{"id":266776,"date":"2000-02-29T00:00:00","date_gmt":"2000-02-28T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/dakshina-kannada-district-vs-rudolph-fernandes-on-29-february-2000"},"modified":"2015-02-14T05:57:08","modified_gmt":"2015-02-14T00:27:08","slug":"dakshina-kannada-district-vs-rudolph-fernandes-on-29-february-2000","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/dakshina-kannada-district-vs-rudolph-fernandes-on-29-february-2000","title":{"rendered":"Dakshina Kannada District vs Rudolph Fernandes on 29 February, 2000"},"content":{"rendered":"
Supreme Court of India<\/div>\n
Dakshina Kannada District vs Rudolph Fernandes on 29 February, 2000<\/div>\n
Author: Shah<\/div>\n
Bench: M.B.Shah, B.N.Kirpal<\/div>\n
           PETITIONER:\nDAKSHINA KANNADA DISTRICT\n\n\tVs.\n\nRESPONDENT:\nRUDOLPH FERNANDES\n\nDATE OF JUDGMENT:\t29\/02\/2000\n\nBENCH:\nM.B.Shah, B.N.Kirpal\n\n\n\n\nJUDGMENT:\n<\/pre>\n
      Shah, J.\n<\/p>\n
      C.A.No.3214  of  1989 In this appeal, a Matador  (Mini
\nLorry) carrying 44 bags of cement was intercepted and seized
\nby   the  Bajpe\t Police,   Dakshina  Kannada  on  22.8.1983.
\nProceedings  under  Section  6A of the\tAct  were  initiated
\nbefore\tthe Deputy Commissioner.  During the pendency of the
\nproceedings,  the respondent applied for interim release  of
\nvehicle\t and the same was granted by order dated 1.9.1983 on
\nhis  furnishing\t a  bank guarantee of Rs.  one\tlakh.\tThat
\norder was challenged by the respondent before the High Court
\nof  Karnataka at Bangalore in W.P.  No.16668 of 1983 on\t the
\nground\tthat  imposition of such condition was\tillegal\t and
\nonerous.   The learned Single Judge after considering second
\nproviso\t to Section 6A(1) held that the words market price
\noccurring  in  the  section relate only\t to  the  essential
\ncommodity  sought to be carried.  According to the  learned
\nJudge  the proviso gives a concession to the owner to avert
\nconfiscation  by paying fine not exceeding the market  price
\nprevalent  on  the  date  of its seizure  of  the  essential
\ncommodity.   According to the learned Judge if option is to
\npay  a\tfine equivalent to the market price of\tthe  vehicle
\nthen  there  is\t no necessity to give  such  option.   Owner
\ninstead\t of paying a fine equivalent to the market price can
\nas  well  think of purchasing a new or fresh  vehicle.\t He,
\ntherefore,  directed  release of the vehicle  accepting\t the
\nBank  Guarantee\t to  the  extent of  Rs.500\/-  only.   Being
\naggrieved  the State preferred an appeal before the Division
\nBench of the High Court in WA No.2248 of 1983 which was also
\ndismissed by the impugned order dated 22.3.1988.\n<\/p>\n
      C.A.  Nos.  5074-75 of 1989<\/p>\n
      In  these appeals, two transport vehicles belonging to
\nthe respondents carrying paddy were seized by the Police for
\nthe   alleged\tcontravention  of   Food   Control   Orders.
\nApplications  were filed before the Deputy Commissioner\t for
\nrelease\t of  said  vehicles.  By order dated  16.2.1989\t the
\nDeputy Commissioner passed an order directing the release of
\nthe  vehicles in question on their furnishing Bank Guarantee
\nin  a  sum  of\tRupees three lakhs  each.   That  order\t was
\nchallenged before the High Court of Karnataka by filing writ
\npetition  Nos.\t 3563  and  3579 of 1989.   The\t High  Court
\nfollowing  its\tearlier\t decision in Rudolph  Fernandes\t vs.
\nDeputy\tCommissioner,  D.K<\/a>.   [1984  (1)  Kar.\t L.J.\t200]
\n(C.A.No.3214\/89\t before\t us) allowed the writ petitions\t and
\nreduced\t the fine amount to rupees 10,000\/- each.  Both\t the
\norders are challenged before us in these appeals.  The short
\nquestion involved in these appeals is  whether fine in lieu
\nof  confiscation  contemplated under the second\t proviso  to
\nSection 6A(1)<\/a> of the Essential Commodities Act, 1955 (herein
\nafter referred to as The Act<\/a>) provides for levy of fine on
\n     the basis of market value of the confiscated vehicle or
\non  the basis of the market price of the essential commodity
\nsought\tunder:\t– to be carried by such vehicle.  Section 6A<\/a>
\nof  The Act is as 6A.  Confiscation of essential  commodity
\n(1)  Where any essential commodity is seized in pursuance of
\nan  order made under section 3<\/a> in relation thereto, a report
\nof  such seizure shall, without unreasonable delay, be\tmade
\nto  the collector of the district or the Presidency town  in
\nwhich  such essential commodity is seized and whether or not
\na  prosecution\tis instituted for the contravention of\tsuch
\norder,\tthe  Collector may, if he thinks it expedient so  to
\ndo,  direct the essential commodity so seized to be produced
\nfor inspection before him, and if he is satisfied that there
\nhas been a contravention of the order may order confiscation
\nof<\/p>\n
      (a) the essential commodity so seized;\n<\/p>\n
      (b)  any package, covering or receptacle in which such
\nessential commodity is found;  and<\/p>\n
      (c)  any\tanimal, vehicle, vessel or other  conveyance
\nused in carrying such essential commodity:\n<\/p>\n
      PROVIDED<\/p>\n
      PROVIDED\tFURTHER\t that  in the case  of\tany  animal,
\nvehicle, vessel or other conveyance used for the carriage of
\ngoods  or  passengers for hire, the owners of  such  animal,
\nvehicle,  vessel,  or  other conveyance shall  be  given  an
\noption\tto  pay,  in lieu of its confiscation,\ta  fine\t not
\nexceeding  the\tmarket price at the date of seizure  of\t the
\nessential  commodity  sought to be carried by  such  animal,
\nvehicle, vessel or other conveyance. (emphasis supplied)<\/p>\n
      At  the  outset it is to be stated that the object  of
\nThe  Act<\/a>  is to deter a person from illegally dealing in  an
\nessential  commodity  and consequently, impose\ta  deterrent
\npenalty\t against a person dealing in them illegally.   While
\ndoing  so,  the law takes care to prevent the owner  of\t any
\nvehicle\t from aiding or assisting such an illegal  activity.
\nAs  per\t the preamble of the Act, the Act is to provide,  in
\nthe  interest of the general public, for the control of\t the
\nproduction,  supply  and  distribution\tof,  and  trade\t and
\ncommerce, in certain commodities.  For this purpose, Section
\n3<\/a>  empowers Central Government to provide for regulating  or
\nprohibiting  the  production,  supply  and  distribution  of
\nessential  commodity  and trade and commerce therein if\t the
\nsame  is  considered necessary or expedient inter  alia\t for
\nmaintaining  or increasing supply of any essential commodity
\nor   for   securing  their    equitable\t  distribution\t and
\navailability at fair prices by passing an appropriate order.
\nSection\t 6A<\/a>  as\t quoted\t above\t provides  for\tseizure\t and
\nconfiscation of essential commodity for contravention of any
\norder  issued under Section 3<\/a>.\tFurther Section 6B<\/a>  provides
\nfor  issuance  of  show cause notice and the  procedure\t for
\nconfiscation  of  the seized essential commodity as well  as
\nany  package,  covering\t or receptacle\tin  which  essential
\ncommodity  is found or any animal, vehicle, vessel or  other
\nconveyance  used  in  carrying\t such  essential  commodity.
\nSection\t 6C<\/a>  provides  for appeal against  the\tconfiscation
\norder and the procedure for return of confiscated article in
\ncase  where  appeal filed against the confiscation order  or
\nthe  order  passed under Section 7<\/a> forfeiting the  essential
\ncommodity  is  set aside.  Thereafter, Section\t6D<\/a>  provides
\nthat  the order of any confiscation under The Act<\/a> shall\t not
\nprevent the infliction of any punishment to which the person
\naffected  thereby is liable under The Act<\/a>.  Therefore,\teven
\nif  the\t essential commodity or the vehicle is\tconfiscated,
\nthe  person can be prosecuted and the penalty provided under
\nSection\t 7<\/a>  can\t be imposed.  Section 7(1)(a)<\/a>  provides\t for
\npunishment  to\tany  person who contravenes any\t order\tmade
\nunder Section 3<\/a>.  Section 7(1)(b)<\/a> and (c) empowers the Court
\nto  forfeit  to\t the government any property in\t respect  of
\nwhich  the  order  has been contravened or  to\tforfeit\t any
\npackage,  covering  or receptacle in which the\tproperty  is
\nfound  and also animal, vehicle, vessel or other  conveyance
\nused in carrying the property.\n<\/p>\n
      In  the light of aforesaid provisions, second  proviso
\nto  Section 6A<\/a> is required to be considered.  First it is to
\nbe stated that the proviso limits the power of the competent
\nauthority  to  recover\tfine  up-to  the  market  price\t for
\nreleasing  the\tanimal, vehicle, vessel or other  conveyance
\nsought\tto  be\tconfiscated.  So maximum fine  that  can  be
\nlevied\tin lieu of confiscation should not exceed the market
\nprice.\t For our purpose, relevant part of proviso would  be
\nin  the case of vehiclethe owner of suchvehicle shall be
\ngiven  an option to pay, in lieu of its confiscation, a fine
\nnot exceeding the market price at the date of seizure of the
\nessential  commodity sought to be carried by  suchvehicle.
\nQuestion  is\twhether fine should not exceed\tthe  market
\nprice of the seized essential commodity or whether it should
\nnot  exceed  the  market  price of the\tvehicle.   For\tthis
\npurpose,  it  appears  that there is some ambiguity  in\t the
\nSection.   It  is not specifically provided that in lieu  of
\nconfiscation  of  vehicle  a fine not exceeding\t the  market
\nprice of the vehicle or of the seized essential commodity is
\nto  be taken as measure.  Still however, it is difficult  to
\nsay  that measure of fine is related to the market price  of
\nthe  essential\tcommodity  at the date of its  seizure.\t  It
\nnowhere provides that fine should not exceed market price of
\nthe  essential\tcommodity  at  the date of  seizure  of\t the
\nvehicle.   The\tproviso requires the competent authority  to
\ngive  an option to the owner of such vehicle to pay in\tlieu
\nof confiscation a fine not exceeding the market price.\tWhat
\nis  to be confiscated is the vehicle and, therefore, measure
\nof  fine  would\t be  relatable to the market  price  of\t the
\nvehicle\t at  the date of seizure of the essential  commodity
\nsought\tto  be carried by such vehicle.\t This would also  be
\nconsistent  with the scheme of section 7<\/a> which provides\t for
\nlevy  of penalty.  It empowers the Court trying the criminal
\ncase  to  pass\tan order forfeiting to\tthe  Government\t any
\nproperty  in respect of which the order under Section 3<\/a>\t has
\nbeen   contravened  It\talso   empowers\t forfeiture  to\t the
\nGovernment  any package, covering or receptacle in which the
\nproperty  is  found  and in addition  any  animal,  vehicle,
\nvessel\tor other conveyance used in carrying the  commodity.
\nTherefore,  not only the essential commodity which is seized
\nis  to be forfeited, but the vehicle also could be forfeited
\nto the Government.  Hence, measure of fine which is required
\nto be levied in lieu of confiscation under second proviso to
\nSection\t 6A(1)<\/a> would be relatable to the market price of the
\nvehicle and not of the seized essential commodity.  And, the
\nfine  amount  in lieu of confiscation is not to\t exceed\t the
\nmarket\tprice  of  the\tvehicle on the date  of\t seizure  of
\nessential  commodity.\tThat is to say, limit of  such\tfine
\nwould  be  up-to  the  market price of the  vehicle  on\t the
\nrelevant  date\tand  it\t is within  the\t discretion  of\t the
\ncompetent   authority\tto  fix\t  such\t reasonable   amount
\nconsidering the facts and circumstances of each case.\n<\/p>\n
      In Shambhu Dayal Agarwala v.  State of West Bengal<\/a> and
\nanother1  after considering the scheme of Sections 6A<\/a> and  7<\/a>
\nand  dealing  with  the proviso (ii) to sub-section  (2)  of
\nSection 6A<\/a>, this Court observed:  –\n<\/p>\n
      Section  6-A<\/a>,  therefore,\t merely\t confers  power\t of
\nconfiscation  and  not\tthe   power  of\t release,  disposal,
\ndistribution,  etc., except to the limited extent  permitted
\nby  sub-section (2) thereof.  Of course, the second  proviso
\nto  sub-section\t (1) of Section 6A<\/a> permits the grant  of  an
\n   option  to  pay, in lieu of confiscation of\tany  animal,
\nvehicle,  vessel or other conveyance, seizure. a fine equal
\nto its market price at the date of (emphasis added)<\/p>\n
      Lastly  we  would mention that in the  impugned  order
\ndated  22nd  March  1998, the High Court in support  of\t its
\nreasoning  referred  to\t a similar provision  under  Section
\n115(2)<\/a>\tof  the\t Customs  Act,\t 1962,\twhich  provides\t for
\nconfiscation  inter  alia  of  vehicle\t used  as  means  of
\ntransport  in  smuggling  of any goods or  carriage  of\t any
\nsmuggled  goods\t which is as under:- 115.  Confiscation\t of
\nconveyance. (1)<\/p>\n
      (2)  Any\tconveyance  or\tanimal used as\ta  means  of
\ntransport  in the smuggling of any goods or in the  carriage
\nof  any\t smuggled  goods shall be  liable  to  confiscation,
\nunless\tthe owner of the conveyance or animal proves that it
\nwas so used without the knowledge or connivance of the owner
\nhimself,  his agent, if any, and the person in charge of the
\nconveyance or animal 1[***]:\n<\/p>\n
      Provided\tthat  where any such conveyance is used\t for
\nthe  carriage of goods or passengers for hire, the owner  of
\nany  conveyance\t shall be given an option to pay in lieu  of
\nthe  confiscation of the conveyance a fine not exceeding the
\nmarket price of the goods which are sought to be smuggled or
\nthe smuggled goods, as the case may be.\n<\/p>\n
      Explanation.In  this  section, market  price  means
\nmarket price at the date when the goods are seized.\n<\/p>\n
      The  Court  observed that though the language  of\t the
\naforesaid  proviso is clear, the idea sought to be  conveyed
\nunder  the proviso to Section 6A(1)<\/a> of the Act appear to  be
\nthe  same.  In our view, the analogy drawn by the High Court
\nis  erroneous because the proviso specifically mentions that
\nwhere any such conveyance is used as a means of transport in
\nthe smuggling of goods, the owner of any conveyance is to be
\ngiven  an  option to pay in lieu of the confiscation of\t the
\nconveyance,  a\tfine not exceeding the market price  of\t the
\ngoods which are sought to be smuggled.\tExplanation provides
\nthat  market  price means market price at the date when\t the
\ngoods  are  seized.   As  against this,\t Section  6A<\/a>  second
\nproviso\t does  not  refer to payment of fine  not  exceeding
\nmarket\tprice  of  the\t essential  commodity  but  apparent
\nreference  is  a fine not exceeding the market price of\t the
\nvehicle\t sought\t to  be\t confiscated.  This  appears  to  be
\nobvious\t because  in case where market price of\t the  seized
\nessential commodity is more than the price of the conveyance
\nthen  owner of the conveyance would not come forward to take
\nit back if he is asked to pay something more than its market
\nprice.\t Similarly,  when  the market price  of\t the  seized
\nvehicle\t is  much more than of the essential  commodity,  it
\ncannot\tbe  said that instead of confiscation it  should  be
\nreleased  at  a price which is less than its  market  price.
\nFurther\t it is required to be noted that under Section 6B(2)<\/a>
\nno  order  confiscating vehicle or other conveyance  can  be
\npassed\tif  the\t owner\tproves to the  satisfaction  of\t the
\ncompetent  authority  that  it\twas  used  in  carrying\t the
\nessential commodity without his knowledge or connivance.\n<\/p>\n
      In  the  result,\tthe  appeals  are  allowed  and\t the
\nimpugned  orders  holding that measure of imposing  fine  in
\nlieu  of confiscation under second proviso to Section 6A<\/a>  of
\nthe  Essential Commodities Act would be the market price  of
\nthe  essential\tcommodity  seized are set  aside.   However,
\n      considering  the fact that since vehicles are  already
\nreleased,   no\t further   directions\t are   required\t  to
\nconfiscation.\tbe  given with regard to the fine amount  in
\nlieu of Ordered accordingly.  No costs.<\/p>\n","protected":false},"excerpt":{"rendered":"
Supreme Court of India Dakshina Kannada District vs Rudolph Fernandes on 29 February, 2000 Author: Shah Bench: M.B.Shah, B.N.Kirpal PETITIONER: DAKSHINA KANNADA DISTRICT Vs. RESPONDENT: RUDOLPH FERNANDES DATE OF JUDGMENT: 29\/02\/2000 BENCH: M.B.Shah, B.N.Kirpal JUDGMENT: Shah, J. C.A.No.3214 of 1989 In this appeal, a Matador (Mini Lorry) carrying 44 bags of cement was intercepted and […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[30],"tags":[],"class_list":["post-266776","post","type-post","status-publish","format-standard","hentry","category-supreme-court-of-india"],"yoast_head":"\nDakshina Kannada District vs Rudolph Fernandes on 29 February, 2000 - Free Judgements of Supreme Court & High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/dakshina-kannada-district-vs-rudolph-fernandes-on-29-february-2000\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Dakshina Kannada District vs Rudolph Fernandes on 29 February, 2000 - 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