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Judgment
Mohan, J.—The petitioner before us filed W.P. No. 6562 of 1981, challenging the order of the Deputy Collector of Customs, Customs
House, Madras-1, made in IM. 426/79 MCD/L/C) dated 25-7-1981. In and by that order the second respondent imposed a penalty of Rs.
1,14,447.72 on the petitioner for alleged short-landing of 1,499 bags of ''Soy Fortified Bulgur Wheat''. He questioned the levy on various grounds.
Inter alia it was urged that the penalty u/s 116 of the Customs Act. 1962, was leviable only on dutiable goods. Insofar as the consignment was
exempt from duty no penalty could be levied thereon for short-landing. Further the cargo in question would either fall under T.I. No. 10 or 10(1)
and not Item No. 21.01.07. Originally the petitioner before us obtained injunction from the collection of penalty. That came to be vacated by the
order of my learned Brother Ratnam, J., on 24th June, 1987 in the following terms :-
No case is made out for continuing the interim injunction any longer, on the facts and circumstances of the case and also on merits as it is common
ground that another writ petition raising similar questions had been dismissed. In view of this, the interim injunction granted already is vacated and
this petition is dismissed"".
Thus, the appeal.
Interim injunction and notice having been ordered on 21-9-1987 by the Division Bench, it is argued before us now that the interim injunction
was continued. This continuation of interim injunction is opposed by the respondents.
On behalf of the petitioner (appellant) it is urged before us by Mr. G. Gopinath, that where there is a prima facie lack of jurisdiction on the part
of the Deputy Collector of Customs to levy penalty u/s 116 of the Customs Act, 1962, there is no necessity for the petitioner to go before the
appellate authority viz, Collector of Customs and thereafter before the Tribunal. Presently, no doubt, the Tribunal has been created for adjudication
of such matters in exercise of powers under Article 323-B; but that does not mean that the right of the appellant to move this Court under Article
226 of the Constitution of India has been taken away. This is because there is no legislation made by Parliament under the said Article, taking away
the jurisdiction of this Court exercisable under Article 226. In support of this submission, reliance is placed on a decision reported in Awadhesh
Kumar Singh Vs. State of Bihar and Others, .
In opposition to this, Mr. P. Narasimhan, Senior Central Government Standing Counsel on behalf of the respondents would submit that, no
doubt, specifical legislation has been passed, taking away the jurisdiction of this court under Article 226 of the Constitution of India. Nevertheless,
this Court cannot ignore the trend of modern legislation by reason of which the jurisdiction in relation to matters of this kind had been exclusively
conferred upon the hierarchy of authorities constituted under the Customs Act, pursuant to Article 323-B of the Constitution of India. First and
foremost, what is agitated in this case is that no vires of the provision or a rule or a regulation which alone could rightly attract the jurisdiction of this
Court under Article 226 of the Constitution of India. Whether the items forming the subject matter of writ petition are dutiable or not, certainly the
authorities are capable of deciding and that is the very purpose for which the authorities viz. the appellate authority and the Tribunal have been
created. Therefore, to by-pass them and to come before this Court to invite jurisdiction under Article 226 of the Constitution of India is acting
against the trend of modern legislation. The very object of such legislation is to see that the High Court is not troubled with matters of this kind,
where there is no need for the High Court to entertain such grievances. But that is not to say that the petitioner (appellant) will have to exhaust the
other remedy before coming to this Court as provided for under Sections 128 and 129-A of the Customs Act, 1962. Even on merits, it is urged
that against the same appellant the Calcutta High court had held that the levy of penalty is fully justified as reported in Everett (I) Pvt. Ltd. Vs.
Assistant Collector of Customs, . Besides, W.P. No. 6738 of 1981 on which the learned Senior Central Government Standing Counsel relied on
is clearly against the appellant. No doubt, that is the subject matter of an appeal. Nevertheless, the learned Judge was justified in relying upon that
order.
Before we embark on merits, it is necessary for us to note as to the reasons for amendment which came to be introduced under the Finance Act
44 of 1980. In providing under Chapter XV of the Customs Act of 1962, hereinafter referred to as the Act, Section 128 of the Act categorically
states that any person aggrieved by any decision or order passed under this Act by an officer of Customs lower in rank than a Collector of
Customs may appeal to the Collector (Appeals) within three months from the date of recommunication to him of such decision or order. There is
also proviso which states that delay could be condoned for a further period of three months. That provision does not concern us. In the case on
hand the impugned order had come to be passed by the Deputy Collector of Customs. Therefore, an appeal would lie against an order passed by
the Deputy Collector of Customs u/s 128 of the Act. Section 129-A, Clause 1(b) provides for a further appeal to the Tribunal. Incidentally, it also
provides for suo motu powers u/s 129-B of the Act. After all these, Section 130-E provides for an appeal to the Supreme Court in clause (b)
which says that an appeal shall lie to the Supreme Court from any order passed by the Appellant Tribunal relating, among other things, to the
determination of any question having a relation to the rate of duty of customs or to the value of goods for purposes of assessment. Therefore, if one
has regard to the entire pattern of Chapter XV of the Customs Act, 1962, it would be clear that the High Court does not come into the picture
with reference to a matter OF THIS KIND. However, while saying so, we are conscious of the fact that Section 130 provides for a statement of
case to High court. But that is besides the point in issue. Thus, it will be clear that the very object is, unless and until the High Court is obliged to
exercise its jurisdiction under Article 226 of the Constitution of India, it should not interfere with the working of the Customs Act. No doubt, this is
by virtue of Article 323-B of the Constitution of India. It is also true that the jurisdiction of the High Court under the said Article has not been
specifically taken away. But the question is can this Court remain, disregard to all these legislation and entertain please, which could be validly and
legitimately agitated before the authorities constituted under Chapter XV of the Act; our considered answer is ''No''. This is because, as rightly
pointed out by the learned Senior Central Government Standing Counsel, the present case does not involve any vires or legislative competence. It
is urged by Mr. G. Gopinath, learned counsel for the petitioner that the appellate authority cannot decide this question of jurisdiction. We fail to
comprehend as to why he could not. The appellate authority has every jurisdiction to decide whether the lower authority has jurisdiction or not.
Therefore, merely saying that jurisdictional issue is involved, it cannot enable the petitioner appellant to invoke Article 226 of the Constitution of
India. The position might have been different a few years ago. But certainly not after the enactment of this provision contained in Chapter XV of
the Act to which we have made a reference earlier. Therefore, it stands to reason, the High Court should not interfere. As a matter of facts
complaints were made that High Court did interfere in ordinary matter like this, in which the jurisdiction of the High Court need not be exercised;
as a result of which, large amount of revenue got blocked. It is for the purpose of avoidance of such a situation, this salutary provision has been
introduced. By no means we are to be understood that this tantamounts to the rule of exhaustion. On the contrary, this is only keeping in tune with
the march of legislation.
The learned counsel for the petitioner (appellant) Mr. G. Gopinath relies on a decision reported in Awadhesh Kumar Singh Vs. State of Bihar
and Others, . That case related to State Legislation, purported to be made under Article 323-B of the Constitution of India to take away the
jurisdiction of the High Court under Article 226 of the Constitution of India. Rightly, if we may say so, with respect, the Patna High Court held that
the power to make a legislation under the said Article 323-B is conferred only on the Parliament and not on the State. But the question here is very
different. As we stated above, what does the present rule say and in what direction the High Court could function. In answering these, we find
there is absolutely no justification to approach this Court under Article 226 of the constitution of India when the case on hand can be conveniently
decided by the hierarchy of authorities constituted under the Act. Thus, we conclude that the writ petition itself is misconceived and, therefore,
merely because while initially in the writ petition or at the time of admission of the writ appeal injunction was granted, it does not mean that we must
confirm it, ignoring all the above aspects of the matter.
Coming to the merits as well, as rightly pointed out by the learned single Judge in W.P. No. 6738 of 1981, under similar circumstances, the levy
of penalty was upheld. No doubt, the said judgment is under appeal. Nevertheless, that is a prima facie ground to vacate the interim injunction.
Again in Everett (I) Pvt. Ltd. Vs. Assistant Collector of Customs, , the learned single Judge upheld the validity of levy of penalty u/s 116 of the
Act. For all these reasons, we vacate the interim injunction.
After we dictated the order, an oral prayer was made for leave to appeal to Supreme Court. We do not think this is a fit case, involving any
substantial question of law, for grant of leave, because we have merely relied on the provisions of the Customs Act.
In the result, C.M.P. No. 15166 of 1987 is dismissed. No Costs.