Sattar Habib Hamdani vs Union of India

A.P. Ravani, J.—Three trucks loaded with contraband articles such as fabrics, car-tape stereo, telephone sets, wrist watches, etc.

collectively valued at Rs. 27,39,050/- were intercepted by Porbander Police. The trucks were handed over to the officers of the Customs

Department, which in turn seized the goods found therein. In follow up action 80 packages of contraband goods valued at Rs. 24,30,875/- were

recovered from the factory premises belonging to the petitioner. The petitioner and others were served with show cause notices calling upon them

as to why action proposed to be taken in the notice be not taken against them.

The Collector of Customs, as per his order dated June 20, 1984 directed to confiscate the goods and imposed penalty of different amounts on

different persons. A penalty of Rs. 10 lacs had been imposed upon the petitioner under the provisions of Section 112 of the Customs Act, 1962.

Against the aforesaid order of imposition of penalty, the petitioner preferred an appeal as provided u/s 129A of the Customs Act, 1962 (for

Short ""the Customs Act"") before the Customs, Excise & Gold (Control) Appellate Tribunal (CEGAT). The Tribunal directed that as a pre-

condition for entertaining the appeal the petitioner should deposit an amount of Rs. 2,50,000/. The Tribunal passed this order after examining the

financial position of the petitioner and held that the condition regarding the predeposit of an amount of Rs. 2,50,000/- cannot be dispensed with.

The petitioner failed to deposit this amount. Hence the Tribunal directed that the appeal be rejected as provided u/s 129E of the Customs Act. It is

against the aforesaid order rejecting the appeal on account of failure to pre-deposit the amount of Rs. 2,50,000/- that this petition is filed.

The order passed by the CEGAT is eminently just and proper. The order cannot be said to be in any way contrary to law. All that the Tribunal

did was to insist upon the compliance of the provisions of law. Therefore the order passed by the Tribunal is not required to be interfered with in

exercise of the powers under Articles 226/227 of the Constitution of India.

The learned counsel for the petitioner has submitted that the petitioner had not been afforded an opportunity of being heard by the Collector of

Customs. Therefore, the order passed by the Collector of Customs is in contravention of the principles of natural justice and hence (a) nullity - On

this basis it is submitted that this court should treat this petition as directed against the original order passed by the Collector, Customs. As to

whether adequate opportunity of being heard is provided or not is essentially a question of fact. Unless on the face of it without examining the

record and without making further enquiry whatsoever it appears that the principles of natural justice have been violated, we don''t think it proper

to exercise our extraordinary jurisdiction under Articles 226/227 of the Constitution of India. On reading the order passed by the Collectors,

Customs, it is difficult to say that the petitioner has not been afforded an opportunity of being heard. There is clear statement in the order passed by

the Collector that all the respondents (in all 29) were served with show cause notices and none of them filed reply. Therefore, the order of

confiscation of the goods in question valued at Rs. 63,35,352/- was passed on May 16, 1984. While passing the order further action u/s. 112 and

115 of the Customs Act, 1962 were kept in abeyance. Thereafter further order is (was) passed imposing personal penalty on different persons. A

penalty of Rs. 10 lacs has been imposed upon the petitioner and trucks in question along with other articles have been ordered to be confiscated.

Thus on the face of it without further examining the record it cannot be said that the order is passed in contravention of the principles of natural

justice. Therefore, the contention that the order passed by the Collector, Customs is passed in contravention of the principles of natural justice and

therefore, the petition is maintainable cannot be accepted.

Be it noted that the petitioner had an alternative remedy of challenging the order imposing penalty upon him by way of appeal. The petitioner did

prefer appeal before the CEGAT, but did not comply with the condition of pre-deposit of an amount of Rs. 2,50,000/-. Thus the petitioner did not

avail of the alternative remedy of appeal. One who does not avail of the alternative remedy of the appeal cannot be permitted to invoke the

extraordinary high prerogative writ jurisdiction of his High Court. A person who does not avail of alternative remedy afforded to him cannot claim

that his petition be entertained by the court. If such course is permitted, each and every party aggrieved by the order passed by the appropriate

authorities exercising powers under the provisions of the Central Excises and Salt Act, 1944 (in short ""Excise Act"") and the Customs Act, would

initially file appeal. Thereafter he will not comply with the conditions that may be imposed by the appellate authority. Then he will contend before

this court that this court should exercise its power under extraordinary jurisdiction. The legislature never desired to provide one more forum for the

persons aggrieved by order of original authority exercising powers under the relevant provisions of the Excise Act and the Customs Act. When the

Legislature amended the provisions of Excise Act and Customs Act, it has provided for complete machinery for redressal of the grievances of the

party aggrieved by the orders passed under the Excise Act and Customs Act. The object behind the amended provisions appears to be to make

statutory provisions regarding appeal and second appeal and for the statement of case for making reference to this High Court. Thus an attempt is

to see that the code is complete in itself. As laid down by the Supreme Court in the case of Titaghur Paper Mills Co. Ltd. and Another Vs. State

of Orissa and Others, , where statutory remedy is available the High Court should not exercise its power. In the case of Sales Tax Officer, Jodhpur

and Another Vs. Shiv Ratan G. Mohatta, , the Supreme Court in terms held that simply because the remedy provided for under the ordinary law is

little more onerous it is not ground for not directing the petitioner to exhaust the remedy provided for by the statute.

The aforesaid decision of the Supreme Court and another decision of this High Court [ Ambalal Sarabhai Enterprises Pvt. Ltd. Vs. Union of

India and Others, have been followed by this High Court in Special Civil Application No. 6149 of 1989 decided on September 12, 1989, therein

this court had held that when alternative remedy is provided for by the statute, the party should be directed to exhaust the same. The necessary

corollary of the aforesaid conclusion is that wherever alternative remedy is provided for and the High Court comes to the conclusion that the party

should be directed to avail of the alternative remedy provided for under the statute and that the party ought to have pursued the statutory remedy

the party cannot be permitted to say that ""I had alternative remedy, I have invoked the same, but I have not fulfilled the condition for getting the

matter decided on merits. Therefore permit me to invoke the extraordinary jurisdiction of this High Court"". If such course is permitted to be

adopted the first step taken by the court that the party should be directed to exhaust the statutory remedy would be rendered meaningless and

nullified. Therefore, even in cases in cases where the party who had the alternative remedy but has not availed of the same or allowed the

alternative statutory remedy to become infructuous, in absence of satisfactory explanation for such conduct, cannot be permitted to invoke the

extraordinary jurisdiction under Article 226/227 of the Constitution of India.

The learned counsel for the petitioner contends that certain other persons aggrieved by the order passed by the Collector had preferred appeal.

In appeal, the appellate authority has remanded the matter to the Collector by observing that principles of natural justice were not complied with.

Therefore, it is contended that this petition should be entertained. The contention cannot be accepted. Let us assume that in a given case there may

be seven defendants. The decree is passed against all of them. Two of them only preferred appeal. Five persons do not prefer appeal or prefer

appeal, but do not comply with the condition necessary for entertaining the appeal and deciding the same on merits. Two persons who preferred

appeal may succeed in appeal. Therefore, five persons who did not prefer appeal or did not comply with the conditions of appeal being entertained

and being decided on merits cannot say that the decree passed against them be reversed. As far as they are concerned, the judgment and decree

passed by the lower authority becomes final. Similar is the case with regard to the petitioner herein, the petitioner did not fulfill the conditions of

appeal being entertained and being decided on merits. Therefore, as far as the petitioner is concerned, the position is that the order passed against

him by the original authority has become final. Since he did not avail of the alternative remedy provided under the statute and allowed the same to

become infructuous he cannot be permitted to invoke the extraordinary jurisdiction of the High Court. Moreover, it may be noted that as to

whether petitioner was afforded an opportunity of being heard or not is essentially a question of fact. In case of others it may be that they might not

have been heard. Decision rendered in their appeal cannot be made applicable to the case of the petitioner.

There is no substance in the petition. Hence rejected.