JUDGMENT
Hari Lal Agrawal, J.
1. By this application under Articles 226 and 227 of the Constitution of India, the petitioner prays for release of the goods seized by the Inspector of Customs, Katihar (Respondent No. 2) on 1-5-1974. The relevant facts, shortly put, are as follows :–
2. According to the case of the petitioner who resides at Forbesganj, he carries on business of selling silver Thakas (blocks) and old silver coins, his purchasers being the wholesale dealers in the said commodity at Katihar. On 1-5-1974, he started by train from Forbesganj for Katihar with three Thakas of silver weighing 8.772 kg. and 337 pieces of old silver coins weighing 337 tolas, their value being Rs. 9,500/- and Rs. 4,000/- respectively. He was intercepted outside the gate of the Katihar railway station by respondent No. 2 who, after making search, seized the above articles. A detention receipt of the articles was given by respondent No. 2 to the petitioner, a copy of which is Annexure 1 to the writ application. The petitioner was also examined by the Customs authority, a copy of which statement has been made Annexure 2 to the writ application, in which he stated that he had purchased the silver from several persons residing around Forbesganj and after melting the same, prepared three Thakas. The Customs authority made the seizure on a suspicion that the silver and the silver coins had been smuggled from Nepal. The petitioner, however, denied this suggestion made to him.
3. On 9-7-1974, i. e. about two months after the seizure, the petitioner made an application to the Assistant Collector of Customs, Forbesgunj (Respondent No. 1) for release and return of the seized articles. No order on the said petition having been passed, he filed the present writ application on 13th of February, 1975, and claimed release of the goods on the ground that no notice as required by Section 110(2) of the Customs Act, 1962 having been given by the authorities within the prescribed period of six months from the date of seizure of the goods, he became entitled to the return of the goods. The other ground taken by him that the silver and the old coins being not smuggled goods, their seizure was illegal, cannot be examined by this court as the matter is pending in an adjudication proceeding and the same was rightly not pressed.
4. In the counter-affidavit filed on behalf of the respondents, it has been stated that a show cause notice was issued to the petitioner by the respondent No. 1 on 22-10-1974, within six months of the seizure, at the address furnished by him in his statement given at the time of seizure, by registered post with acknowledgment due. A copy of the said notice has been made Annexure “A”. The notice, however, was returned back by the Postal authorities with a remark dated 24-10-1974 “Not known” and thereafter a copy of the show cause notice was displayed on the Notice Board of the office of respondent No. I on 30-10-1974 as provided under Section 153(b) of the Customs Act. It had been asserted on behalf of the respondents that the customs officials has secret information that some contraband silver was being brought to Katihar by the 37 Down Prayag Passenger, by which the petitioner was travelling on 1-5-1974. According the seizure was made by rummaging the train. However, for the question that has been canvassed before us, it is not necessary to take notice of any other fact in controversy.
5. Section 110(1) of the Customs Act authorises seizure of any goods by a proper Customs Officer if he has reason to believe that the goods are liable to confiscation. But as required by Sub-section (2) of Section 110, if no notice in respect thereof is given under Clause (a) of Section 124 within six months of the seizure of the goods shall be returned to the person from whose possession they are seized. There is a provision for extension of the period of six months by the Collector of Customs, but there is no question of extension in this case.
Section 124 is under Chapter XIV dealing with confiscation of goods and conveyances and imposition of penalties. It provides for issue of show cause notice before confiscation of goods, etc. and lays down that no order confiscating any goons or imposing any penalty on any person shall be made under Chapter XIV unless the owner of the goods or such person-
(a) is given a notice in writing informing him of the grounds on which it is proposed to confiscate the goods or to impose a penalty.
Section 110(2) refers straightaway to giving of the above notice within a period of six months, that is a notice to show cause against confiscation. In other words the scheme of the above provision of the Act lays down that if the authorities do not make up their mind to initiate confiscation proceeding within the prescribed period of six months from the date of the seizure of the goods and call upon the person concerned to show cause, they cannot be permitted to retain the seized goods and the goods are to be returned to the said person.
As already said above, the petitioner claims release of the goods in question on the allegation that the respondents have failed to comply with the above statutory requirement and, therefore, the detention of the goods cannot be permitted and the petitioner was entitled to their release,
6. Section 153 of the Customs Act prescribes the procedure for service of any order, summons or notice is used under the Act and the first mode of service is (a) by tendering the order, summons or notice, etc. or sending it by registered post to the person for whom it is intended or to his agent; or (b) if the order, summons or notice cannot be served in the manner provided in Clause (a), by affixing it on the notice board of the Custom: house.
7. Faced with the above situation namely the provisions contained ir the Customs Act and the above facts brought on the record by the counter-affidavit of the respondents, learned Counsel for the petitioner did not seriously press the main ground taken by the petitioner in the writ application that no notice was issued in this case by the respondents. It is accordingly, not necessary to notice the authorities referred to by him where the. release of the goods was ordered in the absence of service of any notice at all. He, however, still raised a contention that the purported service of the show cause notice being not in terms of Section 124(a), the petitioner was entitled to the release of the goods in question. Learned counsel argued that the notice required to be issued under Section 124(a) must emanate from the authority who is competent to initiate the adjudication proceeding for confiscation of the goods, and inasmuch as the notice in this case was not issued by the said authority, the notice must be deemed to be invalid and of no consequence.
8. In order to appreciate the contention, it is necessary to refer to some other provisions of the Customs Act. According to the provision of Section 122, whereas a Collector or a Deputy Collector of Customs is authorised to confiscate a property of any value “without limit” and adjudicate, an Assistant Collector of Customs can adjudicate only in cases where the value of the goods does not exceed ten thousand rupees. The notice (Annexure “A” to the counter affidavit) in this case has been issued by the office of the Assistant Collector of Customs and has been signed by the Superintendent of Customs, an officer still lower in rank to him. The petitioner was called upon by this notice “to show cause before the Assistant Collector of Customs, Forbesganj… why the said goods should not be confiscated and the personal penalty should not be imposed upon you…” The argument of the learned Counsel for the petitioner was that inasmuch as the value of the articles seized in this case was above Rs. 10,000/-. the Assistant Collector was not the competent authority to adjudge the’ confiscation and that as the notice to show cause is to be issued only by the authority who is competent to initiate the proceeding, the notice purported to have been issued in the present case was invalid and did not meet the requirement of law. Learned counsel appearing for the respondents, however, contended that the value of Rs. 13,500/- given by the petitioner was not an admitted valuation, but was only on approximation, and as such, the Assistant Collector was still competent to issue the notice. He relied upon para 15 of the Manual of Departmental Instructions on Adjudication issued for the guidance of the Departmental Officers by the Central Board of Revenue. According to the instructions contained in this para “there is no legal objection to the issue of show cause notices by officers other than the adjudicating authority” and any officer not below the rank of a Senior Superintendent of Central Excise has been authorised to issue show cause without any restriction to the value of the goods.
Section 152 of the Customs Act in this regard may also be noticed. This section empowers the Central Government to delegate powers by notification in the Official Gazette, and any power exerci sable by a Collector of Customs under this Act may be exercisable also by a Deputy Collector of Customs or an Assistant Collector of Customs empowered in this behalf by the Central Government. In pursuance of the above provision, Notification No. 55 Customs dated the 20th June, 1970, of the Government of India Ministry of Finance, Department of Revenue and Insurance, was shown to us on behalf of the respondents. It says that in pursuance of the powers
conferred under Section 152, the Central Government “directs that the powers of confiscation of goods exercisable under Clause (a) of Section 122 of the said Act, by a Collector of Customs, shall also be exercisable by an Assistant Collector of Customs in such cases involving under valuation or over valuation of goods where the extent of under valuation or, as the case may be, over valuation is less than Rs. 10,000/-.” It was, accordingly, contended on behalf of the respondents that the notice issued by the Assistant Collector of Customs was quite valid in law.
9. Now I will proceed to consider the respective contentions of the parties and the authorities cited before us on behalf of the petitioner. In East India Commercial Co. Ltd. v. Collector of Customs , the question that arose for consideration was as to whether a breach of the conditions of a licence issued to the petitioner in that case for importing certain goods under the Imports and Exports (Control) Act, 1947, was a breach of the order under the Act. It was held that Section 5 of the Act did not penalise contravention of the conditions of the licence issued under the Act. It was further held on construction of the various provisions of the said Act and allied provisions that the breach of the conditions of the licence was not a breach of the Order and, therefore, the proceeding initiated against the petitioner of that case in respect of certain acts alleged to have been done was misconceived. The ratio of this case has got hardly any bearing to the facts of the present case.
10. Learned counsel next relied upon Gullapalli Nageswara Rao and Ors. v. Andhra Pradesh State Road Transport Corporation and Anr., in support of the proposition that inasmuch as the proper authority who could adjudicate in this case being the Collector, the notice to show cause before the Assistant Collector offended the principles of natural justice as if one person hears and another decides, then personal hearing becomes an empty formality. This was a case under the Motor Vehicles Act, according to which a duty is imposed on the State Government to give a personal hearing, but the procedure prescribed by the Rules imposes a duty on the Secretary to hear and the Minister to decide. It was observed by the Supreme Court that this divided responsibility was destructive of the concept of judicial hearing. This decision also has got hardly any bearing as it is still open to the petitioner to challenge the jurisdiction of respondent No. 1, and if satisfied, he maytransfer the proceeding to the Collector. Here is not a case where a procedure is already laid down for hearing of the matter by one authority and final decision to be given by another authority. Respondent No. 1 has issued the notice on the footing that it is he who is the competent authority to adjudicate the matter, and if that be so, it will be he who will pass the final order.
11. Reference now be made to the decision in the case of Tarak Nath Sen and Ors. v. Union of India and Ors. , cited on behalf of the petitioner. In this case a notice to show cause was issued by the Assistant Collector of Customs asking the petitioner of that case to show cause to the Additional Collector of Customs who had admittedly jurisdiction under Section 123 of the Customs Act over the matter. On the basis of this authority, counsel for the petitioner contended that the notice issued in the present case also should have contained a similar direction. In the above case also, para 15 of the Adjudication Manual was referred to and it was held that there was no legal objection to the issue of show cause notice by officers other than the adjudicating authority. Dealing with the purpose of the notice, it was held by the learned Single Judge that the notice under Section 124(a) is akin to a summons of a civil suit, it is partly ministerial and really serves the purpose of being an intimation of initiation of a proceeding without involving any judicial determination. I respectfully agree with the above observation. Section 124 also does not talk of any authority who has to issue the show cause notice. It simply contains a provision for issue of a show cause notice, and nothing else. I would, accordingly, reject the contention of the learned Counsel for the petitioner that the notice to show cause must be issued by only that authority who is competent to pass the order of adjudication. The decision of the Calcutta High Court (supra) also does not support him on this point, rather it goes against him So far as the observation in that case that if a notice is issued by an officer other than the adjudication authority, it must ask the party to show cause direct to the adjudicating authority concerned, I may say that at the moment, it is not certain as to whether the valuation of the goods, namely, Rs. 13,500/- is the correct valuation or is over or under valuation. The notification already referred to above empowers the Assistant Collector to initiate proceeding in a case of over and under valuation ranging between Rs. 10,000/- either side It is, however, true that the valuation given by the petitioner has been mentioned in the show cause notice, and on that learned Counsel for the petitioner forcefully contended that on that account, the responienfs did not treat it as a case of over or under valuation. As already said earlier, it is still open to the petitioner to agitate the question of valuation and jurisdiction. The petitioner before the Calcutta High Court had gone to that court against the final order of confiscation and, therefore, the said case cannot be an authority for the proposition that the notice, although issued by an authority who is competent to issue the same, must be bad if it suffers from any defect. If once it is held that the Assistant Collector was competent to issue notice to show cause, which was nothing more than an intimation of initiation of a proceeding without involving any judicial determination, then the defect of the nature complained of by the petitioner, in my opinion, cannot invalidate the same and it would amount to a proper compliance of the statutory requirement of Section 110(2) of the Act.
12. Learned counsel also cited a decision in Charandas Malhotra v. Assistant Collector of Customs . In that case, the notice under Section 124 was held to be invalid on’the ground that the same was vague and ambiguous and, therefore, failed to give proper opportunity to defend to the appellant. The ratio of this ease has no application to the facts of the case in hand.
14 Now remains for consideration an unreported Bench decision of this court in Krishna Trading Co. v. The State of Bihar and Ors. Civil Writ Jurisdiction case No. 812 of 1973 decided on 1st April, 1976. That vvas a case under the Bihar Foodgrains Dealers Licensing Order, 1967 Notice to show cause was issued to a wholesale dealer by a Sub-divisionai Magistrate, the licensing authority being the District Magistrate. That notice was quashed by this court on the ground that it was not issued by the licensing authority Learned counsel for the petitioner contended that proviso to clause of the Licensing Order in question did not name the authority who is to issue the notice to show cause, like Section 124 of the Customs Act and. therefore, the ratio of this case should be applied. There is hardly any substance m this contention as well because para 15 of the Adjudication Manual, referred to above, clearly authorises the Assistant Collector to issue the adjudication notice.
14. From the discussions of the above authorities and the relevant provisions of the law on the subject, I come to the conclusion that the notice issued to the petitioner on 22-10-1974, or fop that matter, hung up on the notice board on 30-10-1974, was, a legal and valid notice satisfying all the requirements of Section 110(2) read with Section 124(a) of the Customs Act, and, therefore, the goods seized from the possession of the petitioner by the respondent No. 2 on 1-3-1974 cannot be ordered to be released to him.
15. The contentions raised on behalf of the petitioner haying been found to be without any substance this application must fail and is, accordingly, dismissed. On the facts and in the circumstances of the case, however, I leave the parties to bear their own costs.
Shambhu Prasad Singh, J.
16. I agree.