Dated this the 10th day of June 2020
1. The 2nd and 12th accused respectively in C.C.No.2 of 2015 of Special Judge (SPE/CBI), Thiruvananthapuram for offences punishable under sections 120B r/w 420 IPC and sections 7, 12, 13(2) r/w 13(1)(d) of the Prevention of Corruption Act, 1988 are the petitioners.
2. Petitioners, along with 14 other persons, which include various customs officials, clearing agents, and a private person face prosecution in the above crime registered as R.C. 14CA/2012/CBI/ACD/COCHIN dated 14.08.2012. The allegation of the prosecution, as is discernible from the records, is as follows:
3. The 1st, 12th and 13th accused were Superintendents of Customs, Department of Revenue and Central Excise and Customs, Government of India. The 2nd, 3rd, 4th, 14th, 15th and 16th accused were officiating in the capacity of Inspectors of Central Excise and Customs. All the above were posted at the unaccompanied baggage clearing centre, Air Cargo Complex, International Airport, Thiruvananthapuram during the period July 2012. As per the practice in place during the relevant time, Non Resident Indians, mainly in Gulf countries, were permitted to despatch their personal consignments to India as unaccompanied baggages, disclosing their addresses and passport numbers. On arrival of the parcel at the Airport, each consignee was obliged to present himself at the station, fill up the baggage declaration form, disclosing the details of each item and its approximate value and receive the parcel on payment of requisite fee imposed by the customs authorities. It is stated that due to heavy flow of parcels everyday, customs officers were permitted to avoid physical verification of small parcels which were bonafide baggages. According to the prosecution during the relevant period, accused customs officials, who were posted at the Air Cargo Complex, entered into a criminal conspiracy with few clearing house agents and permitted them to club several baggages known by the loose expression of door-to-door delivery, book the entire consignment in the name of an NRI who had recently undertaken travel to India and agreed to impose nominal fee.Utilizing this, several NRIs used to send their parcels through such agents who clubbed those parcels under the name of a single NRI, who had travelled to India. According to the prosecution, baggages were booked by delivery agents on the pretext of baggage of a single passenger. The customs officials, pursuant to the understanding, used to release them without levying the actual customs duty.
4. On getting information of this malpractice, the CBI conducted a joint surprise check in the Air Cargo Complex at Thiruvananthapuram Airport on 13.07.2012 and on finding that three consignments were released in violation of law, detained those unaccompanied baggages in the custody of Assistant Commissioner of Customs. Joint surprise check proceeding was drawn and statements of few persons present there were recorded. FIR was accordingly registered on 14.08.2012. According to the CBI, a very casual inspection of the three consignments showed that they were not bonafide baggages. Those three baggages booked in the name of 3 different passengers contained 20 packets, 42 packets and 35 packets respectively, weighing 1435 kgs, 1775 kgs and 1630 kgs respectively. They were only assessed of value Rs.9,500/-, Rs.24,150/- and Rs.17,900/- respectively and after allowing the free allowance, the duty assessed by the customs authorities were Rs.3425/-, Rs.8706/ and Rs.6453/- respectively totaling to Rs.18,584/-. The CBI got valued the above three consignments by SIIB(Special Intelligence and Investigation Branch), who assessed it at Rs.2,51,526/-. Accordingly, tax liable to be paid was fixed at Rs.2,28,615/-. The tax evasion was assessed at Rs.2,10,031/-.
5. Investigation revealed that 15 such unaccompanied baggages were released on earlier occasions by adopting similar modus operandi. According to the CBI, the above 15 consignments were dubious door -to- door delivery consignments. CBI alleged that, the accused customs officials, fully knowing that heavy weight consignments did not belong to the respective passengers in whose names they were booked, by abusing their official position, dishonestly cleared the cargo by imposing very low customs duty and obtained undue pecuniary advantage to themselves. It was alleged that pursuant to criminal conspiracy entered between the accused persons, all the above baggages were released by levying very less customs duty by valuing the consignments at a very nominal rate. All the discrepancies with respect to the passports and the baggage declarations were deliberately omitted to be taken note of and to determine that baggages were of non bona fide nature and for that the defaulting officers had obtained illegal gratification at a fixed rate. According to the CBI, the rate so decided was a fixed rate of Rs.13 per kg, deducting the customs duty levied, which was the incentive for the officers to levy lesser and lesser customs duty.
6. According to CBI, to streamline the procedure and to ensure revenue, the Commissioner of Central Excise had issued direction, vide circular dated 12.01.2011, that instructions in Circular No.35/2007 should be strictly followed. It was directed that the entire baggage shall be adjudicated where it was held to be non bonafide baggage. Free allowances allowed for personal effects should not be extended to baggages of non-bonafide nature.
7. After completion of investigation, sanction for prosecution under section 19(1)(c) of the Prevention of Corruption Act was sought, which was accorded by the Commissioner of Central Excise and Customs. Thereafter, final report was laid against 16 persons, excluding two officers who were named in the FIR. Pursuant to the summons, the accused appeared. First accused and 11th accused filed Crl.M.P.No.9 of 2016 and Crl.M.P.No.112 of 2016 respectively seeking their discharge under section 239 Cr.P.C. Both the applications were dismissed by a common order and charges were framed. In the meanwhile, the present petitioners have preferred these Crl.M.Cs to quash the prosecution proceedings against them.
8. Heard both the learned counsel for the petitioners and the special prosecutor for the CBI in extenso.
9. The petitioner in Crl.M.C 1826 of 2019 contended that the charge against him was a sheer abuse of process of law. The allegation in Annexure-A2 final report will not constitute any offence in the light of the Baggage Rules 1998. Common ground of attack set up by both the petitioners was that the prosecution was bad, in the absence of non-compliance of statutory mandate contemplated under section 155 of the Customs Act. It was contended that sanction under Prevention of Corruption Act and the protection under section 155 of the Customs Act were two independent protections and therefore sanction granted under the Prevention of Corruption Act would not obviate the need of notice under section 155(2) of the Customs Act. Supplementing the above contention, the petitioner in Crl.M.C.No.8881 of 2018 contended that, special provisions similar to section 155 of the Customs Act were incorporated in several other statutes, to give protection to just and bonafide action of the officials in sensitive formations like Air cargo, who often fall prey to the false vengeance and corruption charges. That protective section of the Act which was unique, extends the principle of natural justice by giving an opportunity to the officers to explain their stand in bonafide actions, it was contended. Consequently the prosecution sanction obtained under the Prevention of Corruption Act was nonest and liable to be interfered, it was argued.
10. On merits, it was contended by the petitioners that the prosecution was launched overlooking the legal and bonafide action taken by them, in accordance with Baggage Rules. It was contended that the sole testimony of one Sivaprasad who himself had given self contradicting statements and also statements which were contrary to Baggage Rules, were relied on by the prosecution. It was also contended that at the unaccompanied baggage centre, Air Cargo Complex, Thiruvananthapuram, the officers were under tremendous pressure to clear 20 to 25 baggages weighing 1000 to 1500 kgs every day. Bonafide human error of judgment, even if any, under such circumstances was liable to be condoned, it was argued.
11. The crux of the prosecution allegation was that the accused who were the customs officers (accused Nos.1, 2, 3, 4, 12, 13, 14, 15, and 16) conspired with clearing agents (accused Nos.5 to 10) and in furtherance of the conspiracy deliberately and with malafide intention, omitted to identify the non-bonafide door -to -door baggages which came as unaccompanied baggages, and to send them for adjudication/confiscation. It was alleged that there was an understanding among the customs officials and clearing agents that former would not impose more than Rs.8 per kg of the weight of consignment as customs duty and only in case of electronic goods, they would impose a maximum of Rs.8 per kg of weight of consignment as duty, whereby even if the Assistant Commissioner decided to confiscate the goods and impose maximum penalty, yet it would be beneficial to both, considering the actual value of consignment. The agents agreed to pay illegal gratification at the rate of Rs.13 per kg of weight of consignment minus customs duty levied. It was alleged that when the baggage declaration form was submitted as per mutual agreement between the accused, respective administrative superintendent knowing well that consignment was apparently non bonafide baggage and that actual and true details were not disclosed in the declaration form and that the baggage declaration was filed by the passenger through the clearing agents, did not insist in following the due procedure.
12. The above allegation is refuted by the petitioners contending that; 1). the investigating agency failed to consider two reports of Assistant Commissioner of Customs to two authorities denying the violation of Rules and supporting the bona fide and legal action of the officers. 2) the correct procedure followed by them had resulted in increase in revenue at unaccompanied baggages formation, which suddenly crashed down after the action of the CBI. 3) customs officers were under tremendous pressure of work by fixing of a target for clearance of baggages, by fixing a customs revenue target to be achieved, by providing that customs will be accountable for any demmurage on account of detention and delay in clearance and, by providing that while attending clearance, they have to be cautious against possible concealment of arms, ammunition, gold, etc. 4) that no material could be gathered to connect the accused to any irregular or illegal act, except the oral statement of one Sivaprasad who has given inconsistent and contradictory statements and 5) that Section 155 of the Customs Act has not been complied with.
13. Evidently, some of the contentions raised above are either touching on merits which can only be decided in a full fledged adjudication, or matters which constitute the defence of accused, which will come into play only if the prosecution is able to establish the case of the prosecution. Though a contention was set up that the method of valuation of the disputed parcels and the finding that it was undervalued was wrong, I find no substance in this contention. The CBI got it valued through the senior officers of the customs department itself, who have found that the parcels were earlier grossly undervalued, which version cannot, at this stage, be doubted. The valuation was done by the officers of the customs department itself. Further, the final report itself indicates that though two more of the customs officers were sought to be prosecuted and their sanction was refused by the sanctioning authority, which also indicates that sanction was granted by the competent authority of the customs department after due and proper application of mind.
14. Prosecution is relying on the oral testimony of about 92 witnesses and 109 documents. The specific contention of the CBI was that there were several apparent indicators in the parcel itself as well as on the baggage declaration form which were sufficient to caution the customs authorities that the baggages were not bona fide baggages and were door-to-door delivery parcels. According to them, these indications could not have missed the scrutiny of any honest officer. They were purposefully overlooked by the accused officers pursuant to the conspiracy with the clearing agents, it was alleged.
15. The witnesses arrayed by the prosecution include about 12 officers of the customs. The remaining witnesses include clearing agents and their assistants who were involved in the process of clearing door-to-door delivery of goods, who had interacted with the customs officers posted at air cargo complex, Thiruvanthapuram. The officers of the customs have given statement touching upon the procedure followed in the Air Cargo Complex and elsewhere, generally in tune with the prosecution allegation. The clearing agents and their assistants have given statements about the clearing of door-to- door parcels send under the name of bona fide passengers and payment of bribe to customs officials at fixed rate. Customers have given statement about the booking of parcels under individual's names and that they were dispatched by parcel/courier agents using the name of another person and the goods so sent did not belong to a single passenger.
16. According to the CBI, the baggage declaration form coupled with connected documents and enclosures would corroborate the statements of witnesses and this would establish the unholy alliance among the accused persons.
17. According to the prosecution, D-59 circular produced by the investigation agency shows that circulars were issued from 1996 onwards that import of consumer goods in commercial quantity was not permissible even in EXIM policy and in addition that, they were not to be treated as part of the bona fide baggage. Import of goods in baggage in commercial quantities would not be permissible within the scope of the Baggage Rules, even on payment of baggages rate of duty. Further D1 report prepared by SIIB, Customs, for valuation of seized consignment would prima facie indicate the door -to -door delivery and, the non bona fide nature of consignment, cleared as unaccompanied baggage and also the low valuation fixed by the accused officials in respect of three seized consignments. The above, coupled with the statements made by the clearing agents and their assistants about the payment of bribes to the said batch of customs officials, the fact that all consignments were bulk quantities each exceeding 1000 kgs and the details of consignees and other apparent indicators indicated the non bona fide nature of the bagage, negates at this stage, an enquiry into the contention that the customs officers were either not aware of the non bona fide nature of the transaction, or had no reason to doubt the bona fide nature of the baggage. The contention that at the most, it could be an error of judgment or that due to work load, they had to clear off huge quantity of parcels disabling them from a detailed examination also do not merit consideration at this stage. Of course, those are matters to be considered at the time of appreciation of evidence at the time of trial, especially in the background of the materials gathered by the prosecution. There is merit in the contention of the CBI that target for clearance of baggages, was fixed by the superiors in the customs department and the wisdom of such a stipulation cannot be considered at this stage. The CBI has a further allegation that at least in one case, one of the passenger had cleared baggage earlier, which could have been easily been verified from the data base.
18. In the light of the oral statements of the various witnesses and the documentary materials relied on by the prosecution, the contention of the petitioners that there are no material to proceed against them andthat the only material available was the version of Siva Prasad, the Assistant Commissioner of Central Excise, who has given inconsistent and self contradictory statement, is not prima facie sustainable at this stage, though the sustainability of the statements of various witnesses need to be tested in a full fledged trial.
19. The main legal contention set up by the petitioners was that though sanction was obtained under Section 19 of the Prevention of Corruption Act, the prosecuting agency did not comply with the procedure under section 155 of the Customs Act. According to the petitioners, the twin protections under the Prevention of Corruption Act and under the Customs Act were unique mandatory protections available to customs officials. Consequently, the prosecution of the accused without obtaining sanction under the Customs Act was bad and liable to be quashed.
20. Before analysing the legal proposition in the background of the various judicial pronouncements, it is essential to refer to the statutory provisions. Section 155 of Customs Act reads as follows:
Section 155:Protection of action taken under the Act
(1) No suit, prosecution or other legal proceedings shall lie against the Central Government or any officer of the government or a local authority for anything which is done, or intended to be done in good faith, in pursuance of this Act or the rules or regulations.
(2). No proceeding other than a suit shall be commenced against the Central Government or any officer of the government or a local authority for anything purporting to be done in pursuance of this Act without giving the Central Government or such officer a month's previous notice in writing of the intended proceeding and of the cause thereof, or after the expiration of three months from the accrual of such cause.
According to the petitioners, the above provision which is similar to other corresponding sections under the various Acts, was mandatory and was intended to protect the honest and diligent officers against vexatious prosecutions. The learned counsel contended that the provision was in pari materia with section 13 of COFEPOSA Act 1974 and Section 23 of SAFEM (FOP) Act 1976. Incidentally, there are several other statutes like the Prevention of Corruption Act, Border Security Force Act, 1968, Income Tax Act, etc.where similar provision is not available. Relying on the judicial precedents it was contended that, even if an officer of the Customs is prosecuted for offences under the provisions of Prevention of Corruption Act, compliance under section 155 (2) of the Customs Act was a pre-requisite.
21. In Costao Fernandes v. State at the instance of DSP CBI Bombay (AIR 1996 SC 1383), a customs officer faced prosecution for offence under section 302 IPC for killing a smuggler by shooting with official revolver, who had attempted to flee with smuggled gold, while being intercepted by the above customs officer. The defence set up was that he was entitled for protection under section 155 of the Customs Act. Holding that Section 155 has nexus with the official duty of the petitioner and analysing the conduct of the petitioner in the background of section 106 of the Customs Act, it was held that facts disclosed that the petitioner caused the death of the smuggler while discharging his official duties. Hon'ble Supreme Court held that the petitioner was entitled for protection under section 155 and consequently the proceeding was quashed.
22, In Public Prosecutor, Madras v. R.Raju and another [(1978) 2 E.L.T. (J 410],(SC) the question that came up for consideration was the applicability of section 40(2) of the Central Excise and Salt Act, 1944. In that case, accused faced prosecution for breach of various provisions of the above Act along with offences under IPC. Prosecution was resisted by the accused relying on section 40(2) of the Act which provided that no suit, prosecution or other legal proceedings shall be instituted for anything done or ordered to be done under the Act after expiration of six months from the date of accrual of cause of action or from the date of act or order complained of. This contention was accepted by the High Court. The above was challenged by the prosecution before the Supreme Court, mainly on three grounds. Firstly, the section applied only to Government servants. Secondly, the words “anything done or ordered to be done under this Act” in the section did not mean any act in violation of the provisions of the Act. Thirdly, the protection given to Government servants under the Act was for actions done inadvertently or mistakenly, but not for acts done deliberately and maliciously. After analysing the scheme of section 40, in the light of identical or similar provisions under other enactments, the Supreme Court noticed that Section 40(1) of the relevant Act spoke about bar of suits against the Government or against any officer of the Government in respect of any order passed or act done or ordered to be done in good faith under the Act. According to the Supreme Court, both sub sections operate in two different fields. It was held that unlike section (1). sub section (2) provides bar of limitation of time in respect of suits, prosecution or other legal proceedings without any qualifying words as to the persons against whom such suit, proceeding and prosecution shall be instituted. Consequently, the contention that sub section (2) confined only to the Government officers was not warranted by the statute and hence repelled. The second contention was also refuted holding that though section 40 (2) had good faith as one of its ingredients, sub section (2) of section 40 does not speak of good faith as a test in relation to acts done. Sub section (1) of section 40 was not the subject matter of the present litigation. Regarding the third ground, relying on the definition of term “act” as provided in the General Clauses Act, it was held that non compliance with the provisions of statute by omitting to do what the Act enjoins, will be anything done or ordered to be done under the Act. Thus repelling all the contentions the Supreme Court concurred with the decision of the High Court that the prosecution was barred by time. Evidently, none of the contentions now raised by the petitioners herein were agitated before the Hon'ble Supreme Court.
23. A learned Single Judge of Calcutta High Court had occasion to consider the scope of section 155 of the Customs Act in a prosecution, in Ashok Kumar Singh v. State of West Bengal [(2016 (338) ELT 255 (Cal.)]. The factual matrix is almost similar to the facts in the present case. A customs officer was charge sheeted by CBI alleging commission of offences punishable under the provisions of IPC and also under the Prevention of Corruption Act. It was challenged before the High Court, inter alia, contending that there was breach of the mandatory provision under section 155 (2) of the Customs Act. This was resisted by CBI relying on the decision in Asst.Collector of Central Excise, Guntur v. Ramdev Tobacco Company. [(1991) 2 SCC 119]. The Hon'ble Supreme Court however relied on its decision in Public Prosecutor v. Raju (cited supra) to support its view that the words “anything purporting to be done in pursuance of this Act” in section 155(2) of the Customs Act 1962 will extend to illegal omissions and infractions of the requirement of the said Act. It was held that the decision in Asst.Collector of Central Excise's case (cited supra) does not lay down the proposition that criminal prosecutions initiated against the officers of the Central Government will not be barred by limitation prescribed in section 40 (2) of the Central Excise and Salt Act, 1944 and hence the above decision cannot be applied in Ashok Kumar's case. Consequently, the prosecution was quashed as barred by time as prescribed under section 155 (2) of the Central Act.
24. Punjab and Haryana High Court had considered an identical situation in Sunil Kumar v . Central Bureau of Investigation [2016 (335) ELT 399 (P & H)]. The court followed the law laid down by the Supreme Court in Public Prosecutor v. R.Raju's case(Supra) and quashed the proceedings. The learned counsel for the CBI relied on the decision of the Supreme Court in P.P. Unnikrishnan v.Puttiyottil Alikutty [2000 (4) RCR (Criminal) 25], wherein the Supreme Court held that beating of a person while in police custody would not fall within official duties of the police officer and hence such officer would not get the benefit of section 64 (3) of the Kerala Police Act, which fixed a period of six months from the date of commission of the offence for taking cognizance. The law laid down in this decision did not find favour with the learned Single Judge of the High Court(P &H) on the reasoning that P.P.Unnikrishan's case(supra) was rendered by a two judges Bench which did not consider the larger Bench decision in Public Prosecutor v. R.Raju's case (supra).
25. In an identical situation, the learned Single Judge of Delhi High court in Atul Dikshit v, CBI [ 2017 (348) ELT 224 (Delhi) and another judge of Rajasthan High Court in Ravindra Kumar v. Union of India [2017 (347) ELT 269 (Raj.)] took views contrary to the views of Calcutta High Court and Punjab and Haryana High Court discussed above. In both the above cases, respective accused challenged the prosecution alleging breach of section 155 (2) of the Customs Act. In Ravindra Kumar's case(Supra), the prosecution was challenged by the accused, inter alia, contending that prosecution was vitiated, being launched without complying with section 155(2) of the Customs Act. Accused relied on Public Prosecutor v. P.Raju's case(supra) to support his contention. According to the learned Single Judge, in the above decision Supreme Court had referred to section 155 of the Customs Act and the corresponding provision of section 40 under the Central Excise and Salt Act, 1944 and held that both the provisions were in pari materia. However, it was noticed by the learned single judge that section 40 of the Central Excise Act 1944 had undergone drastic amendment in 1973. It was noticed that though section 40 (2) of the Excise Act after amendment of 1973, was in para materia with section 155 (2) of the Customs Act, S.40(2), prior to amendment, it was not. However, Supreme Court proceeded as if both were in pari materia. It was held that sub section(2) of Section 40 of Central Excise and Salt Act, 1944 which existed prior to 1973 was not at all in pari materia with section 155(2) of the Customs Act, 1962. The learned Single Judge proceeded to hold that the words “no proceeding” appearing on sub section (2) of section 155 of the Customs Act do not include criminal prosecution as for the protection pertaining to prosecution, there was a specific provision under sub section (1) of section 155 of the Customs Act.
26. According to the learned counsel for the petitioners herein, the above judgment was challenged before the Supreme Court in SLP No.10124/2016 and a stay of operation of the judgment was granted. The matter is reportedly pending.
27. The Delhi High Court in Atul Dixit's case(supra) referred to Ravindra Kumar's case(supra) and approved it as laying down the correct law.
28. In this context, the decision of the two judges Bench of the Supreme Court in Asst.Collector of Central Excise Guntur v. Ramdev Tobacco Company (supra) is crucial. In that, regarding an alleged illicit removal of tobacco, penalty was imposed on the respondent after issuing a show cause notice. It was challenged before the High Court contending that proceedings were contrary to section 40 (2) of the Central Excise and Salt Act. The learned Single Judge took the view that the proceeding was time barred, since it was launched beyond 6 months prescribed under section 40(2) of the relevant Act. This was affirmed by the Division Bench, which judgment was assailed before the Supreme Court.
29. Relying on the decision in Public Prosecutor v. Raju's case (supra), the Supreme Court held that sub sections 1 and 2, both under the corresponding provisions of Customs Act and under the Central Excise and Salt Act operate in two different fields. Consequently, the contention that sub section(2) covers only Government servants was repelled on the reasoning that the plain words of the section do not indicate any such limitation. It was held that the application of the sub sections extended to any person not being a government servant, against whom any suit, prosecution or other legal proceeding was commenced for anything done or ordered to be done under the Act. Yet another argument advanced before the Supreme Court was that the words “anything done or ordered to be done” engrafted in the sub section would not include anything done in violation of the Act. It was noticed that the same argument was advanced before Supreme Court in Public Prosecutor v. R. Raju's case(supra) and was repelled holding that any omission or infraction of the statutory provision would also fall within the ambit of the provision.
30. The Hon'ble Supreme Court then proceeded to the next crucial question whether issuance of show cause notice and initiation of consequential adjudication proceedings can be described as “other legal proceedings” within the meaning of section 40(2) of the relevant Act. Supreme Court held that the words “ other legal proceeding” must be read ejusdum generis with the preceding words “suit” and “prosecution”as they constitute a genus. It was held that a departmental proceeding like penalty proceeding was therefore placed outside the scope of “other legal proceedings” .
31. In the background of the above settled legal propositions and in the context of Section 155(1) and (2) of the Customs Act the present issue needs to be answered. Evidently, sub section (1) and sub section (2) of section 155 of the Customs Act operate in two different fields. Their fields of operation, purpose and object are totally different. The purport of Sub section (2) of section 155 of the relevant section was to apply to “any proceeding other than suit”, which definition, according to the special prosecutor for CBI, does not take within its ambit, a criminal prosecution. This contention was not specifically raised before the Supreme Court in Raju's case(supra) and consequently was not considered, it was contended. Consequently the above decision cannot operate as a precedent in respect of the contention now advanced, it was argued.
32. A close look at sub sections (1) and (2) of Section 155 of the Customs Act, 1963 clearly shows that they are distinct, separate and operate in different context and field and are unique in content and application. Sub section (1) provides that no suit, prosecution or other legal proceedings shall be initiated against the Central Government or any officer of the Government or a local authority for anything which was done or intended to be done in good faith. Sub Section (2) provides that no proceedings other than a suit shall be commenced against the central government or any officer of the Government or a local authority for anything purported to be done without giving the central government or such officer a month's previous notice in writing or after expiration of three months from the accrual of such cause.
33. Sub section (1) of section 155 of the Customs Act provides a complete bar of any suit or other legal proceedings, if the act under challenge was done or intended to be done in good faith. Hence, irrespective of whether the act done was unjustifiable or illegal, or otherwise could not be justified, it would be still be not cognizable, if the authority or the officer is able to establish that it was done or intended to be done in good faith. Consequently, an act which otherwise could not stand the scrutiny of law, may not give rise to an action, if the authority or the concerned officer is able to prove that he was not actuated by mala fides and that the act was done in good faith. On the other hand, sub section (2) speaks of compliance of statutory formalities preceding the institution of any proceeding other than a suit. It contemplates service of one month notice and institution of proceedings within expiry of three months from the accrual of such cause. It is more in the nature of compliance of a statutory formality of giving notice and fixing of a limitation period for launching of a proceeding covered by sub section (2).
34. It is evident that even if a proceeding is initiated in compliance with sub section (2), still a defence will be available to the Government or the officer to resist the suit, prosecution or proceedings on the ground that the act was done or intended to be done in good faith. Conversly, even if the defence of good faith under sub section (1) is not available to the Government or the officer concerned, still a proceeding other than a suit may not be sustainable, if it does not satisfy the condition under sub section (2) of the Act. The bar under Sub section (1) appears to be more in the nature of merits of the decision or order involved where as, sub section (2) appears to be more procedural and technical. Sub section (1) appears to be intended to protect honest and bona fide officers, who have taken a decision bona fide, though wrongly, or which otherwise may not justifi
Please Login To View The Full Judgment!
able in the eye of law. Sub section (2) has two parts ; the first part provides for issuance of one month notice. The second part provides a time limit for launching the proceedings to ensure that any decision taken by the officer will not remain as a perpetual ground for challenge, to an unscrupulous litigant. The rationale for providing one month notice appears to be to give an opportunity to the Government or the officers to remedy the grievance of the person proposing to launch prosecution and if possible, to avoid a litigation. To that extent, the above clause appears to be akin to section 80 CPC. Since initiation of suits against Government and its officers are already taken care of by section 80 CPC, possibly it justifies the exclusion of a suit from the purview of sub section (2). 35. Evidently, sub sections (1) and (2) are distinct, different and operate in different fields. They are also distinct in its content, objects and purpose and one is not a substitute to the other. In this background, though I concur with the conclusion arrived at by the Delhi High Court in Atul Dixit's case (supra) that a criminal proceeding will not be included in “other proceedings” appearing in sub section (2) of section 155 of Customs Act, the reason given for such conclusion being that prosecution has already been taken care of in sub section (1) does not appear to be rational or reasonable. 36. In Public Prosecutor v. Raju's case(supra), the crucial question in relation to section 40 (2) that was raised before the Supreme Court was whether the words “ anything done or ordered to be done” appearing in section 40(2) takes in malicious acts also. The question whether section 40(2) includes in its sweep, a criminal prosecution was not specifically raised before the Supreme Court. That precisely was the contention advanced in the present case. According to the learned counsel for the petitioner section 155 (2) does not bar a criminal prosecution. Section 155 (1) uses the words “suit, prosecution or other legal proceedings”. Evidently each word is expressed independently and each is used to express one in contra distinction with another. Clearly, when the above expressions are used to denote three separate category of proceedings and when statute has explicitely used “prosecution” or “other legal proceedings” separately to denote separate proceedings, it is evident that Parliament was conscious that the term “ other legal proceedings” does not include a prosecution under the Criminal Law. In the above circumstances, applying the interpretative tool of ejusdum generis and the law laid down in Ramdev Tobacco Company(supra), it is evident that the expression “ no proceeding other than a suit” cannot include a prosecution in this case. It can only mean all other civil proceedings except a civil suit. Necessarily the term proceedings should get its colour from the word following it, namely “suit”. Applying this principle, considering the expressions used in sub section (1) and the object of sub section (2), the term “proceedings” used in sub section (2) cannot be interpreted to include a criminal prosecution. Hence, the decision in Ramdev 's case applies to the facts of this case. Accordingly, I concur with the view of Delhi and Rajasthan High Court in Atul Dixit's case and Ravindra Kumar's case respectively. 37. In the light of the above, the contention of the learned counsel for the petitioners that the prosecution of the petitioners is bad for non compliance of section 155 (2) of Customs Act is not sustainable and is rejected. The claim under section 155 (1) of the Customs Act can be raised before the court below, if so advised. In the result, Crl.M.Cs.fail and are accordingly dismissed.