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Judgment
K.T. Thomas, Acg. C.J.
Some gold biscuits were seized from the three persons who arrived at Thiruvananthapuram Air Port by Air Lanka Flight on 5-11-1983. Collector of Customs initiated confiscation and penalty proceedings against those three person under the provisions of the Customs Act, 1962 (for short ''the Act'')- After considering the objections raised by the persons from whom gold biscuits were seized, the Collector of Customs ordered "absolute confiscation" of the seized goods, besides imposing a penalty of Rs. 5,000/- each (vide Ext. P. 4 order). Appeal preferred by them was dismissed by the Appellate Authority (Ext. P. 6 Order). They moved for revision before the Government of India, but that revision also was dismissed (Ext. P 8 order).Thereafter they filed this Original Petition under Article 226 of the Constitution for quashing the above three orders. Learned Single Judge, before whom the Original Petition came up, has referred this to a larger bench.
Petitioners raised mainly one point which, according to their learned counsel, is fatal to the confiscation proceedings. It is based on the fact that no notice was served on the petitioners u/s 124 of the Act within six months of the date of seizure. However, there is no dispute that a notice under the section bearing the date 1-5-1984 was despatched on 4-5-1984, but it was received by the petitioners only on 8-5-1984.
Learned Counsel relied on Section 110(2) of the Act. It reads thus :
"Where any goods are seized under Sub-section (1) and no notice in respect thereof is given under clause (a) of Section 124 within six months of the seizure of the goods, the goods shall be returned to the person from whose possession they were seized.
Provided that the aforesaid period of six months may, on sufficient cause being shown, be extended by the Collector of Customs for a period not exceeding six months."
Learned Central Government Standing Counsel adopted a twin contention in answer to the said point. First is that since notice was sent before the expiry of six months, it is sufficient compliance with the condition to avert the consequences evisaged in the section though the sendee has received it only after expiry of the period. Second is, even if no notice was sent within six months of seizure, it would not preclude the Customs authorities from resorting to confiscation and penalty proceedings.
Shri S. Gopakumaran Nair, learned counsel for the petitioner, relied on the decision of a Division Bench of this Court in Govinda Rao v. Addl. Secretary [1987 (1) KLT 253] wherein Section 79 of the Gold Control Act, 1969 was considered. The Division Bench held that giving of notice as contemplated therein is not completed by sending notice. Division Bench followed the dictum of the Supreme Court in K. Narasimhiah Vs. H.C. Singri Gowda, It was the proviso to Section 23(9) of the Mysore Town Municipalities Act, 1951 which was considered in that decision, as per which proviso, a resolution could not be moved unless "atleast 15 days notice has been given of the intention to move the resolution." Supreme Court considered the object in giving such notice under the said provision and it was held that "giving" is complete when it was delivered to the person, or atleast when it was offered to him if he refused to accept. In the context in which the notice was intended, the giving process must involve the delivery aspect also since the time of 15 days would start running only from the date of getting the notice.
The expressions such as giving notice, issuing notice, serving notice or receipt of notice etc., have been interpreted by the courts in different manner depending upon the context where such notices are contemplated. In Maxwell''s "Interpretation of Statutes" learned author insisted on giving liberal interpretation to "giving of notice". In Black''s Law Dictionary "giving of notice" is distinguished from "receiving of notice". A person ''notifies'' or ''gives'' notice to another by taking such steps as may be reasonably required to inform the other in ordinary course whether or not such other person actually comes to know of it. One of us (Thomas, J.) has considered this position in Madhu v. Omega Pipes Ltd. [1994 (1) KLT 441].
The context in Section 110(2) is that a time limit is fixed for retaining the goods seized by the customs authorities. The period is fixed as six months (which can be extended for another period of six months). If confiscatory proceedings have not been initiated, custody or possession of the seized articles should be returned to the person from whom they were seized. We must remember that customs officials must be seizing contraband articles almost every day. Such articles might include seizable goods such as refrigerators, washing machines etc. They have to be kept in safe custody which means space. If all the seized articles are to be stored without time limit goods would pile upto unmanageable limits. So the legislature provided that if confiscation proceedings are not commenced for six months the goods should be returned to the possession of the person concerned. Commencement of confiscation proceedings is the sending of notice envisaged in Section 124 of the Act. Hence the legislature provided that if notice is not given within six months, then possession of the seized goods should be returned. If this is the purpose of the time limit of six months, then giving of notice must be understood as a process in which despatch of the notice is equally important.
We may point out another distinction. The expression used in Section 79 of the Gold (Control) Act is that no order of adjudication shall be made "unless the owner of the gold...is given a notice in writing". Emphasis is laid there was on the subject "owner of the gold". But Section 110(2) of the Act contains a different context. Though here also active voice is employed the emphasis is more on the subject "notice" and a liability is cast on the sender if notice is not given within the time limit. So, the context in Section 110(2) of the Act would justify an interpretation different from what the division bench has placed on Section 79 of the Gold (Control) Act. We are, therefore, inclined to hold that so far as the sender of the notice is concerned, his part would be over by his despatching the notice and if that is done before the expiry of the period of six months it could be treated that he had given the notice within the time limit.
The next question is whether confiscation proceedings would be debarred if notice was not given within the time fixed in Section 110(2) of the Act. No doubt, if notice was not so given the goods have to be returned to the person from whom they were seized. Does it mean that confiscation proceedings cannot be initiated subsequently? Section 124 of the Act reads thus :
"124. Issue of show-cause notice before confiscation of goods, etc, - No order confiscating any goods or imposing any penalty on any person shall be made under this Chapter unless the owner of the goods or such person -
(a) is given a notice in writing informing him of the grounds on which it is proposed to confiscate the goods or to impose a penalty;
(b) is given an opportunity of making a representation in writing within such reasonable time as may be specified in the notice against the grounds of confiscation or imposition of penalty mentioned therein; and
(c) is given a reasonable opportunity of being heard in the matter;
Provided that the notice referred to in clause (a) and the representation referred to in clause (b) may, at the request of the person concerned, be oral."
The above section provides two conditions for ordering confiscation of any goods or imposing any penalty. First condition pertains to giving notice informing him of the grounds. Second condition is, affording reasonable opportunity to him for making representation and a further opportunity to be heard. This section shows that an order of confiscation can be made if those conditions are satisfied and no time limit is prescribed therein. It is important that Section 110 falls within Chapter XIII which contains a fasciculus of provisions under the head "Searches, Seizure and Arrest" whereas Section 124 falls within another Chapter (Chapter XIV) under another head "Confiscation of goods and Conveyances and Imposition of Penalties". It must be remembered that confiscation can be made even in respect of unseized contraband goods. Provisions in Chapter XIV of the Act are not in any manner restricted or controlled by Section 110 of the Act. So we are of the view that failure to send the notice within the time fixed in Section 110 would not preclude the authorities from resorting to confiscation steps thereafter.
Learned counsel for the petitioners invited our attention to the decision of Narayana Pillai, J. in Kunjan v. Asst. Collector of Customs (1972 KLT 407) wherein learned single Judge has observed that the right which the person gains on account of expiry of the period mentioned in Section 110(2) is a valuable civil right and hence due importance should be given to the period mentioned in the sub-section. The said decision is of no help to consider whether confiscation proceedings cannot be initiated after the period. That decision concerns only with the question whether the goods once returned could be seized again on the strength of a second notice. Supreme Court has, in the decision referred to by the learned single judge [ Assistant Collector of Customs Vs. Charan Das Malhotra, ] made a passing observation that Section 124 does not lay down any period within which notice is required and the period laid down in Section 110(2) affects only the seizure of the goods and not the validity of notice. The view that Section 124 is independent of Section 110 of the Customs Act has been adopted by the other High Courts (vide The Collector of Customs and Central Excise, Somajiguda, Hyderabad Vs. Amruthalakshmi and Others, ; Mohanlal Devdanbhai Choksey and Others Vs. M.P. Mondkar and Others, ); Hemant Bahadur Lama Vs. Union of India and Others, and Shah Chagnlal Gianmalji v. Union of India - 1988 (34) E.L.T. 428 (Delhi)).
The result is, petitioners cannot get the orders quashed on either of the grounds. We, therefore, dismiss their Original Petition.