Statutory Appeal Under Section 6C Is Maintainable Against Orders Directing Deposit of Value in Lieu of Confiscation

The petitioner, working as a Manager at M/s Tiwari Indane Gas Agency, was subjected to an inspection on 05.01.2011, during which 410 LPG cylinders were seized due to alleged irregularities in stock maintenance.

The Collector, Rewa, issued an order on 15.11.2016 directing the petitioner to deposit the value of the seized cylinders (Rs. 5,19,300/-) in lieu of confiscation.

The petitioner challenged this before the Fourth Additional Sessions Judge, Rewa, under Section 6C of the Essential Commodities Act, 1955.

The Appellate Court dismissed the appeal as not maintainable, reasoning that the Collector’s order was not a formal order of confiscation under Section 6A.

The petitioner subsequently moved the High Court under Article 227 of the Constitution.

1. Whether an order directing the deposit of the value of seized goods in lieu of confiscation constitutes an appealable order under Section 6C of the Essential Commodities Act, 1955.

2. Whether the Appellate Court erred in dismissing the appeal at the threshold on grounds of maintainability without examining the jurisdictional validity of the Collector's order.

The court primarily applied Section 6A of the Essential Commodities Act, 1955, which governs the confiscation of seized essential commodities.

It further relied on Section 6C of the same Act, which provides a statutory right of appeal to any person aggrieved by an order of confiscation passed under Section 6A.

The Court emphasized the principle of judicial review under Article 227 of the Constitution to correct jurisdictional errors and ensure that statutory remedies are not defeated by technical interpretations.

The High Court reasoned that since the Collector’s proceedings were expressly initiated under Section 6A and resulted in a financial liability (deposit in lieu of confiscation), the order possessed all the "trappings" of a confiscation order.

The Court observed that such an order directly impacts the civil rights of the petitioner.

It held that the Appellate Court's refusal to entertain the appeal on maintainability was a failure to exercise jurisdiction, as the question of whether the Collector had the power to substitute physical confiscation with a monetary recovery is a substantial legal issue that falls within the scope of appellate scrutiny under Section 6C.

By dismissing the appeal at the threshold, the lower court effectively defeated the statutory remedy intended by the legislature.

The High Court allowed the petition in part, setting aside the Appellate Court's order dated 09.08.2018, and remitted the matter to the Fourth Additional Sessions Judge, Rewa, with directions to restore the appeal and adjudicate it on merits; no opinion was expressed on the factual merits of the search or seizure.