Satyanarayan Agarwalla Vs. the State - Court Judgment

Excerpt:
- state financial corporations act, 1951 [63/1951]. section 29; [p.k. tripathy, a.k. parichha & n.prusty, jj] discharge of loan orissa forest act (14 of 1972), section 56 confiscation of vehicle - held, the authorities under section 56 of the orissa forest act, 1972 are not obliged to release the vehicle from the confiscation proceeding or to pay the sale proceeds of the vehicle after the order of confiscation in favour of orissa state financial corporation when such vehicles were purchased on being financed by the orissa state financial corporation and the loan had not been liquidated by the date of the seizure/confiscation of the vehicle. concept of first charge or second charge has no applicability when the vehicle is not otherwise disposed of to determine the liabilities of the loanee. on the other hand the vehicle having been found indulged in forest offences was made subject matter of a confiscation proceedings, and therefore, the procedure followed for confiscation of the vehicle and for its sale is punitive in nature and not with a view to give benefit to anybody including the department which initiated the confiscation proceeding. apart from that, the claim of the orissa state financial corporation as against its loanee (who had taken the vehicle on hire- purchase agreement) brings the loanee and the sureties within the default clause under the state financial corporation act, 1951 or the heirs and successors of such persons. procedure is provided in the act, 1951 and the rules thereof about the manner in which such loan is to be recovered, and in that context only the vehicle under the hire-purchase agreement is placed as the first charge. if such property is not available for any reason, then the loan is not automatically waived or the loanee and his sureties are not automatically redeemed of the liabilities to repay. the financial corporation is concerned with repayment of loan either from the property or persons offered as surety. thus, a vehicle, which is subject matter of confiscation proceeding under the act, 1872, being not available to the orissa state financial corporation for adjustment of the unpaid loan, that does not at all bring out an anomalous situation so as to defeat the right of the orissa state financial corporation. agreement between the orissa state financial corporation and the loanee is a pure and simple contract governed by the provisions of the contract act, 1872 read with the provisions in the act, 1951 and its rules. on the other hand, a confiscation proceeding under the act, 1972 is punitive in nature for commission of a forest offence. thus, by virtue of the provision in section 56 read with section 64 (2) of the act, 1972, the action taken for confiscation of the vehicle cannot be extended to grant protection of the loan advanced by orissa state financial corporation. by doing that it amounts to grant premium to the pick-pockets in as much as, by making payment of the confiscation amount in favour of the orissa state financial corporation the loan burden of the accused of the forest offence is reduced to the extent of the sale proceeds of the vehicle. in other words, on payment of the sale proceeds of the confiscation proceeding to the orissa state financial corporation towards discharge of the loan account of the accused of a forest offence, it would lead to a system to reward him by repayment of his loan. then it does not become a penalty nor the action become punitive, but it remains as a reward to the accused of forest offence. such a concept is totally not conceivable from any provision in the act, 1972 or the act, 1951. [air 2002 orissa 130 overruled]. -- state financial corporations act, 1951. section 29; discharge of loan orissa forest act (14 of 1972), section 56 confiscation of vehicle - held, the authorities under section 56 of the orissa forest act, 1972 are not obliged to release the vehicle from the confiscation proceeding or to pay the sale proceeds of the vehicle after the order of confiscation in favour of orissa state financial corporation when such vehicles were purchased on being financed by the orissa state financial corporation and the loan had not been liquidated by the date of the seizure/confiscation of the vehicle. concept of first charge or second charge has no applicability when the vehicle is not otherwise disposed of to determine the liabilities of the loanee. on the other hand the vehicle having been found indulged in forest offences was made subject matter of a confiscation proceedings, and therefore, the procedure followed for confiscation of the vehicle and for its sale is punitive in nature and not with a view to give benefit to anybody including the department which initiated the confiscation proceeding. apart from that, the claim of the orissa state financial corporation as against its loanee (who had taken the vehicle on hire- purchase agreement) brings the loanee and the sureties within the default clause under the state financial corporation act, 1951 or the heirs and successors of such persons. procedure is provided in the act, 1951 and the rules thereof about the manner in which such loan is to be recovered, and in that context only the vehicle under the hire-purchase agreement is placed as the first charge. if such property is not available for any reason, then the loan is not automatically waived or the loanee and his sureties are not automatically redeemed of the liabilities to repay. the financial corporation is concerned with repayment of loan either from the property or persons offered as surety. thus, a vehicle, which is subject matter of confiscation proceeding under the act, 1872, being not available to the orissa state financial corporation for adjustment of the unpaid loan, that does not at all bring out an anomalous situation so as to defeat the right of the orissa state financial corporation. agreement between the orissa state financial corporation and the loanee is a pure and simple contract governed by the provisions of the contract act, 1872 read with the provisions in the act, 1951 and its rules. on the other hand, a confiscation proceeding under the act, 1972 is punitive in nature for commission of a forest offence. thus, by virtue of the provision in section 56 read with section 64 (2) of the act, 1972, the action taken for confiscation of the vehicle cannot be extended to grant protection of the loan advanced by orissa state financial corporation. by doing that it amounts to grant premium to the pick-pockets in as much as, by making payment of the confiscation amount in favour of the orissa state financial corporation the loan burden of the accused of the forest offence is reduced to the extent of the sale proceeds of the vehicle. in other words, on payment of the sale proceeds of the confiscation proceeding to the orissa state financial corporation towards discharge of the loan account of the accused of a forest offence, it would lead to a system to reward him by repayment of his loan. then it does not become a penalty nor the action become punitive, but it remains as a reward to the accused of forest offence. such a concept is totally not conceivable from any provision in the act, 1972 or the act, 1951. [air 2002 orissa 130 overruled]. orderr.n. misra, j.1. this revision application is directed against the confirming appellate order of learned sessions judge of cuttack upholding confiscation directed by the collector and district magistrate of cuttack in exercise of powers vested in him under section 6a of the essential commodities act of 1955.2. petitioner carries on business in oil seeds on wholesale basis in malgodown area of cuttack. on the allegation that there had been contravention of clause 3 of the orissa essential food stuffs (prevention of hoarding and requisitioning of stocks) order, 1974, as also clause 3 of the orissa declaration of stocks and prices of essential commodities order, 1973, certain quantities of ground- put seed and ground-nut oil had been seized from the petitioner's premises. a notice was issued to the petitioner to show cause as to why an order of confiscation may not be made. in the notice in miscellaneous case no. 16 of 1975, particulars were not provided except that in the schedule, the two items proposed to be confiscated had been specified. cause was shown on 2-8-1975. on 8-8-1975, petitioner's advocate was heard and after four adjournments, on 22-9-1975, the order of confiscation followed. an appeal had been carried, where no interference was caused. in these circumstances, confiscation is assailed in this revision.3. a preliminary point had been raised by learned additional government advocate when this revision was called for hearing, namely, the order of confiscation by the prescribed authority was administrative in character and merely because an appeal had been provided to a nominated judicial authority, there was no warrant for the position that the judicial authority was a court subordinate to this court and, therefore this court would have no revisional jurisdiction to exercise against the appellate order. lot of arguments had been advanced, but as i find the question has now been finally settled in a recent decision of the supreme court in the case of thakur dass v. state of madhya pradesh, (criminal appeal no. 109 of 1974 disposed of on 14-10-11977) : reported in 1978 cri lj 1. the preliminary point now raised was directly in issue and the court came to hold (at p. 6):since under the constitution the courts being repository of the judicial power and the officer presiding over the court derives his designation from the nomenclature of the court even if the appointment is made by the designation of the judicial officer the appellate authority indicated is the court over which he presides discharging function under the relevant code and place in hierarchy of courts for the purposes of appeal and revision. viewed from this angle, the sessions judge, though appointed an appellate authority by notification, what the state government did was to constitute an appellate authority in the sessions court over which the sessions judge presides.once the appeal is said to have gone to the sessions court, there is no further doubt that a revision would lie to this court. the preliminary point is, therefore, devoid of any merit and is rejected.4. coming to the merit of the matter, as x have already indicated in a recent decision in the case of m/s. geneswar sahu and brother v. state of orissa (1977) 43 cut lt 88, an appropriate opportunity has to be given to the person affected and that opportunity would not be issuing a notice in a bald form as in this case. all details should be provided, the circumstances of seizure should be indicated and the petitioner should be given an opportunity of really giving an appropriate explanation against the proposed action. the scheme of the statute is such that even if evidence is offered, it has to be taken. in the present case, nothing of that type seems to have been done. it is true, as pointed out by learned additional government advocate that the petitioner had the opportunity of an appeal, but as i find, these aspects have not been taken into account. i am inclined to agree with mr. mohanty for the petitioner that for the infirmities referred to above, the order of confiscation should not be sustained. i would accordingly quash it. it would still be open to the prescribed authority under section 6a of the essential commodities act to exercise his jurisdiction by complying with the requirements of the law.the revision application in the circumstances is allowed.

Judgment:
ORDER

R.N. Misra, J.

1. This revision application is directed against the confirming appellate order of learned Sessions Judge of Cuttack upholding confiscation directed by the Collector and District Magistrate of Cuttack in exercise of powers vested in him under Section 6A of the Essential Commodities Act of 1955.

2. Petitioner carries on business in oil seeds on wholesale basis in Malgodown area of Cuttack. On the allegation that there had been contravention of Clause 3 of the Orissa Essential Food Stuffs (Prevention of Hoarding and Requisitioning of Stocks) Order, 1974, as also Clause 3 of the Orissa Declaration of Stocks and Prices of Essential Commodities Order, 1973, certain quantities of ground- put seed and ground-nut oil had been seized from the petitioner's premises. A notice was issued to the petitioner to show cause as to why an order of confiscation may not be made. In the notice in Miscellaneous Case No. 16 of 1975, particulars were not provided except that in the schedule, the two items proposed to be confiscated had been specified. Cause was shown on 2-8-1975. On 8-8-1975, petitioner's advocate was heard and after four adjournments, on 22-9-1975, the order of confiscation followed. An appeal had been carried, where no interference was caused. In these circumstances, confiscation is assailed in this revision.

3. A preliminary point had been raised by learned Additional Government Advocate when this revision was called for hearing, namely, the order of confiscation by the prescribed authority was administrative in character and merely because an appeal had been provided to a nominated judicial authority, there was no warrant for the position that the judicial authority was a court subordinate to this Court and, therefore this Court would have no revisional jurisdiction to exercise against the appellate Order. Lot of arguments had been advanced, but as I find the question has now been finally settled in a recent decision of the Supreme Court in the case of Thakur Dass v. State of Madhya Pradesh, (Criminal Appeal No. 109 of 1974 disposed of on 14-10-11977) : reported in 1978 Cri LJ 1. The preliminary point now raised was directly in issue and the Court came to hold (at p. 6):

Since under the Constitution the Courts being repository of the judicial power and the officer presiding over the court derives his designation from the nomenclature of the Court even if the appointment is made by the designation of the Judicial Officer the appellate authority indicated is the Court over which he presides discharging function under the relevant Code and place in hierarchy of Courts for the purposes of appeal and revision. Viewed from this angle, the Sessions Judge, though appointed an appellate authority by notification, what the State Government did was to constitute an appellate authority in the Sessions Court over which the Sessions Judge presides.

Once the appeal is said to have gone to the Sessions Court, there is no further doubt that a revision would lie to this Court. The preliminary point is, therefore, devoid of any merit and is rejected.

4. Coming to the merit of the matter, as X have already indicated in a recent decision in the case of M/s. Geneswar Sahu and Brother v. State of Orissa (1977) 43 Cut LT 88, an appropriate opportunity has to be given to the person affected and that opportunity would not be issuing a notice in a bald form as in this case. All details should be provided, the circumstances of seizure should be indicated and the petitioner should be given an opportunity of really giving an appropriate explanation against the proposed action. The scheme of the statute is such that even if evidence is offered, it has to be taken. In the present case, nothing of that type seems to have been done. It is true, as pointed out by learned Additional Government Advocate that the petitioner had the opportunity of an appeal, but as I find, these aspects have not been taken into account. I am inclined to agree with Mr. Mohanty for the petitioner that for the infirmities referred to above, the order of confiscation should not be sustained. I would accordingly quash it. It would still be open to the prescribed authority under Section 6A of the Essential Commodities Act to exercise his jurisdiction by complying with the requirements of the law.

The revision application in the circumstances is allowed.