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TMI Blog1968 (2) TMI 129X X X X Extracts X X X X X X X X Extracts X X X X ..... ds forth with, and in default of compliance may, after the expiration of one month from the date of service of the notice, sell the goods by public auction after giving notice of the sale in the manner prescribed. Section 48 of the Customs Act 52 of 1962 provides that if any goods brought into India from a place outside India are not cleared for home consumption or warehoused or transshipped within two months from the date of unloading at a customs station, such goods may, after notice to the importer and with the permission of the proper officer be sold by the person having custody thereof. 3. A large quantity of merchandise unloaded in the Port of Bombay which could not be connected with invoices and manifests was lying in the storage yard of the Port Trust. These goods were liable to duty leviable under the Customs Act, 1962, and were also liable to pay the port trust charges. Early in 1966 the Port Trust authorities opened correspondence with the Collector of Customs for obtaining sanction to sell the goods and in anticipation of sanction advertised the goods for sale by public auction by a notice dated April 30, 1966. In the Auction Notice Lots Nos. 156 and 157 were descr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id shall forthwith be cancelled and the lot reauctioned on account and at the risk of the defaulting purchaser who shall be responsible for the deficit if any in the price. Condition 12 stated that the goods shall lie at the sole risk and responsibility of the purchaser in all respects from the time of the sale and must be removed by the purchaser within the prescribed period. In respect of Lots Nos. 156 and 157 certain Special Conditions were published by the auctioneers. By Condition 3 it was provided that the purchaser will have to take delivery under customs supervision , and Condition 4 provided that: Melting and rerollable scrap will not include the following: (i) Gas Cylinder. (ii) Motor vehicle parts viz. axle, shaft, gear-box, wheels, wheel centre etc. (iii) Tin plates. (iv) Boiler tubes, pipes and tubes. (v) Channels. (vi) Tractor chains and tractor parts, (vii) Structural materials such as channels etc. (viii) Drums in good condition, (ix) Stainless steel tubes, bars, sheets etc. (x) Machinery parts. (xi) Buoys and other materials belonging to the Controller of Stores, B.P.T (xii) Anchor, chain etc. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd Victoria Docks he was prevented from removing the goods. On June 2, 1966, the petitioner's advocate addressed a letter to the trustees of the Port Trust protesting against obstruction to the removal of the goods purchased by the petitioner. On June 7, 1966, the Assistant Collector of Customs, Special Investigation Branch, Appraising Department, issued the following order: Whereas there are reasons to believe that the goods such as round bars, billete, shaftings, prime quality, lying at the open plot of land adjoining the plot of Messrs Mahendra and Mahendra Ltd. at Tile Bunder and belonging to Shri Hariram S. Thakkar of Messrs. Velhari Steel Industries, Bombay, are liable to confiscation under Section 111 of the Customs Act, 1962. Now, therefore, in exercise of the powers vested in me by Section 110(1) of the Customs Act, 1962, I seize the said goods and order the owner thereof not to remove, part with or otherwise deal with the said goods except with the previous permission of the undersigned. On June 8, 1966, the Appraiser, Special Investigation Branch, issued a summons, under Section 108 of the Customs Act, 1962, requiring the petitioner to appear in person ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... prime quality goods delivered to the petitioner were offending goods liable to be confiscated and accordingly in exercise of the power under with Section 111 of the Customs Act he issued the impugned order for seizing the goods delivered to the petitioner and lying in his warehouse; that prime quality goods were delivered to the petitioner by mistake and the officers who supervised delivery of the goods had no power to assent to or permit removal of those goods as scrap from the Customs area. 9. The principal issue in controversy between the parties was whether at the auction sale it was intended to sell out of Lots Nos. 156 and 157 in the auctioneer's list only goods which would commercially be known as scrap and that prime quality goods were not intended nor offered to be sold. The petitioner contended that he purchased the two Lots 156 and 157 excluding therefrom only 12 items of goods mentioned in Special Condition 4. On behalf of the Customs and Port Trust authorities it was contended that prime quality goods out of Lots Nos. 156 and 157 were not intended to be sold and were not offered to be sold and it was so made clear to all the intending bidders. The part ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat when it was intended that the sanction was not to operate in respect of certain classes of goods an express order in that behalf was made. The order refers to the Bombay Port Trust sale list for auction which was submitted to the Assistant Collector of Customs. A copy of that sale list was apparently returned to the Port Trust. Neither the sale list nor its copy has been produced, on the plea that the auctioneer's list alone was submitted to the Assistant Collector, but for that, in our judgment, there is no warrant. There was correspondence between the Port Trust and the Customs Authorities lasting over several months in connection with the proposed sale by the Port Trust authorities of the unclaimed goods. Evidently a separate schedule consisting of 76 items was prepared: Lots Nos. 156 and 157 in the auctioneer's list are Items Nos. 75 and 76 in the Schedule to the order of the Assistant Collector. The principle on which the Schedule was prepared is not explained. The correspondence with the Port Trust authorities which might have thrown some light on this question has also not been produced. There is nothing in the order or in any other record which indicates t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Order, 1956 (which had ceased to be in operation before the date of auction in question). According to the Iron Steel Control Order, 1956, prime quality goods are goods mentioned in the Schedule to the order. In the Schedule there are several items mentioned, for instance, plates, black sheets, wires which may be regarded as prime quality goods within the Iron Steel Control Order, 1956, and still the auctioneer in the presence of the Customs Authorities informed the bidders that those goods were put up for sale. The expression scrap is also not a trade term with any definite connotation: an article may be scrap to one person, to another person it may be serviceable. Scrap cannot be defined, having regard either to the use to which the article has to be put or the reason why the article has been discarded. In the auctioneer's list of articles, Item 156 was designated scrap unserviceable and Item 157 as scrap re-rollable . In the absence of any reservation expressly made, it cannot be said that merely because certain articles included in the two Lots were capable of being used or could be regarded as goods of prime quality - whatever that expression may mean they w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ered would be so negligent in respect of the vast quantity of goods as not to prepare separate inventories of goods which were intended to be sold after confiscation and of goods which were not intended to be sold. But the Customs Authorities have withheld from the Court the relevant record in their possession on which the order dated May 3, 1966, was passed and have, after the Port Trust authorities had taken the step of stopping delivery of goods which remained to be delivered, been persuaded to make an order under Section 110 of the Customs Act, which was, in our judgment, wholly uncalled for. 13. Counsel for the Union of India contended that the matter was one which was incapable of being tried in a writ petition by the High Court. He contended in the first instance that a writ petition for the relief claimed was incompetent and the only remedy of the party aggrieved by the order was either to appeal against the order or to file a suit for setting aside the order. In the alternative, counsel contended that even if the writ petition was maintainable, since disputed questions of fact arose in the case for determination, the High Court should not have dealt with the matter on a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fact the Court may allow oral testimony of witnesses to be taken and for that purpose may adjourn the hearing of the rule to some other date. In such a case either party may obtain summonses to witnesses, and the procedure in all other respects shall be similar to that followed in a suit. 14. The rule it need hardly be said confers no new jurisdiction: it merely affirms the jurisdiction and prescribes the procedure to be followed in the exercise of that jurisdiction. The High Court may, therefore, at the request of a party direct that a person who has filed an affidavit be called before the Court for cross-examination before his affidavit may be taken into consideration; or the Court may allow oral testimony of witnesses to be taken for the purpose of determining any material issue of fact. It is common ground that no request was made before K.K Desai, J., that any of the deponents of affidavits be called before the High Court for cross-examination, nor was the Court requested to set down the case for trial on evidence viva voce. The parties were willing to have the matter tried on affidavits only. It is now too late to contend that the discretion exercised by the learned Judg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tedly a disputed question of fact fell to be determined, but it was not a question of any great complexity. Rangnekar had, it is clear, made inconsistent statements in his affidavit, and Kalyanpur Rao's affidavit had no evidentiary value. The case of the Customs Department and the Port Trust was not supported by any documentary evidence. An order directing the trial of the petition on affidavits only is not in the circumstances open to any serious criticism. We, therefore, reject the application made before us that the Union of India and the Port Trust be given an opportunity to have the question determined on evidence viva voce. 16. Counsel for the Port Trust adopted the arguments of counsel for the Union and submitted in addition that the claim made by the petitioner was in substance a claim for specific performance of a contract, and it is the normal practice of the High Court, that to enforce the rights and obligations arising out of a breach of contract, the High Court will not entertain a petition under Article 226 of the Constitution, but will relegate the parties to a civil suit. It is true as held by this Court in Lekhraj Satramdas Lalvani v. Deputy Custodian-cum-Ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s custody were disposed of. If, thereafter any claim was made, it had to be made after giving a notice in writing and within six months from the date of sale. It is not said that any suit to enforce such a claim has been filed. Again in order to protect the rights of the Port Trust the learned trial Judge had made a reservation in his order that if any of the goods have been claimed or are liable to be delivered to any person, the Customs Authorities and the Port Trust will be at liberty to inform the petitioner of that fact and for that purpose to withhold delivery to the petitioner. That reservation clearly protects the Port Trust against any claims which have been made. 18. Counsel for the Port Trust contended that even if it be held that the claim by the petitioner was only in respect of delivery of goods belonging to him, the High Court was still not justified in entertaining a writ petition for enforcement of the claim. The writ petition, said counsel for the Port Trust, is not intended to be a substitute for a suit in the civil court, for delivery of property wrongfully withheld by a public authority. It is not contended, and cannot be contended, that jurisdiction to orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... description. But the description was Lots Nos. 156 and 157 and both the parties regarded the lots in their entirety as scrap unserviceable and scrap re-rollable . There is therefore no scope for the argument that only a part of the goods described in Lots Nos. 156 and 157 was agreed to be sold. 21. The suggestion that the goods were offered for sale by the Port Trust authorities pursuant to an order of the Customs Authorities and the Customs Authorities had granted permission with reference to the tariff entries in the Customs Act has no merit whatever. There is no evidence on the record that sanction was accorded for sale of scrap by reference to any tariff entry . In the orders recorded on May 3, 1966, there is no reference to scrap at all: the expression scrap occurs only in the Schedule to the first order indicating the nature of the goods in Lots Nos. 156 and 157. Our attention has not been invited to any specific entry in the relevant tariff list in the Customs Act with reference to which the order was or could be passed. There is also no evidence that it was intended by the Customs Authorities to exclude from their permission any of the goods except those speci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dence to be taken by the High Court. But, in our view, on the materials on the record, there is no doubt that what was agreed to be sold was one heap of goods which were referred to as two Lots 156 and 157. That is clear from the affidavit of Gandhi the auctioneer. It is true that in the judgment of K.K Desai, J., there is no clear finding as to what was the quantity of goods remaining to be delivered. But the learned Judge has in his judgment observed: The remaining balance of mixed goods relating to the Lots 156 and 157 sold to the petitioner only weighed 632 tons. He again observed after discussing various points raised before him that as regards the balance of the goods sold to the petitioner there was no warrant in preventing delivery thereof sold to the petitioner . The learned Judge has not, however, set out what in his view the balance of the goods was. In the final order passed by him, the learned Judge made the rule absolute in terms of prayer (b) of the petition and directed the Union of India and the Port Trust to deliver to the petitioner the remaining goods of Lots Nos. 156 and 157 sold to the petitioner by auction on May 3, 1966, subject to exclusion of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uhna dated October 17, 1967, filed in this Court. Delivery shall be effected within two months from the date of the order of this Court free of any rate or rent and thereafter the petitioner will pay rent at the rate prescribed in the Dock Scale of Rates. 24. Counsel for the Union of India contended that this Court should give a direction about payment of customs duty due in respect of the goods. But the Port Trust authorities have undertaken to pay the duty and that is so clearly directed under the supplementary order dated May 3, 1966, passed by the Assistant Collector of Customs. We are at this stage not concerned to decide as to what is the appropriate duty payable in respect of the goods which have been sold by the Port Trust. 25. The petitioner claimed delivery of 2000 tons approximately of scrap. On the view taken by us he has succeeded only in respect of 1032 tons - 400 tons which have been already delivered, and 632 tons remaining to be delivered. The order of the learned Single Judge and the High Court was not clear and it would have led, if allowed to stand, to considerable litigation. Before us, counsel for the petitioner did not seek to press his case for deliver ..... X X X X Extracts X X X X X X X X Extracts X X X X
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