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PETITIONER: R. S. SETH GOPIKRISHAN AGARWAL

       Vs.

RESPONDENT: R. N. SEN, ASSISTANT COLLECTOR

DATE OF JUDGMENT: 05/01/1967

BENCH: RAO, K. SUBBA (CJ) BENCH: RAO, K. SUBBA (CJ) SHAH, J.C. SIKRI, S.M. RAMASWAMI, V. VAIDYIALINGAM, C.A.

CITATION:  1967 AIR 1298            1967 SCR  (2) 340  CITATOR INFO :  F          1985 SC 989  (10,13)

ACT:      Defence  of India (Amendment) Rules 1963 (Gold  Control Rules) r. 126(L) (2) and the Customs Act, 1962 (52 of 1962), ss.  2(34),  105  and  110--Order  of  Assistant   Collector authorising  search of premises, requirements  of--procedure of  search, s. 165(1) of the Code of Criminal Procedure  how far  applicable--Officer  authorised  by  Collector  whether ’proper officer’--Validity of s. 105.      Constitution  of  India, Art. 14--Section  105  of  Sea Customs  Act,  1962  whether gives  unguided  and  arbitrary power--Whether ultra vires.

HEADNOTE: The   Assistant  Collector  of  Central  Excise  issued   an authorization  ’under s. 126(L)(2) of the Defence  of  India (Amendment)  Rules, 1963 (Gold Control Rules) for  searching the  premises of the appellant.  As a result of  the  search undeclared  gold  and  certain other  articles  as  well  as documents were seized.  The appellant’s writ petition  under Art.  226  challenging  the search on  various  grounds  was dismissed.  In appeal by certificate, HELD  :  (i)  Mala fides had not  been  proved  against  the officer authorized to make the search [342 C] (ii) The  authorization  order  could. not  be  said  to  be defective  merely  because it did not expressly  employ  the phrase  ’reason  to  believe’ occurring in s.  105  of  the- Customs  Act.  The phraseology used in the order  meant,  in effect and substance, the same thing. [342 E-F] (iii)     While  it may be advisable and indeed  proper  for the  Assistant Collector to give in the authorization  order the  reasons for his belief that a search is necessary,  the non-mention  of  reasons  would not by  itself  vitiate  the order.   Nor  can all the particulars of the nature  of  the goods and of the documents be mentioned in the order as they will   be   known  only  after  the  search  is   made   The specifications given in the present case,were sufficient  to enable the officer authorized to make the search

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[343 C-D] (iv) The word by in s.2(34) refers both to the Board and the Collecter and therefore both the Board- and the Collector of Customs can assign functions to an officer of Customs.  [343 H] (v)  It  cannot  be  said that the  Assistant  Collector  of Customs  must in authorizing search also record his  reasons for  doing  so on the ground that s. 165(1) of the  Code  of Criminal  Procedure  which makes such a  provision  is  made applicable  to  searches under s. 105 of  the  Customs  Act. While  under S.--105 of the Act the Assistant  Collector  of Customs either makes the search personally or authorizes any officer  of Customs to do so, if he has reasons  to  believe the facts mentioned therein, under s. 165(1) of the Code  of Criminal   Procedure  the  recording  of  the  reasons   for believing  the facts is only to enable him to make a  search urgently  in a case where search warrants in  the  ordinary course cannot be obtained. It is, therefore, not possible to invoke  the condition and apply it to a  situation arising under s. 105 of the Act [345 B-D]                             341 (VI) Section  105  of  the Customs Act does  not  confer  an unguided  and arbitrary power on the Assistant Collector  of Customs  to  make  a  search.  A  deeper  scrutiny   of  the provisions  indicates not only a policy but  also  effective checks  on  the  exercise  of the power  of  search  by  the Assistant Collector.  The section does not therefore  offend Art. 14 of the Constitution. [346 D] (vii)     The High Court on the materials placed before  it, held that the Assistant Collector had acted with  reasonable belief  in  the facts mentioned in s. 105.   There,  was  no justification for interfering with the findings of the  High Court. [346 E-F] ’Durga  Prasad v. H. R. Gomes,  Superintendent  (Prevention) Central Excise, Nagpur, A.I.R. 1966 S.C. 1209, referred to.

JUDGMENT: CIVIL APPELLATE JURISDICTION : Civil Appeal No. 998 of 1965. Appeal  from the judgment and order dated February  24,  25, 1964 of the Bombay High Court, Nagpur Bench in Special Civil Application 459 of 1963. B.   K.  Sanghi,  G.  L. Sanghi and 0. C.  Mathur,  for  the appellant. Niren  De, Addl, Solicitor-General, N. S. Bindra and  R.  H. Dhebar, for the respondents. The Judgment of the Court was delivered by Subba Rao, C. J. This appeal by certificate raises the quest on  whether the search of the premises of the appellant  and the seizure of the articles and the documents found  therein were valid. The relevant facts are as follows: The appellant is a mining proprietor  and holds several manganese  mines in  different States.   He has also been doing business in  many  articles apart   from  being  an  exporter  of  manganese  ore.    On information  alleged to have been received to the effect  of that the appellant was in possession of a large quantity  of undeclared  gold  the  Assistant Collector  of  Customs  and Central Exercise Raipur issued an authorization under r. 126 (L)4(2)  of  the Defence of India  (Amendment)  Rules,  1963 (Gold  Control  Rules)  hereinafter called  the  Rules,  for searching  the premises of the appellant.  Pursuant to  that authorization, the appellants premises were searched and  as a  result  of the search gold and  other  articles,  foreign

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currency  and other documents. were seized.   The  appellant filed  a petition under Art. 226 of the Constitution in  the High Court of Bombay (Nagpur Bench) challenging the validity of  the  said  search and the seizure of  the  articles  and documents  belonging to him.  The petition was  heard  along with similar petitions filed by other persons whose premises were  likewise  searched  and  goods  and  documents  seized therefrom.  The High Court dismissed all the petitions.  The several  petitioners before the High Court, along  with  the appellant,  preferred  appeals  to this  Court  and  the  an appeal’s  other than that filed by the appellant were  heard by this Court : See Durg 342 Prasad  v. H.R. Gomes, Superintendent (Prevention),  Central Exercise  Nagpur(1).   Therein  this  Court  considered  the various  contentions raised by them and dismissed the  same. For  one  reason or other, this appeal was not  heard  along with them. Obviously  the  points covered by that  judgment  cannot  be permitted  to be reagitated in this appeal.  Accepting  that position, learned counsel for the appellant raised before us only  the  questions  that  were not  decided  by  the  said judgment.   We shall now proceed to consider  the  questions that are peculiar to this appeal. The contention that the Assistant Collector and the  officer authorized  by him to make the search acted with mala  fides has  no substance.  The High Court considered  the  evidence and  rejected it. We do not see any justification to take  a different view on the material placed before us. The  second contention is that under s. 105 of  the  Customs Act,  hereinafter  called the Act, the  Assistant  Collector shall  have reason to believe that some goods  are  secreted before he can authorize any officer of Customs to search for them or the relevant documents, but the authorization  given by  the Assistant Collector to the Customs Officer  did  not say that he had reason to believe so. The relevant part of the authorization reads thus                "Whereas information has been laid before  me               of  the suspected commission of offence  under               section  11  read  with  section  111  of  the               Customs Act 1962 (52 of 1962) and it has  been               made   to  appear  that  the   production   of               contraband   goods  and   documents   relating               thereto are essential to the enquiry about  to               be made in the suspected offence........ Though  the  words  "reason to believe"  are  not  in  terms embodied  in  the  authorisation, the  phraseology  used  in effect and substance meant the same thing. ,  The next contention is that on a reasonable  construction of  the said provision it should be held that the  Assistant Collector  of Customs should not only give reasons  for  his belief  but also the particulars of the nature of the  goods and   of  the  documents,  for,  if  the  reasons  and   the particulars are not given the officer authorized may make  a roving search of the house which is not in the contemplation of the said section.  This argument may be dealt with in two parts.   In  terms S. 105 of the Act does not say  that  the Assistant Collector shall give reasons.  The power conferred on  him under S. 105 is not subject to any  such  condition. Though  he cannot make a search or authorize any officer  to make a search (1) A.I.R. 1966 S.C. 1209. 343 unless  he has reason to believe the existence of the  facts mentioned in the section, the section does not compel him to

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give reasons.  While it may be advisable, and indeed proper, for  him  to  give reasons, the non-mention  of  reasons  in itself  does not vitiate the order.  Nor can we  agree  with the  appellant  that the particulars of the  nature  of  the goods   and  of  the  documents  should  be  given  in   the authorization.   Obviously, no question of giving of  parti- culars  arises  if he himself makes the search,  but  if  he authorizes  any  officer  to  do  so,  he  cannot  give  the particulars  of the documents, for they will be  known  only after  the  search is made.  Doubtless he  has  to  indicate broadly the nature of the documents and the goods in  regard to which the officer authorized by him should make a search, for  without that his mandate cannot be obeyed.  The  autho- rization  issued  by the Assistant Collector of  Customs  in this case clearly mentioned that on information received  it appeared that the appellant was in possession of  contraband goods and documents relating thereto and also described  the office and the residential premises wherein those goods  and documents would be found.  In the circumstances of the  case we  are satisfied that the specifications are sufficient  to enable the officer authorized to make the search. The next argument is based upon the provisions of s. 110  of the  Act.  Under s. 110(3) of the Act only a proper  officer can  seize any documents or goods which in his opinion  will be useful for or relevant to any proceedings under the  Act. "Proper  officer"  has been defined by s. 2(34) of  the  Act thus :                "Proper   Officer,"   in  relation   to   any               functions  to  be performed  under  this  Act,               means  the officer of customs who is  assigned               those functions by the Board or the  Collector               of Customs." it is contended that, on a true construction of s. 2(34)  of the  Act the Collector of Customs should himself  seize  the goods,  that he has no power to authorize another to  do  so and that in this case the Collector of Customs did not  make the seizure.  This argument turns upon the terms of the said provision.   It  is  said that the  Board  only  can  assign functions  to  another  officer and that  the  Collector  of Customs  cannot  assign but can  function  personally.   The controversial expression in s. 2(34) is "by the Board or the Collector  of Customs".  The clause "who is  assigned  those functions", the argument proceeds, refers only to the  Board and not to the Collector.  A fair reading of the  provision, in our view, is that the preposition "by" refers both to the Board  and the Collector.  Both the Board and the  Collector of Customs can assign functions to an officer of Customs. It is then contended that the search made was void  inasmuch as  in making the search the relevant provisions of Code  of Criminal 344 Procedure  had  not been complied with.   This  argument  is based upon S. 105(2) of the Act.  It reads                "The  provisions  of  the  Code  of  Criminal               Procedure,  1898, relating to searches  shall,               so far as may be, apply to searches under this               section subject to the modification that  sub-               section  (5) of section 165 of the  said  Code               shall   have  effect  as  if  for   the   word               "Magistrate",  wherever it occurs,  the  words               "Collector of Customs" were substituted." Now,  if we look at the Code of Criminal Procedure,  s.  165 deals  with  searches.  The relevant part  of  that  section reads                (1)  Whenever  an  officer  in  charge  of  a

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             police  station or a police-officer making  an               investigation   has  reasonable  grounds   for               believing  that  anything  necessary  for  the               purposes of an investigation into any  offence               which  he is authorised to investigate may  be               found  in any place within the limits  of  the               police-station of which he is in charge, or to               which  he  is attached, and  that  such  thing               cannot  in his opinion be  otherwise  obtained               without  undue delay, such officer may,  after               recording in writing the grounds of his belief               and  specifying  in such writing,  so  far  as               possible, the thing for which search is to  be               made, search, or cause search to be made,  for               such  thing in any place within the limits  of               such station.                (2)                (3)  If he is unable to conduct the search in               person, and there is no other person competent               to make the search present at the time, he may               after recording in writing his reasons for  so               doing  require any officer subordinate to  him               to  make the search, and he shall  deliver  to               such  subordinate officer an order in  writing               specifying  the place to be searched  and;  so               far as possible, the thing for which search is               to  be made and such subordinate  officer  may               thereupon search for such thing in such place.                (4)  The  provisions  of  this  Code  as   to               search-warrants and the   general   provisions               as  to searches contained in section  102  and               section 103 shall, so far as maybe, apply to a               search made under this section.                (5)  Copies   of   any  record   made   under               subsection   (1)  or  sub-section  (3)   shall               forthwith  be sent to the  nearest  Magistrate               empowered  to take cognizance of  the  offence               and  the  owner  or  occupier  of  the   place               searched  shall  on application  be  furnished               with a copy of the same by the .Magistrate.               345 The argument is that the expression "so far as may be" in s. 105(2) of the Act attracts s. 165(1) of the Code of Criminal Procedure and under that section, as the police-officer  has to record in writing the grounds of his belief the Assistant Collector  of Customs shall also in authorizing  the  search record  his reasons for doing so.  But, in our view, s.  105 of  the Act and s. 165(1) of the Code of Criminal  Procedure are  intended to meet totally different  situations.   While under  s. 105 of the Act the Assistant Collector of  Customs either makes the search personally or authorizes any officer of  Customs to do so, if he has reason to believe the  facts mentioned  therein, under s. 165(1) of the Code of  Criminal Procedure  the  recording of the reasons for  believing  the facts  is only to enable him to make a search urgently in  a case where search warrants in the ordinary course cannot  be obtained.   It  is, therefore, not possible to  invoke  that condition  and apply it to a situation arising under s.  105 of   the  Act.   It  is  not  necessary  in  this  case   to particularize  which  of the other clauses or  part  of  the clauses of that section can be applied to a search under  s. 105 of the Act.  We, therefore, reject this contention also. Then  it  is  contended that s. 105 of the  Act  confers  an unguided) and arbitrary power on the Assistant Collector  of Customs to make a search,. the only condition being that  he

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has  reason  to  believe  in  the  existence  of  the  facts mentioned  therein.   It  is said that the  said  belief  is practically  a  subjective  satisfaction  and  the   section neither  lays  down  any policy nor  imposes  any  effective control  on his absolute discretion. So stated the  argument is  attractive,  but  a deeper scrutiny  of  the  provisions indicates  not only a policy but also effective  checks  Oil the  exercise  of  the  power to  search  by  the  Assistant Collector of Customs.  The object of the section is to  make a  search  for  the goods liable to be  confiscated  or  the documents  secreted in any place. which are relevant to  any proceeding under the Act.  The legislative policy  reflected in  the section is that the search must be in regard to  the two categories mentioned therein, namely, goods liable to be confiscated and documents relevant to a ding under the  Act. No doubt the power can be abused. at is controlled by  other means.  Though under the section the Assistant Collector  of Customs  need  not  give the reasons, if  the  existence  of belief  is questioned in any collateral proceedings, he  has to  produce relevant evidence to sustain his  belief.   That apart,  under s. 165(5) of the Code of  Criminal  Procedure, read with s. 105(2) of the Act, he has to send forthwith  to the  Collector of Customs a copy of any record made by  him. The  Collector would certainly give necessary directions  if the Assistant Collector went wrong, or if his act was guided by  mala  fides.  But the more effective control on  him  is found in s. 136(2) of the Act.  It reads : If any officer of customs.... 346                  (a) requires any person to be searched  for               goods  liable to confiscation or any  document               relating  thereto,  without having  reason  to               believe  that he has such goods  or  documents               secreted about this person; or                (b)  arrests any person without having reason               to  believe  that  he has been  guilty  of  an               offence punishable under section 135; or                (c)  searches or authorises any other officer               of customs to search any place without  having               reason to believe that any goods, documents or               things  of the nature referred to  in  section               105 are secreted in that place,                he shall be punishable with imprisonment  for               a term which may extend to six months, or with               fine which may extend to one thousand  rupees,               or with both. No  doubt  he  can  be prosecuted  only  with  the  previous sanction  of  the Central Government, but his  liability  to criminal prosecution for dereliction of duty under S. 105 of the  Act is certainly an effective control on his  arbitrary acts.   It  is, therefore, clear that not only a  policy  is laid down in S. 105, but also that the acts of the Assistant Collector  are effectively controlled in the  manner  stated above.   We cannot, therefore, say that s. 105 offends  Art. 14 of the Constitution. Lastly,  it  is contended that the  Assistant  Collector  of Customs in fact has not placed any material before the  High Court to sustain his reasonable belief.  The High Court,  on the  material  placed  before it, held  that  the  Assistant Collector  had  acted with reasonable belief  in  the  facts mentioned  in that section.  There is no  justification  for our interference with the findings of the High Court. In the result, the appeal fails and is dismissed with costs. It is represented to us that three years have elapsed  since the  documents  were  seized and  it  appears  that  nothing

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further  has been done in the matter.  We hope  and  trust that  the  Customs  Authorities will  take  appropriate  and immediate steps to finish their investigation and return the documents which are not required, to the appellant. G.C. Appeal dismissed. 347