Collector of Customs, Calcutta Vs.
East India Commercial Co. Ltd.  INSC 176 (30 April 1962)
30/04/1962 WANCHOO, K.N.
AIYYAR, T.L. VENKATARAMA SINHA, BHUVNESHWAR
P.(CJ) GAJENDRAGADKAR, P.B.
AYYANGAR, N. RAJAGOPALA
CITATION: 1963 AIR 1124 1963 SCR Supl. (2)
R 1965 SC 458 (28) D 1967 SC1244 (12) D 1968
SC 231 (19) RF 1974 SC1380 (21,30) RF 1987 SC2111 (13) R 1990 SC 10 (12)
Sea Customs-Effect of confirmation of order
in appeal-Order of Collector merged into that of Central Board of Revenue --Sea
Customs Act, 1878 (8 of 1878).
The respondent imported 2,000 drums of
mineral oil and the appellant confiscated 50 drums and imposed a personal
penalty. The appeal of the respondent was dismissed by the Central Board of
Revenue. The respondent filed a petition under Art. 226 of the Constitution in
the Calcutta High Court. A Full Bench of the High Court held that the High
Court had no jurisdiction to issue a writ against the Central Board of Revenue
in view of the decision in the case of Saka Venkata Subbha Rao. However, as the
Central Board of Revenue had merely dismissed the appeal against the 564 order
of the appellant, the High Court further held that it had jurisdiction to pass
an order against the appellant.
The appellant came to this Court after
obtaining a certificate.
Held that the appellant had merged into that
of the Central Board of Revenue and hence no order could be issued against the
appellant. It is only the order of the appellate authority which is operative
after the appeal is disposed of. It is immaterial whether the appellate order
reverses the original order, modifies it or confirms it. The appellate order of
confirmation is as efficacious as an operative order as an appellate order of reversal
or modification. As the appellate authority in this case was beyond the
territorial jurisdiction of the High Court, it was not open to the High Court
to issue a writ to the original authority which was within its jurisdiction.
Election Commission, India v. Saka Vankata
Subba Rao,  S. C. R. 1144, A. Thangal Kunju Mudatiar v. M. Venkitachalam
Poiti,  2 S. C. R. 1196, Commissioner of Income-tax v. M/s. Amritlal
Bhogilal & Co.  S. C. R. 713 and Madan Gopal Rungta v. Secretary to
the Government of Orissa, (1962) (Supp.) 3 S.C.R. followed.
Barkatali v. Custodian General of Evacuee
Property, A. 1. R. 1954 Raj. 214, overruled.
Joginder Singh Waryam Singh v. Director,
Rural Rehabilitation, Pepsu, Patiala, A. 1. R. 1955 Pepsu 91, Burhanpur National
Textile Workers Union v. Labour Appellate Tribunal of India at Bombay, A. I. R.
1955 Nag. 148, and Azmat Ullah v. Custodian, Evacuee Property, A.I.R. 1955 All
State of U. P. v. Mohammed Nooh,  S. C.
R. 595, distinguished.
CIVIL APPELLATE, JURISDICTION: Civil Appeal
No. 383 of 1961.
Appeal from the judgment and order dated July
21 1959, of the Special Bench of the Calcutta High Court in Matter No. 76 of
D. R. Prem and R. L. Dhebar, for the
appellant and respondents NOS. 2 and 3.
S. P. Desai and B. P. Maheshwari, for
respondent No. 1 565 1962. April 30. The Judgment of the Court was delivered by
WANCHOO, T.-This ii an appeal on a certificate granted by the Calcutta High
Court. The brief facts necessary for present purposes are these. The respondent
had imported 2,000 drums of mineral oil. Out of this quantity, the appellant,
the Collector of Customs, Calcutta, confiscated 50 drums by order dated
September 20, 1950. He also imposed a personal penalty of Rs.61,000/on the respondent
under the Sea Customs Act, No. 8 of 1878, (hereinafter referred to as the Act).
The respondent appealed to the Central Board of Revenue under s. 188 of the
Act, and this appeal was dismissed in April 1952. Thereupon the respondent
filed a petition under Art. 226 of the Constitution in the High Court. We are
in the present appeal not concerned with the merits of the case put forward by
the respondent, for the matter has not yet been heard on the merits. When the
petition came up before a learned Single Judge a question was raised as to the
jurisdiction of the High Court to hear the petition in view of the decision of
this Court in Election Commission India v. Saka Venkata Subba Rao.(1) As the
learned Single Judge considered the point important, he referred the matter to
a larger bench; and eventually the question was considered by a Full-Bench if
the High Court.
The Full-Bench addressed itself two questions
in that connection, namely, (i) whether any writ could issue against the
Central Board of Revenue which was a party to the writ petition and which was
permanently located outside the jurisdiction of the High Court, and (ii)
whether if no writ could issue, against the Central Board of Revenue any writ
could be issued against the appellant, which was the original authority to pass
the order under challenge, when the appellate (1) (1953) S.C.R. 1144, 566
authority (namely, the Central Board of Revenue) had merely dismissed the appeal.
The Full-Bench held on the first question.
that the High Court, had no jurisdiction to issue a writ against the Central
Board of Revenue in view of the Precision in the case of Sake Venkata Subba
Rao.(1). On the second question, it held that as the Central Board of Revenue
had merely dis- missed the appeal against the order of the Collector of Customs
Calcutta, the really operative order was the order of the appellant, which was
located within the jurisdiction of the High Court, and therefore it had jurisdiction
to pass an order against the Collector of Customs in spite of the fact that
order had been taken in appeal (which was dismissed) to the Central Board of
Revenue to which no writ, could be issued. The Full-Bench further directed that
the petition would be placed before the learned Single Judge for disposal in
the light of its decision or, the question of jurisdiction. Thereupon there was
an application for a certificate to appeal to this Court, which was granted;
and that in how the matter has come up before us.
The only question which 1ells for decision
before us in the second question debated in the' High Court,. namely, whatever
the High Court would have jurisdiction to issue a writ against the Collector of
Customs Calcutta in spite of the fact that his order was taken in appeal to the
Central Board of Revenue against which the High Court could not issue a writ
and the appeal had been dismissed. There seems to have been a difference of
opinion amongst the High Courts in this matter. The Rajasthan High Courts in
Barkatali v. Custodian General of Evacuee Property (1) held that where the
A.I.R. (1904) Raj. 214.
567 original authority passing the order was
within the jurisdiction of the High Court but the appellate authority was not
within such jurisdiction, the High Court would still have jurisdiction to issue
a writ to the original authority, where the appellate authority had merely
dismissed the appeal and the order of the original authority stood confirmed
without any modification whatsoever. On the other hand, the PEPSU High Court in
Joginder Singh Waryam Singh v. Director, Rural Rehabilitation. Pepsu Patiala,
the Nagpur High Court in Burhanpur, National Textile Workers Union, v.
Labour- Appellate Tribunal of India at Bombay
( 2) and the Allahabad High Court in Azmat Ullah, v. Custodian, Evacuee
Property (3 ) held otherwise, taking the view that even Where the appeal was
merely dismissed, the order of the original authority merged in the order of
the appellate authority, and if the appellate authority was beyond the
territorial jurisdiction of the High Court, no writ could issue even to the
original authority. It may be mentioned that the Rajasthan High Court had
occasion to reconsider the matter after the decision of this Court in A.
Thangal Kunju Mudaliar v. M. Venkita-chalam Potti ( 4 ) and held that in view
of that decision, itsearlier decision in Barkatali's case (5) was no longer
good law. The High Court has however not noticed this later decision of the
Rajasthan High Court to which the learned Chief Justice who was party to the
earlier Rajasthan case was also a party. The main reason which impelled the
High Courts, which held otherwise, was that the order of the original authority
got merged in the order of the Appellate authority when the appeal was disposed
of and therefore if the High Court had no territorial jurisdiction to issue a
writ against the appellate authority it could not issue a writ (1) A.I.R.
(1955) Pepsu 91 (3) A. I. R. (1955) All- 435.
(2) A. I. R. (1955) Nag. 148.
(4) 1955 2 S. C. R. 1196- (5) A.I.R. (1954)
568 against the original authority, even
though the appellate authority had merely dismissed the appeal without any
modification of the order passed by the original authority.
The question therefore turns on whether the
order of the original authority becomes merged in the order of the appellate
authority even where the appellate authority merely dismisses the appeal
without any modification of the order of the original authority. It is obvious
that when an appeal is made, the appellate authority can do one of three
things, namely, (i) it may reverse the order under appeal, (ii) it may modify
that order, and (iii) it may merely dismiss the appeal and thus confirm the
order without any modification. It is not disputed that in the first two cases
where the order of the original authority is either reversed or modified it is
the order of the appellate authority which is the operative order and if the
High Court has no jurisdiction to issue a writ to the appellate authority it
cannot issue a writ to the original authority.
The question therefore is whether there is
any difference between these two cases and the third case where the appellate
authority dismisses the appeal and thus confirms the order of the original
authority. It seems to us that on principle it is difficult to draw a
distinction between the first tori kinds of orders passed by the appellate
authority and the third kind of order passed by it. In all these three cases
after the appellate authority has disposed of the appeal, the operative order
is the order of the appellate authority whether it has reversed the original
order or modified it or confirmed it. In law, the appellate order of
confirmation is quite as efficacious as an operative order as an appellate
order of reversal or modification. Therefore, if the appellate authority is
beyond the territorial jurisdiction of the High Court it seems difficult to
bold even in a case where the appellate 569 authority has confirmed the order
of the original authority that the High Court can issue a writ to the original
authority which may even have the effect of setting aside the order of the
original authority when it cannot issue a writ to the appellate authority which
has confirmed the order of the original authority. In effect, by issuing a writ
to the original authority setting aside its order, the High Court would be
interfering with the order of the appellate authority which had confirmed the
order or the original authority even though it has DO territorial jurisdiction
to issue any writ to the appellate authority.
We therefore feel that on principle when once
an order of an original authority is taken in appeal to the appellate authority
which is located beyond the territorial jurisdiction of the High Court, it is
the order after the appeal is disposed of; and as the High Court cannot issue a
writ against the appellate authority for want of territorial jurisdiction it
would not be open to it at issue a writ to the original authority which may be
within its territorial jurisdiction once the appeal is disposed of, though it
may be that the appellate authority has merely confirmed the order of the
original authority and dismissed the appeal.
It is this principle, viz., that the
appellate order is the operative order after the appeal is disposed of, which
is in our opinion the basis of the rule that the decree of the lower court
merges in the decree of the appellate court, and on the same principle it would
not be incorrect to say that the order of the original authority is merged in
the order of the appellate authority whatsoever its decision-whether of
reversal or modification or mere confirmation. This matter has been considered
by this Court on a number of occasions after the decision in Saka Venkata Subba
Rao's case.(1) (1) (1953) S.C.R. 1144.
570 In A. Thangal Kunju Mudaliar's case (1),
though the point was not directly in issue in that case, the Court had occasion
to consider the matter (see p. 1213) and it approved of the decisions of the
PEPSU, Nagpur and Allahabad High Courts, (referred to above). Then in
Commissioner of Income-tax v. Messrs. Amritlal Bhogilal and Company (2), a
similar question arose as to the merging of an order of the income-tax officer
into the order of the Appellate Assistant Commissioner passed in appeal in
connection with the powers of the Commissioner of Income-tax in revision.
Though in that case the order of registration by the Income-tax officer was
held not to have merged in the order of the Assistant Commissioner on appeal in
view of the special provisions of the Income tax Act, this Court observed as
follows in that connection at p. 720 :- ",There can be no doubt that, if
an appeal is provided against an order passed by a tribunal, the decision of
the appellate authority is the operative decision in law.
If the appellate authority modifies or
reverses the decision of the tribunal, it is obvious that it is the appellate
decision that is effective and can be enforced. In law the position would be
just the same even if the appellate decision merely confirms the decision of
the tribunal. As a result of the confirmation or affirmable of the decision of
the tribunal by the appellate authority the original decision merges in the
appellate decision and it is the appellate decision alone which subsists and is
operative and capable of enforcement.
The matter was considered again by this
Court, in Madan Gopal Rungta v. Secretary to the Government of Orissa (3) in
connection with an order of the (1) (1955)2 S.C.R.1196. 12) (1959) S.C.R. 713,
(3) (1962) (Supp.) 3 S.C.R. 966.
571 Central Government in revision under the
Mineral Concession Rules, 1949, framed under the Mines and Minerals (Regulation
and Development) Act, (No. 53 of 1948) and it was held that when the Central
Government rejected the review. petition against the order of the State
Government under the Mineral Concession Rules it was in effect rejecting the
application of the appellant of that case for grant of the mining lease to him.
The question of the original order with the appellate order was also considered
in that case though it was pointed out in view of r.60 of the Mineral
Concession Rules that it is the Central Government's order in review which is
the effective and final order. Learned counsel for the respondent sought to
distinguish Madan Gopal Rungla's case (1) on the ground that it was based
mainly on an interpretation of r. 60 of the Mineral Concession Rules 1949,
though he did not pursue this further when s. 188 of the Sea Customs Act was
pointed out to him.
The main reliance however of the respondent
both in the High Court and before us is on the decision in the State of Uttar
Pradesh v. Mohmmed Nooh (2). That was a case where a public servant was
dismissed on April 20, 1948 before the Constitu- tion had come into force. His
appeal from the order of dismissal was dismissed in May 1949 which was also
before the Constitution came into force. His revision against the order in the
appeal was dismissed on April 22, 1950, when the Constitution had come into
force, and the question that arose in that case was whether the dismissed
public servant could take advantage of the provisions of the Constitution
because the revisional order had been passed after the Constitution came into
force. In that case, this Court certainly held that the order of dismissal
passed on April 20, 1948 could not be said to have merged in the orders in
appeal and in revision. It (1) (1962) (Supp.) 3 S.C.R. 906.
(2) (1958) S.C.R. 595.
572 was pointed out that the order of
dismissal was operative of its own strength as from April 20, 1948 and the
public servant stood dismissed as from that date and therefore it was a case of
dismissal before the Constitution came into force and the. public servant could
not take advantage of the provisions of the Constitution in view of the fact
that his dismissal had taken place before the Constitution had come into force.
As was pointed out in Madan Gopal Rungta's, case(1) Mohammad Nooh's case (2)
was a special case, which stands on its own facts. The question there was
whether a writ under Art. 226 could be issued in respect of a dismissal which
was effective from 1948. The relief that was being sought was against an order
of dismissal which came into existence before the Constitution came into force
and remained effective all along even after the dismissal of the appeal and the
revision from that order. It was in those special circumstances that this Court
held that the dismissal had taken place in 1948 and it could not be the
subject-matter of consideration under Art.226 of the constitution, for that
would be giving retrospective effect to the Article. The argument based on the
principle of merger was repelled by this Court in that case on two grounds,
namely, (i) that the principle of merger applicable to decrees of courts would
not be applicable to departmental tribunals, and (ii) that the original order
would be operative on its own strength and did not gain greater efficacy by the
subsequent order of dismissal of the appeal or revision. in effect, this means
that even if the principle of merger were applicable to an order of dismissed
like the one in Mohammad Nooh's case, (2) the fact would still remain that the
dismissal was before the Constitution came into force and therefore the person
dismiss could not take advantage of the provisions of the Constitution, so (1)
(2) (1958) S.C.R. 595.
573 far as that dismissal was concerned. That
case was not concerned with the territorial jurisdiction of the High Court
where the original authority is within such territorial jurisdiction while the
appellate authority is not and must therefore be confined to the special facts
with which it was dealing. We have therefore no hesitation in holding
consistently with the view taken by this Court in Mudaliar's case (1) as well
as in Messrs. Amritlal Bhogilat's (2) that the order of the origin%] authority
must be held to have merged in the order of the appellate authority in a case like
the present and it is only the order of the appellate authority which is
operative after the appeal is disposed of. Therefore, if the appellate
authority is beyond the territorial jurisdiction of the High Court it would not
be open to it to issue a writ to the original autbority which is within its
jurisdiction so long as it cannot issue a writ to the appellate authority. It
is not in dispute in this case that no writ could be issued to the appellate
authority and in the circumstances the High Court could issue no writ even to
the original authority.
We therefore allow the appeal, set aside the
order of the High Court and dismiss the writ petition with costs.
(1) (1955) 2 S.C.R. 1196.
(2) (1959) S.C.R. 713.