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PETITIONER: COLLECTOR OF CUSTOMS, CALCUTTA

       Vs.

RESPONDENT: EAST INDIA COMMERCIAL CO.  LTD.

DATE OF JUDGMENT: 30/04/1962

BENCH: WANCHOO, K.N. BENCH: WANCHOO, K.N. AIYYAR, T.L. VENKATARAMA SINHA, BHUVNESHWAR P.(CJ) GAJENDRAGADKAR, P.B. AYYANGAR, N. RAJAGOPALA

CITATION:  1963 AIR 1124            1963 SCR  Supl. (2) 563  CITATOR INFO :  R          1965 SC 458  (28)  D          1967 SC1244  (12)  D          1968 SC 231  (19)  RF         1974 SC1380  (21,30)  RF         1987 SC2111  (13)  R          1990 SC  10  (12)

ACT: Sea Customs-Effect of confirmation of order in  appeal-Order of  Collector merged into that of Central Board  of  Revenue --Sea Customs Act, 1878 (8 of 1878).

HEADNOTE: The  respondent imported 2,000 drums of mineral oil and  the appellant  confiscated  50  drums  and  imposed  a  personal penalty.  The appeal of the respondent was dismissed by  the Central  Board of Revenue.  The respondent filed a  petition under  Art.  226 of the Constitution in  the  Calcutta  High Court.   A Full Bench of the High Court held that  the  High Court  had  no  jurisdiction to issue  a  writ  against  the Central Board of Revenue in view of the decision in the case of  Saka Venkata Subbha Rao.  However, as the Central  Board of Revenue had merely dismissed the appeal against the 564 order of the appellant, the High Court further held that  it had  jurisdiction  to pass an order against  the  appellant. The   appellant  came  to  this  Court  after  obtaining   a certificate. Held that the appellant had merged into that of the  Central Board of Revenue and hence no order could be issued  against the  appellant.   It  is only the  order  of  the  appellate authority  which is operative after the appeal  is  disposed of.   It is immaterial whether the appellate order  reverses the  original  order,  modifies  it  or  confirms  it.   The appellate  order  of confirmation is as  efficacious  as  an operative  order  as  an  appellate  order  of  reversal  or modification.   As the appellate authority in this case  was beyond  the territorial jurisdiction of the High  Court,  it was  not  open  to the High Court to issue  a  writ  to  the

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original authority which was within its jurisdiction. Election Commission, India v. Saka Vankata Subba Rao, [1951] S. C. R. 1144, A. Thangal Kunju Mudatiar v. M. Venkitachalam Poiti, [1955] 2 S. C. R. 1196, Commissioner of Income-tax v. M/s.  Amritlal Bhogilal & Co. [1959] S. C. R. 713 and  Madan Gopal  Rungta  v.  Secretary to the  Government  of  Orissa, (1962) (Supp.) 3 S.C.R. followed. Barkatali v. Custodian General of Evacuee Property, A. 1. R.   1954 Raj. 214, overruled. Joginder    Singh   Waryam   Singh   v.   Director,    Rural Rehabilitation,  Pepsu,  Patiala, A. 1. R.  1955  Pepsu  91, Burhanpur National Textile Workers Union v. Labour Appellate Tribunal  of  India at Bombay, A. I. R. 1955 Nag.  148,  and Azmat Ullah v. Custodian, Evacuee Property, A.I.R. 1955  All 435, approved. State  of  U.  P. v. Mohammed Nooh, [1958]  S.  C.  R.  595, distinguished.

JUDGMENT: CIVIL APPELLATE, JURISDICTION: Civil Appeal No. 383 of 1961. Appeal from the judgment and order dated July 21  1959,   of the Special Bench of the Calcutta High Court in  Matter  No. 76 of 1952. D. R.     Prem  and  R.  L. Dhebar, for  the  appellant  and respondents NOS. 2 and 3. S.   P. Desai and B. P. Maheshwari, for respondent No. 1  565 1962.  April 30.  The Judgment of the Court was delivered by WANCHOO,  T.-This ii an appeal on a certificate  granted  by the  Calcutta  High Court.  The brief  facts  necessary  for present  purposes  are these.  The respondent  had  imported 2,000  drums  of  mineral oil.  Out of  this  quantity,  the appellant,  the Collector of Customs, Calcutta,  confiscated 50 drums by order dated September 20, 1950.  He also imposed a personal penalty of Rs.61,000/on the respondent under  the Sea Customs Act, No. 8 of 1878, (hereinafter referred to  as the  Act).  The respondent appealed to the Central Board  of Revenue  under  s.  188  of the Act,  and  this  appeal  was dismissed  in April 1952.  Thereupon the respondent filed  a petition  under  Art. 226 of the Constitution  in  the  High Court.  We are in the present appeal not concerned with  the merits  of the case put forward by the respondent,  for  the matter  has  not  yet been heard on the  merits.   When  the petition  came up before a learned Single Judge  a  question was raised as to the jurisdiction of the High Court to  hear the  petition  in  view of the decision  of  this  Court  in Election  Commission India v. Saka Venkata Subba Rao.(1)  As the learned Single Judge considered the point important,  he referred  the matter to a larger bench; and  eventually  the question  was considered by a Full-Bench if the High  Court. The  Full-Bench  addressed  itself  two  questions  in  that connection, namely, (i) whether any writ could issue against the  Central Board of Revenue which was a party to the  writ petition  and  which  was permanently  located  outside  the jurisdiction of the High Court, and (ii) whether if no  writ could  issue, against the Central Board of Revenue any  writ could  be  issued  against  the  appellant,  which  was  the original  authority to pass the order under challenge,  when the appellate (1) (1953) S.C.R. 1144, 566 authority (namely, the Central Board of Revenue) had  merely dismissed the appeal.

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The  Full-Bench held on the first question.  that  the  High Court,  had  no  jurisdiction to issue a  writ  against  the Central  Board  of Revenue in view of the Precision  in  the case of Sake Venkata Subba Rao.(1). On the second  question, it held that as the Central Board of Revenue had merely dis- missed  the  appeal against the order of  the  Collector  of Customs  Calcutta, the really operative order was the  order of the appellant, which was located within the  jurisdiction of the High Court, and therefore it had jurisdiction to pass an  order against the Collector of Customs in spite  of  the fact  that  order  had  been  taken  in  appeal  (which  was dismissed) to the Central Board of Revenue to which no writ, could  be issued.  The Full-Bench further directed that  the petition would be placed before the learned Single Judge for disposal  in the light of its decision or, the  question  of jurisdiction.   Thereupon  there was an  application  for  a certificate to appeal to this Court, which was granted;  and that in how the matter has come up before us. The only question which 1ells for decision before us in  the second  question  debated  in  the’  High  Court,.   namely, whatever  the High Court would have jurisdiction to issue  a writ  against the Collector of Customs Calcutta in spite  of the  fact that his order was taken in appeal to the  Central Board  of  Revenue against which the High  Court  could  not issue a writ and the appeal had been dismissed.  There seems to have been a difference of opinion amongst the High Courts in  this matter.  The Rajasthan High Courts in Barkatali  v. Custodian  General of Evacuee Property (1) held  that  where the A.I.R. (1904) Raj. 214.  567 original   authority  passing  the  order  was  within   the jurisdiction  of the High Court but the appellate  authority was not within such jurisdiction, the High Court would still have jurisdiction to issue a writ to the original authority, where  the  appellate  authority had  merely  dismissed  the appeal  and  the  order  of  the  original  authority  stood confirmed without any modification whatsoever.  On the other hand, the PEPSU High Court in Joginder Singh Waryam Singh v. Director,  Rural Rehabilitation.  Pepsu Patiala, the  Nagpur High Court in Burhanpur, National Textile Workers Union,  v. Labour-  Appellate Tribunal of India at Bombay ( 2) and  the Allahabad  High Court in Azmat Ullah, v. Custodian,  Evacuee Property  (3  ) held otherwise, taking the  view  that  even Where  the  appeal was merely dismissed, the  order  of  the original  authority  merged in the order  of  the  appellate authority,  and  if the appellate authority was  beyond  the territorial  jurisdiction of the High Court, no  writ  could issue  even to the original authority.  It may be  mentioned that the Rajasthan High Court had occasion to reconsider the matter after the decision of this Court in A.     Thangal Kunju Mudaliar v. M. Venkita-chalam Potti    ( 4 ) and  held that  in  view  of that  decision,  itsearlier  decision  in Barkatali’s case (5) was no longer good law.  The High Court has however not noticed this later decision of the Rajasthan High Court to which the learned Chief Justice who was  party to  the earlier Rajasthan case was also a party.   The  main reason which impelled the High Courts, which held otherwise, was  that the order of the original authority got merged  in the  order  of the Appellate authority when the  appeal  was disposed  of  and  therefore  if  the  High  Court  had   no territorial  jurisdiction  to  issue  a  writ  against   the appellate authority it could not issue a writ (1)  A.I.R. (1955) Pepsu 91 (3) A. I. R. (1955) All- 435.

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(2)  A. I. R. (1955) Nag. 148. (4)  1955 2 S. C. R. 1196- (5)  A.I.R. (1954) Raj. 214. 568 against  the original authority, even though  the  appellate authority  had  merely  dismissed  the  appeal  without  any modification of the order passed by the original authority. The  question  therefore turns on whether the order  of  the original  authority  becomes  merged in  the  order  of  the appellate  authority  even  where  the  appellate  authority merely dismisses the appeal without any modification of  the order of the original authority.  It is obvious that when an appeal is made, the appellate authority can do one of  three things,  namely, (i) it may reverse the order under  appeal, (ii)  it  may  modify that order, and (iii)  it  may  merely dismiss  the appeal and thus confirm the order  without  any modification.   It  is not disputed that in  the  first  two cases  where the order of the original authority  is  either reversed  or  modified  it is the  order  of  the  appellate authority which is the operative order and if the High Court has  no  jurisdiction  to  issue a  writ  to  the  appellate authority it cannot issue a writ to the original  authority. The  question therefore is whether there is  any  difference between  these  two  cases  and the  third  case  where  the appellate  authority dismisses the appeal and thus  confirms the order of the original authority.  It seems to us that on principle it is difficult to draw a distinction between  the first tori kinds of orders passed by the appellate authority and  the  third kind of order passed by it.   In  all  these three  cases after the appellate authority has  disposed  of the  appeal,  the  operative  order  is  the  order  of  the appellate  authority  whether it has reversed  the  original order or modified it or confirmed it.  In law, the appellate order  of  confirmation  is  quite  as  efficacious  as   an operative  order  as  an  appellate  order  of  reversal  or modification.   Therefore,  if the  appellate  authority  is beyond  the  territorial jurisdiction of the High  Court  it seems difficult to bold even in a case where the appellate  569 authority has confirmed the order of the original  authority that  the  High  Court  can issue a  writ  to  the  original authority  which may even have the effect of  setting  aside the  order of the original authority when it cannot issue  a writ  to  the appellate authority which  has  confirmed  the order  of the original authority.  In effect, by  issuing  a writ to the original authority setting aside its order,  the High  Court  would  be interfering with  the  order  of  the appellate  authority  which had confirmed the order  or  the original  authority  even  though  it  has  DO   territorial jurisdiction  to issue any writ to the appellate  authority. We therefore feel that on principle when once an order of an original  authority  is  taken in appeal  to  the  appellate authority   which   is  located   beyond   the   territorial jurisdiction  of the High Court, it is the order  after  the appeal is disposed of; and as the High Court cannot issue  a writ against the appellate authority for want of territorial jurisdiction  it would not be open to it at issue a writ  to the  original authority which may be within its  territorial jurisdiction  once the appeal is disposed of, though it  may be  that  the appellate authority has merely  confirmed  the order of the original authority and dismissed the appeal. It is this principle, viz., that the appellate order is  the operative order after the appeal is disposed of, which is in our  opinion  the basis of the rule that the decree  of  the lower court merges in the decree of the appellate court, and

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on the same principle it would not be incorrect to say  that the  order of the original authority is merged in the  order of  the appellate authority whatsoever its  decision-whether of  reversal  or modification or  mere  confirmation.   This matter  has  been considered by this Court on  a  number  of occasions  after  the decision in Saka Venkata  Subba  Rao’s case.(1) (1)  (1953) S.C.R. 1144. 570 In  A. Thangal Kunju Mudaliar’s case (1), though  the  point was  not  directly  in issue in that  case,  the  Court  had occasion  to  consider  the  matter (see  p.  1213)  and  it approved of the decisions of the PEPSU, Nagpur and Allahabad High  Courts, (referred to above).  Then in Commissioner  of Income-tax v. Messrs.  Amritlal Bhogilal and Company (2),  a similar question arose as to the merging of an order of  the income-tax officer into the order of the Appellate Assistant Commissioner passed in appeal in connection with the  powers of  the Commissioner of Income-tax in revision.   Though  in that  case  the  order of  registration  by  the  Income-tax officer  was  held not to have merged in the  order  of  the Assistant  Commissioner  on appeal in view  of  the  special provisions  of  the Income tax Act, this Court  observed  as follows in that connection at p. 720 :-               ",There can be no doubt that, if an appeal  is               provided   against  an  order  passed   by   a               tribunal,   the  decision  of  the   appellate               authority  is the operative decision  in  law.               If   the  appellate  authority   modifies   or               reverses  the decision of the tribunal, it  is               obvious that it is the appellate decision that               is effective and can be enforced.  In law  the               position  would be just the same even  if  the               appellate   decision   merely   confirms   the               decision of the tribunal.  As a result of  the               confirmation or affirmable of the decision  of               the  tribunal by the appellate  authority  the               original  decision  merges  in  the  appellate               decision  and  it is  the  appellate  decision               alone  which  subsists and  is  operative  and               capable of enforcement. The  matter  was considered again by this  Court,  in  Madan Gopal Rungta v. Secretary to the Government of Orissa (3) in connection with an order of the (1) (1955)2 S.C.R.1196.     12)  (1959) S.C.R. 713, (3)  (1962) (Supp.) 3 S.C.R. 966.                             571 Central Government in revision under the Mineral  Concession Rules, 1949, framed under the Mines and Minerals (Regulation and Development) Act, (No. 53 of 1948) and it was held  that when  the Central Government rejected the  review.  petition against the order of the State Government under the  Mineral Concession Rules it was in effect rejecting the  application of the appellant of that case for grant of the mining  lease to  him.   The  question  of the  original  order  with  the appellate  order was also considered in that case though  it was  pointed out in view of r.60 of the  Mineral  Concession Rules  that it is the Central Government’s order  in  review which is the effective and final order.  Learned counsel for the  respondent sought to distinguish Madan  Gopal  Rungla’s case  (1)  on  the ground that it was  based  mainly  on  an interpretation  of  r. 60 of the  Mineral  Concession  Rules 1949,  though he did not pursue this further when s. 188  of the Sea Customs Act was pointed out to him. The main reliance however of the respondent both in the High

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Court and before us is on the decision in the State of Uttar Pradesh v. Mohmmed Nooh (2).  That was a case where a public servant was dismissed on April 20, 1948 before the Constitu- tion  had  come into force.  His appeal from  the  order  of dismissal  was dismissed in May 1949 which was  also  before the Constitution came into force.  His revision against  the order  in the appeal was dismissed on April 22,  1950,  when the Constitution had come into force, and the question  that arose in that case was whether the dismissed public  servant could  take advantage of the provisions of the  Constitution because  the  revisional  order had been  passed  after  the Constitution  came  into force.  In that  case,  this  Court certainly  held that the order of dismissal passed on  April 20,  1948 could not be said to have merged in the orders  in appeal and in revision.  It (1) (1962) (Supp.) 3 S.C.R. 906. (2) (1958) S.C.R. 595. 572 was pointed out that the order of dismissal was operative of its  own  strength  as from April 20, 1948  and  the  public servant  stood dismissed as from that date and therefore  it was  a case of dismissal before the Constitution  came  into force  and the. public servant could not take  advantage  of the provisions of the Constitution in view of the fact  that his  dismissal had taken place before the  Constitution  had come  into  force.   As  was  pointed  out  in  Madan  Gopal Rungta’s,  case(1)  Mohammad Nooh’s case (2) was  a  special case, which stands on its own facts.  The question there was whether a writ under Art. 226 could be issued in respect  of a dismissal which was effective from 1948.  The relief  that was  being  sought was against an order of  dismissal  which came into existence before the Constitution came into  force and remained effective all along even after the dismissal of the  appeal  and the revision from that order.   It  was  in those  special circumstances that this Court held  that  the dismissal  had taken place in 1948 and it could not  be  the subject-matter   of  consideration  under  Art.226  of   the constitution, for that would be giving retrospective  effect to  the  Article.  The argument based on  the  principle  of merger  was  repelled  by this Court in  that  case  on  two grounds, namely, (i) that the principle of merger applicable to decrees of courts would not be applicable to departmental tribunals,  and  (ii)  that  the  original  order  would  be operative  on  its  own strength and did  not  gain  greater efficacy by the subsequent order of dismissal of the  appeal or  revision.  in  effect,  this  means  that  even  if  the principle of merger were applicable to an order of dismissed like  the  one in Mohammad Nooh’s case, (2) the  fact  would still remain that the dismissal was before the  Constitution came  into force and therefore the person dismiss could  not take advantage of the provisions of the Constitution, so (1) (1962)(Supp.)3 S.C.R.906.                    (2) (1958) S.C.R. 595. 573 far  as  that dismissal was concerned.  That  case  was  not concerned  with  the territorial jurisdiction  of  the  High Court   where   the  original  authority  is   within   such territorial  jurisdiction while the appellate  authority  is not and must therefore be confined to the special facts with which  it was dealing.  We have therefore no  hesitation  in holding  consistently with the view taken by this  Court  in Mudaliar’s  case  (1)  as  well  as  in  Messrs.    Amritlal Bhogilat’s (2) that the order of the origin%] authority must be  held  to  have  merged in the  order  of  the  appellate authority  in  a case like the present and it  is  only  the order  of the appellate authority which is  operative  after

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the  appeal  is disposed of.  Therefore,  if  the  appellate authority is beyond the territorial jurisdiction of the High Court  it  would not be open to it to issue a  writ  to  the original autbority which is within its jurisdiction so  long as  it can not issue a writ to the appellate authority.   It is not in dispute in this case that no writ could be  issued to the appellate authority and in the circumstances the High Court  could issue no writ even to the  original  authority. We  therefore allow the appeal, set aside the order  of  the High Court and dismiss the writ petition with costs. Appeal allowed. (1) (1955) 2 S.C.R. 1196. (2) (1959) S.C.R. 713. 574