Mahavir Kumar Surana vs Assistant Excise Commissioner

M. Jagannadha Rao, C.J.—This is an appeal filed by the writ Petitioner against the judgment of the learned Single Judge in O.P. No. 2197 of 1998 dated 25th February 1993 dismissing the writ petition.

The Appellant/writ Petitioner is a person, residing in the State of Rajasthan and he is the registered owner of a goods vehicle (lorry) bearing No. R.J. 01/GO. 459 covered by a national permit. The driver of the vehicle is one Darbar Singh. While so the Appellant hired his vehicle to M/s. Goodwill Transport Corporation, Indore for transportation of liquor bottles from M.P. Beer Products, New Industrial Area, Indore to Palakkad Depot of the Kerala Beverages Corporation Ltd. According to him the liquor bottles were transported in the above-vehicle with all necessary documents. It is the cage of the Petitioner that the Petitioner as well as the driver had taken all due care to avoid any contravention of law in relation to the transportation of the Abkari item. His case is that the documents were signed by the responsible officers of the Excise Department.

When the vehicle was passing through the check post at Palakkad on 15th November 1992 it was restrained by certain persons on the basis of the information given by them to the Circle Inspector of Police, Palakkad Town. The Police suspected that, the documents that were being carried in the lorry were forged and a crime was registered as Crime No. 450 of 1992 under Sections 420, 408 and 471 read with Section 34 of the Indian Penal Code along with Section 58 of the Kerala Abkari Act. Since the abkari offence was also included, the Circle Inspector of Police handed over the documents for the investigation by the officials of the Excise Department. The Excise Department registered a separate case, O.P. No. 38 of 1992 and thereby the vehicle came into the custody of the Excise officials.

The, Appellant/writ Petitioner''s case is that he is totally innocent of the incident. The Appellant is depending a on this vehicle for his livelihood and therefore he prays for release of the same. He filed an application, Ext. P-1, before the Assistant Excise Commissioner, Palakkad, seeking release of the vehicle mentioning the above, said facts. This was on 8th January 1993. The same was rejected by the Assistant Excise Commissioner by Ext. P-2 order dated 16th January 1993. Pursuant to the same the writ petition was filed, out of which this writ appeal arises.

The learned Single Judge referred to the contention of the Government Pleader that proceedings u/s 67B of the Abkari Act have been initiated. The learned Single Judge however rejected the request of the Appellant''s counsel for release of the vehicle during the pendency of the proceedings under the Abkari Act, even though it was stated that the vehicle, which is kept idle may become useless by the time the confiscating proceedings are completed. The learned Judge relied upon the decision of a Division Bench of this Court in Shoby Varghese v. State of Kerala 1992 (2) KLT 680. In that case the question was with regard to the validity of the Circular issued by the Government on 16th January 1992.The circular reads as follows:

Government Circular No. 8824/G2/91/TD., dated 16th January 1992 from K. Chandrasekhara Babu, Additional Secretary to Government Taxes (G) Department, Thiruvananthapuram to the Assistant Excise Commissioners.

Sub: Abkari-Release of seized vehicles involving smuggling of spirit-Instructions issued.

It has come to the notice of Government that vehicles involved in smuggling of spirit which are later released on Bank guarantee are either being re-used or likely to be re-used for similar activities like smuggling of spirit. In order to avoid this practice, or possibility, the Assistant Excise Commissioners are hereby directed that release of such vehicles-on Bank guarantee-especially the tanker lorries seized in connection with smuggling of spirit should be stopped forthwith.

All Assistant Excise Commissioners are also instructed that cases seized or registered against such vehicles should be disposed of and formal orders issued immediately on a priority basis.

(Sd.) Additional Secretary to Government

From the above said circular it has to be noticed that the Government has issued the same because of the information, that the vehicles involved in smuggling of spirit which are later released on Bank guarantee are being re-used or likely to be re-used for smuggling activities. It was to avoid this practice, or possibility, that the Assistant'' Excise Commissioners were directed that release of such vehicles on Bank guarantee, especially the tanker lorries seized in connection with smuggling of spirit should be stopped forthwith. It was also directed that the cases of seizure of vehicles would be disposed of and orders issued on priority basis. The Division Bench in Shoby Varghese Case 1992 (2) KLT 680, observed that the above said circular was valid considering the public policy discernible from the Abkari Act. The power exercised u/s 67B of the Act is permissive and not obligatory and a. very wide discretion is vested in the statute. But, pending adjudication, the release of the vehicle as an interim measure has its own hazards. If the Government on the baas of experience in working out the provisions of the Act has taken a policy decision, that the same vehicle involved in smuggling activities at one time being re-used for similar activities once it is released, it cannot be said that the above said direction given in the circular is in any way unauthorised or illegal. The Division Bench held that, viewed from the larger public interest and the public policy discernible from the Kerala Abkari Act, the guidelines issued cannot be in any way attacked as ultra vires or illegal. The directions given in the circular have got nexus with the ultimate object to be achieved by the Act and the proceedings that have been initiated in, exercise of the powers u/s 67B of the Act. Thus, upholding the circular the learned Judges finally observed as follows:

Whatever may be our view regarding the release of the vehicle pending final adjudication, in the light of Ext. P-6 (Circular), the learned Single Judge having exercised the discretion by ordering the release of the vehicle on furnishing bank guarantee for a sum of rupees three lakhs, we do not think that as at present advised we should go into the merits of the said direction. The learned Single Judge has exercised the discretion in favour of the Appellant and has ordered a conditional release of the vehicle, We do not find any illegality or infirmity in the condition attached to the release of the vehicle. We affirm the judgment of the learned Single Judge on that aspect also.

From the above said judgment of the Division Bench it is clear that while circular dated 16th January 1992 was upheld the learned Judges were not inclined to disturb the order passed by the learned Single Judge in that case in releasing the vehicle on Bank guarantee being furnished for a sum of rupees three lakhs.

In the present case the learned Single Judge did not proceed to consider whether any discretion to release the vehicle has to be exercised. The learned Single Judge felt compelled by Shoby Varghese''s case 1992 (2) KLT 680, to hold that there is no discretion to release the vehicle at all.

The Division Bench in Shoby Varghese''s case 1992 (2) KLT 680, clearly kept the distinction between the powers of the Excise Authorities as also the power of this Court under Article 226 of the Constitution. It is to be noticed that while the Assistant Excise Commissioners have been directed by the Government to exercise power as mentioned in the circular, the said circular cannot in any manner interfere with the powers of this Court to release the vehicles on a consideration of the over all facts of the case. That is why the Division Bench upheld the exercise, of the discretion of the learned Single Judge to release the vehicle on Bank guarantee. Inasmuch as the learned Single Judge did not, in this case now before us, consider the question of exercise of discretion, we shall consider the said question of releasing the vehicle.

Having regard to the facts and circumstances of the case we are of the view that the vehicle bearing registration No. R.J. 01/GO. 459 should be released in favour of the writ Petitioner, on the Petitioner furnishing Bank guarantee for such sum as may be decided by the Assistant Excise Commissioner as being; the market value of the vehicle. It shall also be open to the Assistant Commissioner of Excise, Palakkad, to direct the Appellant to file an undertaking in the form of an affidavit for production of the vehicle as and when required for the purpose of investigation and proceedings u/s 67B of the Abkari Act.

The Writ Appeal is disposed of as stated above.