed in Section 124 of the Act is clear and precise and no restriction or limitation or even a fetter is imposed as regards the time when proceeding may be initiated by issue of a Show Cause Notice. A plain reading of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 110 and Section 124(a) of the Act came to be considered. It has been held that mere dispatch of notice would not amount to "giving" of notice and the words "giving" as found in sub-section (2) of Section 110 of the Act would be complete only when such notice has reached the person concerned or if such notice after being tendered had been refused. The said judgment of the Delhi High Court is undisputedly pending adjudication before the Hon'ble Apex Court in Civil Appeal No.3122/15. 15. A perusal of the said judgment would indicate that judgment rendered by the Hon'ble High Court of Madhya Pradesh in the matter of Commissioner Vs. Ram Kumar Aggarwal reported in 2012 (280) ELT 13 (M.P.) has been distinguished. The High Court of Madhya Pradesh in Ram Kumar Aggarwal's case while interpreting Sections 110(2) and 124 of the Act has held issuance of Show Cause Notice by registered post before the expiry of six (6) months from the date of seizure would be sufficient compliance more particularly when the same is received by the addressee though after lapse of six (6) months. It has been further held that neither Section 110(2) nor clause (a) of Section 124 of the Act co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder Section 110(2) of the Act had lapsed by the time show cause notice was delivered and therefore he would be entitled to return of seized goods. 18. Section 153 of the Act provides that notice issued under the Act should be served in the manner as provided under said Section. It does not even remotely suggest that such person should be served with such notice to hold service of notice as complete. Dispatching of notice by registered post would constitute a valid service. Clause (b) of Section 153 of the Act also provides that in case tendering of summons or sending the notice by registered post is not feasible or possible, then such service can also be effected by affixing the notice on the notice board. Thus, Section 153 controls Section 110(2). Thus, date of sending or dispatching the notice by registered post is the date of giving the notice as contemplated under Section 110(2) of the Act. 19. Though Delhi High Court was persuaded by the dicta laid down by the Apex Court in the case of Jayanthi for construing the plain and simple meaning of the word "given" to extend the said meaning to sub-section (2) of Section 110, the High Court of Madhya Pradesh has taken note of the f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (6) months. Hence, words "given" used in Section 110(2), 124 and Section 153 should be read conjointly. The object in setting the time limit under Section 110(2) of the Act was not to harass the citizen from whom goods have been seized and keep the kettle boiling, but to ensure that proceedings are commenced or started within six (6) months from date of such confiscation. 23. Section 79 of the Gold Control Act which is similar to Section 110 of the Customs Act would indicate that the purpose of issue of notice is two fold namely: (i) to intimate concerned person the grounds on which confiscation is proposed; and (ii) to give opportunity to the concerned person for making a representation against such confiscation. In the event of authorities making up their mind to confiscate goods, they will have to issue a notice under Section 124(a) within a period of six (6) months of such seizure as required under Section 110(2) and on such failure the goods so seized will have to be returned to the owner or to the person from whom it was seized. In this background the period of six months has been prescribed by the Legislature, to enable the authority concerned to make out a prima facie case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion passed or any summons or notice issued under this Act" would acquire significance to hold that notice indicated under sub-section (2) of Section 110 would also encompass notice indicated in Section 153 of the Act. It has been held by the Madhya Pradesh High Court in the case of C.C.E., Indore Vs. Ram Kumar Aggrawal reported in 2012 (280) E.L.T. 13 by referring to the judgment of Calcutta High Court in the case of Union of India Vs. Kanti Tarafdar reported in 1997 (91) E.L.T. 51 (Cal.) to the following effect: "13. We may successfully refer to the Division Bench decision of the High Court of Calcutta in the case of Union of India v. Kanti Tarafdar [(1997 (91) E.L.T. 51 (Cal.)]. While dealing with Section 110(2), 124 and 153 of Customs Act, 1962, it has been observed: 28. Therefore, the real object of the notice under Section 110(2), which is required to be issued in writing as provided in Section 124 and which is required to be given within six months, is to give the authority concerned a time-limit of six months to make out a case for confiscation of the goods seized. 29. Once the authority concerned makes out a case for confiscation within the time-limit, it cannot sit idl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... special provision will prevail upon general provision, we are of the view that special procedure for service of notice as provided for in the Act should prevail over the general enactment of giving of notice. 35. We, therefore, conclude that Section 153 of the Act controls Section 110(2) of the Act and a notice which is required to be given under Section 110(2) should be given in a manner provided in Section 153 and by no other means. 36. The word "serve" in legal connotation means to make legal delivery (a process or writ) on or upon (a person) or to present (a person) with a writ. (See the Shorter Oxford English Dictionary, re-print of 1988 at Page 1949). Therefore, is legal parlance serving is giving. 37. Under Section 153 of the Act, service is either by personal delivery (tender) or by putting it into transmission by registered post in case both are possible. 38. Thus, the logical conclusion would be that service of a notice will be complete either by tendering or by sending the same by registered post, since the legislature has equated both the situations by using the word "or". 39. In the event of the notice is tendered, the date on which the same was tendered should be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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