Case Law Details
DRI Vs Atul Gupta (Patiala House Court)
It was held that the decision interpreting the word “Magistrate” to be Judicial/Metropolitan Magistrate seemed flawed and it was categorically held that it is an Executive function. Thereby, giving strength to the decision of this Court about the application not being maintainable before this Court. This Court also feels the need to discuss another decision of the Hon’ble High Court of Delhi pronounced recently in Air Customs v. Mosafier Alizahi & Ors., Crl. MC 1490/2020 wherein the Hon’ble High Court held that the proceedings under Section 52A of NDPS Act were to be carried out by the Metropolitan Magistrate. The order emphasized on 52A (4) of the NDPS Act however, there is no provision akin to Section 52A (4) in the Customs Act. Hence, the decision cannot be held to be a precedent especially in light of the authoritative pronouncements discussed above with emphasis on the decision in SLA (Crl.) no. 10280/2015. Moreover, this decision does not discuss the above-mentioned authoritative orders which are pertinent to the question under scanner.
Hence, to conclude, I do not find the application to be maintainable before this Court and therefore, the same is dismissed liberty to invoke the same before the Competent Authority.
FULL TEXT OF THE HIGH COURT ORDER /JUDGEMENT
An application was filed under Section 110 (1B) of the Customs Act, 1962 before Ld. CMM on 26.02.2021. The same was marked to Ld. Duty MM on 01.03.2021. On the same date, Ld. Duty MM had issued notice to the respondent for 23.03.21. On 23.03.21, Ld. Counsel for respondent had sought time to file reply to the application and the reply was filed on 03.08.21. Today written submissions have been filed on behalf of DRI and arguments have been heard on the application. Maintainability of the application was questioned on the first date of hearing before this court in light of several judgments of the Hon’ble Supreme Court and Hon’ble High Court of Delhi. Ld. SPP ably argued in support of the application filed and sought time to file certain precedents.
After due consideration, vide this order, this court shall proceed to decide the present application.
Before proceeding to decide the question of maintainability, it is pertinent to succinctly provide the facts in the matter. Through this application, the department has alleged that foreign currency equivalent to INR 1,42,50,257/- and Indian currency equivalent to Rs. 5,32,500/- has been recovered on 29.08.2019. Panchnama was prepared. No admission or denial of the recovery, seizure and other incriminating facts has been done on behalf of the respondent.
Ld. SPP mentioned that this court has already recorded and prepared the inventory in another matter which was decided by Ld. CMM and marked to this court.
He further mentioned and relied upon the pronouncements of the Hon’ble High Court of Delhi in support of his arguments in Air Customs Vs. Mosafier Alizahi & Ors in CRL.M.C 1490/2020 & CRL.M.A 7224/2020.
Ld. Counsel for respondent has relied on the following judgments amongst others in support of his arguments that the present application is maintainable before Executive Magistrate only:
1) M/s Canon India Pvt Ltd Vs. Commissioner of Customs(2021-VIL-34-SC-CU)
2) Department of Customs Vs. Siddhant Enterprises[2018(360)ELT 88(Del)]
3) Directorate of Revenue Intelligence Vs. State- Crtl. M.C526/2013. Submissions were heard in detail.
Before the court proceeds to decide the merits, it is important to ruminate the law applicable/judicial pronouncements/precedents on the point that whether a Judicial/Metropolitan Magistrate can proceed to conduct the proceeding under Section 110 (1B), Customs Act. The provision lays down:
“110. Seizure of goods, documents and things. –
(1) If the proper officer has reason to believe that any goods are liable to confiscation under this Act, he may seize such goods;
Provided that where it is not practicable to seize any such goods, the proper officer may serve on the owner of the goods an order that he shall not remove, part with, or otherwise deal with the goods except with the previous permission of such officer.
(1A) The Central Government may, having regard to the perishable or hazardous nature of any goods, depreciation in the value of the goods with the passage of time, constraints of storage space for the goods or any other relevant considerations, by notification in the Official Gazette, specify the goods or class of goods which shall, as soon as may be after its seizure under sub-section (1), be disposed of by the proper officer in such manner as the Central Government may, from time to time, determine after following the procedure hereinafter specified.
(1B) Where any goods, being goods specified under sub- section (1A), have been seized by a proper officer under sub- section (1), he shall prepare an inventory of such goods containing such details relating to their description, quality, quantity, mark, numbers, country of origin and other particulars as the proper officer may consider relevant to the identity of the goods in any proceedings under this Act and shall make an application to a Magistrate for the purpose of –
(a) certifying the correctness of the inventory so prepared; or
(b) taking, in the presence of the Magistrate, photographs of such goods, and certifying such photographs as true; or
(c) allowing to draw representative samples of such goods, in the presence of the Magistrate, and certifying the correctness of any list of samples so drawn.
(1C) Where an application is made under sub-section (1B), the Magistrate shall, as soon as may be, allow the application.
(2) Where any goods are seized under sub-section (1) and no notice in respect thereof is given under clause
(a) of section 124 within six months of the seizure of the goods, the goods shall be returned to the person from whose possession they were seized:
Provided that the aforesaid period of six months may, on sufficient cause being shown, be extended by the Commissioner of Customs for a period not exceeding six months.
(3) The proper officer may seize any documents or things which, in his opinion, will be useful for, or relevant to, any proceeding under this Act.
(4) The person from whose custody any documents are seized under sub-section (3) shall be entitled to make copies thereof or take extracts therefrom in the presence of an officer of customs.”
It is pertinent to mention here that Section 110 of the Customs Act does not contain any provision such as Section 52 A (4) of the NDPS Act which reads as:
“(4) Notwithstanding anything contained in the Indian Evidence Act, 1872 (1 of 1872) or the Code of Criminal Procedure, 1973 (2 of 1974), every court trying an offence under this Act, shall treat the inventory, the photographs of narcotic drugs or psychotropic substances and any list of samples drawn under sub-section (2) and certified by the Magistrate, as primary evidence in respect of such offence.”
Reference here is made to the decision of Hon’ble Supreme Court in Noor Aga v. State of Punjab, Criminal Appeal No. 1034/2008, wherein it was held:
“ …We must also notice a distinction between Section 110(1B) of the 1962 Act and Section 52A(2) of the Act as sub-section (4) thereof, namely, that the former does not contain any provision like sub-section (4) of Section 52A.”
The question of interpretation of the word “Magistrate” used in the provision under Section 110 (1B) of the Customs Act has been contemplated by the Hon’ble High Court several times. In Department of Customs v. Parvinder Kaur, 2991 (73) ECC 66, Department of Revenue Intelligence v. Agro Impex, Crl. M.C. No. 3644/2012 decided on 29.01.2013 and DRI v. State & Ors., Crl. M. C. 2513/2010 decided on 06.08.2010 (all decisions of Hon’ble High Court of Delhi) tilted towards the same to be read as Metropolitan Magistrate though, these decisions did not delve into the question specifically. However, in Directorate of Revenue Intelligence v. State, Crl. M. C. 526/2013, decided on 21.02.2013 by Hon’ble High Court, again with the same strength of the Bench, i.e Single Judge, held:
“…4. One of the reasons given by the learned Magistrate is that the aforesaid duties cannot be said to judicial duties which a Judicial Magistrate has to perform. As these duties are in the nature of either executive or administrative one the Judicial Magistrate should not be entrusted with such work, because such work can be discharged by the Executive Magistrates or Sub-Divisional Magistrates. It, is, therefore, necessary to see as to whether any definition of the term ‘Magistrate’ is given in the Customs Act. la the Customs Act no such definition of the term ‘Magistrate’ is given, but in Section 3(4) of the Criminal Procedure Code it is provided as under:
(4) Where under any law, other than this Code, the function exercisable by a Magistrate relates matters:
(a) which involve the appreciation or sifting of evidence or the formulation of any decision which exposes any person to any punishment or penalty or detention in custody pending investigation, inquiry or trial or would have the effect of sending him for trial before any Court, they shall, subject to the provisions of this Code, be exercisable by a Judicial Magistrate; or
(b) which are administrative or executive in nature, such as, the granting of a licence, the suspension or cancellation of licence, sanctioning a prosecution, or withdrawing from a prosecution, they shall, subject as aforesaid, be exercisable by an Executive Magistrate.
It is, therefore, clear that the functions to be performed by the Magistrate under Sub-section (1B) of Section 110 of the Customs Act would not involve any appreciation or sifting of evidence which expose any person to any punishment or penalty or detention to custody pending investigation, inquiry or trial or would have the effect of sending him for trial before any Court. In that view of the matter those functions cannot be said to be the functions to be discharged by Judicial Magistrates. Functions described in Sub- section (1B) of Section 110 of the Customs Act are either executive or administrative nature and therefore, they are exercisable by the Executive Magistrates. Further, Judicial Magistrates are so much over-burdened with the pending criminal matters in Courts that it is not desirable to put any further additional burden of executive work.
It is also not desirable in the interests of justice that such matters be assigned to the Judicial Magistrate for the additional reason that ultimately when criminal complaints are filed for the offence under Section 135 of the Customs Act, such complaints are also filed before the Judicial Magistrates. If they are assigned such work, those Magistrates who have done work under Sections 110(1B) cannot try such cases and hence there will be embarrassment which would require transfer of such cases to other Magistrates.
7. Since the task of certifying the correctness of the inventory in respect of seized goods under Section 110 (1B) of the Act is only an Executive function, in view of the provision of Section 3, sub-Section (4) of the Cr.P.C. the functions must be performed by an Executive Magistrate and not by a Judicial Magistrate. Since the aspect of function of the Magistrate as appearing under Section 110 (1B) under reference to the provision of Section 3 (4) Cr.P.C. was not examined in the orders relied upon by the learned counsel for the Petitioner, they cannot be said to be binding precedents. Rather, the same are per incuriam.”
The decision was appealed before Hon’ble Supreme Court in DRI v. State of NCT of Delhi, SLA (Crl.) No. 2152/2014 which was decided on 01.05.2017 by leaving the question of law open. Therefore, this order cannot be held to be a precedent on the point especially when Hon’ble Apex Court did not delve in to the question under dilemma. The decision was arrived only in facts and circumstances of the case and the petition was dismissed.
The Hon’ble High Court was again faced with the same question in Department of Customs v. Siddhant Enterprises and Anr., W.P. (Crl.) 556/2014 decided on 27.08.2014, the same bench strength again decided that the word “Magistrate” is to be as Executive Magistrate. This decision also held that the decision in Crl. M.C. No. 526/2013 was correct and dismissed the objection raised by the Department that a different view was taken by the two Coordinate Benches of Hon’ble High Court. It was held that the decision in Crl. M.C. No. 526/2013 discussed the previous decisions. At this stage, it important to recollect that the law of precedents also lays down that when a subsequent decision discusses the previous decisions then the latter in time decision will prevail.
This order was challenged before the Hon’ble Supreme Court in Department of Customs v. M/s. Siddhant Enterprises & Anr., Special Leave to Appeal (Crl.) No. 10280/2015 which was decided on 27.10.2015 as:
“…Having regard to the scheme under Section 110(1B) of the Customs Act, 1962 in absence of any proceedings in court, the judicial magistrate will not be required for the purpose of certifying the inventory or performing any function mentioned in the said section.
The special leave petition is accordingly disposed of.”
This order lays the discussion to rest as it clearly holds that the proceedings under Section 110 (1B) will not require Judicial (Metropolitan) Magistrate for the purpose which is also the prayer in the application under consideration before me. Hence, at this stage itself it can be safely concluded that the application is not maintainable before the undersigned. However, I find it pertinent and useful to continue the quest with the other judicial pronouncements on the same question to firmly bolster the decision arrived.
In continuation with the above discussion, Hon’ble High Court of Delhi in its decision in Department of Customs v. Ram Mohan Gulati & Ors., W.P. (CRL.) 1021/2013, decided on 15 May, 2017 held that:
“…6. There can be no doubt as to the fact that the proceedings of the above nature are not adjudicatory so as to involve appreciation or sifting of evidence or formulating any decision which might expose any person to any punishment or penalty or detention in custody or to put him on trial before any court. The preparation of an inventory at the time of seizure is a step in investigation by the customs authorities under the Customs Act, 1962. The objective of the proceedings envisaged in sub-Section (1B) and sub-Section (1C) of Section 110 is to have reconfirmation of the correctness of such inventory and, if possible, to de-burden the investigating agency of the responsibility of retaining the entire goods thus seized and, instead, to preserve only what is absolutely necessary which may be in the form of photographs of the goods or their representative samples. This is clear, inter alia, from the further provisions contained in other clauses of Section 110 as also by Section 110-A of the Customs Act, 1962.
7. In above view of the matter, the exercise of certification of the correctness of the inventory or taking of photographs of the seized goods or drawing representative samples can be nothing but an exercise which is administrative or executive in nature within the meaning of clause (b) of sub-Section (4) of Section 3 Cr.P.C. Therefore, the word “Magistrate” appearing in Section 110 (IB) and (1C) of the Customs Act, 1962 must be interpreted so as to be read as a reference to an Executive Magistrate and not to a Judicial Magistrate or a Metropolitan Magistrate.
8. A view to above effect taken by Gujarat High Court in Assistant Collector of Customs vs. Surender Praggar Gosain & Anr., (1988) 1 GLR 421 was adopted by a learned Single Judge of this court in Crl.M.C. No.526/2013, titled Directorate of Revenue Intelligence vs. State, decided on 21.02.2013. A contrary view taken by another learned Single Judge of this court in Crl. Misc. (Main) No.2484/1998, titled Department of Customs vs. Parvinder Kaur, decided on 24.08.2000 was apparently per incuriam and does not commend to be the correct approach for the reason the matter was not examined there in light of provision contained in Section 3(4) Cr.P.C.
9. For the foregoing reasons, the petition is devoid of substance and is accordingly dismissed.”
In this decision as well, it was held that the decision interpreting the word “Magistrate” to be Judicial/Metropolitan Magistrate seemed flawed and it was categorically held that it is an Executive function. Thereby, giving strength to the decision of this Court about the application not being maintainable before this Court. This Court also feels the need to discuss another decision of the Hon’ble High Court of Delhi pronounced recently in Air Customs v. Mosafier Alizahi & Ors., Crl. MC 1490/2020 wherein the Hon’ble High Court held that the proceedings under Section 52A of NDPS Act were to be carried out by the Metropolitan Magistrate. The order emphasized on 52A (4) of the NDPS Act however, there is no provision akin to Section 52A (4) in the Customs Act. Hence, the decision cannot be held to be a precedent especially in light of the authoritative pronouncements discussed above with emphasis on the decision in SLA (Crl.) no. 10280/2015. Moreover, this decision does not discuss the above-mentioned authoritative orders which are pertinent to the question under scanner.
Hence, to conclude, I do not find the application to be maintainable before this Court and therefore, the same is dismissed liberty to invoke the same before the Competent Authority.
Case papers be sent to concerned court.
