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Supreme Court: Moving the High Court’s jurisdiction to seek release of seized vehicles without engaging the magistrate deemed inappropriate.

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Case title: Khengarbhai Lakhabhai Dambhala v. The State of Gujarat

Case no.: Criminal Appeal No.1547 Of 2024

Order on: 8th April 2024

Quorum: Justice Bela M. Trivedi and Justice Pankaj Mithal

FACTS OF THE CASE

In this case, the appellant claimed ownership of a vehicle, an Eicher 10.80 (Blue) bearing no. GJ 05-BT-0899, which was seized by police as Muddamal Article in connection with FIR no. 11200038231465/2023. The FIR was lodged under various sections of the Gujarat Prohibition Act and IPC at the Pardi Police Station, District Valasad. The police intercepted the vehicle based on secret information and alleged that it was carrying English Liquor (1240.200 Liters) worth rupees 7 lakhs without any pass or permit. The appellant, claiming to be the owner, filed a Special Criminal Application No.6465 of 2023 before the High Court of Gujarat at Ahmedabad seeking release of the seized vehicle. However, the High Court dismissed the application through an order dated 08.06.2023, leading to the present appeal.

CONTENTIONS OF THE APPELLANT

The appellant contended that the vehicle should be released, claiming ownership, without approaching the concerned criminal court under Section 451 of the Cr.P.C. Instead, they filed a Special Criminal Application directly in the High Court under Article 226/227 of the Constitution of India.

CONTENTIONS OF THE RESPONDENTS

The State of Gujarat, represented as the respondent, contended that Section 98(2) of the Gujarat Prohibition Act 1949 forbids the release of the vehicle until the final judgment of the court if the quantity of seized liquor exceeds the prescribed limit.

In this case, the seized quantity of liquor was 1240 liters, far exceeding the prescribed quantity of 20 liters as per the relevant notification.

In case of Sunderbhai Ambalal Desai vs. State of Gujarat, it is of no use to keep the seized vehicles at the police stations for a long period and it is for the magistrate to pass appropriate orders for the proper custody of the said such vehicles during the pendency of the trial. However, as observed earlier, the appellant without approaching the concerned criminal court under Section 451 of the Cr.P.C seeking custody of the vehicle in question, directly approached the High Court by filing Special Criminal Application under Article 226/227 of the Constitution of India, which was not the proper course as adopted by the appellant.

LEGAL PROVISIONS

Section 65 of Gujarat Prohibition Act, Sub-Section:

(a) imports or exports any intoxicant 1 [ ( other than opium ) ] or hemp.

(e) sells or buys any intoxicant 1 [ (other than opium) ] or hemp.

Section 81 of Gujarat Prohibition Act – Whoever, attempts to commit or abets the commission of an offence be punished for such attempt or abetment.

Section 98(2) of Gujarat Prohibition Act – Any receptacle, package or covering in which any of the articles liable to confiscation by the order of the Court.

Section 132 of Gujarat Prohibition Act – Article seized – [When anything has been seized, under the provisions of this Act by a Prohibition Officer exercising powers under section 129 or by an Officer in-charge of a Police Station].

ISSUE –

  • Whether the vehicle seized in connection with the offense under the Gujarat Prohibition Act could be released pending trial.
  • Whether the appellant’s approach, directly filing a Special Criminal Application in the High Court, was appropriate.

COURT’S ANALYSIS AND JUDGEMENT

The court analyzed Section 451 of the Cr.P.C., which deals with the custody and disposal of property during an inquiry or trial. It emphasized that the criminal court has the jurisdiction to pass orders regarding custody or disposal of the property. The appellant’s direct approach to the High Court was deemed inappropriate, as there existed a specific statutory provision under Cr.P.C. for seeking custody of the seized property.

Regarding the prohibition against the release of the vehicle under Section 98(2) of the Gujarat Prohibition Act, the court noted the ambiguity in its wording. It observed that the provision lacked coherence in its construction and did not clearly establish a relationship between its parts. However, considering the broader context of the Act and Cr.P.C., the court concluded that the vehicle could not be released without proper legal procedure being followed.

The court dismissed the appeal, emphasizing that the appellant should approach the concerned criminal court for custody of the vehicle during the trial. It clarified that the dismissal didn’t bar the appellant from seeking relief through the appropriate legal channels.

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Judgement Reviewed by – Chiraag K A

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“Delhi HC: Proper Officer Must Carefully Evaluate The Response On Its Merits Before Forming An Opinion”

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Case title: Canara Bank v. Assistant Commissioner, DGST

Case no.:  W.P.(C) 4689/2024 & CM APPL. 19233-34/2024

Order on: 2nd April 2024

Coram: Hon’ble Mr. Justice Sanjeev Sachdeva & Hon’ble Mr. Justice Ravinder Dudeja

FACTS OF THE CASE

In the High Court of Delhi, a significant judgment was delivered on April 2, 2024, in the case of W.P.(C) 4689/2024 involving Canara Bank and the Assistant Commissioner, DGST. The case revolved around a disputed show-cause notice dated 25.09.2023, proposing a substantial demand against the petitioner under Section 73 of the Central Goods and Services Tax Act, 2017. The court’s meticulous analysis of the facts and legal submissions led to a pivotal decision that merits closer examination.

Canara Bank challenged an order dated 26.12.2023, whereby the impugned show-cause notice proposing a demand of Rs.20,07,15,517.00 against the bank was disposed of, and a demand including penalty was raised. The bank had submitted a detailed reply dated 19.10.2023 to the show-cause notice, providing full disclosures under each of the heads mentioned in the notice. However, the impugned order dismissed the reply as incomplete, unsupported by adequate documents, and unsatisfactory.

CONTENTIONS OF THE PETITIONERS

  • Canara Bank, represented by Mr. G. Shivadass, Senior Advocate, argued that their reply to the show-cause notice was comprehensive and should have been considered on its merits.
  • They contended that the order was cryptic and failed to address the points raised in their reply.

CONTENTIONS OF THE RESPONDENTS

  • The Assistant Commissioner, DGST, represented by Mr. Rajiv Aggarwal, ASC, defended the impugned order, asserting that the petitioner’s reply was inadequate and unsatisfactory.

LEGAL PROVISIONS

Section 73 of the Central Goods and Services Tax Act, 2017 – Determination of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilized for any reason other than fraud or any willful-misstatement or suppression of facts.

ISSUE – The primary issue before the court was whether the impugned order dismissing the petitioner’s reply as incomplete and unsatisfactory was valid.

COURT’S ANALYSIS AND JUDGEMENT

Upon careful consideration of the submissions and perusal of the show-cause notice and the petitioner’s reply, the court found the impugned order untenable. Despite the petitioner’s detailed response, the order summarily dismissed it without proper consideration. The court noted that the Proper Officer had not applied his mind to the petitioner’s submissions and failed to seek further clarification if needed.

Consequently, the court set aside the impugned order and remitted the matter to the Proper Officer for re-adjudication. The Proper Officer was directed to intimate the petitioner regarding any additional details or documents required and provide an opportunity for a fresh hearing. The court clarified that it had not adjudicated on the merits of the case, leaving all rights and contentions of the parties reserved.

The judgment in W.P.(C) 4689/2024 underscores the importance of proper adjudication and due process in tax matters. It emphasizes the need for authorities to carefully consider the submissions made by taxpayers and provide them with a fair opportunity to present their case. By setting aside the impugned order and directing a re-adjudication, the court upheld the principles of natural justice and procedural fairness.

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Judgement Reviewed by – Chiraag K A

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