Full Judgment Text
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PETITIONER:
PIONEER TRADERS AND OTHERS
Vs.
RESPONDENT:
CHIEF CONTROLLER OF IMPORTS ANDEXPORTS PONDICHERRY
DATE OF JUDGMENT:
27/09/1962
BENCH:
WANCHOO, K.N.
BENCH:
WANCHOO, K.N.
SINHA, BHUVNESHWAR P.(CJ)
GAJENDRAGADKAR, P.B.
GUPTA, K.C. DAS
SHAH, J.C.
CITATION:
1963 AIR 734 1963 SCR Supl. (1) 349
ACT:
French Establishments--Administrative integration with
India-Confiscation of goods imported and imposition of
penalty in the alternative--Petition in enforcement of
fundamental rights-Maintainability--Constitution of India,
Arts. 19 (1) (f), 32-French Establishments (Application of
Laws) Order , 1954, S. R. O. 3315, para 6-Sea Customs Act,
1878 (8 of 1878), s. 67 (8)-Imports and Exports
(Control) Act, 1947 (18 of 1947), s. 3 (2).
HEADNOTE:
The petitioners, on patentes issued to them by the French
Administration, imported goods to Pondicherry after its
administration had been taken over by the Union of India on
November 1, 1954. They had placed orders for the imports in
England before August 15, 1954, after acquiring foreign
exchange by modes approved by the French Administration.
Before the goods arrived in Pondicherry, the Government of
India had issued S. R. O. 3315 under s. 4 of the Foreign
jurisdiction Act, 1947. By this notification the Sea
Customs Act, 1878, the Imports and Exports (Control) Act,
1947, and various other Acts mentioned in the schedule were
extended to French Establishments. By a press communique
issued by the Government of India, French license-holders
were asked to apply to the Controller of Imports and Exports
for validation of their licences before the shipping of
goods. As it was too late for the petitioners to stop
shipment, they applied to the Controller for the validation
of their authorisation but this was refused and the goods
arrived after November 1, 1954. The Collector confiscated
them under s. 167 (8) of the Sea Customs Act, 1878 read with
s. 3(2) of the Imports and Exports (Control) Act, 1947, and
imposed penalties in the alternative for clearing them. The
petitioners preferred appeals to the Central Board of
Revenue on the basis of para 6 of S. R. O. 3315 but the
Board dismissed the appeals reducing the penalties.
Revision petitions made to the Government of India were also
rejected. Relying on the decision of this Court in Messrs
Universal Imports Agency v. The Chief Controller of Imports
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and Exports that para 6 of S. R. O. 3315 had the effect of
protecting the imports
350
made in similar circumstances such as in the present cases,
the petitioners came up to this Court under Art. 32 of the
Constitution for enforcement of their fundamental rights
under Art. 19 (1) (f). A preliminary objection to the
maintainability of the writ petitions was taken on behalf of
the Union of India on basis of the decision of this Court in
Smt. Ujjambai v. The State of Uttar Pradesh.
Held (per Sinha, C. J., Gajendragadkar, Wanchoo and Shah,
JJ.), that the decision of this Court in Ujjambai’s case
applied and the petitions under Art. 32 must fail. The
questions that were raised in Ujjambai’s case not having
been raised in the case of Messrs Universal Imports Agency
this Court had no occasion to consider in the latter case
whether the quasi-judicial authority in that case had
jurisdiction to decide the matter. The petitioners could
not, therefore, get out of the decision in Ujjambai’s case
on the ground that the tax authorities in the present cases
had no inherent jurisdiction to do so.
The observations of Das, J., and Kapurj., in Ujjambai’s case
with regard to Messrs Universal Agency’s case must be held
to be per incuriam.
M/s. Universal Imports Agency v. The Chief Controller of
Imports and Exports, [1961] 1 S. C. R. 305, discussed.
Smt. Ujjambai v. The State of Uttar Pradesh, [1963] 1
S.C.R. 778, explained and applied.
Kailash Nath v. State of U. P., A. 1. R. (1957) S. C. 790,
referred to.
Paragraph 6 of S. R. O. 3315, properly construed, must be
deemed to have been inserted in each one of the Acts men-
tioned in the Schedule and in the Sea Customs Act to have
taken the place of original s. 2 of that Act. There was
therefore no scope for the contention that Ujjambai’s case
had no application inasmuch as no misconstruction of any
provisions of the Sea Customs Act was involved.
Held, further, that the order of a Customs authority
imposing confiscation and penalty under s. 167 (8) of the
Sea Customs Act, 1878, was a quasi-judicial order and the
Customs authorities had the duty to act judicially in
deciding questions of confiscation and penalty.
Leo Roy Frey v. The Superintendent District Jail, Amritsar,
[1958] S. C. R. 822, referred to.
Per Das Gupta, J.--If the importations in the present cases
were made on the basis of contracts concluded before
351
November 1. 1954, the Sea Customs Act would have no
application because of para 6 of S. R. O. 3315 as
construed by this Court in M/s Universal Agency’s me and
the customs authorities who derived their jurisdiction from
that Act would have no jurisdiction to make the orders they
did, and so the present petitions under Art. 32 of the
Constitution would be maintainable.
An inferior tribunal could not give itself jurisdiction by
wrongly deciding a collateral fact.
Universal Imports Agency v. The Chief Controller of Import’s
JUDGMENT:
State of U. P., [1963] 1 S. C. R. 778, The State Trading
Corporation of India v. The State of Mysore, [1963] 3 S. C.
R. 792 and Rex v. Shoreditch Assessment Committee, [1910] 2
K. B. 859, relied on.
Where a judicial or quasi-judicial authority had in law no
jurisdiction, the omission of the party to canvass that
question before the authority could not also give it
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jurisdiction.
&
ORIGINAL JURISDICTION : Petitions Nos. 314 to 342 of 1961.
Petition under Art. 32 of the Constitution of India for
enforcement of Fundamental Rights.
N. C. Chatterjee, R. Ganapathy Iyer, and G.
Gopalakrishnan, for the petitioners.
C. K. Daphtary, Solicitor General of India, B. R. L.
Iyengar and R.H. Dhebar, for the respondents.
1962. September 27. The judgment of Sinha, C. J.,
Gajendragadkar, Wanchoo and Shah, JJ., was delivered by
Wanchoo, J., Das Gupta, J., delivered a separate Judgment.
WANCHOO, J.-These twenty-nine petitions under Art. 32 of the
Constitution raise common questions and will be dealt with
together. They have been filed by two firms who obtained
patentes to carry on business in Pondicherry in September,
1954, for the first time. As the facts in all the petitions
are similar, we shall only give the facts generally to
understand the questions raised before us. The two firms,
352
it may be mentioned, did not carry on any business in
Pondicherry before September, 1954, when they got a patente
each and the proprietor of one of them is a resident of New
Delhi while the proprietor of the other is a resident of
Bombay.
The administration of Pondicherry was taken over by the
Union of India from November 1, 1954. Before that
Pondicherry was under the administration of the Government
of France and was a free port. Import into Pondicherry was
thus not subject to any restriction, except with regard to
certain goods with which we are not concerned. in the
present petitions. Any merchant desiring to carry on
business in the territory of Pondicherry had however to
obtain a patente before he could do so. These patentes were
of five kinds one of which was a patente authorising the
trader to carry on the business of import of goods other
than those which were under restriction. Though the
importers were entitled by virtue of the patente to import
goods subject to certain restrictions, this right could only
be exercised by securing foreign exchange which was subject
to certain limitations and was controlled by the Department
of Economic Affairs at Pondicherry. There were two ways in
which foreign exchange could be acquired, namely, (i) at the
official rate through the Department of Economic Affairs, or
(ii) in the open market at such rate as might be available;
and both these ways were considered valid before November 1,
1954. Further there used to be authorisations for the
purpose of import and the authorisations indicated the limit
within which foreign exchange could be acquired either at
the official rate or through the open market.
The petitioners’ case is that though the patentes were
secured in September, 1954, orders for import were placed
before August 15, 1954. Thereafter after authorisations had
been obtained from the French authorities, foreign exchange
was acquired in the open market for the purpose of financing
the
353
import. There were in all twenty-nine transactions by the
two firms, which are the subject-matter of these petitions;
and in certain cases advances were paid, the balance being
payable by means of bills of exchange drawn on ’documents
against payment" basis. But though the orders were placed
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before August 15, 1954, and necessary foreign exchange had
also been secured in the open market later, shipments could
not be made because of an unexpected dock strike in England
and on the Continent and also for want of shipping space,
and therefore most of the consignments on the basis of the
twenty-nine orders were shipped after November 1, 1954, and
only three consignments out of twenty-nine could be shipped
in October, 1954, that is, before the administration of
Pondicherry was taken over by the Government of India. The
goods in all these cases arrived at Pondicherry after
November 1, 1954. In the meantime, the administration of
Pondicherry was taken over by the Government of India from
November 1, 1954, in pursuance of an agreement between the
Government of India and the Government of France, and two
notifications were issued by the Government of India,
namely, S. R. O.s. Nos. 3314 and 3315. By S. R. O. 3315,
which was made under s,4 of the Foreign jurisdiction Act, No
XLVII of 1947, the Sea Customs Act, 1878, the Reserve Bank
of India Act, 1934, the Imports and Exports (Control) Act,
1947, the Foreign Exchange Regulation Act, 1947, and the
Indian Tariff Act, 1934, were extended to Pondicherry. This
S.R.O. contained a saving clause which laid down that--
"’Unless otherwise specially provided in the
schedule, all laws in force in the French
Establishments immediately before the
commencement of this Order., which correspond
to the enactments specified in the Schedule,
shall cease to have effect, save as respects
things done or omitted to be done before such
commencement."
354
As a consequence of these two S. R. O.s. a press communique
was issued by the Government of India on November 1, 1954,
explaining the effect of these notifications, in which it
was stated that imports into and exports from the French
Establishments would be regulated in accordance with the
provisions of the Imports and Exports (Control) Act, 1947.
It was further stated that as regards orders placed outside
the Establishments and finalized through grant of a licence
by competent French authorities in accordance with the laws
and regulations in force prior to November 1, 1954, licence-
holders were advised to apply to the Controller of Imports
and Exports for validation of licences held by them.
Licence-holders were further advised not to arrange for
shipment of goods until the licences held by them had been
validated by the Controller of Imports and Exports. In view
of this press communique, the petitioners tried to stop
shipment until the authorisations held by them were
validated by the Chief Controller of Imports and Exports,
Pondicherry. But their suppliers told them that this could
not be done,, as the goods were in the course of shipment
and it was too late to stop the shipment. The petitioners
then applied for validation of the authorisations, but the
Chief Controller of Imports and Exports, Pondicherry refused
to validate them. The petitioners’ case is that this
refusal was arbitrary. Eventually, when the goods arrived
at Pondicherry after November 1, 1954, the petitioners
approached the Collector of Customs at Pondicherry to permit
clearance of the goods. They were not, however, allowed to
clear them, and notices were issued to them to show cause
why the goods should not be forfeited on the ground that the
import had been made in contravention of the Imports and
Exports (Control) Act, 1947 and the Sea Customs Act, 1878.
The petitioners thereupon showed cause and their case was
that orders had been placed before August 15, 1954, and the
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imports had been made strictly in accordance with the law in
force in,
355
Pondicherry before November 1, 1954, and therefore could not
be said to be unauthorised. The Collector of Customs
however refused to accept this explanation and ordered
confiscation of the goods, and in the alternative imposed
penalties for clearing them. These penalties amounted to
over Rs. 64,000/- in the case of one of the firms and over
Rs. 96,000/- in the case of the other firm, There were then
appeals by the petitioners before the Central Board of
Revenue against the orders imposing penalties. These
appeals were dismissed, though the penalty was reduced to
over Rs.35,000/- in the case of one firm and Rs. 60,000/- in
the case of other firm. The petitioners then went in
revision to the Government of India but their revisions were
rejected on January 23, 1957. It appears that the
petitioners paid the penalty though the date is not clear
from the petitions and cleared the goods. The petitioners
were apparently satisfied with the orders passed against
them for they took no steps to go to Court after the
revisions had been dismissed by the Government of India in
January, 1957, though they say that they have been making
representations to the Government of India in that behalf
without any effect and that the last communication from the
Government of India was received by them in this connection
in August, 1961.
In the meantime, certain impotrers of Pondicherry filed
petitions in this Court in 1959 challenging the order of
confiscation and the alternative order imposing penalties on
them by the Collector of Customs, Pondicherry, in somewhat
similar circumstances : (see Messrs. Universal Imports
Agency v. The Chief Controller of Imports and Exports (1)).
Those petitions were decided on August 23, 1960 and this
Court held that in view of para. 6 of S. R. O. 3315, already
referred to, which saved the effect of all laws in force in
the French Establishments immediately before the
commencement of the order even though those laws were
repealed by the order, with respect to things done or
omitted to be
(1) [1961] 1 S.C.R. 305.
356
done before such commencement, the authorisations granted by
the French authorities before November 1, 1954, for import
were sufficient to protect the goods imported on the basis
of those authorisations whether the exchange was secured
officially or from the open market, from the operation of
the Imports and Exports (Control) Act, 1947, and other
provisions to the same effect. This view was taken on the
ground that para. 6 saved "things done" before November 1,
1954 and as firm contracts had been entered into and
authorisations granted before November 1, 1954, the
subsequent arrival of goods in Pondicherry after November 1,
1954, as the consequence of the contracts and the
authorisations was a "thing done" under para. 6 of S.R.O.
3315. It was held that the words "’things done" must be
reasonably interpreted and if so interpreted they not only
meant things done but also the legal consequence flowing
therefrom. Consequently, it was held that the imported
goods in those cases were not liable to confiscation under
the Imports and Exports (Control) Act and similar provisions
of any other law, as firm contracts had been made before
November 1, 1954 and exchange had been arranged either
officially or through the open marketin full or in part
under authorisations granted by the French Government and
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the subsequent import after November 1, 1954 was a
consequence of these things which had been done before
November 1, 1954 an was therefore protected by para. 6. In
the result the penalty collected was ordered to be refunded.
This decision was given in August 1960, and it seems that
after this decision, the petitioners wrote to the Government
of India in September, 1960, for refund of penalties in
their cases also; they were informed in February, 1961, that
no refund could be made. The petitioners seem to have
written again to the Government of India in June, 1961, and
to this the Government of India gave a final reply in
357
August, 1961. Thereafter the present writ petitions were
filed in October, 1961. The petitioners rely on the
decision of this Court in Messrs. Universal Imports Agency
(1) and contend that they are entitled to refund of penalty
as their cases are exactly similar to the case of Messrs.
Universal Imports Agency. (1) They pray for a writ, order or
direction in the nature of certiorari quashing the orders
resulting in the imposition of penalty beginning with the
orders of the Collector of Customs. Pondicherry, and ending
with those of the Government of India in revision and also
for a direction requiring the respondents to refund to the
petitioners the sum realised as penalty.
The petitions have been opposed on behalf of the Union of
India on a number of grounds. It is however unnecessary for
us to detail all the grounds raised on behalf of the Union
of India in view of an objection that has been taken to the
maintainability of these petitions based on the decision of
this Court in Smt. Ujjambai v. The State of Uttar
Pradesh.(2) We shall therefore refer only to such parts of
the counter affidavit filed on behalf of the Union of India
as will suffice to explain the preliminary objection raised
on its behalf.
The Union’s case is that the talks for the de facto transfer
of the French-Indian Establishments to the Government of
India were resumed in August 1954, and that as a result of
these talks, an agreement dated October 20, 1954, between
the Government of India and the Government of France for the
settlement of the question of the future of the French
Establishments in India was arrived at. Pursuant to this
agreement, the administration of the French Establishments
(including Pondicherry) was transferred to the Government of
India from November 1, 1954. In consequence, the Government
of India promulgated two orders, namely, S. R. O’s 3314 and
3315 on October 30, 1954, to come into force from November
1, 1954. The first of these orders was known as the
(1) [1961] 1 S.C.R. 305.
(2) [1963] 1 S. C. R. 770,
358
French Establishments (Administration) Order while the
second order was known as the French Establishments
(Applications of laws) Order, 1954, by which the Sea Customs
Act, 1878, and the Imports and Exports (Control) Act, 1947,
and certain other Acts were made applicable to the said
settlements. Some persons, including the petitioners, who
had no business in Pondicherry from before mala fide with
intent to defeat the laws in force in the Indian Union which
were legally to be extended to the French Establishments
when their administration was taken over by the Government
of India, managed to procure some colourable documents on
the strength of which they claimed that they had placed firm
orders with foreign firms for import of goods which were
restricted under the Indian Import Control Regulations.
After the Government of India had applied S. R. O’s 3314 and
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3315 to the French Establishments and taken over their
administration from November 1, 1954, a press communique was
issued on November 1, 1954, that orders placed outside the
French Establishments and finalised through a grant of
licence by the competent French authorities in accordance
with the laws and regulations in force prior to November 1,
1954 should be got validated by the Controller of Imports
and Exports appointed for Pondicherry. Further, the
licence-holders were advised not to arrange for shipments of
goods until the licences held by them were validated. Later
on January 5, 1955, the Union of India issued another press
communique in view of certain representations received on
the basis of Art. 17 of the Indo-French Agreement and the
public was informed that import of goods against open market
transactions after November 1, 1954, would be treated as
unauthorised. But having regard to the hardship likely to
be caused to genuine importers who had placed orders in
pursuance of their normal trading operations against which
goods were in the normal course shipped by the suppliers
prior-to the date of merger, the Collector of Customs,
359
Pondicherry was being authorised to accord certain
concessions to genuine importers. One of these concession
was that goods shipped before November 1, 1954, but ordered
before August 15, 1954, would be cleared without penalty
irrespective of origin and value. The petitioners tried to
take advantage of this concession and therefore tried to
show before the Collector of Customs, Pondicherry that they
had placed firm orders before August 15, 1954, though
shipments could only be made in three cases before November
1, 1954, and were delayed in others because of dock strike
in England and in Continental countries. This case was
scrutinised by the Collector of Customs and he pointed out
in his order that though the orders for these goods are said
to have been placed before August 15, 1954, the two firms
could only start functioning in Pondicherry from the month
of September in which month they had obtained patent for
conducting business there legally. The Collector also
pointed out that in the ordinary course of business,
commitments were not made without entering into
correspondence with the suppliers regarding the prices,
terms of payment etc., but in these cases, the petitioners
produced no such correspondence. It was also found that the
petitioners had not done any business of this kind even in
the Indian Union before this. The Collector therefore held
that it had not been proved that the goods had in fact been
ordered before August 15, 1954, and therefore ordered their
confiscation and imposed penalty in lieu thereof The appeals
of the Petitioners to the Central Board of Revenue failed
except to the extent that the penalty was reduced. The
Board’s order was silent on the point whether the goods had
in fact been ordered before August 15, 1954. But the Board
held that as the goods were imported without licence at a
time when a licence was required for their import, the
appeal must fail. The petitioners then went in revision to
the Government of India but failed there also.
360
The preliminary objection is that the orders imposing
penalty are quasi-judicial orders passed by a competent
authority having jurisdiction under a taxing statute. It is
not the case of the petitioners that the statute under which
the orders had been made read with S.R.O. 3315 of 1954 is in
any way ultra vires. The sole basis of these petitions is
that para. 6 of S. R. O. 3315 has been misconstrued by the
authorities concerned and thus a penalty has been levied
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which could not be levied if para. 6 had not been
misconstrued. The petitioners therefore question the
validity of the order imposing penalty based on a mis-
construction of para. 6 of S.R.O. 3315 of 1954 and this they
cannot do by petition under Art. 32, whatever other remedies
they might have against such an order, in view of the
decision of this Court in Ujjambai’s case.(1) It is
therefore contended on behalf of the Union of India that
these petitions under Art. 32 of the Constitution are not
maintainable and should be dismissed on this ground alone.
In reply, it is submitted on behalf of the petitioners that
Ujjambai’s case.(1) does not apply in the circumstances of
these petitions. It is not seriously disputed that the
orders imposing penalty were quasi-judicial orders; but it
is urged that these orders were passed without jurisdiction
and infringe the fundamental right of the petitioners under
Art. 19 (1) (f) and Art. 19 (1) (g), and would be liable to
challenge by petition under Art. 32 and the actual decision
in Ujjambai’s case(1) will not be applicable.
It is therefore necessary to consider the effect of the
decision in Ujjambai’s case.(1) That case was heard by a
Bench of seven learned judges of this Court, and the final
decision was by a majority of five to two. The following
two questions came up for decision in that case
"1. Is an order of assessment made by an
authority under a taxing statute which is
(1) [1963] 1 S. C. R. 778.
361
intra vires, open to challenge as repugnant to
Art. 19 (1) (g), on the sole ground that it is
based on a misconstruction of a provision of
the Act or of a notification issued
thereunder?
2. Can the validity of such an order be
questioned in a petition under Art. 32 of the
Constitution?"
As was pointed out by Das, J., in that case, the two
questions were inter-connected and substantially related to
one matter, namely, "is the validity of an order made with
jurisdiction under an Act which is intra vires and good law
in all respects, or a notification properly issued
thereunder, liable to be questioned in a petition under Art.
32 of the Constitution on the sole ground that the
provisions of the Act, or the terms of the notification
issued thereunder, have been misconstrued?" It was not
disputed in that case that where the statute or a provision
thereof is ultra vires, any action taken under such ultra
vires provision by a quasi-judicial authority which violates
or threatens to violate a fundamental right does give rise
to a question of enforcement of that right and a petition
under Art. 32 of the Constitution will lie. Further, it was
not disputed that when the assessing authority sought to tax
a transaction the taxation of which came within the
constitutional prohibition, the violation of fundamental
right must be taken to have been established and such cases
were treated as on a par with those cases where the
provision itself was ultra vires. It was also not disputed
that where the statute was intra vires but the action taken
under it was without inherent jurisdiction, a petition under
Art. 32 would lie. Finally, it was also not disputed in
that case that where the action taken is procedurally ultra
vires, the case is assimilated to a case of an action taken
without inherent jurisdiction and would be open to challenge
by a petition under Art. 32,
362
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The controversy was ""what is the position with regard to an
order made by a quasi-judicial authority in the undoubted
exercise of its jurisdiction in pursuance of a provision of
law which is admittedly intra vires ?" It was in that
connection where the authority has inherent jurisdiction to
decide the matter and the law under which it proceeds is
intra vires that the question arose whether the decision of
such an authority could be challenged by a petition under
Art. 32 on the sole ground that it was based on a
misconstruction of the provision of law or of the
notification properly issued thereunder. Five of the
learned judges composing the Bench answered both the
questions raised in that case in the negative. Das, J.,
held as follows :-
"’An order of assessment made by an authority
under a taxing statute which is intra vires
and in the undoubted exercise of its
jurisdiction cannot be challenged on the sole
ground that it is passed on a misconstruction
of a provision of the Act or of a notification
issued thereunder. Nor can the validity ’of
such an order be questioned in a petition
under Art. 32 of the Constitution."
Kapur, J., held as follows
"’If the statute and its constitutionality is
not challenged then every part of it is
constitutionally valid including the
provisions authorising the levying of a tax
and the mode and procedure for assessment and
appeals etc. A determination of a question by
a Sales-Tax Officer acting within his
jurisdiction must be equally valid and legal.
In such a case, an erroneous construction,
assuming it is erroneous, is in respect of a
matter which the statute has given the
authority complete jurisdiction to decide.
The decision is therefore a valid act
irrespective of its being erroneous,
363
An order of assessment passed by a quasi-
judicial tribunal under a statute which is
ultra vires cannot be equated with an
assessment order passed by that tribunal under
an intra vires statute even though erroneous.
The former being without authority of law is
wholly unauthorised and has no existence in
law and therefore the order is an infringement
of fundamental rights under Art. 19 (1) (f)
and (g) and can be challenged under Art. 32.
The latter is not unconstitutional and has the
protection of law being under the authority of
a valid law and therefore it does not infringe
any fundamental right and cannot be impugned
under Art. 32."
Sarkar, J., agreed with Das and Kapur, JJ.
Hidayatullah, J., held as follows:-
"But where the law is made validly and in
conformity with the fundamental rights and the
officer enforcing it acts with jurisdiction,
other considerations arise. If, in the course
of his duties, he has to construe provisions
of law and miscarries, it gives a right of
appeal and revision, where such lie and in
other appropriate cases, resort can be had to
the provisions of Arts. 226 and 227 of the
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Constitution, and the matter brought before
this Court by further appeals. This is
because every erroneous decision "does not
give rise to a breach of fundamental
rights. Every right of appeal or revision
cannot be said to merge in the enforcement of
fundamental rights. Such errors can only be
corrected by the processes of appeals and
revisions. Art. 32 does not, as already
stated, confer an appellate or revisional
jurisdiction on this Court, and if the law is
valid and the decision with jurisdiction, the
protection of Art. 265 is
364
not destroyed. There is only one exception to
this, and it lies within extremely narrow
limits. That exception also bears upon
jurisdiction, where by a misconstruction the
State Officer or a quasi-judicial tribunal
embarks upon an action wholly outside the pale
of the law he is enforcing. if, in those
circumstances., his action constitutes a
breach of fundamental rights, then a petition
under Art. 32 may lie."
Mudholkar, J., summarised his conclusions as
below:-
The question of enforcement of a fundamental
right will arise if a tax is assessed under a
law which is (a) void under Art. 13 or (b) is
ultra vires the Constitution, or (c) where it
is subordinate legislation, it is ultra vires
the law under which it is made or inconsistent
with any other law in force.
2. A similar question will also arise if
the tax is assessed and/or levied by an
authority (a) other than the one empowered to
do so under the taxing law or (b) in violation
of the procedure prescribed by the law or (c)in
colourable exercise of the powers conferred by
the law.
3. No fundamental right is breached and
consequently no question of enforcing a funda-
mental right arises where a tax is assessed
and levied bona fled by a competent authority
under a valid law by following the procedure
laid down by that law, even though it be based
upon an erroneous construction of the law
except when by reason of the construction
placed upon the law a tax is assessed and
levied which is beyond the competence of the
legislature or is violative of the provisions
of Part III
365
or of any other provisions of the Constitu-
tion.
4. A mere misconstruction of a provision of
law does not render the decision of a quasi-
judicial tribunal void (as being beyond its
jurisdiction). It is a good and valid deci-
sion in law until and unless it is corrected
in the appropriate manner. So long as that
decision stands, despite its being erroneous,
it must be regarded as one authorised by law
and where, under such a decision a person is
held liable top pay a tax that person cannot
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treat the decision as a nullity and contend
that "what is demanded of him is something
which is not authorised by law. The position
would be the same even though upon a proper
construction, the law under which the decision
was given did not authorise such a levy."
Mudholkar, J., therefore, agreed with Das, J., and was of
the view that the two questions must be answered in the
negative.
The other two learned judges, Subha Rao and Ayyangar, JJ.,
took the contrary view. They were of the view that there
could be no valid distinction between an order passed by an
authority without jurisdiction, in the sense that the
authority is not duly constituted under the Act or that it
has inherent want of jurisdiction, and a wrong order passed
by the authority on a misconstruction of the relevant provi-
sions of the Act; in either case if the order affects a
fundamental right it will be open to challenge by petition
under Art. 32 on the ground that by a wrong construction, a
fundamental right either under Art. 19 (1) (f) or under Art.
19 (1) (g) is violated.
It will be seen from the above summary of the views of the
learned Judges who constituted the majority that, though the
reasons given for coming to
366
their conclusion were slightly different they were all
agreed that where an order of assessment is made by an
authority with jurisdiction under a taxing statute which is
intra vires, it is not open to challenge as repugnant to
Art. 19 (1) (g) on the sole ground that it is based on a
misconstruction of a provision of the Act or of a
notification issued thereunder and the validity of such ail
order cannot be questioned in a petition under Art. 32 of
the Constitution, though it may be open to question such an
order on appeal or in revision in case’ the statute provides
for that remedy or by a petition under Arts. 226 and 227 in
appropriate cases.
The contention on behalf of the Union is that the orders in
the present case are orders of an authority with
jurisdiction acting quasi-judicially and even if they are
based on a misconstruction of para. 6 of S.R.O. 3315 they
will not be open to challenge by petition under Art. 32 of
the Constitution, whatever other remedies the petitioners
might have against them. It is urged that in principle
there is no difference between an order of assessment under
a taxing statute and an order of confiscation, with an
alternative penalty, for both are orders of a quasi-judicial
authority under a taxing statute which is intra vires; and
if orders are passed with jurisdiction in either case they
will not be open to challenge under Art. 32 on the sole
ground that they are passed on a misconstruction of a
provision of an Act or a notification issued thereunder.
It has not been disputed that the order of a customs
authority imposing confiscation and penalties under s. 167
(8) of the Sea Customs Act (No. 8 of 1878) is quasi-judicial
and the customs authority has the duty to act judicially in
deciding the question of confiscation and penalty: (see Leo
Roy Frey v. The Superintendent District Jail, Amritsar(1).
But it is urged on behalf of the petitioners that the orders
in this case were passed without inherent jurisdiction and
(1) [1958] S. C. R. 822.
367
would thus be open to challenge and in this connection
reliance was placed on the observations of Kapur, J., in
Ujjambai’s case() in connection with the decision in the
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case of Messrs. Universal Imports Agency.(2) Kapur, J.,
observed with respect to this decision that "in any case
this is an instance of want of jurisdiction to tax
transactions which the law excludes from the taxing powers
of the authority levying the tax", though he pointed out
further that the question of the applicability of Art. 32 to
quasi-judicial determinations was not raised in that case.
With respect, it may be pointed out that as the question of
the applicability of Art. 32 to quasi-judicial determi-
nations was not raised at all in the case of Messrs.
Universal Imports Agency(), the Court had no occasion to
consider the question whether the authority in that case had
inherent jurisdiction to decide the matter. The majority
judgment on which the petitioners rely has nowhere
considered the question whether the authority in that case
suffered from inherent lack of jurisdiction when it decided
to confiscate the goods imported and levy penalties in the
alternative. All that the learned counsel for the
petitioners could draw our attention to was a sentence in
the majority judgment to the following effect :
"We would, therefore, hold that paragraph 6 of
the Order saves the transactions entered into
by the petitioners and that the respondents
had no right to confiscate their goods on the
ground that they were imported without
licence."
It is urged that when the majority said that the authorities
had no right to confiscate the goods, it was meant that they
had no inherent jurisdiction to do so. As we read the
majority judgment, however, we do not find any warrant for
coming to the conclusion that it was decided in that case
that the authorities in that case had no inherent
jurisdiction to confiscate the goods or impose penalties in
lieu thereof. It is true that it was said in the majority
judgment that
(1) [1963] 1 S. C. R. 778.
(2) [1961] 1 S. C. R. 305.
368
the respondents had no right to confiscate the goods but
that was because just before in that very sentence it was
held that para. 6 of the Order saved the transactions.
Therefore, when the majority in that case said that the
authorities had no right to confiscate the goods, all that
was meant was that the authorities had misconstrued para. 6
and so confiscated the goods, but that on a correct
construction of para. 6 they could not do so. It cannot
therefore he said that the majority decision in that case
was based on lack of inherent jurisdiction. The petitioners
therefore cannot get out of the decision in Ujjambai’s
case(1) on the ground that the authorities who confiscated
the goods and levied penalties in the alternative in the
present cases had no inherent jurisdiction to do so.
As we have just indicated, the decision of this Court in the
case of Messrs. Universal Imports Agency(2) was not based
on the ground that the appropriate authority who confiscated
the goods lacked inherent jurisdiction to do so. The
decision, in substance, proceeded on the ground that in
exercising the said jurisdiction, the authority had
misconstrued S.R.O. 3315. The question as to whether a writ
petition under Art. 32 can lie on that ground was not raised
before the Court and has not been considered. Therefore, it
seems to us, with respect, that the observation made by
Kapur J. in the case of Ujjambai(1) that the decision in the
case of Messrs. (universal Imports Agency(2) affords an
instance of want of jurisdiction to tax transactions which
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the law excludes from the taxing powers of the authority
levying the tax, is not very accurate. Similarly, it may be
added that the inclusion of the said decision ’˜m the Est of
judgments cited by ˜Das, J., which, in his opinion,
illustrated categories of cases where executive authorities
have acted without jurisdiction, is also not justified.
Since the point about the competence of the writ petition
was not raised or considered in the case of Messrs.
Universal Imports Agency,(2) it would
(1) [1963] 1 S. C. R. 778.
(2) [1961] 1 S. C. R. 30.
369
not be accurate or correct to hold that that decision turned
on the absence of jurisdiction of the appropriate authority.
It is well known that after the decision of the Court in the
case of Kailash Nath v. State of U. P.,(1) some writ
petitions were entertained on the ground that the
jurisdiction of the Court under Art. 32 could be invoked
even if a tribunal exercising quasi-judicial authority had
misconstrued the law under which it purported to act.
Having regard to the decision of the Special Bench in the
case of Ujjambai(2), these precedents have now lost their
validity.
Then we come to the question whether this is a case of
misconstruction of a provision of the law which is intra
vires by an authority acting under a taxing statute. It is
contended on behalf of the petitioners that the taxing
statute in this case was the Sea a Customs Act and the
misconstruction, if any, would be of para. 6 of S. R. O.
3315. This in our opinion is not correct. The Sea Customs
Act was applied to Pondicherry by S. R. O. 3315. This S.R.
O. has six paragraphs. The first paragraph gives the name
of the S. R. O. and the date from which it will come into
force. The second paragraph defines what are "French
Establishments" to which the S. R. O. was applicable. The
third paragraph lays down that certain Acts mentioned in the
Schedule which are twenty-two in number would apply to the
French Establishments subject to certain conditions which
are not material. Sub-paragraph (2) of para. 3 applies all
rules under the various enactments in the Sehedule to the
French Establishments. Paragraph 4 lays down how references
in any enactment, notification, rule, order or regulation
applied to the French Establishments have to be construed.
Paragraph 5 gives power to any Court, tribunal or authority
required or empowered to enforce in the French
Establishments any enactment specified in the schedule to
construe enactment with such alterations, not affecting the
(1) A. 1. R. (1957) S. C. 790. (2) [1963] 1 S. C. R. 778.
370
substance, as may be necessary or proper. Then comes para.
6 which we have already set out. It will be seen therefore
that S. R. O. 3315 applied the Sea Customs Act and certain
other Acts to the French Establishments, including
Pondicherry, and para. 6 in particular is similar to a
repealing and saving provision to be found in an Act which
repeals and reenacts an earlier enactment. It would
therefore be not improper to read para. 6 as if it was
incorporated in each one of the twenty-two Acts which were
extended to the French Establishments by S. R. O. 3315. The
construction therefore of para. 6 of the S. R. O. which must
be deemed to have been inserted in each one of the Acts
mentioned in the Schedule would be a construction of the Sea
Customs Act itself. Original s. 2 in the Sea Customs Act
provided for repeal of earlier enactments and for saving,
(though it no longer exists in the Act as it was repealed by
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the Repealing Act No. 1 of 1938). In effect, therefore,
para. 6 of the S. R. O. would take the place of original s.
2 of the Sea Customs Act. Therefore, an interpretation of
para. 6 of the S. R. O. which must be deemed to have been
inserted in the Sea Customs Act in place of original s. 2
would be an interpretation of the Sea Customs Act. So the
contention that Ujjambai’s case(1) does not apply, for there
has been no misconstruction of any of the provisions of the
Sea Customs Act, has no force. It may be added that it is
not disputed in this case that the Collector of Customs had
inherent jurisdiction to deal with this matter and the only
attack on his order aid on the subsequent orders passed in
appeal and revision is that they misconstrue the provision
of para. 6 of the S. R. O.
Finally, it is urged that there was in fact no
misconstruction of the provisions of para. 6 of S.R.O. 3315
in these cases and Ujjambai’s case(1) will not apply to
these petitions. Literally speaking, it masbe correct to
say that there was no actual miscoyn
(1) [1963] 1 S. O. R. 778.
371
truction of para. 6 of S. R. O. 3315 in these cases by the
Collector of Customs. What had happened was, as we have
already indicated, that the petitioners tried to bring their
case before him within the terms of the press communique of
January 5, 1955, by which certain concessions were extended
to genuine importers. They therefore tried to prove that
they had placed firm orders before August 15, 1954, and had
also provided for foreign exchange to the extent necessary
after receiving authorisations and that three of the
consignments had been shipped before the 1st of November
while the other twenty-six could not be shipped before that
date for reasons beyond their control. The petitioners thus
wanted to take advantage of the concessions in the press
communique. They do not seem to have raised before the
Collector of Customs the question that even if they had not
placed the orders before August 15, they would still be
entitled to the benefit of para. 6 of S. R. O. 3315 if they
had placed the orders before November 1, 1954 and had
received authorisations from the French authorities before
November 1, 1954, and had made arrangements to the extent
necessary for foreign exchange either through official
channels or through open market. The Collector considered
the case put forward by the petitioners namely, that they
had placed firm orders before August 15, 1954, and held, for
reasons which we have already indicated, that that could not
be true. The Collector therefore refused to give the
petitioners the benefit of the press communique. In the
circumstances the Collector could not proceed further to
consider that even if the orders were placed after August
15, the petitioners would be protected by para. 6 of S. R.
O. 3315.
The Board in appeal however did not rest its decision on
this. It held that as-the goods were actually imported
after November 1, 1954, when licence’ restrictions were
actually in force, the goods would be liable to confiscation
as imported,without licence.
372
This decision, in effect, refused to give the benefit of
para. 6 of S. R. O. 3315 to the petitioners. and to that
extent the paragraph can by implication be said to have been
misconstrued by the Board.
This matter can therefore be looked at in two ways. If it
is held that the petitioners rested their case on only the
ground that they had placed the orders for import before
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August 15, 1954, and were thus entitled to the benefit of
the press communique, the finding of the Collector to the
effect that he was not prepared to believe that case for
three reasons given by him cannot be said to justify a
prayer for a writ because it is a finding of fact; and a
writ cannot issue even if the said finding is erroneous.
If, there. fore, that was all that was raised by the
petitioners before the authorities concerned, and the
authorities concerned have found against the petitioners on
the main question of fact involved in their contentions
before them, it cannot be said that the authorities were
wrong in the view they took for the reasons given by them
and there would therefore be no question of any interference
under Art. 32. Further, if a petition under Art. 32 is not
maintainable when a provision of law is misconstrued, it
would be much less maintainable when there is a mistake of
fact though as we have indicated already, it cannot be said
in this case that the Collector was wrong in his conclusion
on the facts.
The petitioners’ case, as put forward in, this Court, is
that even if firm orders were not placed be. fore August 15,
1954, they were entitled to take advantage of the judgment
of this Court in Messrs. Universal Imports Agency’s(1) case
if they had placed orders after obtaining the patentes in
September and had received authorisations and had arranged
for foreign exchange to the extent necessary before November
1, 1954. If this is the case of the petitioners now, and
they want to succeed on it, it must
(1)[1961] 1 S. C. R. 305.
373
be held that the Board by implication negatived it in
appeal. This could only be done by a misconstruction of
para. 6 of S. R. O . 3315, for if that paragraph had been
rightly construed, as held by this Court in Messrs.
Universal Imports Agency’s case, (1) the goods would not
have been confiscated.
Therefore the position is this. If the petitioners only
raise the claim based on the press communique that they had
placed firm orders before August 15, 1954, their claim has
been negatived on facts and we see no reason to differ from
the conclusion of the Collector on the facts. On the other
hand, if the petitioners seem to have raised the case which
they are now raising before us on the basis of Messrs.
Universal Imports Agency’s case (1) before the Board, the
Board must be deemed to have turned down that claim and that
could only be on the basis of the misconstruction of para 6
of S. R. O. 3315. The case, therefore, that is now put
forward on behalf of the petitioners before us would be
absolutely analogous to the position in Ujjambai’s case(2)
In that case the assessing authority acting with
jurisdiction upon a. misconstruction of a statute which was
intra vires or a notification properly issued thereunder
assessed the tax and it was held that such an assessment
cannot be impugned as repugnant to Art. 19 (1) (f) and (g)
on the sole ground that it was based on a misconstruction of
a provision of the Act and the validity of such an order
cannot be questioned in a petition under Art. 32. In the
present case, a similar quasi-judicial authority i. e., the
Board acting judicially within its jurisdiction must be
deemed to have turned down by implication the contention
raised on the basis of para 6 of S.R.O. 3315 by the
petitioners before it and this could only be done on the
misconstruction of that paragraph in view of the decision in
Messrs. Universal Imports Aqency’s case (1). The
petitioners however cannot question the validity of those
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orders by petition under Art. 32 of the Constitution, for
the Act under
(1) [ 1661] 1 S, C. R. 305.
(2) [1963] 1 S. C. R, 778
374
which the orders were passed read with S.R.O. 3315 is not
assailed as ultra, vires and the only ground on which it
is said that a fundamental right has been violated is
that there has been by implication a misconstruction of
para. 6 of S. R. O. 3315 by the Board. In that view the
decision in Ujjambai’s case (1) will apply with full force
to the present petitions. We therefore hold that the
validity. of the orders impugned cannot be questioned in a
petition under Art. 32 of the Constitution. The petitions
are hereby dismissed with costs-one set of hearing costs.
DASs GUPTA, J.--In sixteen petitions under Art. 32 of the
Constitution the petitioner, a merchant carrying on business
under the name and style, Messrs. Eastern Overseas
(Pondicherry), seeks relief against the orders by which the
Collector of Customs purporting to act under s. 167 (8) of
the Sea Customs Act read with s. 3 (2) of the Import and
Export Control Act, 1947 directed confiscation of goods
which he had imported into Pondicherry, at the same time
giving him option to pay in lieu of confiscation, fines
aggregating in all 16 cases to Rs. 96,400/-. The appeals
against these- orders to the Central Board of Revenue were
unsuccessful except that the penalty of fine payable was
reduced to a total sum of Rs. 60,235/-. The petitioner then
moved the Government of India for revision of these orders
but the revision applications were rejected.
Shortly stated, the petitioner’s case is that in all the
sixteen cases he had concluded before November 1, 1954, firm
contracts with foreign suppliers for supply of these goods
by shipment to Pondicherry and it was on these contracts
that the goods in question were imported by him. By the
date the goods reached Pondicherry, the Sea Customs Act had
become applicable to Pondicherry as a result of an order
made by the Government of India on October 30, 1954, the S..
R. O. No. 3315. This order was made under s. 4 of the
Foreign Jurisdiction
(1) [1963] 1.S. C. R. 778,
375
Act, 1947,in pursuance of the Indo-French Agreement under
which the administration of Pondicherry was vested with the
Government of India from November 1, 1954. Paragraph 6 of
that order however contained a saving clause. By reason of
that the Sea Customs Act did not apply to the imports made
by him. That paragraph is in these words :-
"Unless otherwise specifically provided in the Schedule, all
laws in force in the French Establishments immediately
before the commencement of the order, which correspond to
enactments specified in the Schedule, shall cease to have
effect, save as respect things done, or omitted to be done
before such commencement."
It was held by this Court in Universal Imports Agency v. The
Chief Controller of Imports & Exports (1) that importations
of goods into Pondicherry after November 1, 1954, would have
the benefit of this saving clause, if the importation is in
pursuance of a contract concluded prior to November 1, 1954.
The Court petitioner bases his case on the law as settled by
this Court in the case mentioned above and contends that as
the Sea Customs Act was not applicable to the importations
of the goods, in these sixteen cases, the importations being
in pursuance of contracts concluded before November 1, 1954,
the orders of confiscation of his property and the orders of
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penalty made upon him were illegal. There has thus been by
these orders an invasion of the petitioner’s fundamental
right under Art. 19 (1) (f) of the Constitution and for the
protection of that right these petitions have been made.
The respondent contends that the basis of the petitioner’s
case that the importations were in pursuance of a contract
concluded before November 1, 1954, has not been established.
Apart from this defence on merits, a preliminary objection
is raised at the hearing on the authority of the decision of
this
(1)..[1961] 1 S. C. R. 305,
376
Court in Smt. Ujjam Bai v. The State of U.P. () that a
petition under Art. 32 does not lie. The argument is that
the order of confiscation and penalty has been made by an
authority under a statute which is intra vires and in the
undoubted exercise of its jurisdiction. The validity of
such an order cannot therefore be called in question in a
petition under Art. 32 of the Constitution even though the
authority may have misconstrued the provisions of Para. 6 of
S.R.O. 3315.
In resisting the preliminary objection, Mr. N.C. Chatterjee
has argued on behalf of the petitioner that all these 16
cases are cases of a quasi-judicial authority acting without
Jurisdiction and so, the decision in Ujjam Bai’s Case (1),
far from creating any difficulty in the way of the issue of
a writ, definitely helps the petitioner. It is not disputed
that in deciding the preliminary objection the Court has to
proceed on the basis that the petitioner’s allegations about
the importations having been made on the basis of contracts
concluded before November 1, 1954, are correct. The
necessary consequence of this fact it is argued, is that the
Sea Customs Act would not apply to these cases of
importations and consequently the Collector of Customs, an
officer, who derives his jurisdiction from the Sea Customs
Act, would have no jurisdiction to make any, order in
respect of them. In my opinion, there is considerable force
in the argument and the preliminary objection raised on
behalf of the respondent should fail.
The majority decision in Ujjam Bai’s case (1) is clear
authority for the proposition, that an order of confiscation
or penalty made by an authority under a statutory provision
which is intra vires cannot be questioned in a petition
under Art. 32 of the Constitution on the ground that it has
been passed under a misconstruction of the provision of law,
provided the order is made "’in the undoubted exercise of
its
(1) [1963] 1 S. C. R. 778,
377
jurisdiction." Ujjam Bai’s case also appears however to be
equally clear authority for the proposition that "’if a
quasi-judicial authority acts without jurisdiction or
wrongly assumes jurisdiction by committing an error as to a
collateral fact and the resultant action threatens or
violates a fundamental right the question of enforcement of
that right arises and a petition under Art. 32 will lie."
This proposition has been recently reiterated by a Bench of
five judges of this Court in The State Trading Corporation
of India v. The State of Mysore (Writ Petitions Nos. 65 and
66 of 1960.) In that case also an objection was raised on
the authority of Ujjam Bai’s Case to the maintainability of
writ petitions under Art. 32 of the Constitution’.
Repelling the objection, Sarkar, J., speaking for the Court,
observed :-.
"It was however said that the petitions were incompetent in
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view of our decision in Ujjam Bai v. State of Uttar Pradesh
(1) in as much as the Taxing Officer under the Mysore Acts
had jurisdiction to decide whether particular sale was an
inter-State sale or not and any error committed by them as a
quasi-judicial tribunals in exercise of such jurisdiction
did not offend any fundamental right. But we think that
case is clearly distinguishable. Das, J., there stated that
"’if a quasi-judicial authority acts without jurisdiction or
wrongly assumes jurisdiction by committing an error as to a
collateral fact and the resultant action threatens or
violates a fundamental right, the question of enforcement of
that right arises and a petition under Art. 32 will lie." He
also said that where a statute is intra vires but the action
taken is without jurisdiction, then a petition under Art. 32
would be competent. That is the case here. There is no
dispute that the taxing officer had no jurisdiction to tax
inter-State sales, there being a constitutional prohibition
against a State taxing them. He could not give himself
jurisdiction to do so by deciding a collateral fact wrongly.
That is what he seems to
(1)..[1963] 1 S. C. R. 778.
378
have done here., Therefore, we think the decision in
Ujjambai’s case is not applicable to the present case and
the petitions are fully competent."
It is hardly necessary to cite any further authority for the
proposition that an inferior tribunal cannot give to itself
jurisdiction by deciding a collateral fact wrongly. I;
shall only refer to the decision in Rex v. Shoreditch
Assessment Committee (1) where the matter was discussed in
picturesque language thus : "No tribunal of inferior
jurisdiction can by its own decision finally decide on the
question of the existence or extent of such jurisdiction
;............... .................. a Court with
jurisdiction confined to the city of London cannot extend
such jurisdiction by finding as a fact that Piccadilly
Circus is in the ward of Chepe."
What has happened in the cases now before us is that the
Collector who has jurisdiction only in cases coming under
the Sea Customs Act has assumed jurisdiction, on a wrong
finding that the Sea Customs Act applies to these cases,
even though in law it does not.
There is no escape from the conclusion that on the authority
of this Court’s decision in Messrs. Universal Imports
Agency v. The Chief Controller of Imports and Exports (2),
the Sea Customs Act will not apply and the law formerly in
force in the French Establishments, immediately before
November 1, 1954, would apply, in respect of all
importations into Pondicherry made on the basis of contracts
concluded before November 1, 1954. On the assumption which,
as already stated, must be made in considering the
preliminary objection, that the importations in these cases
were made on the basis of contracts concluded before
November 1, 1954, the irresistible conclusion is that the
Sea Customs Act had no application to these cases. It
necessarily follows that the Collector of Customs had,, on
the
(1) [1910] 2 K. B. 859.
(2) [1961] 1 S. C. R. 305.
379
above assumption of facts, no jurisdiction to make any order
in respect of these. The fact that the Collector of Customs
thought, in exercising his functions as a quasi-judicial
authority, that the Sea Customs Act did apply cannot
possibly affect this question.
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It appears that before the Collector the petitioner did not
seek to make the case which he now wants to make, viz., that
the contract for supply of the goods was made in all these
cases before November 1, 1954. Before the Collector the
petitioner’s case was that the contracts in all the cases
had been concluded before August 15, 1954. The collector
came to the conclusion that this case, viz., that the
contracts had been concluded before August 15, 1954, had not
been established. It was in that view that he made the
orders of confiscation with an option to pay penalty
instead. It seems probable that in the appeals before the
Central Board of Revenue and the revisional applications
before the Government of India also the petitioner’s case
was that the contracts had been concluded before August 15,
1954, and the case that the contracts were concluded before
November 1, 1954, was not pleaded. The Member, Central
Board of Revenue, in disposing of the appeals recorded his
view that it was not in doubt that the goods in question
were imported into Pondicherry at a time when a licence was
required for their import and that the appellant did not
have such a licence. In that view he affirmed the
Collector’s orders with a modification that the fine in lieu
of confiscation be reduced. The Government of India also
found no reason to interfere with the orders passed by the
Central Board of Revenue.
These facts can however make no difference to the position
in law that if in fact the importations were made on the
basis of contracts concluded before November 1, 1954, the
Sea Customs Act would not
380
apply and the Collector or the Central Board of Revenue
would have no jurisdiction to make any order of confiscation
or penalty. Where an authority whether judicial or quasi-
judicial has in law no jurisdiction to make an order the
omission by a party to raise before the authority the
relevant facts for deciding that question cannot clothe it
with jurisdiction.
The substance of the matter is that the Collector assumed
jurisdiction on the view that the Sea Customs Act applied to
these cases, if the importations were on the basis of
contracts concluded before November 1, 1954-as we have
assumed,-the Sea Customs Act does not however apply to these
cases. Therefore, the Collector acted without jurisdiction
and the fact that the assumption of jurisdiction was based
on the Collector’s wrong decision, does not change that
position. The writ petitions would therefore be
maintainable, if the petitioner can satisfy the Court that
the importations were made on the basis of contracts
concluded before November 1, 1954. I would therefore reject
the preliminary objection.
When the Universal Imports Agency Case was decided by this
Court, no objection to the maintainability of the writ
petition was raised; and consequently, the Court had not to
consider the question whether the action taken by the
Collector of Customs was with or without jurisdiction. So
long as however the law as laid down by the majority
judgment in that case remains good law, we must hold that
the Sea Customs Act would not apply to imports in these
cases also if they were made on the basis of contracts
concluded before November 1, 1954; and as explained above,
that in my opinion compels the conclusion that the Collector
of Customs acted without jurisdiction, if the imports were
on the basis of contracts concluded before November 1, 1954.
It may be mentioned here in this connection that S. K.
Das, J., in his judgment in Ujjam Bai’s Case (2)
http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 20 of 20
(1) [1962] 1 S. C. R. 305.
(2) [1963] 1 S. C. R. 778
381
referred to the decision of this Court in Universal Imports
Agency v. Chief Controller of Imports and Exports (1) as a
case where a quasi-judicial authority has acted without
jurisdiction. Kapur, J., has also referred to this case and
said in any case, this is an instance of want of
jurisdiction to tax transactions which the law excludes from
the taxing powers of the authority levying the tax."
Coming now to the merits of the petitions, I need only state
that the materials that have been produced by the petitioner
are by no means sufficient to establish the case that the
contracts in these several cases were concluded before
November 1, 1954. Mr. Chatterjee prayed to the Court for an
opportunity to adduce further documentary evidence to
convince us of the truth of the petitioner’s case on this
point. I might perhaps have been inclined to grant this
prayer. No useful purpose will however be served by my
discussing Chat question, or the materials already on the
record, as my learned brethren,. having come to a conclusion
that the preliminary objection should succeed, have not
considered the merits of the petition.
The position is exactly similar in the other thirteen
petitions filed by M/s. Pioneer Traders which were heard
along with the petitions already discussed and my conclusion
in regard to those petitions is also the same.
BY COURT : In accordance with the judgment of the majority
of the Court, the petitions are dismissed with costs. There
will be one set of hearing costs.
Petitions dismissed.
(1) [1961] 1 S. C. R. 305.
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