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J. Harimal Oil Mills, Raipur v. Assistant Collector, Central Excise, Jabalpur And Another

Madhya Pradesh High Court

Sep 7, 1960

Judgment

Subsequent
References

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Factual and Procedural Background

This is a Letters Patent appeal from an order of Naik J. dismissing an application by the appellant under Articles 226 and 227 of the Constitution of India. The appellant challenged the validity of a demand under Rule 9(2) of the Central Excise Rules for Rs. 1,437/15/- as excise duty said to be payable for clearance of about 20 tins of vegetable non-essential oils in March 1956. The excise duty was imposed on 2-5-1956 by the Inspector, Central Excise at Raipur under the Central Excise and Salt Act, 1944 and Rules made thereunder.

After the levy, the appellant protested; the Assistant Collector, Central Excise, Jabalpur, advised him to pay and appeal to the Collector, Central Excise, Nagpur. On appeal the appellant was again asked to pay before his appeal would be considered. The appellant made a representation to the Central Government which was dealt with by the Ministry of Finance; the Government of India on 31-10-1957 rejected the representation (treated as a revision) stating it saw no justification for interfering with the order in appeal. The appellant then moved the High Court under Articles 226 and 227.

The learned Single Judge dismissed the petition largely on the basis of a Full Bench decision in Surajmal v. State of M.P. (AIR 1958 Madh-Pra 103), holding that the appellant had approached the Central Government and that the orders of the Inspector and the Collector in appeal had merged in the order of the Central Government, which was situated outside the jurisdiction of the High Court, rendering the petition not tenable.

Legal Issues Presented

Whether the order of the Central Government rejecting the appellant's representation/revision petition (dated 31-10-1957) operates as a "final order" under the Act in which the orders of the Inspector, Central Excise, and of the appellate authority merged, thereby ousting the High Court's jurisdiction under Articles 226 and 227.
Whether the analogy of a trial court decree merging in the decree of an appellate court applies to administrative/departmental orders and appeals/revisions exercised by administrative authorities (i.e., whether departmental/administrative orders merge so as to render original orders non-operative).
If no merger occurred, whether the High Court has jurisdiction to entertain the petition under Articles 226 and 227 directed against orders of authorities (Inspector and appellate authority) within its territorial jurisdiction despite a rejected revision by the Central Government.

Arguments of the Parties

Appellant's Arguments (as advanced by Shri Dabir)

Conceded that if the Central Government's order of 31-10-1957 is regarded as a final order in which the orders of the Inspector and the Collector in appeal merged, Surajmal's Case (AIR 1958 Madh Pra 103) would make the petition untenable.
Contended, however, that later Supreme Court decisions — State of U.P. v. Mohammad Nooh (AIR 1958 SC 86) and Sita Ram Goel v. Municipal Board, Kanpur (AIR 1958 SC 1036) — establish that the analogy of merger of decrees from civil procedure does not apply to administrative/departmental tribunals exercising quasi-judicial functions; therefore, the original administrative order remains operative even if appeal/revision is dismissed.
Argued that these Supreme Court decisions substantially weakened the authority of the Full Bench decision in Surajmal's Case on the merger question.

Single Judge's / Respondent Position (as recorded)

The Single Judge (Naik J.) held that because the appellant had approached the Central Government and the Central Government had passed an order, the orders of the Inspector and Collector in appeal had merged into the Central Government's order.
On that basis, the Central Government (being situated outside this Court's territorial jurisdiction) was beyond the High Court's jurisdiction to bind; consequently, the petition under Articles 226 and 227 could not be entertained by this Court.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Surajmal v. State of M.P., AIR 1958 Madh-Pra 103 (Full Bench)	Held (by Full Bench) that where an authority outside the High Court's jurisdiction passes a final order (e.g., Central Government), orders of inferior authorities may be treated as merged and the High Court cannot deal with them.	The Single Judge relied on this decision to dismiss the petition. The present Court analysed Surajmal and concluded that its principles do not conflict with the Supreme Court pronouncements; however, the present case differs because the Central Government did not vary the order but merely declined to exercise revisional powers.
State of U.P. v. Mohammad Nooh, AIR 1958 SC 86	Supreme Court: departmental/administrative orders and orders on appeal/revision by higher departmental authorities are not to be equated with decrees of civil courts; the original administrative order remains operative unless reversed or modified; the analogy of merger of decrees is inapplicable to departmental tribunals except for limited purposes such as limitation.	Relied upon by the Court to hold that the analogy of merger of decrees does not apply to administrative orders; therefore rejection of revision by Central Government does not merge or extinguish the original order of the Inspector/appellate authority.
Sita Ram Goel v. Municipal Board, Kanpur, AIR 1958 SC 1036	Affirmed the principle that administrative/departmental orders retain operation until reversed or modified and that the trial-court/appellate-court merger analogy cannot be mechanically applied to departmental proceedings.	Used alongside AIR 1958 SC 86 to furnish a conclusive answer that the Inspector's order and the appellate authority's order continued to be operative despite rejection of revision by the Central Government.
Thangal Kunju Musaliar v. Venkatachalam, 1955-2 SCR 1196 : (S) AIR 1956 SC 246	Discusses jurisdiction where an authority is permanently located outside the High Court's territorial jurisdiction and circumstances where actions of an agent located within the jurisdiction may be amenable to High Court interference; observations on tribunal jurisdiction and merger were noted.	Quoted to show the limits of High Court jurisdiction where superior tribunal is outside jurisdiction and to illustrate when local agents/authorities can be interfered with; used to frame the merger question contextually.
Election Commission, India v. Saka Venkata Subba Rao, 1 Ele-LR 417 : AIR 1953 SC 210	Principle that if an authority is permanently located or normally carries on activities elsewhere, the High Court cannot possess jurisdiction over it even if parties and cause of action are within the High Court's area.	Referred to (via Surajmal summary) as a foundational authority on territorial jurisdiction issues in the context of tribunals located outside the High Court's territory.
Rashid Ahmed v. Income-tax Investigation Commission, ILR (1951) Punj 165 : AIR 1951 Punj 73	Where cause of action arises and parties reside outside the High Court's jurisdiction but the authority is situated within it, jurisdiction may exist.	Referenced in the Surajmal summary to illustrate jurisdictional nuances considered by the Full Bench.
Hari Vishnu Kamath v. Ahmad Ishaque, 1955-1 SCR 1104 : (S) AIR 1955 SC 233	Where records are legally within custody of someone in the High Court's jurisdiction, certiorari can issue even if the tribunal is functus officio or located outside.	Quoted in the Surajmal summary to show circumstances where High Court may call for records despite tribunal being outside its territorial limits.
Batuk Nath v. Munni Dei, 41 Ind App 104 : AIR 1914 PC 65	Illustrates that the merger of decrees concept may be relevant for computing periods of limitation for execution of decrees.	Referred to in the context of Supreme Court observations that merger analogy in civil procedure only applies for limited purposes such as limitation computation, not to departmental orders generally.
Jowad Hussain v. Gendan Singh, 53 Ind App 197 : AIR 1926 PC 93	Another civil-law example showing merger relevance for limitation in certain contexts.	Used similarly to Batuk Nath to underline the Supreme Court's point that merger in civil procedure has confined consequences and is not broadly applicable to departmental proceedings.
Juscurn Boid v. Pirthichand Lal, 46 Ind App 52 : ILR 46 Cal 670 : AIR 1918 PC 151	Privy Council observation that under Indian law an original decree is not suspended by the presentation of an appeal; original decree remains effective unless reversed or modified.	Quoted by the Supreme Court in AIR 1958 SC 86 and relied upon by the present Court to support the proposition that original orders remain operative pending appeal/revision unless modified.
Masalkhan v. Custodian of Evacuee Property, AIR 1959 Madh Pra 256	Applied AIR 1958 SC 86 to hold that an order passed in revision by the Custodian General did not bar a High Court petition under Article 226 directed against inferior authorities functioning under the Act.	Referred to as a local application of the Supreme Court's principle; supports the conclusion that a revisional order by an outside authority is not necessarily a bar to High Court jurisdiction against local inferior authorities.
East India Commercial Ltd. v. Customs Collector, AIR 1960 Cal 1	Calcutta High Court followed AIR 1958 SC 86 and held jurisdiction to issue a writ in respect of an order of the Collector of Customs even though appeal to the Central Board of Revenue had been dismissed.	Referred to as corroborative authority that dismissal of appeal/revision by a higher/central authority does not automatically oust High Court jurisdiction against local authority orders.
Kamtaprasad Nathoo-lal v. G. P. Bhatnagar, Misc. Petn. No. 169 of 1958 (Dated 16-7-1959)	Factual example where the Central Government varied the order of an Inspector in revision, resulting in the Central Government's order being final and outside the High Court's jurisdiction.	Distinguished by the present Court: because the Central Government in that case varied the Inspector's order, the final order was of the Central Government, unlike the present case where Central Government declined to interfere.

Court's Reasoning and Analysis

The Court's analysis proceeds in identifiable steps, based solely on the materials and authorities cited in the opinion:

Identification of the key legal question: whether the Central Government's rejection of the appellant's representation (treated as a revision) produced a merger of the orders of the Inspector and of the appellate authority into a "final order" of the Central Government such that the High Court could not exercise jurisdiction under Articles 226 and 227.
Examination of the nature of the Inspector's order: the Court observed that the Inspector, Central Excise, performs statutory duties and exercises judgment in imposing excise duty; though under Central Government control, the Inspector is not merely a mouthpiece and acts within the territorial jurisdiction of the High Court.
Consideration of statutory scheme: Section 35(2) makes every order passed in appeal final subject to the revision power in Section 36. Section 36 empowers the Central Government to reverse or modify orders "from which no appeal lies." The Court emphasised that Section 36 confers revisional power but does not expressly give the Central Government power to "confirm" or "affirm" the order sought to be revised in a way that would operate as a fresh superior order merging the earlier order.
Analysis of precedent: the Court reviewed Surajmal (Full Bench) and, crucially, the Supreme Court's decisions in AIR 1958 SC 86 (State of U.P. v. Mohammad Nooh) and AIR 1958 SC 1036 (Sita Ram Goel). The Supreme Court authorities were interpreted to mean that the civil-law analogy of merger of decrees (trial court decree merging in appellate decree) cannot be applied wholesale to administrative/departmental orders; an original administrative order remains operative and effective unless it is reversed or modified by a competent authority.
Application of these principles to the facts: since the Central Government in this case simply declined to exercise its revisional power (rejected the representation) and did not reverse or modify the Inspector's or the appellate authority's orders, there was no merger. The rejection therefore only meant the Central Government chose not to intervene; it did not convert the rejection into a new substantive order extinguishing or replacing the earlier orders.
Jurisdictional consequence: because the Inspector and the appellate authority are located within the High Court's territorial jurisdiction and their orders remain operative (not merged into a novel final Central Government order), the High Court can entertain a petition under Articles 226 and 227 directed against those local authorities.
Procedural disposition: the Court concluded that the Single Judge's dismissal (based on merger reasoning) was incorrect in the circumstances of this case and that the appellant's petition should be heard on merits by the appropriate Bench.

Holding and Implications

Holding: APPEAL ALLOWED.

Implications and direct consequences:

The order of the learned Single Judge dismissing the petition is set aside.
The appellant's petition under Articles 226 and 227 of the Constitution shall be disposed of on merits by the appropriate Bench of the High Court.
Parties shall bear their own costs of this Letters Patent appeal.
The outstanding amount of the security deposit shall be refunded to the appellant.
The Court emphasized that no new overarching rule was invented; rather, established Supreme Court authorities (AIR 1958 SC 86 and AIR 1958 SC 1036) control the merger question and the outcome depends on whether the revisional authority actually reverses/modifies the earlier order. In cases where the revisional body modifies or varies the original order, that will produce a different jurisdictional result (as in Kamtaprasad Nathoo-lal), but where the revisional authority declines to interfere the original order remains operative and local High Court jurisdiction may be invoked.

Note: This summary is confined strictly to the matters, authorities and reasoning contained in the provided opinion. Sections omitted where the opinion did not supply additional material (for example, detailed respondent submissions beyond the Single Judge's reasoning) have been addressed by use of the precise statements appearing in the text.

Show all summary ...

JUDGMENT Dixit, C.J.

1. This is a Letters Patent appeal from an order, of Naik J. dismissing an application filed by the appellant under Articles 226 and 227 of the Constitution of India challenging the validity of a demand made on him under Rule 9(2) of the Central Excise Rules for payment of Rs. 1437/15/- as excise duty on about 20 tins of vegetable non-essential oils said to have been cleared by the appellant in the month of March 1956.

2. The excise duty was imposed on 2-5-1956 by the Inspector, Central Excise, in charge of Oil Mills at Raipur under the Central Excise and Salt Act, 1944, and the Rules made thereunder. It seems that after the levy of the duty when the appellant protested against it he was advised by the Assistant Collector, Central Excise, Jabalpur, to pay up the amount and appeal to the Collector, Central Excise, Nagpur.

Thereafter when the appellant preferred an appeal he was again asked to pay the amount of the duty and informed that his appeal would be considered only after the payment of the amount. The appellant says that he made a 'representation' to the Central Government against the imposition of the duty. On this representation the Government of India in the Ministry of Finance passed the following order on 31st October 1957:

"The Government of India have carefully considered all the points made by the applicant, but they regret that they do not see any justification for interfering with the Order in appeal. The revision application is, therefore, rejected"

The appellant then moved this Court under Articles 226 and 227 of the Constitution. The learned Single Judge held that in view of the Full Bench decision of this Court in Surajmal v. State of M. P., AIR 1958 Madh-Pra 103 the petition was not tenable as the appellant had approached the Central Government and the order of the Inspector, Central Excise, and of the Collector in appeal had merged in the order of the Central Government; that the Central Government in this matter was outside the jurisdiction of this Court; and that as the original order could not be set aside without setting aside the order of the Central Government which was outside the jurisdiction of this Court, the petition could not be entertained by this Court.

3. Shri Dabir, learned counsel for the appellant, conceded that if the order of the Central Government passed on 31-10-1957 were to be regarded as a final order in which the order of the Inspector. Central Excise, and of the Collector in appeal were merged, then no doubt according to the decision in Surajmal's Case, AIR 1958 Madh Pra 103 (supra) the petition was not tenable. He, however, argued that the later decisions of the Supreme Court in State Of U.P v. Mohammad Nooh ., AIR 1958 SC 86 and Sita Ram Goel v. Municipal Board, Kanpur, AIR 1958 SC 1036 made it clear that the analogy of the decree of the trial Court merging into the decree of the appeal Court did not apply to orders passed by administrative tribunals exercising quasi-judicial Functions and that the original order in such proceedings would remain operative on its own strength even if an appeal or a revision against the order had been dismissed. Learned counsel urged that the authority of the decision in Surajmal's Case, AIR 1958 Madh Pra 103 was considerably weakened by the two decisions of the Supreme Court mentioned earlier.

4. In our judgment this appeal must be allowed. In Surajmal's Case, AIR 1958 Madh Pra 103' after a review of several decisions the Full Bench summarized its conclusion thus:

"To begin with, if an authority sought to be bound is permanently located or normally carries on its activities elsewhere, the High Court cannot possess Jurisdiction over it even though the parties to the case reside and the cause of action arises within the High Court's jurisdiction: Election Commission, India v. Saka Venkata Subba Rao, 1 Ele - LR 417 : ( AIR 1953 SC 210). On the contrary, if the cause of action arises elsewhere and the parties also reside outside the jurisdiction of the High Court, iurisdiction to bind the authority would be existing if the authority is permanently located or normally carrying on its activities within the jurisdiction of the High Court: Rashid Ahmed v. Income-tax Investigation Commission, ILR (1951) Punj 165: ( AIR 1951 Punj 73). The tribunal may not be existing; it may have finished its work and may have become functus officio; even then, if the record is legally within the custody of someone within the jurisdiction of the High Court, the record can be called up and certiorari can issue against the record: Hari Vishnu Kamath v. Ahmad Ishaque, 1955-1 SCR 1104: (( S) AIR 1955 SC 233). If an authority employs an agent within the jurisdiction of the High Court and the agent acts independently under law, though under the general supervision of the outside authority, the action of the agent can be interfered with by the High Court if it is opposed to fundamental rights or is contrary to law or the course of natural justice: Thangal Kunju Musaliar v. Venkatachalam, 1955-2 SCR 1196 : (( S), AIR 1956 SC 246). If a special tribunal situated outside the jurisdiction of the State deals with an order of an inferior tribunal within the jurisdiction of the State and the order of the inferior tribunal can be said to merge in that of the superior tribunal the High Court cannot of necessity deal with the order of the inferior tribunal, if it cannot deal with the order of the Superior tribunal: (Observations in Musaliar's case, 1955-2 SCR 1196 : (( S) AIR 1956 SC 246)"

Here it cannot be disputed that the Inspector, Central Excise, performs the various functions assigned to him under the Act and the Rules and imposes the excise duty on bis own initiative and in exercise of his judgment. He may be under the control of the Central Government but he is not merely a mouthpiece or a conduit pipe transmitting the orders of the Central Government in the matter of levy of duty under the Act.

The action of the Inspector, Central Excise, Raipur, who functions within the jurisdiction of this Court can, therefore, be as laid down in 1955-2 SCR 1196: ((S) AIR 1956 SC 246) and Surajmal's Case, AIR 1958 Madh Pra 103 (supra), interfered with by the High Court if it is opposed to fundamental rights or is contrary to law or the course of natural justice. An order of the Inspector under the Act or the Rules made thereunder is appealable under Section 35(1) of the Act.

The appellate Authority is also located within the jurisdiction of this Court and being thus amenable to the jurisdiction of this Court its decisions can be examined by the High Court under Articles 226 and 227. Now Sub-section (2) of Section 35 provides that every order passed in appeal shall, subject to the power of revision conferred by Section 36, be final. Section 36 is as follows:

"The Central Government may on the application of any person aggrieved by any decision or order passed under this Act or the rules made thereunder by any Central Excise officer or by the Central Board of Revenue, and from which no appeal lies, reverse or modify such decision or order"

In the present case the appellant did move the Central Government under Section 36. He says that he made a representation to the Central Government but the representation was actually treated as a revision by the Central Government and rejected as such. The question, therefore, arises whether the order of the Central Government rejecting the representation even if treated as a revision petition, is a final order under the Act in which the orders of the Inspector, Central Excise and of the appellate authority merged.

If the orders can be said to have merged in the order of the Central Government, then there can be no doubt, as observed by the Supreme Court in Musaliar's Case, 1955-2 SCR 1196: ((S) AIR 1956 SC 246) (supra) and by this Court in Surajmal's Case, AIR 1958 Madh Pra 103 (supra), that the High Court cannot deal with the Order of the Central Government situated outside the jurisdiction of the State and cannot, therefore, consequently deal with the order of the Inspector or of the appellate authority.

5. The short question, therefore, for consideration is whether there is any merger of the orders ot the Inspector and of the appellate authority in the order dated 31-10-1957 of the Central Government. In Musaliar's Case, 1955-2 SCR 1196 : ((S) AIR 1956 SC 246) (supra) no question of merger of an order of an inferior authority merging in the order of a superior authority arose. The decisions in AIR 1958 SC 86 (supra) and AIR 1958 SC 1036 (supra) throw light directly on the question whether an order of an inferior authority functioning under an Act can be said to merge in the order of an administrative tribunal exercising quasi-judicial functions passed in an appeal or a revision. In AIR 1958 SC 86 the question arose with reference to an order dismissing a head constable and the orders passed by higher authorities in appeal and in revision against the order of dismissal. Dealing with this question the Supreme Court said:

...an order of dismissal passed on a departmental enquiry by an officer in the department and an order passed by another officer next higher in rank dismissing an appeal therefrom and an order rejecting an application for revision by the head of the department can hardly be equated with any propriety with decrees made in a Civil Suit under the Code of Civil Procedure by the Court of first instance and the decree dismissing the appeal therefrom by an appeal Court and the order dismissing the revision petition by a yet higher court, as has been sought to be done by the High Court in this case, because the departmental tribunals of the first instance or on appeal or revision are not regular courts manned by persons trained in law although they may have the trappings of the courts of law. The danger of so doing is evident from what has happened in the very case now before us. In the next place while it is true that a decree of a court of first instance may be said to merge in the decree passed on appeal therefrom or even in the order passed in revision, it docs so only for certain purposes namely, for the purposes of computing the period of limitation for execution of the decree as in Batuk Nath v. Munni Dei, 41 Ind App 104: (AIR 1914 PC 65) or for computing the period of limitation for an application for final decree in a mortgage suit as in Jowad Hussain v. Gendan Singh, 53 Ind App 197: ( AIR 1926 PC 93). But as pointed out by Sir Lawrence lenkins in delivering the judgment ol the Privy Council in Juscurn Boid v. Pirthichand Lal, 46 Ind App 52: ( ILR 46 Cal 670 at pp. 678 and 679: AIR 1918 PC 151 at pp. 152-153) whatever be the theory under other systems of law, under the Indian Law and procedure an original decree is not suspended by the presentation of an appeal nor is its operation interrupted where the decree on appeal is merely one of dismissal. There is nothing in the Indian Law to warrant the suggestion that the decree or order of the Court or tribunal of the first instance becomes final only on the termination of all proceedings by way of appeal or revision. The filing of the appeal or revision may put the decree or order in jeopardy but until it is reversed or modified it remains effective

This principle was reaffirmed in AIR 1958 SC 1036 where the legality of an order of the Municipal Board, Kanpur, dismissing an overseer was challenged These authoritative pronouncements of the Supreme Court furnish a conclusive answer to the question whether the order of the Inspector, Central Excise, and ot the appellate authority merged in the order of the Central Government passed on 31-10-1957.

The Supreme Court's decisions make it clear that the analogy of a trial Court's decree merging in the decree of the appellate Court cannot be extended to departmental appeals and that even it the analogy were to be applied and the order of the higher authority in appeal or revision affirmed the order of the interior authority, the original order would remain operative and would not gain any greater efficacy from the subsequent orders passed in appeal or revision except for the purpose of computing the period of limitation in certain cases.

Now it cannot be denied that the order passed by the Inspector, Central Excise, levying excise duty on the appellant is an administrative or executive order and the order passed by the appellate authority and the revisional authority are orders of administrative authorities exercising at the most quasi-judicial functions. The theory of merger of orders cannot, therefore, be applied to these orders and even if it were to be applied, they would not in any way affect the operation of the order of the original authority even if affirmed in appeal or revision.

It must be noted that under Sub-section (2) of Section 35 the order that is made final is of the original authority or of the appellate authority where there is an appeal. It is the order of the appellate authority which is final subject, of course, to the power of revision conferred by Section 36, under Section 36 the Central Government can in the exercise of its revisional powers reverse or modify the decision where a revision petition has been preferred. Section 36 does not give to the Central Government the authority to confirm or affirm the order sought to be revised.

When, therefore, the Central Government sees no reason to reverse or modify any order of the appellate or of the original authority and rejects the revision petition, it cannot be contended with any degree of force that there is any merger of the order sought to be revised in the order rejecting the revision petition. The effect of the rejection of a revision petition is merely this, namely, that the Central Government declines to exercise the power conferred on it by Section 36 and allows the order of the appellate or the original authority to stand. Thus the order sought to be revised remains operative notwithstanding the rejection of the revision petition.

6. In our opinion the matter is really concluded by the decisions of the Supreme Court in AIR 1958 SC 86 (supra) and AIR 1958 SC 1036 (supra) and in the present case it must be held that despite the rejection of the appellant's 'representation' by the Government of India on 31-10-1957 the order of the Inspector, Central Excise, and of the appellate authority remained operative and that as these authorities are located within the jurisdiction of this Court, the petition filed by the appellant under Articles 226 and 227 of the Constitution can be entertained by this Court.

7. The decision of the Supreme Court in AIR 1958 SC 86 (supra) was applied by this Court in Masalkhan v. Custodian of Evacuee Property, AIR 1959 Madh Pra 256 and it was held that an order passed by the Custodian General under Section 28 of the Administration of Evacuee Property Act in the exercise of his revisional powers was no bar to the entertainment of a petition by the High Court under Article 226 directed against inferior authorities functioning under the Act.

The Calcutta High Court also following the Supreme Court's decision in AIR 1958 SC 86 (supra) held in East India Commercial Ltd. v. Customs Collector, AIR 1960 Cal 1 that it had jurisdiction to issue a writ to the Collector of Customs in respect of an order made by him even if that order had been appealed against to the Central Board of Revenue and the appeal had been dismissed. In Kamtaprasad Nathoo-lal v. G. P. Bhatnagar. Misc. Petn. No. 169 of 1958 D/- 16-7-1959 an order of the Inspector, Central Excise, imposing duty on tobacco was varied in revision by the Central Government by reducing the amount of duty payable by the petitioner in that Case.

It was because of this variation in the order of the Inspector that it was held that the final order was of the Central Government which was outside the jurisdiction of this Court and, therefore, the petition under Article 226 of the Constitution against the order of the Central Government could not be filed in this Court. The position here is different in that the Central Government declined to interfere under Section 36 with the order of the Inspector, Central Excise, and the appellate authority.

It seems to us unnecessary to make a reference to a larirer Bench For a reconsideration of the decision in Surajmal's case, AIR 1958 Madh Pra 103 (supra). The principles summarized in paragraph 31 of the judgment of the Court in that case do not in any way run counter to the observations of the Supreme Court in AIR 1958 SC 86 (supra) about the merger of orders The question whether in any particular case the order of the original authority has or has not merged in the order passed by the higher authority in appeal or in revision has to be decided with reference to the relevant provisions of the material Act and hearing in mind the observations of the Supreme Court in AIR 1958 SC 86 (supra).

In Surajmal's Case, AIR 1958 Madh Pra 103 (supra) the question of merger was considered with reference to orders under the Mineral. Concession Rules and it was held that under Rule 60 of the Rules the order of the State Government in that case merged in that of the Central Government. The question whether that conclusion can now be said to be right in view of the later pronouncements of the Supreme Court in AIR 1958 SC 86 (supra) and AIR 1958 SC 1036 (supra) can properly be considered in a case dealing with orders under the Mineral Concession Rules.

8. For these reasons this appeal is allowed and the order of the learned Single Judge is set aside with a direction that the appellant's petition under Articles 226 and 227 of the Constitution shall now be disposed of by the appropriate Bench on merits. Parties shall bear their own costs of this appeal. The outstanding amount of the security deposit shall be refunded to the appellant.