JUDGMENT
1. These two Rules arise out of the same adjudication proceeding under the Customs Act of 1962. Petitioner in both the Rules is the same person. While the order challenged in C.R 7271 (W)/69 is an interlocutory order in course of the adjudication passed by the Collector of Customs dated July 26, 1969 and the Appellate Order therefrom passed by the Central Board of Excise and Customs dated September 17, 1969, the order challenged in C.R 8607(W) of 1969 is the final order of confiscation dated September 27, 1969 passed by the Collector of Customs in the same adjudication proceeding. In the facts and circumstances of the case, it is not in dispute by the respondents that if C.R 7271(W) of 1969 succeeds and the interlocutory order passed therein is set aside, then in that event the final order of confiscation would fail irrespective of the question whether it should fail on other merits or not. To appreciate the dispute it will be necessary to refer to the facts in short which are set out as follows.
2. Acting on an information about smuggling of contraband gold Customs Officers of the Preventive and Intelligence Unit took out search orders from the appropriate authority and searched two contiguous premises being premises Nos. 81-B, Chittaranjan Avenue and 14 Feares Land/Calcutta on January 31, 1968. While flat No. 81-B Chittaranjan Avenue was in the nature of a residential flat the premises in 14, Feares Lane appears to be a store room. The room at 14, Feares Lane was found under double locks. The Preventive Officers found a cook present at flat No. 81-B, Chittaranjan Avenue and while they were proceeding with the search two persons Abdul Kader and I.A.M Hamid appeared on the scene. Nothing in criminating was found on search at 81-B, Chittaranjan Avenue but a key bearing No. 2793967 was recovered from a steel cabinet. With the help of this key one of the locks at the store room at 14, Feares Lane bearing the identical number was opened. The other lock, however, could not be opened and as such the latch on the door was removed. On entry so secure the Preventive Officers searched the room and recovered two lakhs in Indian currency notes under circumstances which led to a reasonable belief that the said money represents the sale proceeds of smuggled gold. The currency note were, therefore, seized. Consequent to such seizure on July 22, 1968 an adjudication proceeding was initiated on a show cause notice issued under section 124 of the Customs Act. It was claimed that the seized Indian Currency is believed to be the sale proceeds of goods imported unlawfully from foreign territory and as such liable to be confiscated under section 121 and further persons involved are liable to penalty under section 112 of the Customs Act. The present petitioner M.S Naina was served with the said show cause notice inasmuch as he was found to be the tenant in respect of flat at 81-B, Chittaranjan Avenue from where one of the keys of the store room of 14, Feares Lane, was recovered.
3. The petitioner appeared in the adjudication proceeding and filed an explanation on December 23, 1968. He claimed the money recovered as his own but denied the allegation that it represents the sale proceeds of any contraband goods. Adjudication proceeding was then taken up by the Collector of Customs. In course of the adjudication on May 6, 1969 the petitioner produced a Godrej Key bearing No. 948328 which number is borne by the other lock of the store room at 14, Feares Lane, which could not be opened at the time of the search. Obviously he produced that key to support his claim that at the relevant time of seizure he was in possession of the store room and the contents thereof. The Collector of Customs, however, had a suspicion that the key produced by the petitioner was a new one and was not in use for locking or unlocking the other lock at the store room at 14, Feares Lane. He directed the key to be sent for forensic test. It is not in dispute that such test was held and on June 12, 1969 the petitioner asked for a copy of the report of such test. It was refused. At that stage an attempt was made to use that key to unlock the lock which was left attached to the latch but the lock, could not be unlocked. According to the petitioner it could not be so unlocked inasmuch as the key had been bent while in the custody of the Customs Authorities for the test and he wanted to examine a representative of Messrs. Godrej Company Limited for establishing whether the key produced by him was a genuine key of the lock or not. The Collector though he refused to disclose the forensic test report had no objection to a representative of Messrs. Godrej Company Ltd. being examined as a defence witness.
4. On the next date of bearing i.e, on June 20, 1969 the petitioner filed an application before the Collector of Customs with two prayers as follows:—
“In the above circumstances I request (1) that a certified copy of the forensic test report regarding the key may be granted to my client on my client's. cost and (2) that summons may be issued on Messrs. Godrej and Boyce Manufacturing Company (P) Ltd., Calcutta to send their agent to give evidence about the seized Godrej lock No. 948328 and its key. My client is prepared to bear the cost for the witnesses.”
5. The first prayer was made on the ground that the forensic test report would be a material and necessary document. The second prayer was made on the ground that the evidence of a representative of Messrs. Godrej Company Limited would be indispensable in order to establish that the key produced by him was the genuine key of the lock seized and also to explain the reason why the said lock could not be unlocked with the key so produced by him. It was further stated that the petitioner had approached the manufacturers i.e, Messrs. Godrej and Company for deputing an agent to give evidence in the adjudication but they have agreed to do so provided only they receive an official summons from the adjudicating authority.
6. On the application so made the petitioner was informed by a memo, dated the July 26, 1969 that both the prayers so made have been refused and the ground assigned is as follows:
A copy of the report of forensic test of the key Will be given to your client if the same is used as an evidence against your client in the instant case. The representative of Messrs. Godrej and Boyce Manufacturing Company (P) Ltd. has been cited as your witness and therefore, no summons need be issued from this end.”
7. Aggrieved by this interlocutory order of the adjudicating authority the petitioner preferred an appeal under section 128 of the Customs Act, 1962 to the Central Board of Excise and Customs but the Appellate Authority, returned the memo of appeal with an order dated September 17, 1969 to the effect that no appeal lies against an interlocutory order under section 128 of the Customs Act, 1962.
8. In C.R 7271 (W) of 1969 the petitioner is disputing the validity of both the interlocutory order of the adjudicating authority as communicated to him by the memo, dated July 26, 1969 as also the Appellate Order dated September 17, 1969 refusing to entertain the appeal. According to the petitioner the Appellate Authority went wrong in misconstruing the scope of section 128 of the Customs Act, 1962 and in holding that no appeal lies from an order passed in the adjudication proceeding if the order so passed is not the final order. Furthermore, according to the petitioner the adjudicating authority was in error in refusing both the reasonable prayers made by the petitioner in his application dated June 20, 1968 and refusal of such prayer has resulted in a denial of a reasonable opportunity to substantiate his defence in the proceeding. This is how the said C.R 7271 (W) of 1969 was obtained from this Court on October 9, 1969 with an interim order of stay of further proceeding in the adjudication.
9. But the adjudicating authority after the disposal of the appeal by the Appellate Authority in the manner as aforesaid without giving any further notice to the petitioner and without fixing any date of further hearing disposed of the proceeding by an order of confiscation passed on September 27, 1969 and such order was communicated to the petitioner by a memo, dated October 13, 1969. Thus the adjudication proceeding was disposed of just a few days before this court had issued the interim order staying further proceedings.
10. In C.R 8607(W) of 1969 the petitioner is disputing the validity of this confiscation order on two fold grounds. In the first place, it is claimed that such an order has been passed in a proceeding wherein the petitioner had been denied a reasonable opportunity to substantiate his defence by denial of his prayers made in his application dated June 20, 1969. Secondly it is claimed that in any event when the adjudication proceeding was stayed pending appeal before the Appellate Authority against the interlocutory order, the adjudicating authority could not have disposed of the matter ex parte after the disposal of the appeal without fixing a further date of hearing and without giving a further notice to the petitioner.
11. Both the Rules are being contested by the respondents and affidavits have been filed. Facts set out hereinbefore are not in dispute. ??? davits have been filed. Facts set out hereinbefore are not in dispute.
12. Mr. Burman, appearing on behalf of the petitioner in these Rules, his first disputed the validity of the interlocutory order refusing the petitioner's prayers made on June 20, 1969 and the Appellate Order there from. In the first place, it has been strongly contended by Mr. Burman that in law an appeal lay against an interlocutory order passed in an adjudication proceeding under section 128 of the Customs Act, 1962 and as such the Appellate Authority could not have returned the memo, of appeal without deciding the appeal on merits. Such a point has been strongly contested by Mr. Roy, appearing on behalf of the respondents. It has been pointed out by Mr. Roy that if section 128 be interpreted to authorise appeal from interlocutory orders passed in course of adjudication proceeding then it would be difficult if not impossible for the Adjudicating authority to complete a proceeding because every order that he may pass would be liable to an appeal before the Appellate Authority. The difficulty pointed out by Mr. Roy may result from acceptance of the construction of section 128 contended for by Mr. Burman but if such construction follows from the terms of the section itself, this Court cannot help it. It would be for the Legislature to take note of the difficulty to remove the same. Section 128, however, is in such wide terms that it may be difficult to support the view taken by the Central Board of Excise and Cus toms. Section 128(1) specifically provides:—
“Any person aggrieved by any decision or order passed under this Act may……… appeal to the Board or……………. appeal to the Collector of Customs”
13. Any decision or order under this Act may well be construed to include interlocutory orders passed in course of the adjudication proceeding. The decision of the Privy Council in the case of Secretary of State v. Mask and Co., A.I.R 1940 P.C 105 well supports a view in favour of wider meaning being ascribed to the words “decision or order” though the statute thereunder consideration was the previous Sea Customs Act of 1878. However, in my opinion, when the petitioner has moved this Court not only against the Appellate order but also against the interlocutory order itself and when the said interlocutory order for reasons given hereunder is clearly unsustainable in law it is not necessary for me to decide this issue finally.
14. The petitioner by his application dated the June 20, 1969 had prayed for two things. Firstly he had prayed for disclosure of a forensic test report which was directed in course of the adjudication proceeding when the petitioner had produced the key No. 948328. Importance of possession of this key to prove possession of the seized currency notes had not been disputed by the Collector. As a matter of fact, he had a suspicion that the key produced was not the real key in use but might have been manufactured later on. Therefore to ascertain the genuineness of this key and further to ascertain whether the key was in use or not he himself had directed a forensic test. Having directed such a forensic test it is not open to him to disown the relevancy or the importance of such a test report. Now the petitioner wanted to know the result of the test and therefore he asked for a copy of the report. The Collector did not refuse this prayer on any ground that the report is not relevant. On the other hand, the reason for the rejection of the prayer was that such report will be disclosed only if it be used against the petitioner and not otherwise. In my opinion, the Collector was obviously in error. A document to be relevant may support either the prosecution or the defence. No adjudicating authority can refuse production of such a document only because that document will be of no use to the prosecution. Refusal of a document on that account would certainly amount to refusal of reasonable opportunity to the defence. This being the position, I cannot but hold that the Collector was obviously in error in refusing disclosure of the report on the ground assigned and that such refusal has necessarily prejudiced the defence. The next prayer of the petitioner was for a summons on a defence witness. Petitioner wanted to examine the witness proposed to be summoned as according to him evidence of such witness will be necessary for his defence. The Collector did not dispute the position that such a witness was a necessary witness for the defence. As a matter of fact, he conceded the prayer to allow such a witness to be examined but when the petitioner in his application dated June 20, 1969 brought it to the notice of the Collector that the Company is not agreeable to send a representative as a witness in the absence of a summons from the adjudicating authority, the Collector refused to issue the Summons prayed for only on the ground that the witness cited being a defence witness no summons need be issued. In my view, such an order was passed in an obvious disregard of the Collector's obligation under section 108 of the Customs Act, 1962. Section 108(1) is in following terms:—
“Any gazetted officer of customs was for power to summon any person whose attendance he considers necessary either to give evidence or to produce a document or any other thing in an enquiry which such officer is making in connection with the smuggling of goods”.
15. That the Collector while in adjudication can issue a summons under this provision to compel attendence of a witness has not been disputed by Mr. Roy, appearing on behalf of the respondents. The only question that arises for consideration is as to whether he could reasonably refuse to issue such a summons if the person to be summoned is a defence witness. Collector takes the view that he can lawfully refuse to do so. But in my opinion that would not be a proper use of the powers under section 108(1) of the Act at all. The provision acknowledges the necessity of persons being summoned for giving evidence in proceedings under the Act including adjudication proceedings. Only limitation contemplated by section 128(1) is that the persons to be summoned must be such as the authority issuing the summons considers necessary. It would be improper construction of this provision to think that the witness necessary for the prosecution alone could be summoned and not the witness necessary for the defence. Such a construction would be found amentally inconsistent with quasi-judicial nature of adjudication the object whereof is to find out the truth or otherwise of the allegations on which a charge has been levelled. This being the position. I must accept contention of Mr. Burman and hold that the Collector on the face of the records misguided himself in thinking that a summons under section 108(1) may not be issued for enforcement of attendance of a witness cited by the defence. It is obvious, therefore, the refusal of these two prayers had materially prejudiced the petitioner in the adjudication proceeding and the order is erroneous on the face of the records.
16. On the conclusions as above C.R 7271 (W) of 1969 must succeed and the impugned order of the Collector of Customs refusing the petitioner's. prayers made on June 20, 1968 must be set aside. So far as the Appellate Order is concerned as the memorandum of appeal has been returned on a view that the appeal is not maintainable it is not longer necessary for this Court to set aside the said order when the order appealed against is being set aside.
17. Coming on to consider the second Rule, as pointed out herein before on the success of the petitioner in the first Rule he is bound to succeed in this Rule too. What is challenged in this Rule is the final order passed in the adjudication proceeding leading to the confiscation of two lakhs worth Indian currency notes. On my findings made hereinbefore the interlocutory order of the Collector dated June 20, 1960 is erroneous and has resulted in denial of a reasonable opportunity to the petitioner to establish his defence. The final order which follows cannot, therefore, be upheld. That apart, there is great substance in the other objection raised by the petitioner disputing the validity of this final order. It could not be disputed by the respondents as a fact that the Collector disposed of the proceeding by passing the confiscation order without any further notice to the petitioner when the Central Board of Excise and Customs had returned the memo of appeal with its order dated September 17, 1969. Admittedly no further date of hearing was fixed and no notice was given to the petitioner when the adjudication proceeding was finally disposed of by the order of confiscation. This the Collector could not have done. The petitioner had a fight to be heard in the proceeding itself before the proceeding could be concluded and the order of confiscation could be made. That was not done by the Collector. Therefore, both the objections raised as against the final order of the confiscation dated September 27, 1969 must be sustained and S.R 8607(W) of 1969 must succeed. The impugned order is, therefore, set aside.
18. In the result, both the Rules succeed and are made absolute. The impugned order of confiscation: passed by the Collector of Customs dated September 27, 1969 and the interlocutory order passed by the said Collector refusing the petitioner's prayers made on June 20, 1969 and as communicated by the departmental memo, dated July 26, 1969 are set aside. The Collector would now be at liberty to proceed afresh with the adjudication in accordance with law. Let a writ in the nature of Certiorari do issue in each case incorporating the above direction.
19. There will be no order as to costs.