ORDER
V.V.S. Rao, J.
1. The petitioner is proprietor of M/s. Rahimuddin and brothers Saw Mill, Dharmapuri in Karimnagar District. His father established the said saw mill statedly in 1976 after obtaining a licence from the first respondent as required under A.P. Saw Mills (Regulation) Rules, 1969 (hereafter called the Rules, for brevity). After the demise of the father, the petitioner has been running the saw mill. It appears the second respondent herein having received some anonymous information on 13.5.2005 regarding misuse of permits by the petitioner, inspected the petitioner’s saw mill on 15.5.2005 along with special party staff. The second respondent collected six original permits and verified the same with reference to the records of the office of the second respondent. He allegedly found variations in the quantities. Therefore, on the same day, the second respondent seized the petitioner’s saw mill and submitted a report on 18.5.2005 to the first respondent. The latter having come to an initial conclusion that the petitioner indulged in illegal activities and illegal trading of timber, issued a show-cause notice on 24.5.2005 calling upon the petitioner to show-cause as to why the saw mill licence should not be cancelled besides confiscating the timber and plant involved in the offence and further show-cause as to why penal action should not be taken under Rules 7 and 9 of the Rules, Sections 20 and 29 of A.P. Forest Act, 1967 (the Act, for brevity) for violation of Rule 5 of A.P. Forest Produce Transit Rules, 1970 (the Transit Rules, for brevity).
2. After receiving show-cause notice, the petitioner submitted explanation on 22.8.2005 to lift the seizure in vain. The first respondent also did not pass any orders pursuant to show-cause notice either cancelling the licence or confiscating forest produce stopped in the saw mill. Therefore, the petitioner filed the present writ petition.
3. It is the contention of the petitioner that the six permits seized by the second respondent were valid upto 31.3.2004 and therefore the allegation of variation of the permits in no manner can lead to culpability of the petitioner. It is also his contention that the petitioner never applied for permits and even permits are issued, they will be in the custody of the third respondent and no saw mill owner will be permitted to retain the permits. Even before deciding this question, seizing the unit is contrary to law and violates principles of natural justice. According to the petitioner, it is unfair on the part of the respondents to seize the entire saw mill even before passing orders and therefore the same is in violation of Rule 9 of the Rules.
4. The matter was initially listed for preliminary hearing on 26.10.2005 and the matter was adjourned from time to time to enable the learned Government Pleader for Forests Department to get instructions in the matter, to file counter and to produce the original file from the Secretariat of Andhra Pradesh dealing with the subsequent amendment to Rule 9. This was necessitated as the question involves the interpretation of Rule 9 as amended by G.O. Ms. No. 234, Forest and Rural Development Department, dated 23.5.1985 gazetted on 6.6.1985. Accordingly, the learned Government Pleader has filed counter-affidavit and also produced the file.
5. The Divisional Forest Officer, the first respondent herein, in counter-affidavit admitted that the petitioner’s saw mill licence was renewed and that he was sanctioned 650 permits in Form II issued by the first respondent for issuing the same to purchasers for quantities to be sold during the years 2004-2005. It is the further case of the respondents that on reliable information, the second respondent proceeded to the addresses of the purchasers located at Ramagundam town on 15.5.2005 and 17.5.2005, and proceeded to Pedapalli town and collected eleven original copies of Form II permits, each of which was issued for quantities below 1 cmt of timber by the saw mill owner himself to purchaser. The second respondent verified the original permits with reference to the duplicate copies of the permits available in the office of the third respondent and found discrepancies in the quantities and addresses of the purchasers. During the physical verification of ground stock by the second respondent on 16.5.2005 with reference to stock register of the petitioner’s saw mill, an excess quantity of thirty one round logs measuring 0.2451 cmts valued at Rs. 6,882/-was found in the saw mill premises. This is contravention of Rules 7 and 9 of the Rules. The petitioner was involved in these irregularities, which were reported to the first respondent. The first respondent, therefore, issued a show-cause notice dated 24.5.2005 and in response thereto, the petitioner requested for supply of documents, which were given to them. The petitioner submitted explanation on 22.9.2005 denying the charges and the case was posted for enquiry from time to time. It is also stated that the second respondent also lodged a police complaint at P.S., Dharmapuri, which was registered as F.I.R.No. 80 of 2005, dated 27.6.2005, under Sections 420, 468 and 471 of Indian Penal Code for misuse of transit permits and indulging in illegal activities and cheating the Government. The investigation is in progress. The enquiry is at the. preliminary stage and without waiting for the final orders by the first respondent, the petitioner’s writ petition against the show-cause notice is not maintainable.
6. The learned Counsel for the petitioner raised two contentions. First, he would urge that Rule 9 of the Rules does not enable the respondents to seize the saw mill as long as the saw mill licence is valid and the same is not cancelled. Alternatively, he submits that Rule 9 provides for cancellation, seizure, confiscation and penalty, which can be imposed as a measure of penalty for contravention. Pending such final action, there is no power vested in the respondents to seize the unit as an interim measure. Secondly, he would urge pursuant to the report submitted by the second respondent, the first respondent issued a show-cause notice dated 24.5.2005 calling upon the petitioner to show-cause as to why an appropriate action should not be taken against him and even before the petitioner submitted his explanation, if the saw mill is seized, the same would amount to presuming the guilt of the petitioner and therefore violative of principles of natural justice.
7. The learned Government Pleader for Forest Department submits that at the stage of show-cause notice, the writ petition is not maintainable. According to him whether the petitioner has contravened the provisions of the Act, the Rules and Transit Rules is a matter, which has to be decided by the first respondent based on the evidence collected against the petitioner and the Court cannot adjudicate these issues. Secondly, he would urge that pending the imposition of various penalties as contemplated under Rule 9 of the Rules, if the petitioner’s unit is not seized, there is a likelihood of further misuse by the petitioner and therefore seizure of the unit even before final order is passed by the competent authority is justified. The learned Government Pleader would like this Court to read Rule 9 as enabling the authorities to seize unit pending the cancellation/confiscation orders by the competent authority.
8. To appreciate the contentions raised by the learned Counsel for the petitioner, it is necessary to notice relevant provisions of the Act. The main object of the Act is the protection and management of forests in the State. Chapter II of the Act deals with Reserved Forests. When the land is notified as reserved forest by following the procedure contemplated under Sections 4 to 15 of the Act, Section 20 prohibits the commission of certain acts and penalizes with penalty of imprisonment for a term which may extend to one year or with fine which may extend to Rs. 2,000/- or with both. Insofar as the contraventions enumerated in Section 20(1)(a)(b)(c) of the Act is concerned, the penalty can go upto Rs. 10,000/-. Sub-section (2) thereof, however, exempts any act done in accordance with any Rule made under the Act or with the permission of the Divisional Forest Officer. Sub-section (3) empowers a forest officer not below the rank of Ranger, a police officer not below the rank of Sub-Inspector or a revenue officer not below the rank of Deputy Tahsildar to evict a person from the forest land, pertaining to which the contravention has taken place. The proviso to Section 20(3), however, requires the officer concerned to give opportunity to the person affected to make any representation against the action proposed. Section 29 of the Act empowers the Government to make rules for the purpose of regulating the transit and possession of timber and other forest produce. Chapter VII of the Act provides for penalties and procedure. Section 44 deals with the seizure of property liable for confiscation along with tools, ropes, chains, boats and vehicles used in committing a forest offence, which means [Section 2(e)] an offence punishable under the Act or any Rules made thereunder. Here again no order confiscating any property can be made unless the person from whom the property seized is given a notice in writing informing the grounds for such confiscation. Sub-section (2) of Section 44 of the Act requires every officer seizing any property without any unreasonable delay to produce the seized property before an officer not below the rank of Assistant Conservator of Forests or make a report of such seizure to the Magistrate i.e., Magistrate of First Class or Second Class having jurisdiction to try forest offences [Section 2(i)].
9. The Government of Andhra Pradesh promulgated Rules in exercise of powers under Section 29 of the Act. Rule 3 prohibits any person from erecting or operating a Saw Mill for cutting, converting or sawing of timber without obtaining a licence for such installation from the Divisional Forest Officer, who is the licensing authority. The licence is granted under Rule 4 on an application made by a person and a licensee is under obligation to maintain the registers in Form-III(A) and (B) for accounting fully and properly the timber received in the saw mill for conversion and its disposal. These registers are to be made available at any time to all inspecting officers along with permits/invoices in original within the saw mill premises. Rule 9 of the Saw Mill Rules provides for revocation of the licence. Before it was amended in 1985, the same reads as under:
9. Notwithstanding anything in the foregoing rules, the licensing authority may, where he has reason to believe that a licensee is operating a saw mill in contravention of the provisions of these rules and conditions of the licence or the licensee is indulging in activities prejudicial to the interest of forest conservancy, at any time, revoke the licence granted under these rules, after giving the licensee an opportunity of being heard.
10. Any contravention of provisions of the rules and conditions of licence or in the event of licensee indulging any activities prejudicial to the interests of forest conservancy, the licensing authority can revoke licence after giving the licensee an opportunity of being heard. Except this rule, there was no other provision empowering the licensing authority either to suspend the licence or seize the saw mill or to impose penalty for any contravention of the conditions of licence.
11. The Government issued orders/ notification in G.O. Ms. No. 234, Forest and Rural Development (Forest III) Department, dated 23.5.1985, and notified the same in A.P. Gazette (EO) R.S. to Pt.II, dated 6.6.1985, inserting Sub-rules (2) and (3) and renumbering Rule 9 as Sub-rule (1). After amendment with its sub rules, Rule 9 reads as under.
9. (1) Not withstanding anything in the foregoing rules, the licensing authority may, where he has reason to believe that a licensee is operating a saw mill in contravention of the [Provisions of the Andhra Pradesh Forest Act, 1967 or any rules made thereunder] at any time, revoke the licence granted under these rules, after giving the licensee an opportunity of being heard.
(2) (a) For any violation of the provisions of the Andhra Pradesh Forest Act, 1967 or the rules made thereunder by the licensee the [licensing authority or Divisional Forest Officer, Flying Squad Party] shall be competent to seize and confiscate forest produce together with whole or portion of the plant, machinery, implements and equipments which have been used in the commission of the offence;
(b) In case of violations, where it is not proposed to either revoke the licence or seize and confiscate the plant, machinery etc., the licencing authority shall be competent to impose a penalty of a sum upto the limit of available security deposit. If the amount of penalty so levied exceeds Rs. 1,000/-, an appeal against such imposition shall lie with the Conservator of Forests having territorial jurisdiction over the area, and his decision, thereon shall be final. The appeal should however be preferred within fifteen days from the date of despatch of the order, imposing penalty, by registered post;
(c) All penalties levied shall be paid by the licencee within fifteen days from the date of despatch by registered post of the order or the notice of demand for payment. In case of failure to pay the penalties in time, the same will be adjusted from the security deposit, which shall be replenished immediately so as to keep it always full and complete. The licence shall be deemed to be inoperative, until such time, the licencee replenishes the adjustments in the security deposit.
(3) In the event of revocation of licence under Sub-rule (1) or seizure and confiscation of forest produce together with whole or portion of the plant machinery, implements and equipments under Sub-rule (2) the licensing authority shall be competent and shall be at liberty to forfeit security deposit in part or whole.
12. So as to know the reason for amending and inserting Sub-rules (2) and (3) in Rule 9 of the Rules, this Court summoned the relevant file from the Secretariat. The same would show that the Chief Conservator of Forests addressed a letter dated 23.11.1984 to the Government suggesting amendments to the Rules purportedly based on the discussions in the meeting held by the Minister for Agriculture and Co-operation. It was pointed out that except Rule 9 of the Rules empowering the Divisional Forest Officer to revoke the licence, there is no other punishment that can be imposed to be deterrent preventing the commission of contravention by saw mill owners. The Chief Conservator of Forests, therefore, opined that there must be sufficient powers for the Divisional Forest Officer to (i) impose and adjust fines from, or forfeit the security deposit; and (ii) to seize and confiscate the forest produce together with whole or part of the machinery and equipment used in commission of the offence. Accordingly, the above Rules were prepared suggesting the renumbering of the existing Rule 9 as Rule 9(1) and further inserting Sub-rules (2) and (3) in Rule 9 of the Rules.
13. At this stage, Rule 9 as it stands on the statute book may be analysed keeping in view the amendments made in 1985. The licensing authority is empowered to revoke the licence of a saw mill if he has reason to believe that the licensee is operating the saw mill in contravention of the provisions of the Act and the Rules made thereunder. Such revocation can be made, however, only after giving the licensee an opportunity of being heard. Sub-rule (2) enables the licensing authority, Divisional Forest Officer or a flying squad, to seize and confiscate forest produce, whole or portion of the plant, machinery, implements and equipment which have been used in the commission of offence. Therefore, under Clause (a) of Sub-rule (2) of Rule 9 of the Rules, what is permitted to be seized or confiscated is only movable property and it does not in any manner empower the seizure of the premises where saw mill is established. Clause (b) of Sub-rule (2) of Rule 9 of the Rules empowers the licensing authority to impose penalty of a sum upto the limit available security deposit in the case of violations where it is not proposed to revoke the license or seize and confiscate the plant. Sub-rule (3) of Rule 9 speaks of forfeiting security deposit when in the event of revocation or seizure of forest produce or plant and machinery. The rule contemplates, therefore, the seizure of forest produce or the machinery used in the commission of offence. The authorities competent to seize under Rule 9(2) of the Rules have no power to seize the premises of saw mill merely on the ground that during the inspection unaccounted forest timber was found. The rule making authority, it is interesting to notice, does not incorporate the deeming provision to give any indication that the authority inspecting the saw mill can seize the saw mill premises merely on the ground that some unaccounted timber logs were found in the saw mill. Even in a case where the flying squad finds at the time of inspection some timber or forest produce and the presence of such timber or forest produce is as a result of use of the machinery of the saw mill unless and until a finding is recorded that the same is in violation of the provisions of the Act and the Rules, seizure is not permissible. Indeed, the purpose for which amendments were incorporated as seen from the file produced before this Court would suggest such interpretation.
14. There is yet another reason to conclude that the seizure of saw mill premises is not permissible under the Rules. A reference to Section 44(1) of the Act would show that if there is a reason to believe that forest offence has been committed in respect of any timber or forest produce, it shall be competent to the forest officer to seize such forest produce together with tools, chains, boats or vehicles used in committing the offence. Immediately, thereafter the same has to be reported to the forest officer or to a Court and thereafter in exercise of powers under Section 44(2-A) of the Act, the authorized officer can order confiscation of timber along with the vehicle used in the commission of offence. A comparison of Section 44(1) with Rule 9(2)(a) of the Rules would show that mere suspicion would be sufficient for seizing the forest produce and the vehicles used for commission of offence under Section 44(1) of the Act. Whereas unless and until there is a finding recorded that the provisions of the Act and the Rules made thereunder have been violated, the forest produce and/or the plant and machinery of the saw mill cannot be seized. This would only suggest that a prior notice is required as in the case of revocation under Rule 9(1) of the Rules. If there is any suspicion, the Divisional Forest Officer can initiate action for revocation of the licence and also for seizure and confiscation of the forest produce and the machinery in the saw mill. The submission of the learned Government Pleader that seizure is effected immediately to prevent further abuse of law cannot be accepted. When the forest produce or vehicles are seized under Section 44(1) of the Act, they go into the custody of forest officials whereas in the case of seizure under Rule 9(2) of the Rules, such seizure cannot be effected, especially when the equipment in saw mill is fixed to the ground. However, after final orders are passed, under Rule 9(3) of the Rules, it may be possible to remove the machinery by the forest officials if a finding is recorded that such machinery has been used in the commission of offence. Even such an order cannot be passed unless an enquiry is conducted.
15. Rule 9 of the Rules is a penal provision. It has to be interpreted strictly. It is well settled that strict rule of construction applies to penal statutes. In his Magnum Opus ‘Principles of Statutory Interpretation’, Justice Guru Prasanna Singh (1999 7th Edition: Wadhwa Company pp 640-641), after discussing the strict construction of the principle, summarised the propositions as under.
(1) If the prohibitory words in their known signification cover only some class of persons or some well-defined activity, their import cannot be extended to cover other persons or other activity on considerations of policy or object of the statute.
(2) If the prohibitory words are reasonably capable of having a wider as also a narrower meaning and if there is no indication in the statute or in its policy or object that the words were used in the wider sense, they would be given the narrower meaning. In other words where after full consideration it is found that the prohibitory words are equally open to two constructions, one of which covers the subject and the other does not, the benefit of construction will be given to the subject.
(3) If the prohibitory words in their known signification can reasonably bear a wider meaning which promotes the object or policy of the statute, the words will receive that wider meaning and their import will not be restricted even if when construed literally they bear a narrower meaning.
(4) If the literal reading of the prohibitory words produces an unintelligible or non-sensual or socially harmful result, but the statute read as a whole gives out its meaning clearly, effect will be given to that meaning by curing a mere defect in phraseology and even by rejecting words as surplusage.
16. Applying strict rule of construction to Rule 9 of the Rules, this Court holds that immediately on suspicion at the time of inspection forest officials have no power or authority to seize the saw mill premises along with its machinery though it may be permissible to remove the forest produce to departmental custody, which is alleged to be in possession of the owner in contravention of the provisions of the Act and the Rules. In case the Divisional Forest Officer desires to impose the penalty of seizure and confiscation as contemplated under Rule 9(3) of the Rules, the same can only be done after giving the licensee an opportunity of being heard, as otherwise seizure and confiscation would be illegal for violation of principles of natural justice. Confiscation is expropriatory and no such order can be passed without first recording the finding that there is clear violation of provisions of law and Rules made thereunder.
17. The petitioner submitted explanation on 22.8.2005 denying the allegations and requesting to relief the seizure. Though the show-cause notice was issued on 24.5.2005, so far the first respondent has not passed any orders. Such inaction has certainly resulted in huge loss to the petitioner, who alleges that even according to the respondents, a minor portion of the forest produce available in the petitioner’s premises was found to be unaccounted. Therefore, it is a fit case where this Court should interfere directing the respondents to immediately release M/s. Rahimuddin and Brothers Saw Mill, Dharmapuri, to the petitioner and pass appropriate orders pursuant to show-cause notice, dated 24.5.2005.
18. The writ petition is accordingly allowed with costs.