LexM/S. LOKENATH TOLARAM ETC. versus B. N. RANGWANI & ORS.
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199
A
M/S. LOKENATH TOLARAM ETC.
v.
B. N. RANGWANI & ORS.
November 8, 1973
[A. N. RAY, C.J., K. K. MATHEW, Y. V. CHANDRACHUD AND
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P. N. BHAGWATI. JJ.]
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Custom3 Act. 1962. SJ. 110 and 124-Scope of.
Under 5. 110(1) of the Customs Act. 1962, the excise
authorities may
seize goods if the proper officer has reason to believe that the goods are liable-
for confiscation.
Section 124Ca) p,·ovides that no such order of cor..fiscation
shall be made unless the owner of the goods or the person from whose posses-
sion they are· seized is liven notice informina him of the arounds of confisca-
tion. l! no such notice is 1iven within 6 months of the seizure. the goods
shall be returned to the person from whom they were seiz~d. Section 110(2)
provides 1bat the period of 6 months may, on sufficient cause being shown, be
extended by the Collector of Customs for a period not exceeding 6 months.
Jn the present case. th~ central excise authorities seized certain aoods front'
the appellar~ts. The appellants filed writ petitions in the High Court for release-
of the aoods.
While the petitions were '!'ending various coil'SCnt orders were-
passed by the High Court providing for execution of bonds as well as deposit
of amounts of money by the appellants irr favour of the excise authorities against
release of the .izood~- and the tiarties had a.Rreed that the deposit111 of the 1-onds
were to be treated· as. proceeds of sale of the goods and - treated as goods 10-
seized for the purpose of adjudication proceedings. Pursuant to the consent
orders the goods were ·released.
Meanwhile, the Assis!ant Collector apolied for extension of time tor giving
notice- under s. 124(a) and a-n order of extension for a further period of 6-
months was made.
In the case of two of the appellants, the order. of exten.-
sion v.:as made beyond 6 months' from the date of seizure.
The writ petitions were dismissed by the High Court.
On the questions. ( 1) whether the orders extendini time not beina within 6
months of !he date of seizure of the goods. were illeA:al: and (2) wheth~r the
order111 made withoui aivin2 an opportuhfty to ·the appellant were violative or
the principles of n1tural justice,
·
HE~D (Dismissing the appeals)::
But for the special ap:reement in the consent orders between the parties !he
orde:"S for extension of time to ~crve the notice und-:r s, 124(a) might have
~;.
beM e11:oo~ed ro the infirmities of limitation as to time nnd the observance of'
princip]e!I. of
natural
iu~tice ·referred to. in As.tistan.t Collector of Custom.,
v. Charan DaJ Malhotra 1!9711 3 S.C.R. 802. [2400-EJ
·c11 Ca) All the ~oods had already been released to the
nppellants
by-
reason of the con5enc orders. ·Therefore, it cou1d not be .:ontended that since the-
order of exter..sion was not within 6 months of the !'ieizure of goods, the appcl~----·
tant111 were entitled to the release of the Jt:oods.
[204FJ
(b) The agreements between the parties as a result· of the consent orders
came into existence before as wcJI --as after the date when the Collector or
Customs e11:tended the 'Period for service of the nntice ur..der ~. 124(a). After
the appellants had obtained ·release of the goods in terms of the agreements.,·
the f!:Oods wen• out of the orovince of app1ication of s. 110, and therefore, the
appel1ants ·could r.ot contend that the amounts deposited in rerms of the agree.
mcnts represented the goods or· that the app.:llan~s were entitled to the return
of the amounts. The parties agreed that t·he Excise Authorities would retain_
the securities for the purpose of adjudkation proceedings ir.. the event of failure:
of the appellants in-the writ· petitions filed by hem. {204F-H1 .
·
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SUPREME COURT RBPOR TS
[ 1974 J 2 s.c.n..
(2) The agreements establish that the parties, on consideration of all
tb.c
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:facts and circumstances waived notice for extending the time for givina notice
tUnder s. 124 of lhc Act. Therefore, there cannot be any question of violation of
Principles of na-tural justi::e· or any lack of opportunity to the appellants to
-show cause in regard to the order extending time. [20SA-B)
( 3) Also, as the goods of one of the appellant were in possenion of a
Bank as pledgee, and the excise authorities seized the goods from the posses-
:sion of the Ban}.;, that appellant had no locus standi to ask for release of the
.goods. (2059-C]
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