Anil Kumar Didwania vs Collector of Customs

C.J.

Against the order of the Collector of Customs dated January 30, 1995 (dispatched on March 9, 1995) u/s 129 of the Customs Act, 1962, the Petitioner has filed a writ petition before a Learned Single Judge on the Original Side. The relevant portion of the order of the Collector of Customs is as follows: In view of my above findings, I hold that the duty amounting to Rs. 1,53,09,118.00 has been short levied in respect of the Bills of Entries 2091 to 2130 all dated 29th November, 1990, by reason of collusion, willful mis-statement deliberate mis-declaration and suppression of vital facts by the importer and their accomplices and, therefore, I confirm the demand of duty amounting to, Rs. 1,53,09,118.00 u/s 28 of Custom Act, 1962. I order that the said amount should be paid by the importer immediately.

The Collector also found that the goods were liable for confiscation u/s 111(d) & (m) of the Customs Act, 1962. The goods had been allowed clearance under an undertaking that they were not available for confiscation. Subsequently by the judgment impugned the Collector of Customs held that they were liable for confiscation. On that findings, since the goods had been removed, a fine of Rs. 75,00,000 (Rupees Seventy five lakhs only) in lieu of confiscation and in terms of the undertaking u/s 125 of the Customs Act, 1962, have been imposed. His finding further was to the following effect:

I could see from the evidences that Shri Anil Kumar Didwania, Proprietor of the importing firm, Shri Vinod Kumar, Director of the intrem-diractory suppliers'' firm in Singapore and Shri Pawan Kumar Didwania have masterminded the illegal importation by manipulation of documents suppression of facts and knowingly concerned themselves in various acts of omission and commission. Hence, I hold them, including the importing firm, liable to penalty u/s " 112(a) of Custom Act 1962, Shri Pawan Kumar Didwania who had involved in mis-declaration of value and goods in number of causes in the past and had reportedly doing the same to evade Customs Duty, intend to penalize him in a heavy manner. I impose penalty on the individual party/persons concerned as follows:

M/s. Asia Mercantile Corporation Rs. 50.00,000

Shri Pawan Kumar Didwania Rs. 1,50,00,000

Shri. Anil Kumar Didwania Rs. 1,00,00,000

Shri Vinod Kumar Rs. 1,00,00,000

The grounds on which the writ petition has been filed by the writ Petitioner-Appellant are that the Collector of Customs had passed the said order in breach of. principles of natural justice and without serving any notice of the adjudication proceedings on the writ Petitioner. The learned Single Judge by the order under challenge in this appeal dismissed the writ application without going into the merits of the said order only on the ground of availability of an alternative remedy against the order under challenge in this appeal by way of filing an appeal before the Appellate Authority.

We have heard the learned Counsels for the parties and are of the view that the learned Single Judge was right in dismissing the writ petition on the ground of availability of alternative remedy. Therefore, the present appeal preferred against the judgment of the learned Single Judge has no substance.

Where a statute which .creates right or obligation, provides for remedy of challenging an order passed under it, the party aggrieved must avail that relief first. It seems that the Customs Act provides for filing of an appeal against the order passed by the Collector of Customs u/s 129 of the Customs Act, 1962, in which question of fact and law can also be gone into. This position has already been settled by the Supreme Court by various decisions. Reference may also be made to the case of The Bengal Immunity Company Limited Vs. The State of Bihar and Others, In Assistant Collector of Central Excise, Chandan Nagar, West Bengal Vs. Dunlop India Ltd. and Others, Para. 3, Per Chinnappa Reddy J.) the Supreme Court held as follows:

Article 226 is not meant to short-circuit or circumvent statutory procedure. It is only where statutory remedies are entirely ill-suited to meet the demands of extra-ordinary situations, as for instance, where the very vires of the statute is in question or where private or public wrongs are so inextricably mixed up and the prevention of public injury and the vindication of public justice require it that recourse may be had to Article 226 of the Constitution. But then the Court may have good and sufficient reason to bypass the alternative remedy provided by statute. Surely, matters involving the revenue where statutory remedies are available are not such matters. The Supreme Court can take judicial'' notice of the fact that the vast majority of the petitions under Article 226 of the Constitution are filed solely for the purpose of obtaining interim orders and thereafter prolong the proceedings by one device or the other. The practice needs to be strongly discouraged.

In another case C.I.T. v. Ramendra Nath Ghosh, (1972) 4 SCC 379 (381, Para. 10, Per Hedge J.) the Supreme Court took the same view. It said:

The question whether the Assessees had been served in accordance with the law or not is essentially a question of fact. The Income Tax Act provides for an appeal against the order u/s 33B. Normally, the Assesses should have gone up in appeal against the order u/s 33B. They should not .have been allowed to invoke the extraordinary jurisdiction of the High Court. It cannot be said that the High Court had no jurisdiction to entertain the writ petitions though it should not have exercised its discretion in favour of the . Assesses in view of the adequate alternative remedy they had.

This principle that High Court shall not invoke its extra-ordinary writ jurisdiction where a statutory appeal has been provided in the Act against the order, has also been accepted by the Supreme Court in its recent decision which is State of Goa and Others Vs. A.H. Jaffar and Sons, of the aforesaid decision the Supreme Court observed as follows:

The appeal has been argued at length. Sri Siraj Sait has attempted to support the judgment with industry and precision. But it does not appear necessary to decide whether the finding recorded by the High Court that the order of Commissioner being administrative in nature it could be reviewed by the State Government nor it is necessary to decide whether the Minister could exercise any power where the grant of lease is regulated by the Statute as in our opinion the remedy of revision having been provided by Section 30 of the Act, the proper course for the Respondent was to approach the Central Government and not the High Court.

Relying on the aforesaid decisions of the Supreme Court and considering that the relief under Article 226 of the Constitution of India is a discretionary remedy, we are unable to hold that the learned trial Judge was wrong in dismissing the writ petition on the ground of availability of an alternative remedy by way of an appeal before the Appellate Authority under the Customs Act against the order challenged in the writ petition.

The learned Counsel urged that for availing the right of appeal, the Appellant would be required to deposit the Excise Duty and the fine to the tune of Rs. 1,53,09,118. He submitted that the remedy provided is, therefore, onerous and illusory. Therefore, the writ petition cannot be dismissed on the ground of availability of an alternative remedy by way of filing an appeal. The submission so made has no merit. A similar controversy arose before the Apex Court of India in Shyam Kishore and others Vs. Municipal Corporation of Delhi and another, (2294, Para. 42, Per Jogeohwar Dayal J.) It was held:

A more satisfactory solution is available on the terms of the Statute itself. The construction of the section approved by us above vests in the appellate authority a power to deal with the appeal otherwise than by way of final disposal even if the disputed tax is not paid. It enables the authority'' to exercise a judicial discretion to allow the payment of the disputed tax even after the appeal is tiled but. no doubt, before the appeal is taken up for actual hearing. The interpretation will greatly ameliorate the genuine grievances of, and hardships faced by, the Assesses in the payment of the tax as determined. Though an Assesses may not be able to acquire an absolute stay of the recovery of the tax until the dispute is resolved, he will certainly be able to get breathing time to pay up the same where his case deserves it. If this interpretation is placed on the provision, no question of unconstitutionality can at all arise.

In the case of Nandlal v. State of Haryana AIR 1980 S.C. 2077 at p. 2109 para. 19 (per Tulza F''urkar, J.) the Supreme Court had an occasion to consider the same aspect when it said�

that the right of appeal is a creature of statute and there is no reason why the Legislature while granting the right cannot impose conditions for the exercise of such right so long as the conditions are not so onerous as to amount to unreasonable restrictions rendering the right almost illusory.

(Emphasis added)

The learned Counsel for the Appellant urged before us that as the Appellant had not been served with the notice by the Customs Authorities, the present case could not be relegated at par with the decisions cited on behalf of the Customs Authorities. We are unable to agree with the submissions of Mr. Mullick on this question.

Mr. Muliick after drawing our attention to certain annexures to the writ petition, sought to argue that service was not effected on the writ Petitioner-Appellant. Whereas, the learned Counsel appearing for the department sought to argue that service was duly effected u/s 153 of the Customs Act by reliance of the service return in respect of the writ Petitioner-appellant. This is a question of fact which needs to be decided in detail on production of documentary evidence before the Authorities. Therefore, there would be no difficulty for the Appellant-Petitioner to raise such question before the Appellate Authority. We are also of the view that when such disputed questions have arisen and there is already an alternative remedy for the Appellant to file an appeal before the Appellate Authority, it would be fit and proper to relegate the writ Petitioner-Appellant to file a regular appeal against the order which is challenged in this appeal. So far as the question of violation of principles of natural justice is concerned, Mr. Mullick sought to argue that it was the duty on the part of the authorities to serve the enquiry report on which reliance was made by the Collector of Customs in the impugned order before passing a final order in the adjudication proceeding. Mr. Bajoria, learned Counsel appearing on behalf of the department, however, contested the submission of Mr. Mullick. According to Mr. Bajoria with the show-cause notice, the copies of the enquiry report were sent and since the writ Petitioner did not accept the service of the show cause notice in which the enquiry reports were annexed, question of service of the enquiry report before passing a final order in the adjudication proceeding did not arise at all. This question raised again is a disputed question of fact which can be decided by the Appellate Authority. It is not disputed by Mr. Mullick, learned Counsel appearing on behalf of the Appellant before us, that the Appellate Authority has no jurisdiction to entertain the appeal on facts. Such being the position and in view of the decisions cited above, we are of the view that the learned Judge was justified in the facts and circumstances of the case to dismiss, the writ application on the ground that the writ Petitioner-Appellant had an alternative remedy to file an appeal against the order passed by the Collector of Customs. We, therefore, do not find any merit in this appeal. Before parting with this order, one more decision on which Mr. Mullick relied needs to be discussed. This is the case of Sovachand Mulchand Vs. The Collector of Central Excise and Land Customs and Others, (185, Para. 53 per S.P. Mitra J.). In that decision a Division Bench of this Court only held that the principle that the writ Petitioner should be discouraged when the Act itself prescribes other remedies is not an absolute principle which ought to be invariably followed. There is no dispute about this proposition of law. But in view of the discussion made hereinabove and considering the fact that it will be open to the writ Petitioner to urge the point on fact, we are not inclined to accept the contention of the Appellant.

In view of the facts and circumstances discussed above this appeal is dismissed. There will be no order as to costs.

Tarun Chatterjee, J.

I agree.

Appeal dismissed.