The State of Himachal Pradesh vs Singla Brothers and Others

R.S. Pathak, C.J.—This Letters Patent Appeal by the State of Himachal Pradesh is directed against the Judgment and order of our brother C.R. Thakur allowing a writ petition filed by the Respondents.

Messrs Mahabir Trading Company carry on business as grain dealers at Solan. A surprise check was made of their business premises on July 8, 1975. Among other things it was discovered that 435 bags of rice were kept in the go down and had not been shown in the stock list which the dealers were required to maintain under the Himachal Pradesh Commodities Price Marking and Display Order, 1975. The police seized the bags of rice and registered a case against the dealers for contravention of the aforesaid Order. A Special Tribunal, constituted u/s 7 of the Defence and Internal Security of India Act, 1971, tried the accused. The accused pleaded that the bags of rice did not belong to them but to Messrs Singla Brothers, the present Respondents, and alleged that they did not possess any stock of rice and for that reason had made no reference to the bags of rice in the stock list. However, they pleaded guilty of having committed the offence of not making the entry "out of stock" against the commodity of rice in the list. The Special Tribunal accepted the plea, and convicted and sentenced the accused for the omission to make that entry. That order was made on September 11, 1975. While the case against Messrs Mahabir Trading Company was pending before the Special Tribunal, an application was made by the present Respondents for release of the rice on the ground that they, as owners of the rice, were entitled to possession. The Special Tribunal rejected the application on the ground that the present Respondents had not proved that they were owners of the rice and observed that they could, if so advised, file a suit for a declaration of their title. After dismissing the application they made the aforesaid order dated September 11,1975, convicting and sentencing the accused towards the end of the order the Tribunal observed that the application of the present Respondents for possession of the rice having failed the goods stood confiscated and it directed the Magistrate to take steps for their immediate disposal.

According to the present Respondents, when the order was passed rejecting their application for return of the rice to them they instituted a suit the next day, September 12, 1975, in the court of the Subordinate Judge for a declaration that they were the owners of the rice and for an injunction restraining Messrs Mahabir Trading Company from disposing of the rice. The State was impleaded as a proforma Defendant. It is said that no relief was claimed against the order of confiscation made by the Tribunal as the present Respondents had no knowledge of that order at that time. It is alleged that subsequently the present Respondents came to know of that order and on September 17, 1975, a writ petition, out of which the present appeal arises, was filed in this Court praying for relief against the order of confiscation. It was mentioned in paragraph 13 of the writ petition that a suit had been filed but because of the subsequent order of confiscation passed by the Tribunal the suit had become infructuous.

The writ petition has been allowed by our brother Thakur, and he has directed the Appellants to return the bags of rice to the present Respondents.

In this Letters Patent Appeal, it is pointed out by learned Counsel for the Appellants that the suit Was dismissed as withdrawn on November 27, 1975, and, it is urged, the Respondents are not entitled to any relief in the writ petition by virtue of the doctrine of res judicata. Reliance is placed on Ram Kishan and Others Vs. Secretary to Govt. State of Haryana, Co-operative Dept., Chandigarh and Others, , in support of the proposition that if a suit is unconditionally withdrawn a writ petition cannot be maintanied for the same relief. Reference has also been made to Order 23 Rule 1 of the Code of Civil Procedure. The Appellants say that the grounds on which the writ petition has been brought are identical with the grounds on which the suit was founded, and our attention has-been drawn to the order dismissing the suit which attributes to the Respondents the statement that a wirt petition had been filed on the same grounds as the suit.

A consideration of the facts will show that the contention of the Appellant is without substance. The suit was filed by the present Respondents against Messrs Mahabir Trading Company. Relief was sought against them. No relief was sought against the State of Himachal Pradesh, which was impleaded merely as a proforma Defendant. The order of confiscation in favour of the State was not the subject matter of the suit. Unless relief was obtained against the order of confiscation a decree in the suit against Messrs Mahabir Trading Company would not entitle the present Respondents to possession.

It is urged for the Appellant that the order of confiscation made by the Tribunal was merely an order temporarily detaining the rice until the Respondents had established their title by suit, and that the rice had not been forfeited to the State. The submission is without force. Towards the end of its order, the Tribunal said:

The 435 bags of rice which have already been taken in possession by the police and which are not claimed by the accused shall stand confiscated to the State. An application for release of these 435 bags of rice was moved today by Messrs Singla Brothers, Solan and vide order of even date the same has been rejected. A copy of this judgment be forwarded to D.M. Solan who shall make necessary arrangement for immediate disposal of the confiscated rice.

It is apparent that the Tribunal, after noting that the application of the present Respondents for possession of the rice had been rejected and that they had been referred to a civil suit for establishing their title, proceeded to order confiscation of the rice and indeed directed that the rice be disposed of. It seems to me difficult to hold that the Tribunal intended by that order that the rice should be detained only until the present Respondents had instituted a declaratory suit and obtained a decree.

The ordinary dictionary meaning of the word "confiscatte" is given by Webster''s Third New International Dictionary as "appropriated by Government to public use, forfeited; deprive of property by confiscation", and the word "confiscation" has been defined as "the taking of private property to the public use as being forfeited". The word "forfeit" itself refers to something "which is lost or the right to which is alienated by a criminal offence, neglect of duty, or breach of contract". According to Stroud''s Judicial Dictionary 4th Edn. P. 659, property "confiscated" in its ordinary sense means property taken by the Crown by way of penalty. It is of interest to note that Stroud''s Judicial Dictionary 4th Edn. P. 1081 defines "forfeitute" to mean "the loss of interest" in the property spoken of. Under the law of Austria it was provided by Article 760 of the General Civil Code that, if the spouses were no longer alive, the succession was "confiscated" as heirless property. Kekewitch J., construing the provision in Re Barnett''s Trusts ILR (1902) Ch. 847,858 pointed out that the word "confiscated" did not imply the sense of taking by way of penalty but "it is taken, or assumed by the State, as its own property. What the Code says is that it is confiscated as heirless property�that is, as property which we call in England bona vacantia".

Therefore, the word "confiscate" can mean either that the property is appropriated to the State by way of penalty or that ownership therein posses to the State because of want of proved private title. It is in the latter sense that the Tribunal must be considered to have appropriated the bags of rice to the State and directed that they be disposed of. According to the Tribunal, as messrs Mahabir Trading Company disclaimed ownership in the rice and the present Respondents had not been able to prove title therein and no one else had come forward to claim it, the proper order was that the rice should stand confiscated to the State and be treated now as State property. With the order of confiscation on the record, it is apparent that the declaratory suit instituted by the present Respondents would have been of no avail unless the order of confiscation was questioned and relief sought against the State. In the circumstances, neither the doctrine of res judicate nor the provisions of Order 23 Rule 1, Code of Civil Procedure, can come into play.

The learned Advocate General then contends that this Court has no jurisdiction to grant relief on the writ petition by reason of Section 12(2) of the Defence and Internal Security of India Act, 1971. Section 12 provides that no court shall have authority to revise the order or sentence of the Special Tribunal "or have any jurisdiction of any kind in respect of any proceedings of a Special Tribunal". It is pointed out that the jurisdiction exercised by the learned single Judge over the order of the Tribunal is essentially in the nature of revisional Jurisdiction and, it is urged, because of the wide language of Section 12 precluding the jurisdiction of every court in respect of the proceedings of a Tribunal, the jurisdiction of the learned single Judge was barred. The contention has no merit whatever. Clearly, nothing contained in a statute can divest a court of its constitutional jurisdiction. Section 12 of the Act cannot abrogate or abridge the jurisdiction conferred on this Court by Article 226 of the Constitution.

The question on the merits is whether the order of confiscation made by the Tribunal is an order within its competence or in any event is manifestly erroneous in law.

The learned Advocate General submits that the Tribunal had ample power to make the order which it did by reason of Section 452(1) of the Code of Criminal Procedure, 1973, which, he urges, is applicable to the proceedings of the Tribunal by virtue of Section 9(8) and Section 11 of the Defence and Internal Security of India Act, and he also relies on Section 4(2) of the Code of Criminal Procedure. Section 452(1) of the Code Provides:

(1) When an inquiry or trial in any Criminal Court is concluded, the Court may make such order as it thinks fit for the disposal, by destruction, confiscation or delivery to any person claiming to be entitled to possession thereof or otherwise, of any property or document produced before it or in its custody, or regarding which any offence appears to have been committed, or which has been used for the commission of any offence.

To the contrary, learned Counsel for the Respondents contends that Section 452 of the Code cannot be invoked because Section 37 of the Defence and Internal Security of India Act provides that the provisions of the Act or any rule made thereunder shall have effect notwithstanding anything inconsistent therewith contained in any enactment other than that Act. Section 452 of the Code, he says, is inconsistent with Rule 114(11)(b) of the Defence and Internal Security of India Rules and therefore its application is excluded. According to him, Rule 114(11)(b) exhausts the power of the Tribunal to make an order of confiscation. The said provision declares:

(6) If any order made under this rule so provides, any Court trying a contravention of the order may direct that any property in respect of which the Court is satisfied that the order has been contravened shall be forfeited to Government;

Provided that where an order made under this rule relating to foodstuffs so provides, any Court trying a contravention of the order may also direct that all packages, coverings, or receptacles in which such foodstuffs are found and every animal, vehicle, vessel or other conveyance used in carrying such foodstuffs shall be forfeited to Government.

As regards the aforesaid provision, the Tribunal could invoke it only if the Himachal Pradesh Commodities Price Marking and Display Order itself had provided that the property covered by it would be forfeited to Government where the Tribunal was satisfied that the Order had been contravened in respect of it. The Order does not contain such provision and, the submission goes on, in any event there was no contravention of the Order in respect of the 435 bags of rice.

In suppot of his submission, learned Counsel for the Respondents relies on Purushottam Devji v. Emperor AIR 1944 Bom. 247 Hansraj Astaji v. Emperor AIR 1944 Bom. 292, In re Appukuti Chetiar AIR 1945 Mad. 23, and Abdul Majid v. Emperor AIR 1945 Lah. 149 , Reference has also been made to Mangi Lal Vs. The State of Maharashtra, and Chint Ram v. State G.M.P. (Main) No. 62 of 1975 decided by R.S. Pathak, G.J. on November 30 1975.

Section 3 of the Defence and Internal Security of India Act empowers the Central Government to make rules for securing the objectives of the Act. Sub-section (3) declares that the rules may provide, inter alia, that a contravention of the rules or any order issued under any such rule shall be punishable, and that the rules may also provide for the seizure, detention and forfeiture of any property in respect of which such contravention has been committed. Pursuant to that power Rule 114(11) of the Defence and Internal Security of India Rules has been enacted. Clause (a) provides for the punishment of persons contravening any provision of Rule 114 or any order made under that rule, and Clause (b), which has been extracted above, provides for forfeiting any property in respect of which the court is satisfied that an order made under Rule 114 has been contravened, provided that the order contains a provision for the making of such a direction. It will be noticed that the scope of Rule 114(11)(b) covers a part only of the field covered by Section 452(1) of the Code. While Rule 114(11)(b) deals with that class of cases only where an order has been contravened in respect of a property, Section 452(1) deals also with cases where a property has been produced before the court or is in its custody, not being necessarily property regarding which any offence appears to have been committed or which has been used for the commission of any offence. Section 452(1) covers a wide area. Under the Code of Criminal Procedure, 1882, a court could make an order for disposal of a property produced before it in those cases only where the property was one regarding which any offence appeared to have been committed or which had been used for the commission of an offence. On the enactment of the Code of 1898, it was not essential u/s 517 thereof that the property should be of that description. The court could make an order for the disposal of any property produced before it or in its custody B. Ram Lal Vs. State, , Section 452(1) of the Code of 1973 has been framed in the same terms. A case in which a property is produced before the court but regarding which no offence appears to have been committed nor has it been used for the commission of any offence is included within the comprehensive scope of that provision. It is apparent that such a case does not fall within Section (3) of the Defence and Internal Security of India Act and Rule 114(11)(A) of the Rules made thereunder. That being so, Section 37 of the Act does not come into play. There can be no inconsistency between Rule 114(11)(b) and that part of Section 452(1) which falls outside the area covered by the said rule. To the extent that Section 452(1) covers an area not occupied by Rule 114(11)(b), there is no reason why it should not operate in cases legitimately falling within its scope. The cases on which reliance has been placed by the Respondents are all cases where confiscation was ordered of property in respect of which the offence was committed. They cannot serve as authority in those cases where the property has nothing to do with the offence committed. In such a case, jurisdiction exists to make an order u/s 452(1).

In the present case, the Tribunal accepted the plea of the accused that the rice did not belong to them. That is apparent from the basis on which the accused were convicted. They were convicted for the offence of not making the entry ''out of stock'' in the list, that is to say, for omitting to make the entry that they had no stock of rice. In other words, the Tribunal proceeded on the basis that the 435 bags of rice had nothing whatever to do with the offence. In the circumstances, the plea raised by learned Counsel for the Respondents that Rule 114(11)(b) is attracted must fail. The case, in my opinion, is one which properly falls within the terms of Section 452(1) so far as it deals with property which, although not used for the commission of any offence nor regarding which any offence appears to have been committed, has been produced before the court.

Learned Counsel for the Respondents does not dispute that in a matter such as this, if no provision has been made by the Defence and Internal Security of India Act and the Rules made thereunder the Tribunal is entitled to invoke the powers contained in the Code of Criminal Procedure. In the circumstances, I shall assume that subject to the limitation mentioned above, the provisions of Section 452(1) of the Code are available to the Tribunal.

The point then to be considered is whether the order of confiscation made by the Tribunal calls for interference by this Court in its writ jurisdiction, Section 452(1) contemplates several alternatives for the disposal of property. The property may be destroyed or confiscated or delivered to any person claiming to be entitled to possession thereof or it may be disposed of otherwise. The order to be passed in that behalf is in the case of a criminal court a judicial order, and in the case of a Tribunal a quasi-judicial order. In either case, it must be a reasonable order, such order as is reasonably called for by the facts and circumstances of the case and not an order which is arbitrary, contrary to reason or perverse. An order passed on the whim or humour of the court or tribunal is not an order in law at all. It is not an order within its jurisdiction.

What are the facts in the present case? The 435 bags of rice were seized from the custody of Messrs Mahabir Trading Company. In the case before the Tribunal both accused stated that the bags of rice did not belong to them but to the present Respondents. The Respondents applied to the Tribunal for release of the rice to them. They detailed material on the basis of which they claimed that the rice belonged to them. The application was supported by affidavit. The Tribunal, however, rejected the application by a cryptic order which gives no satisfactory reason for doing so. In making the order which it did the Tribunal acted arbitrarily and apparently without seriously applying its mind to the claim made before it. It failed to appreciate the facts placed before it by the present Respondents seeking to establish that the rice belonged to them. It failed to take note of the fact that the rice was recovered from the custody of Messrs Mahabir Trading Company, and that the accused had clearly stated before it that the rice had been entrusted to them by the present Respondents for safe custody. The material in support of their claim has been set out elaborately by the Respondents in the writ petition in this Court. To my mind, the orders dated September 11, 1975, of the Tribunal rejecting the application of the Respondents for release of the rice in their favour and confiscating the rice to the State are vitiated by an improper exercise of jurisdiction and are manifestly illegal.

I would quash the orders mentioned above and direct the Tribunal to pass fresh orders on the application of Messrs Singla Brothers in accordance with law and the observations made in this judgment. The Tribunal will give a reasonable opportunity to the parties to produce such further evidence in support of their case as they may be advised.

The order which I propose is at variance with the order made by the learned single Judge under appeal before us the learned single Judge has taken the view that the Tribunal had no jurisdiction u/s 452(1) of the Code in respect of the 435 bags of rice and he has proceeded to dispose of the issue of the ownership of the rice on an appraisal of the facts and circumstances of the case. The learned single Judge has, on such appraisal, come to the conclusion that Messrs Singla Brothers are the owners of the rice and that they are entitled to an order for its release in their favour. On the view which has prevailed with me, it is the Tribunal which has jurisdiction to decide that question, and accordingly the matter should properly be left to it.

The orders dated September 11, 1975, of the Special Tribunal rejecting the application of the present Respondents, Messrs Singla Brothers, for release of the 435 bags of rice in their favour and confiscating the rice to the State are quashed. The Special Tribunal is directed to consider afresh the said application for release made by Messrs Singla Brothers in accordance with law and the observations made in this judgement; a reasonable opportunity will be given by the Special Tribunal to Messrs Singla Brothers and the State to produce such further evidence as they may be advised. The order of the learned single Judge is modified and the appeal is allowed accordingly. In the circumstances, there is no order as to costs.