Sharda Khandsari Udyog vs State of Bihar

Bhuvaneshwar Prasad, J.—This application u/s 482 of the Cr. P.C. 1973 (in short, the Code) is directed against the order dt. 18-9-1987 passed by the Deputy Commissioner, Dhanbad in Confiscation Case No. 50/87 whereby he had directed the Marketing Officer, Dhanbad to sell the seized 40 bags of sugar belonging to the petitioner by public auction or through fair price shop and to deposit the sale proceeds in the treasury.

It appears on 27-6-1987 the godown of M/s. Pradeep Kumar Shrawan Kumar at Manaitand, Dhanbad was inspected by the complainant Shri Vijoy Kumar Srivastava, Supply Inspector Dhanbad. He found 40 bags of cement stored in the said godown which was sent by this petitioner for sale through challan No. 197 dt. 22-6-1987 showing it as Khandsari sugar Sulpher. A sample was taken from these bags and on test the same was found to be sugar. Accordingly a case u/s 7 of the Essential Commodities Act (in short the Act) was filed since 40 bags of sugar were stored in the godown without any valid licence. Subsequently confiscation proceeding u/s 6A of the Act was started on 18-9-1987 and the learned Collector, Dhanbad asked the petitioner to show cause as to why the seized articles may not be confiscated fixing 19-10-1987 as the date for the filing of the Show cause. However, by an order of the same date the learned Collector was pleased to order for the sale by public auction or through fair price shop of the seized articles on the ground that the same articles was required for the use for the public that it was subject to speedy decay. It is against this order that the present application is directed.

On behalf of the petitioner it has been submitted that no such order could have been passed without affording an opportunity of hearing to the petitioner. Since the sugar in question was Khandsari sugar the provisions of Bihar Trade Articles (Licenses Unification) Order, 1984 are not attracted and the petitioner does not come within the purview of the definition of "dealer". On these grounds amongst others it has contended that the impugned order be quashed.

The only point for decision before me is whether this Criminal Misc. case is fit to be allowed or not.

At the outset, Shri Agarwal the learned A.P.P. appearing on behalf of the State of Bihar has contended that the jurisdiction of this Court is barred in terms of Section 6A(6) and Section 6E of the Essential Commodities Act (in short, the Act). He has further contended that the provisions of Section 482 of the Code are not attracted and therefore this Court in exercise of its inherent powers cannot quash the two orders as prayed for. In this connection, he has firstly drawn my attention to Section 482 of the Code, which runs as follows:

Nothing in this Code shall be deemed to limit or affect the inherent powers of the High Court to make such orders as may be necessary to give effect to any order under this Code or to prevent abuses of the process of any court or otherwise to secure the ends of justice.

It was the submission of Shri Agarwal that this Court can exercise the inherent powers only to give effect to any order passed under this Code. From the bare reading of the section, however, it appears that there is no substance in this contention of the learned Advocate. As a matter of fact from this Section it clearly appears that nothing in the Cri. P.C. shall limit or affect the inherent powers of the High Court to prevent the abuses of the process of any court or otherwise to secure the ends of justice, Hence, this Court can invoke its inherent powers to prevent the abuse of the process of any. court or to otherwise secure the ends of justice. This shows that the scope of this section is hot limited only to the order passed under the Cr. P.C. but it extends to the order passed by any court under other laws also to secure the ends of justice. Hence this submission is without any merit.

It has further been submitted by Shri Agarwal that in view of Section 6A(6) and Section 6E of the Essential Commodities Act, the jurisdiction of this Court to pass any order is barred. In this contention, a reference may be made to Section 6A(6) of the Act which provides that notwithstanding anything to the contrary contained in the Cr. P.C., 1973 no court shall entertain any application with respect to an essential commodity when the Collector or appellate authority is seized with the matter in so far as its release, distribution etc. is concerned Similar is the provision in Section 6E which bars the jurisdiction of any court, tribunal or other authority to make any order with regard to the possession, delivery disposal or distribution of any property which is the subject matter of any proceeding u/s 6A(6). On these grounds Shri Agarwal has submitted that this Criminal Misc. case cannot be entertained by this Court.

In reply Shri R.P. Sah the learned Advocate for the petitioner has submitted that the bar under these two provisions of law will operate against this Court only so far as the passing of the order with regard to possession, delivery, disposal or distribution of such property is concerned. So far as passing of any other order by this Court is concerned, according to Shri Sah the learned Advocate there is no such bar under these two provisions of law.

Shri Agarwal has relied on the case of Khemraj Jugraj Vs. The State of M.P., This decision however docs not support him because it has clearly been held in it that what is barred is the making of an order with regard to the possession, delivery, disposal or distribution of the essential commodities seized u/s 3 of the Act is concerned. It has clearly been held in it that therefore "the provisions of Sections 397 and 401 of the Cr. P.C. and also other provisions of the Code relating to disposal of property would no longer be applicable in face of specific disabling provision as contained in Section 6E which clearly lays down that the Collector or the Judicial Authority as the case may be shall have the jurisdiction to make order with regard to the possession, delivery, disposal or distribution of the property concerned" (Emphasis supplied). It is thus clear that except for the facts that this Court cannot pass arty order with respect to the possession, delivery, disposal or distribution of the property seized u/s 3 of the Act, no bar is imposed on the powers of this Court so far as passing of any other order is concerned. In the instant case, prayer is for quashing of the order for auction sale of the seized food grains. This will not come within the mischief of Section 6E of the Essential Commodities Act, and therefore, I hold that the jurisdiction of this Court is not barred so far as the present two cases are concerned.

Shri Agarwal the learned A.P.P. has also placed reliance on the case of Divisional Forest Officer and Another Vs. G.V. Sudhakar Rao and Others, . This was a case under the Forest Act. It appears that the Forest Officer has seized some timber or forest produce on the ground that he had reasons to believe that a forest offence has been committed in their respect. It was held that a simultaneous proceeding for their confiscation can go on before the Authorised Officer u/s 44(2) of A.P. Forest Act and also a criminal case instituted on complaint by the Forest Officer before a Magistrate for the commission of an offence u/s 20 of this Act. It appears that Andhra Pradesh High Court had stayed the confiscation proceeding before the authorised officer till the disposal of the criminal case against the accused. It was held by the Hon''ble Supreme Court that this could not be done, In the present case however it is not the confiscation proceeding which has been challenged before me. As will appear from the impugned order the learned Collector, Dhanbad by the impugned order asked the petitioner to show cause as to why the seized articles should not be confiscated u/s 6A of the Act. At present the grievance of the petitioner is not against the order issuing show cause notices to him. The main grievance is that on the same day without waiting for filing of the show cause by the petitioner the learned Collector, Dhanbad had ordered that the seized articles may be auction sold and the sale proceeds deposited in the treasury on the ground that the seized articles may deteriorate putting the petitioner and also the State of Bihar to loss. Hence what has been challenged before me in the case is not the order of the seizure or even the confiscation proceeding started against the petitioner. What has been challenged is the order passed by the learned Collector on the same day for the auction sale of the seized articles. Hence this decision is not applicable to the facts of the present case.

Shri Agarwal has also placed reliance on the case of Bishambhar Dayal Chandra Mohan and Others Vs. State of Uttar Pradesh and Others, . In particular he has drawn my attention to paras 43 and 44 of this order to support his contention that the proceeding u/s 6A of the Act should be allowed to continue without any interference from this Court. It may be mentioned here that the proceeding before the Hon''ble Supreme Court was started under Article 32 of the Constitution of India and it was observed in para 43 that for the establishment of their right to relief under Article 32 the petitioners must, in our opinion, establish the necessary facts before the said Additional District Magistrate u/s 6A of the Act. In the present case the application before me is not under Article 32 of the Constitution of India. Moreover, his neither the seizure nor the confiscation proceeding that has been challenged before this Court. What has been challenged before me is the order passed by the Collector on the same day for the auction sale of the seized articles. Hence, this decision also is not of much assistance to Shri Agarwal.

Shri Agarwal has also placed reliance on the case of State of Gujarat v. Mansukhlal Ramjibhai 1986 EFR 154. This is a single Bench decision of Gujarat High Court passed in a revision petition under Sections 397 and 401 of the Code. It was held that Section 6E of the Act bars the jurisdiction of any court including the High Court in making orders with regard to possession, delivery, disposal or distribution of the Essential Commodity. It was, however, held that it is only the Collector and the Judicial authority u/s 6(E) of the Act who could have passed any order with respect to the possession, delivery, disposal and distribution of the seized goods. In this case reliance has been placed on the case of Khemraj Jugraj Vs. The State of M.P., .

As already stated above it is clear that in terms of Section 6A(6) and also Section 6(E) of the Act the jurisdiction of the court is barred only in a given situation and for a specific purpose. If these two provisions are closely examined it will appear that except for the Collector or the appellate authority no court shall entertain any application for the release, distribution etc. (under Section 6A(6)) and for the possession, delivery, disposal or distribution of such property (under Section 6E). The jurisdiction of this Court, however is not barred in terms of these two provisions of law so far as passing of an order not with regard to the specific purposes mentioned therein. From this it would appear for the jurisdiction of this Court to pass all the orders has not been barred in terms of these two provisions of law. What has been barred really is that this Court should hot pass any order with regard to the possession, delivery, disposal or distribution of the seized goods.

In the present case, however, no order is proposed to be passed for the aforesaid purposes. It has been pointed out to me on behalf of the petitioner that there has been a complete failure of justice in as much as the learned Collector in this case had ordered for the auction sale of the seized goods on the same day on which he has started the confiscation proceeding. This he was doing without affording an opportunity to the petitioner to show cause why the auction sale should not be held. It has been submitted that this is definitely against the principles of natural justice and the failure to observe these principles amounted to abuse of the powers given under law and has resulted in failure of justice to the petitioner. I feel inclined to agree with this submission made on behalf of the petitioner.

It may be stated here that forty bags of sugar were seized in this case for which the confiscation proceeding was started and the same cannot be said to be the such perishable articles for which the learned Collector was compelled to pass the order of auction sale on the same day on which he issued the show cause notice to the petitioner. u/s 6A(2) of the Act, it is only when the Collector is of the opinion that the seized essential commodity is subject to speedy and natural decay or that it is otherwise expedient in the public interest so to do he may order the same to be sold at the controlled price, if any, fixed under any law for the time in force. In the present case it appears that the learned Collector was in great hurry. Without trying to comply with the mandatory provisions of Section 6A(2) and 6A(3) of the Act and without informing the petitioner from whose possession the articles were seized he has proceeded to order for their auction sale on the same day. This does not appear to be in terms of the spirit of law and is definitely against the principles of natural justice. The articles were not such that a delay of few days could have mattered. Thereafter, obviously the impugned order so far as it relates to the auction sale of the seized articles should not have been passed by the learned Collector and is liable to be quashed. It may be pointed out here that the quashing of this order for the auction sale of the seized articles will not come within the mischief of Sections 6A(6) and 6(E) of the Act.

For the reasons stated above this Criminal Misc. case is allowed and the impugned order so far as relate to the auction sale of the seized articles is hereby quashed.