Gujarat High Court
Hussain Haji Harun Alias Hussein Kabiju vs Union Of India And Ors. on 4 March, 1988
Equivalent citations: AIR1988GUJ218, [1989]66COMPCAS430(GUJ), 1995(77)ELT803(GUJ), AIR 1988 GUJARAT 218
Author: S.B. Majmudar
Bench: S.B. Majmudar
JUDGMENT Shah, J.
1. Rule in Spl. C.A. No. 2515 of W87. Mr. J." D. Ajmera waives service of the rule.
2. The petitioner in both the petitions is the same. The respondents in both the petitions are mostly common, except that there is one more respondent in Special Civil Application No. 2515 of 1987, who is the Mamlatdar (Recovery), Mandvi (Kutch). As common questions arise in the above petitions, the same are disposed of by this common judgment.
3. To appreciate the controversies between the parties, it is necessary to state a few relevant facts. A notice dt. 18-8-84 was issued to the present petitioner along with 21 others to show cause as to why goods of foreign origin totally valued at Rs. 17,32,000/ should not be confiscated under the provisions of the Customs Act, 1962. The concerned persons were also asked to show cause as to why the vessel MSV PIRANI MNV 192 should not be confiscated under the provisions of the Customs Act, 1962. The persons concerned were also asked to show cause as to why a penalty to the extent permissible should not be imposed on each one of them. After giving a personal hearing on 19-10-84, Collector Customs (Preventive) Gujarat, Ahmedabad passed an order dt. 26-10-84. So far as the present petitioner is concerned, he was affected by the said order in as much as the aforesaid ship was ordered to be confiscated. The Collector, however, allowed redemption of the said ship on payment of a fine of Rs. 1,75,000/- in lieu of confiscation. By the said order, a personal penalty under S. 112 of the Customs Act was also imposed on the petitioner, amounting to Rs. 5 lacs. Being aggrieved by the said order, the. petitioner had preferred an appeal before the Customs, Excise and Gold (Control) Appellate Tribunal, being Appeal No. 109 of 1985. After filing the said appeal, an application for stay was filed by the petitioner in the said appeal against the penalty amount of Rs. 5 lacs. The petitioner was directed to deposit a sum of Rs.1 lac and for the said purpose, two months time was granted by The order dt. 15-4-85. Ultimately, the petitioner could not make the said deposit. A notice was issued to the petitioner as to why the appeal should not be rejected in terms of S. 129E of the said Act. On 20- t2-85, the said Tribunal passed an order, recording that on that day neither the applicant; nor his Advocate was present; that there was no intimation of the deposit having been made; that no cause was also shown for non-deposit and so in the circumstances the appeal was rejected in terms of S. 129E of the Customs Act. It appears that the petitioner thereafter preferred Misc. Application No. 36 of 1986 for setting aside the said order of dismissal of the appeal and for restoring the said appeal No. 109 of 1985. The said application was heard and dismissed as per the majority view by the Tribunal on 26-8-87. Mr. K. S. Dilip singhji , Member of the said Tribunal did not see any merit in the restoration application and so had expressed an opinion to reject the same. Mr. K. Gopal Hedge, Member (J) did not agree with the said view and was of the opinion that the application should be allowed; that the order of rejection of the appeal should be set aside; and that the appeal should be restored on the applicant depositing a sum of Rs. 1 lac within a week from the date of receipt of the order. Because of the said difference of opinion between the two learned Members, the records were submitted to the President as provided in sub-section (5) of S. 129C of the Customs Act, the points of difference being as under :-
(a) Whether restoration of the appeal dismissed for non-deposit of the penalty amount would amount to review of the earlier order and as such the application has no merit and therefore requires rejection as held by Member (T);
OR
(b) The restoration of the appeal dismissed for non-deposit of the penalty amount would not amount to review of the earlier order and on the facts and in the circumstances of the case the application should be allowed as held by Member(J);
Mr. K. L. Rekhi, Member (T) agreed with the aforesaid view of Mr. K. S. Dilip sinhji and reached the conclusion that restoring an appeal would amount to review of the earlier order of dismissal and since the Tribunal had no such power to review its earlier final order, he was of the view that the application for restoration of the appeal had no merit and so he ordered dismissal of the same. Thus, pursuant to the majority view, the application for restoration failed as per the final order dated 26-8-87.
4. The aforesaid Special Civil Application No. 2727 of 1986 was filed on or about 19-586 and in the said petition, amongst other, things, quashing and setting aside the said order dt. 20-l0-85, Annexure C, was prayed. The aforesaid Special Civil Application No. 2525 of 1987 was f led on or about 2-6-87. In the original petition, it was prayed that the aforesaid order of the Tribunal, rejecting the aforesaid application No. 36 of 1986 dt. 29-5-87. Annexure D, should be set aside and the Appellate Tribunal should be directed to accept the said sum of Rs 1ac by way of deposit and to restore the said appeal on file and dispose of the same on merits. In this Special Civil Application No. 2515 of 1987, a Misc. Application No. 372 of 1987 was filed, seeking leave to amend the main petition. That leave was granted on 9-12-87. By virtue of the said amendment, the petitioner has brought to light certain other relevant facts. He has stated that he had paid the entire amount of Rs. 1,75,000/- as redemption fine imposed on his aforesaid vessel and had also paid the amount of Rs. 1 lac towards the penalty amount and had also executed guarantee to the extent of Rs. 5 lacs against the total amount of penalty of Rs. 5 lacs on him, in pursuance of the several orders passed by the High Court from time to time in the aforesaid Special Civil Application. The petitioner has also stated by the said amendment that he had filed the aforesaid appeal, which was a composite appeal for setting aside penalty and also for setting aside the order of confiscation of the said vessel and, therefore, the Appellate Tribunal was not justified in rejecting the composite appeal. He has also submitted vide the amendment that the aforesaid restoration application deserves to be reconsidered in the light of the new development also, that is to say, in the light of the payment of entire redemption fine and also payment of pre-deposit of Rs. 1 lac as per the original order passed in the application for stay and also in view of the fact that remainder amount of the penalty was also secured by a guarantee bond. In Special Civil Application No. 2515 of 1987, the petitioner has, therefore, prayed that the aforesaid order dismissing the appeal should be set aside and the appeal should be restored on file and be decided on merits and that the order on the aforesaid restoration application should be set aside so that the aforesaid appeal of the petitioner may be disposed of at an early date.
5. The following questions, therefore arise for consideration : -
(1) Whether the order rejecting the application for restoration of the said appeal requires to be interfered with as alleged or otherwise ?
(2) Whether the order dismissing the said appeal is vitiated as alleged or otherwise ?
(3) What final orders are required to be passed in the above petitions ?Question No. 1
6. As noted above, the appeal was dismissed for non-deposit of the penalty amount. The question is whether the restoration of such an appeal would amount to reviewing the earlier order. Such an order of dismissal can hardly be regarded as a final order under S. 129-B(4) of the Customs Act, 1962. The learned Judicial Member has rightly observed in his order that the Tribunal has been entertaining appeals against the orders passed by the Collector (Appeals) rejecting the appeal for non-deposit of the penalty amount; that such orders of the Collector (Appeals) are treated as orders made under S. 128A that in such appeals the Tribunal has jurisdiction to entertain appeals which were rejected by the Collector (Appeals) on the ground of non-deposit of the penalty levied or duty demanded; and that if the Tribunal has such jurisdiction then the Tribunal can certainly set aside its orders and restore the appeal rejected by it for non-deposit of the penalty levied or duty demanded, if the circumstances warranted such a course. It cannot be gainsaid that when the Act or the Rules in question do not specifically prohibit restoration of an appeal dismissed on the ground on-deposit of the penalty amount, the Tribunal certainly has the power and jurisdiction to recall its earlier order, if the ends of justice require such a course of action. It is more so because while dismissing appeal on the ground of non-deposit of the penalty amount, the Tribunal did not determine any issue or dispute and so there was no question of reviewing the earlier decision in the present case. Rule 20 of the Customs, Excise and Gold (Control) Appellate Tribunal Procedure Rules, 1982 provides for dismissal of the appeal for non-appearance of the appellant on the date of hearing. It is also true that the proviso to the said Rule specifically provides for restoration of the appeal which has been dismissed for default of the appellant. The mere absence of such a provision regarding the situation when an appeal comes to be dismissed for non-deposit of the penalty amount or duty demanded cannot be construed on the basis that the Tribunal had no power to restore the appeal, which was dismissed for non-deposit of the penalty amount or duty demanded. As observed by the Supreme Court in the case of Collector Land Acquisition, Anantnag v. Mst Katiji, (1987) 28 ELT 185 : (AIR 1987 SC 1373), when substantial justice and technical considerations are pitted against each other, cause of substantial justice deserves to be preferred. It has further been observed in that case that it must be grasped that judiciary is respected not on account of power to legalise injustice on technical grounds but because it is capable of removing injustice and is expected to do so. The same principles would apply in the present case. It is not possible to regard the order of dismissal on the ground that penalty amount was not deposited in time to be a final order. It is also, therefore, not possible to accept the view that restoring such an appeal would amount to reviewing the earlier order of dismissal. The whole fallacy files in the approach that if such an appeal was to be restored, it would amount to reviewing its earlier final order. The majority view is that the Tribunal will have power to restore an appeal which has been dismissed for default in appearance on sufficient cause being shown in terms of R. 20 of the Customs, Excise and Gold (Control) appellate Tribunal Procedure Rules, 1982 but because there is no such express provision authorising the restoring of an appeal dismissed on the ground that the amount of penalty has not been paid, the Tribunal was powerless to restore such an appeal. We are unable to agree with the aforesaid majority view because such orders passed in cases where the amount of penalty has not been paid are not final orders. Such a construction would lead to injustice and would not further the ends of justice. What would happen in a given case where an appeal was dismissed for non-production of proof of deposit of penalty and it turned out in an application for restoration of such an appeal that the amount had already been deposited within the time granted but for some reason the same could not be reported or brought to the notice of the Tribunal before the appeal came to be dismissed on the ground of non-production of proof of deposit of penalty '? As per majority view, it would be a helpless situation since they had no power to restore even such an appeal. Such a construction would obviously defeat the ends of justice because it would amount to taking too technical a view of the matter just because there is absence of a positive provision authorising the Tribunal to restore such an appeal. We are, therefore, of the view that the order. rejecting the application for restoration of the said appeal requires to be interfered with and requires to be set aside.
Question No. 2 :
7. As we have seen, by the order dated 20-12-85 the said Appeal No. 109 of 1985 was dismissed. Reading the said order, it also becomes clear that the entire appeal was dismissed on the ground that the appellant as well as his Advocate were absent and that there was no intimation of the deposit having been made and further that no cause was also shown for non-deposit and it was in those circumstances that the entire appeal was dismissed. The order does not show that it was appreciated by the learned Members that the appeal that they were dismissing on the ground that the penalty amount was not deposited as directed. Was a composite appeal inasmuch as the same (sic). The appeal was a composite appeal because the same was for setting aside the penalty and also for setting aside the order of confiscation of the said vessel. It is also to be appreciated that under the order in question, redemption fine was ordered to the extent of Rs 1,75,000/- in respect of the aforesaid vessel. It is apparent, therefore, that the entire composite appeal could not have been dismissed on the mere ground that there was a failure in depositing the penalty amount as ordered. I t would seem that this aspect was not noticed by the learned Members of the Tribunal, when the order dismissing the appeal was passed. This is, therefore, one more consideration as to why the said application for restoring such an appeal should have been allowed. The aforesaid order dismissing the said appeal is, therefore, vitiated on this ground also. We, therefore, answer question No. 2 accordingly.
Question No. 38. In these matters, one cannot ignore the subsequent circumstances that have taken place since the date of the order of dismissal of the said appeal. It is not disputed that since that date, out of the penalty of Rs. 5 lacs the petitioner has deposited an amount of Rs. 1 lac. Not only that, but the petitioner has paid up the aforesaid entire Amount of Rs. 1,75,000/- which was imposed as redemption fine on his aforesaid vessel. Furthermore, petitioner has also executed guarantee bond in respect of the remaining penalty amount. These weighty subsequent circumstances cannot be ignored while hearing the above Special Civil Applications. Even on this consideration, therefore, the order rejecting the restoration application and the order dismissing the above appeal are required to be set aside in the ends of justice.
9. We, therefore, allow both the aforesaid Special Civil Applications, set aside the order rejecting the restoration application as also. the order under which the said appeal has been dismissed. We also direct that the said appeal be restored to file and be heard expeditiously on merits after affording an opportunity to the parties of being heard. The said appeal, after restoration, be disposed of on merits preferably by 31-5-1988. The Special Civil Applications are allowed to the aforesaid extent rules made absolute accordingly. In the circumstances of the case. There will be no order as to costs.
10. Order accordingly.