Ajay Sarkar v. The Union of India & Ors.

Patna High Court CWJC No.15970 of 2012 (5) dt.24-01-2013 Traders, Mallaguri, Siliguri which appeared to be not genuine. Hence the loaded truck along with the consignment of Garlic was brought to Kishanganj Customs Office and seizure memo and panchnama were issued and handed over the driver. Investigation was made in which voluntary statements of the driver and Khalasi were recorded. They disclosed that the owner of the truck was the petitioner who had given direction for loading of the consignment on the truck which was brought from Nepal through Pick-up Van. As per the road challan, the consignment was to be delivered to the consignee M/s Annamalai Trading Company, Vadugapatti (South). Summons were issued to the petitioner and others for their interrogatory statement. Petitioner appeared before the Customs authorities and recorded his interrogatory statement on

09.11.2011 in which he accepted that the said garlic of foreign origin was loaded on his direction. Further enquiries were made in which it was found that money receipt and road challan produced by the driver were not genuine. The sample of garlic was also sent for laboratory test at Regional Branch of Quarantine Station in Kolkata and a report was received that garlic was found infected with ‘Embellisia alli’ a quarantine pathogen. During investigation it transpired that similar shape and size of garlic being infected with the said Embellisia alli had been attempted to be smuggled in the 3 Patna High Court CWJC No.15970 of 2012 (5) dt.24-01-2013 Country several times earlier also which was required to be destroyed immediately. Accordingly, on 16.03.2012 a notice was issued to the petitioner, driver and Khalasi under the provisions of Section 124 of the Customs Act, 1962 to show cause as to why the said consignment of garlic and truck may not be confiscated. This notice, annexed as Annexure-1 with the writ application, is under challenge before this Court. However, is admitted subsequently, truck was provisionally released by the Customs officials in favour of the petitioner subject to the final decision in the confiscation proceeding. Learned counsel for the petitioner submitted that garlic is a free trade commodity and not a notified item under the Customs Act and no customs duty is payable thereon. Hence, onus to prove that the ceased garlic was of foreign origin lay on the Customs authorities. In support of this submission, learned counsel for the petitioner placed reliance on a judgment of a Division Bench of this Court the case of Commissioner, Custom Department, Government of India, Patna Vs. Dwarika Prasad Agrawal [ 2009 (2) PLJR 858]. It was submitted that in 2005, some garlic was seized which was found infected. Hence, if on that basis the department desired to prevent import of garlic, it was required to include it amongst prohibited goods by a notification. It was 4 Patna High Court CWJC No.15970 of 2012 (5) dt.24-01-2013 submitted that in fact the ceased garlic was not of foreign origin. Hence, Customs Act especially Section 111 (d) was not applicable in the case. He further submitted that provisions of Section 123 of the Act have not been complied with by the Customs officials and statements of the petitioner, driver and Khalasi, recorded in terms of Section 108 of the Act during investigation, have no evidentiary value. In support of this submission, learned counsel for the petitioner placed reliance on a judgment of the Apex Court in the case of Noor Aga Vs. State of Punjab and another in [(2008) 16 Supreme Court Cases 417]. He submitted that in cases in which notice issued under Section 124 of the Act was itself found without jurisdiction, the court had the powers to quash the notice itself without waiting for conclusion of the confiscation proceeding. For this he placed reliance on a judgment of the Apex Court in the case of Union of India and others Vs. Jain Shudh Vanaspati (AIR 1992 Supreme Court 572). Learned counsel for the Customs Department, in reply, submitted that two show cause notices were issued to the petitioner to place materials in his defence which he failed to do. On the other hand during investigation materials became available which prima facie showed that the ceased garlic appeared to be of foreign origin. He submitted that consigner and consignee of the consignment 5 Patna High Court CWJC No.15970 of 2012 (5) dt.24-01-2013 were also noticed earlier but they have not appeared to claim the Indian origin of the garlic and have not come forward to claim its ownership and for its release. He submitted that during the investigation the voluntary statements of the petitioner, driver and Khalasi were recorded in which they admitted that garlic had been smuggled in the Country. He submitted that though garlic may not be a notified item and, therefore customs duties may not be payable on it, but since the same was being imported into the Country from outside, it had to conform to the provisions of the Customs Act as well as provisions of the Foreign Trade (Development and Regulation) Act, 1992. He submitted that since this appeared to be a case of import, it had to be imported and cleared in terms of the provisions of Sections 46 and 47 of the Customs Act. He submitted that since the ceased garlic was found to be infected, it required to be destroyed immediately. He submitted that such case had come up before the Apex Court also and the Apex Court in the case of Union of India Vs. Exim Rajathi India Pvt. Ltd. [2008 (232) E.L.T. 774 (SC), had approved destruction of such infected garlic. Having heard learned counsel for the parties and having considered the materials available on record, this Court finds that, as mentioned in the impugned notice, transportation of garlic by the 6 Patna High Court CWJC No.15970 of 2012 (5) dt.24-01-2013 truck of the petitioner was found in contravention of the provisions of Sections 7, 11, 46 and 47 of the Customs Act read with Section 3(2) of the Foreign Trade (Development and Regulation) Act,

1992. This Court finds that even though garlic was not a notified item, still, as import of free trade articles are regulated by Sections 46 and 47 of the Customs Act, this transportation of garlic also required clearance by the Custom authorities. This Court finds that driver and Khalasi had not produced any evidence in support of the compliance of the provisions of said Sections 46 and 47 of the Customs Act nor did petitioner, after appearance before the Customs authorities, produce any such evidence. This Court also finds that, upon enquiries made during the investigation in respect of the road challan and money receipt produced by the driver before the Customs authorities, they were not found to be genuine. This Court also finds that sample of garlic seized was subjected to laboratory test and the same found to be infected with the said ‘alli’, commonly found in garlic of foreign origin. This Court also finds that petitioner as well as driver and Khalasi in their interrogatory statements did admit that garlic was imported from foreign country for which they did not produce any valid papers. Though in the writ petition petitioner has denied that he made any such statement but, after filing of the counter affidavit and after his 7 Patna High Court CWJC No.15970 of 2012 (5) dt.24-01-2013 statement with his signature and others documents were produced by the Department with the counter affidavit, he has not challenged the authenticity and genuineness of the same. It may be that their statements during investigation may not have evidentiary value in the confiscation proceeding, but this does not make investigation or the findings collected as bad and the notice as without jurisdiction. It may be pointed out that neither before this Court nor before the Custom authorities petitioner has produced any reliable material to show that the ceased garlic was of Indian origin. It may also be pointed out that petitioner is only the transporter and neither the consignor nor the consignee, who only could make such claim and ownership and release, has come forward till now to claim the garlic. This Court also finds that during investigation sufficient materials were collected which justified the initiation of confiscation proceeding by the Custom authorities. This Court also finds that Section 111 (d) of the Customs Act talks of any goods which are imported or attempted to be imported or are brought within the Indian customs waters for the purpose of import. Thus, the section applies to the import of any goods through water or through land also by any transport. It is true that judgment of the Division Bench of this Court in the case of Commissioner, Custom Department, Government of 8 Patna High Court CWJC No.15970 of 2012 (5) dt.24-01-2013 India, Patna (supra) does lay down that in case of free trade goods, the onus of the Department is to prove its foreign origin, but in the facts of this case, this Court finds that in the preliminary investigation, the Department has prima facie established that the seized garlic appeared to be of foreign origin, which is, of course, subject to final adjudication in the confiscation proceeding. But, in any case, this gives jurisdiction to the Department to initiate a proceeding for which the impugned show notice has been issued to the petitioner. It is also true that where very notice is found to be without jurisdiction, this Court can interfere without waiting for final decision in the proceeding. But in the present case, this Court is not satisfied that the impugned notice issued by the Customs Department was in any way without jurisdiction. The content of the impugned show cause notice shows that during the investigation sufficient materials had been collected to give authorities of the Customs Department jurisdiction initiate a confiscation proceeding. As such, this Court does not find any merit in any of the submissions of the learned counsel for the petitioner. The writ application is, accordingly, dismissed. B.T/- (Jayanandan Singh, J)