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CASE NO.: Appeal (civil)  905 of 2002

PETITIONER: Oma Ram

RESPONDENT: State of Rajasthan and Ors

DATE OF JUDGMENT: 21/04/2008

BENCH: Dr. ARIJIT PASAYAT & P. SATHASIVAM

JUDGMENT: J U D G M E N T REPORTABLE

CIVIL APPEAL NO. 905 of  2002 With (CIVIL APPEAL NO.291 OF 2004, CIVIL APPEAL NO.3575 OF  2002, CIVIL APPEAL NO.4562 of 2002 and CIVIL APPEAL  NO.906 of 2002)

Dr. ARIJTI PASAYAT, J.

1.      In all these appeals challenge is to the judgment of the  Rajasthan High Court at Jodhpur dismissing the writ petitions  filed under Articles 226 and 227 of the Constitution of India,  1950 (in short the ’Constitution’).  Challenge in the writ  petitions was to the vires of certain provision of the Rajasthan  Excise Act, 1950 (in short the ’Act’).  Essentially the prayers  were as follows:

"(a) appropriate writ, order or direction,  incorporation of Sec. 54(ka) and Sub-Sections (4) to  (9) in Section 69 of the Excise Act may be declared  ultra-vires and be struck down; (b) by an appropriate writ, order or direction,  amendment in the Excise Act, 1950 by  incorporation of Section 9B may be declared ultra- vires and be struck down; (c) by a further appropriate, writ, order or direction  impugned order dated 16.5.2000, passed by  respondent No. 2 may be declared invalid and may  be quashed and set aside; (d) Pending decision, if any further order is made or  action is taken prejudicial to the interest of the  petitioner, the same may also be quashed and set  aside." 2.      The contentions raised on behalf of the appellant in the  writ petitions challenging the vires of the provisions were  founded on the following allegations:

1.      The provisions of the amendment are  contrary to Article 254 of the Constitution  and without the assent of the President  those are ultra vires; 2.      the amended provisions are repugnant to  the provisions of the Code of Criminal  Procedure and the Code of Civil Procedure; 3.      The amended provisions confer unguided

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powers on the Excise Authorities; 4.      By Section 9(B) the remedy of judicial  review is taken away and the petitioner is  remediless."

3.      The respondent-State prayed for dismissal of the writ  petition on the ground that the Act was within the legislative  competence of the State Government under Item 8 read with  Items 64 & 65 of List II of the 7th Schedule of the Constitution  and is a special Act dealing with right of the State to regulate  production, transfer, storage, possession and sale of liquor or  intoxicating drugs.    4.      The High Court noted that 75 similar petitions were filed  before the Jaipur Bench raising similar contentions.  

5.      Following the view of the Jaipur Bench the Writ Petitions  were dismissed by the impugned judgment.

6.      In support of the appeals, it was submitted that as per  the provisions of Sections 451 to 457 of the Code of Criminal  Procedure, 1973 (in short the ’Cr.P.C’), the criminal court has  jurisdiction to release any property seized or recovered during  any enquiry or trial.  By the insertion of Section 54(A) of the  Rajasthan Excise Amendment Ordinance, 2000 which was  later on substituted by the Amendment Act Along with Section  54A,  Section 69 has also been amended and as per amended  sub section (6) of Section 69 it has been provided that  whenever any means of conveyance is seized in connection  with commission of offence under the Act, the Excise  Commissioner or any officer authorized in this behalf by the  State Government shall have and notwithstanding anything  contained in any law for the time being in force, any Court,  Tribunal or other Authority shall not have jurisdiction to make  order with regard to the possession, delivery, disposal or  release of such conveyance.  Grievance was that in view of the  aforesaid provisions the criminal courts were not invoking  jurisdiction and the power of the court has been taken away.   Challenge to Section 54A and Section 69(6) were made on the  ground that they are unconstitutional, arbitrary, unreasonable  and violative of Articles 14, 19, 20, 21 and 301 of the  Constitution.  It was submitted that the powers conferred on  judicial courts by virtue of Sections 451 to 457 Cr.P.C. has  been curtailed or have been taken away and indirectly the  power of revision of Sessions judge or the High Court and  inherent power of the High Court under Section 482 Cr.P.C.   has been curtailed.  

7.       In response, learned counsel for the State made the   reference to Sections 4,5, & 9 Cr.P.C. and Section 41 of the  Indian Penal Code, 1860 (in short the ’IPC’).

8.      The objects and reasons of the Rajasthan Excise  Amendment Act, 2000 need to be noted. The same is as  follows:

"Statement of Objects and Reasons:

The incidence of unauthorised  transportation of excisable articles had  increased in recent past and it was noticed  that owners of such vehicles were indulging in  these activities with impunity. It was also  noticed that the vehicles indulging in such  transportation even after seizure for

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commission of the offence were released from  courts and were again used for unauthorised  transportation of exciseable articles.  To check  this menace, it was considered necessary to  provide that  if any means of -conveyance is  used in commission of offence under the  Rajasthan Excise Act, 1950, then the same  shall be liable to be confiscated by order of the  Excise Commissioner or the Officer, not below  the rank of District Excise Officer as may be  authorized by the State Government in this  behalf and the owner of such a means of  conveyance shall be, deemed to be guilty of  offence for the commission of which, the said  means of conveyance was used.  For achieving  these purposes, Section 69 of the Rajasthan  Excise Act was proposed to be suitably  amended and a new Section 54A was proposed  to be inserted."

The amended Section 54 reads as follows: -,       

"54. Penalty for unlawful import, export,  transport, manufacture, possession etc.- ,          Whoever in contravention of this Act or of any  rule or order made or of any licence, permit or  pass granted, thereunder

(a)     imports, exports, transports,  manufactures,  collects, sells or possesses any excisable article, or,

(b)     cultivates any hemp plant (Cannabis Sativa);  or (c)     constructs or works any distillery, pot still or  brewery; or (d)     uses, keeps or has in his possession any  materials stills, utensil, implements or apparatus  whatsoever for the  purpose of manufacturing any   excisable article other than tari; or removes any excisable  articles for any distillery potstill,(brewery) or warehouse  established or licensed under this Act or (e)     bottles any liquor for the purposes of sale; or (f)     taps or draws tari from any tari producing  tree;

shall be punishable with imprisonment for a term which  may extend to three years and with fine which may  extend to two thousand rupees.

       Sections 54A and 69 read as follows: "54-A. Owner of animal, cart, vessel, raft, motor  vehicle or any other means of conveyance deemed to  be guilty in certain cases. Where any animal, cart,  vessel, raft, motor, vehicle or any other means of  conveyance is used in the commission of an offence  under this Act, and is liable to confiscation, the  owner thereof, except, in case of a motor vehicle -or  other, means of conveyance being owned by the  Central, Government or any State Government or  any of the undertakings, shall be deemed to be  guilty of such offence and such owner shall be liable

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to be proceeded and be- punished accordingly  unless he satisfies the court that he had no reason  to believe that such offence was being  or likely to   be committed and he had exercised due care in the  prevention of the commission of such an offence.

69.     What things are liable to confiscation- (1)  Whenever an offence punishable under this Act has  been committed   (a)  every excisable article in respect of which such  offence has been committed.  

(b) every still, utensil, implement or apparatus and  all materials by means of which such offence has  been committed,

(c) every excisable article lawfully imported  transported, manufactured held in possession or  sold alongwith or in addition to any excisable article  liable to confiscation under clause (a),

(d), every receptacle, package or covering in which  any article as aforesaid or any materials, still,  utensil, implement or apparatus is or are found  together with the other contents --(if  any) of such  receptacle or package, and

(e) every animal, cart,  vessel, raft or other  conveyance      used in carrying such receptacle or  package, shall be liable to confiscation.  

(2) When in the trial of any offence punishable  under this Act the Magistrate decides that anything  is liable to confiscation under clause (a) to (d) of  sub-sec (1) he may order confiscation.

Provided that (in case of a thing other than an  excisable article he may, in lieu of ordering  confiscation, give) the owner of the thing liable to be  confiscated an option to pay any such fine as the  Magistrate thinks fit.

(3) When anything mentioned in sub-section (1) is  found in circumstances which afford reason to  believe that an offence under this Act has been  committed in respect or by, means thereof, or when  such an offence has been, committed and the  offender is not known or cannot be found, the  Excise Commissioner may order confiscation of the  same:

Provided that no such order shall be made  until the expiration of one month from the date of  seizing the thing or animal in question or without  hearing the person (if any) claiming any right  thereto, and the evidence (if any) which he produces  in support of the claim:

Provided further that if the thing in question is  liable to speedy and natural decay, if the Excise  Commissioner is of opinion that the sale of the thing  or animal in question would be for the benefit of its  owner, he may at any time direct it to be sold;  and  the provisions of this section shall so far as may be,

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apply to the net proceeds of such sale.

(4)     Where any means of conveyance referred to in  clause (e) of sub-section (1) is seized in connection  with the commission of any offence under this Act,  a report of such seizure shall, without unreasonable  delay, be made by the person seizing to the Excise  Commissioner or to the officer, not below the rank  of the District Excise Officer, as may be duly  authorized by the State Government in this behalf  and whether or not a prosecution is instituted for  commission of such an offence, the Excise  Commissioner or the officer authorized in this  behalf by the State Government, having jurisdiction  over the area where the said means of conveyance  was seized, may, if satisfied that the said means of  conveyance was used for commission of offence  under this Act, order confiscation of the said means  of conveyance.  

Provided that before ordering confiscation of  the said means of conveyance a reasonable  opportunity of being. heard shall be afforded to the  owner of the said means of conveyance and if such  owner satisfies the Excise Commissioner or the  officer authorised by the State Government in this  behalf that he had no reason to believe that such  offence was being or likely to be committed and he  had exercised due care in the prevention of the  commission of such an offence, the Excise  Commissioner or the officer authorised by the State  Government in this behalf, may not confiscate the  said means of conveyance.  

Provided further that where such means of  conveyance is owned by the Central Government or  any State Government or any of their undertaking,  no order of confiscation of-such means of  conveyance shall be passed by the Excise  Commissioner or the officer authorised by the State  Government in this behalf and the matter shall be  referred to the State Government by the Excise  Commissioner or the officer authorised by the State  Government -in this behalf, for making such orders  regarding means of conveyance as the State  Government may deem fit.  

Provided also that before ordering confiscation  under this, sub-section the owner of the means of  conveyance, referred to in clause (e) of sub-sec. (1),  may be given an option to pay in lieu of  confiscation, a fine not exceeding the market price  of such means of conveyance.

(5)     Any person aggrieved by an order of  confiscation made under sub-sec. (4) may within  sixty days from the date of communication to him of  such order, appeal to the Divisional Commissioner  and the Divisional Commissioner after giving  opportunity to the appellant to be heard, shall pass  such order as it may think fit, confirming, modifying  or annulling the order appealed against.

(6)     Whenever any means of conveyance as referred

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to in clause (e) of sub-section  (1) is seized in  connection with commission of an offence under  this Act, the Excise Commissioner or any officer  authorised in this behalf by the State Government  shall have, and, notwithstanding anything  contained in any law for the time being in force any  court, tribunal or other authority shall not have  jurisdiction to make order with regard to the  possession, delivery, disposal, release of such  means  of conveyance. (7)     Where the Excise Commissioner or the officer  authorised by the State government in this behalf is  of the opinion that it is expedient in public interest  or for the benefit of its owner that the means of  conveyance as referred to in clause (e) of sub-sec.  (1), seized for commission of offence under this Act  be sold by public auction, he may at anytime direct  it to be sold.  

(8) Where any means of conveyance is sold, as  aforesaid, the sale proceeds thereof, after deduction  of the expenses of such sale or auction or other  incidental expenses relating thereto and in other  cases, the means of conveyance which was seized or  the amount of fine paid in lieu of its confiscation,  shall-

(a)     where no order of confiscation is ultimately  passed by the Excise Commissioner or the  officer authorized by the State Government  in this behalf or,  

(b) where an order passed on appeal under  sub-sec. (5) so requires; or

(c) where in a prosecution instituted for   commission of offence under this Act in  respect of which an order of confiscation has  been made under this section, the person  concerned is acquitted,

be paid, returned or refunded, as the case may  be, to its owner:

Provided that no interest shall be payable on the  amount to be paid or refunded under this sub- section.

any order of confiscation made by the Excise  Commissioner or any officer authorised by the  State Government in this behalf, shall not prevent  the infliction of any ‘punishment to which the  person affected thereby is liable under this Act."

Section 9B of the Act which was introduced in the  Gazette Notification dated 31.7.1998 reads as follows: "Bar of jurisdiction of civil courts; No Civil Court shall have jurisdiction to  entertain any suit or proceeding to set aside or  modify; (a)     any original order passed by any of the  officer competent to do so under the provisions  of this Act; (b)     any order passed under or referred to in

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Section 9A."

Article 254 of the Constitution reads as follows: "(1) If any provision of a law made by the  legislature of a State is repugnant to any  provision of a law made by Parliament which  Parliament is competent to enact, or to any,;  provision of an existing law with respect to one  of the matters enumerated in the  Concurrent  List, then, subject to the Provisions of clause  (2),the law made by Parliament, whether passed  before or after the law made by the Legislature  of such State, or, as the case may be, the  existing law, shall prevail and the law made by  the Legislature of the State shall, to the extent  of the repugnancy be void.

(2) Where a law made by the Legislature of a  State with respect to one of the matters  enumerated in the Concurrent List contains  any provision repugnant to the provisions of  an earlier law made by Parliament, or an  existing law with respect to that matter, then,  the law so made by the Legislature of such  State shall, if it has been, .reserved for the  consideration of the President and has  received his assent, prevail in that State

Provided that nothing in this clause shall  prevent Parliament from enacting at any time  any law with respect to the same matter  including a law adding to, amending, varying  or repealing the law so made by the  Legislature of the State."

9.      So far as Amendment Act, 2000 is concerned it received  assent of the Governor on 3.4.2000 by which Section 54A was  inserted and amendments were made in Section 69 of the  existing provisions and sub-sections 4 to 9 were inserted and  earlier amendments were made in Section 9-B which has been  quoted above.

10.     In P.N. Krishna Lal & Ors. v. Govt. of Kerala & Anr.(1995  (suppl.) 2 SCC 187) it was observed at para 12 as follows:

"12. The scheme of the Act and the  Amendment Act is a consistent whole,  regulating production, manufacture,  possession, transport, purchase or sale of  intoxicating liquors. The Amendment Act was  enacted to prohibit mixing or permitting to mix  methanol in arrack or intoxicating drug or  failure to take reasonable precautions to prevent  acts or omissions, of mixing methanol in arrack  or intoxicating drug or to be in possession  thereof with knowledge of its adulteration or to  prevent deleterious effect on the health of the  consumers to prevent grievous hurt to human  beings or their death. As a part of it, the burden  of proof of the ingredients of the offence being  within the special knowledge of the accused has  also been laid on the accused person. Therefore,  though incidentally it trenches into some of the

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provisions of the Evidence Act, the Indian Penal  Code and the Code, in its pith and substance, it  is an integral scheme of the Act, which falls  within Entry 8 read with Entries 64 and 65 of  List II of the Seventh Schedule of the  Constitution. Under Article 246(3), the State  legislature was competent to enact the  Amendment Act. Therefore, the assent of the  President is not necessary. Even assuming that  some of the provisions incidentally trespass into  the field of operation of the Central provisions  falling in the Concurrent List, which empower  both Parliament and the State legislatures to  enact the law, the assent given by the President  made Sections 57-A and 57-B valid. The Gazette  Notification of the Amendment Act has been  placed before us which shows that the President  has given his assent to the Amendment Act on  1-12-1984. Therefore, by operation of proviso to  clause (2) of Article 254, the Amendment Act  prevails over the relevant provisions in the  Indian Evidence Act, IPC and the Code in  relation to the State of Kerala."

11.     This is a complete answer to most of the submissions  made by the appellants.

12.     In State of Karnataka v. K. Krishnan (2000(7) SCC 80)  this court while considering a case of forest offence under the  Karnataka Forest Act, 1963, observed that the provisions of  the Act should be strictly complied with and generally the  seized forest produce and the vehicle, boat, tools etc. used in  commission of forest offence should not be released and even  if the Court is allowed to release the same, the authorized  officer must specify reasons therefor and must insist on  furnishing of bank guarantee as the minimum condition.  In  that case the forest produce was transported in violation of the  provisions of the Act.  The High Court had modified the  conditions regarding bank guarantee stipulated by the  authorized officer and instead had directed to furnish two like  sureties to the extent of Rs.1,50,000/- each for the purpose of  getting interim custody of the vehicle.  This Court held that  the High Court had adopted a casual approach and its order  was contrary to law.  

13.     Certain provisions of the Essential Commodities Act,  1955 have relevance.  Section 6A deals with confiscation of  food grains, edible oil seeds and edible oils. Section 6B deals  with issue of show cause notice before confiscation of food  grains etc.  Section 6E deals with bar of jurisdiction in certain  cases.  Section 6E has been substituted to provide that except  Collector or State Government, all other authorities, judicial or  otherwise, would be debarred from making any order with  regard to the possession, delivery, disposal or distribution of  any essential commodity, seized in pursuance of an order  made under Section 3.  Thus a Magistrate has no jurisdiction  to grant relief against seizure under Section 457 Cr.P.C.   Section 6A provides for confiscation of essential commodities  seized in pursuance of an order made under Section 3.  Collector of the district of the Presidency Town, in which such  commodity is seized, may order confiscation, if he is satisfied  that there has been a contravention of such an order.  But, no  order of confiscation shall be made under this Section, if the  seized essential commodity has been produced by the  producer, without prejudice to any action, which may be taken

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under any other provision of this Act.  Section 6B of the Act  provides the procedure to be adopted by the Collector, before  passing order for confiscation, which provides that after  issuing of notice, an opportunity has to be given to the  aggrieved party, for contesting the same.  The Collector, after  giving him a hearing, has to decide the objection and pass an  order either confiscating the property or refusing to confiscate  the property.

14.     In case Shambhu Dayal Agarwala v. State of West Bengal  & Anr. (1990 (3) SCC 549) this Court held that whenever any  essential commodity is seized, pending confiscation under  Section 6A, the Collector has no power to order release of the  commodity in favour of the owner.  Having regard to the  scheme of the Act, the object and purpose of the statute and  the mischief it seeks to guard, this Court held that the word  "release" in Section 6E is used in the limited sense of release  for sale etc., so that the same becomes available to the  consumer public.  It was further held:

"No unqualified and unrestricted power  has been conferred on the Collector of  releasing the commodity in the sense of  returning it to the owner or person from whom  it was seized even before the proceeding for  confiscation stood completed and before the  termination of the prosecution in acquittal of  the offender.  Such a view would render clause  (b) of Section 7(1) totally nugatory and would  completely defeat the purpose and object of the  Act.  The view that the Act itself contemplates  a situation which would render Section 7(1)(b)  otiose where the essential commodity is  disposed of by the Collector under Section  6A(2) is misconceived.  Section 6A does not  empower the Collector to give an option to pay,  in lieu of confiscation of essential commodity a  fine not exceeding the market value of the  commodity on the date of seizure, as in the  case of any animal, vehicle, vessel or other  conveyance seized along with the essential  commodity.  Only a limited power of sale of the  commodity in the manner prescribed by  Section 6A the essential commodity has to be  exercised in public interest for maintaining the  supplies and for securing the equitable  distribution of the essential commodity."

15.     The amendments introduced, in our view, are regulatory  in nature and cannot be regarded as violative of freedom  guaranteed under Article 301 of the Constitution. In Jilubhai  Nanbhjai Khachar & Ors. v. State of Gujarat and Anr. (1995  Supp (1) SCC 596), after examining the principle of "Eminent  Domain" it was held by this Court that Article 300-A is not  attracted and deprivation is in exercise of police power and  said article enjoins that such deprivation should not be  without sanction of law.

16.     There are similar provisions in the Excise Acts of other  States, for example the Tamil Nadu Excise Act, 1971,  Karnataka Excise Act, 1965, Uttar Pradesh Excise Act, 1910  and the Andhra Pradesh Excise Act, 1968.  The provisions are  in Sections 4 and 14A of the Tamil Nadu Act, Sections 43A  and 43B of the Karnataka Act, Section 72 of the Uttar Pradesh  Act and Sections 46 and 46A of the Andhra Pradesh Excise

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Act.

17.     Reference may also be made to Deputy Commissioner,  Dakshina Kannada District v. Rudolph Fernandes [2000(3)  SCC 306] and State of W.B. & Ors. v. Sujit Kumar Rana [2004  (4) SCC 129] while gauzing the validity of the impugned  provisions.   

18.     In view of what has been stated above the inevitable  conclusion is that the appeals are without merit, deserve  dismissal, which we direct. No costs.