judgement:
Civil Appeal No. 2821 of 1987 From the Judgment and order dated 4.9.1986 of the Jammu and Kashmir High Court in 15 Civil 2nd Appeal of 1975.
D.D. Thakur, E.C. Agarwal, Atul Sharma, Vijay Pandit and 558 Ms. Poornima Bhatt, for the Appellants.
Anil Dev Singh, Dr. Meera Agarwal, R.C. Mishra and Mushtaq Ahmed, for the Respondent.
The Judgment of the Court was delivered by KANIA, J.
This is an appeal against the judgment of a learned Single Judge of the High Court of Jammu & Kashmir in a Second Appeal.
The Appellants are the heirs and legal representatives of one Indro Devi.
The Respondent is the heir and legal representative of one Raghunath Dass Lakra.
Very few facts are necessary for the disposal of the Appeal before us.
The dispute relates to a piece of land measuring 4 marlas and 99 sq.
situated at Residency Road in Jammu.
This land was granted to one Attar Chand by the Government of Kashmir on a long lease.
As per the practice prevailing in the State of Jammu & Kashmir he was known as the Wasidar in respect of the said land.
On his death his son Guranditta Mal inherited the lease hold rights of Attar Chand and on the death of Guranditta Mal his widow Indro Devi, who was the original plaintiff, inherited the lease hold rights under the said lease on the basis of a Will executed by Guranditta Mal in her favour.
Guranditta Mal, during his life time, in 1954, had granted a sub lease of the said land to Raghunath, the father of the Respondent herein.
Indro Devi instituted a suit in the Court of the learned Sub Judge, Jammu for recovery of possession of the said land on the ground that Reghunath Dass had sub let the house constructed by Raghunath Dass on the said land and was liable to be evicted under the provisions of the Transfer of Property Act read with Section 11 of the Jammu & Kashmir Houses and Shops Rent Control Act (hereinafter referred to as the "J & K Rent Act").
She also contended that the land was required by her bona fide for occupation by her and her family.
The period of the said sub lease had expired and it was alleged that in the aforesaid circumstances, the respondent was liable to be evicted.
These allegations were denied by the Respondent.
It was inter alia contended by the Respondent that the sub lease granted to Raghunath was void ab initio.
It was held by the learned Sub Judge that the ground of bona fide requirement of the landlord as well as unlawful sub letting by the sub lessee had been established.
It was further held that the sub lease granted by Guranditta Mal to 559 Raghunath was valid.
On these findings the suit was decreed.
This decision was upheld on first appeal by the learned Additional District Judge, Jammu before whom an appeal was preferred and the findings of the learned Sub Judge were upheld by him.
On a Second Appeal preferred to the High Court, the learned Single Judge of the High Court took the view that the sub lease granted by Guranditta Mal to Raghunath Dass was void as it violated the provisions of Rule 35 of Wasidari Rules in as much as it amounted to a transfer of immovable property and hence it amounted to a transfer of the leased land by the Government to the Wasidar under the provisions of the Wasidari Rules As no permission of the Government was taken for granting the said sub lease the sub lease was void as against the provisions of the Wasdari Rules.
The learned Single Judge rejected the contention urged on behalf of the Appellants herein that the transfer made by Guranditta Mal was of a mere interest in the lease hold and did not amount to a transfer of the land leased as contemplated under Rule 35 of the said Wasidari Rules.
The learned Single Judge, without considering what would be the effect of the sub lease being void has somehow come to the conclusion that, in view of the sub lease being void, the suit filed by the Appellants herein must be dismissed and took the view that the appeal before the learned Judge must be allowed and the suit filed by the Appellants must be dismissed.
It is this decision which is challenged by the Appellants in the present Appeal preferred by Special Leave.
In our view, the Appeal can be shortly disposed of and the Appellants are entitled to succeed.
Even assuming that the sub lease granted by Guranditta Mal in favour of Raghunath, the father of the Respondent was void, the result would be that the Respondent and his father would be persons without any legal interest in the said land.
Indro Devi and the Appellants being the lessees of the said land were suing on their own title and not relying on the sub lease and hence they were entitled to evict the Respondent who had no title or interest in the said land.
If a view is taken that the sub lease in favour of Raghunath was valid, in that event, as held by both the Courts below, as grounds for eviction set out in Section 11 of the J & K Rent Act have been made out, the Respondent ceased to be entitled to the protection of the said Act and was liable to be evicted as the term of his sub lease had expired.
It was strenuously sought to be contended by Mr. Anil Dev Singh, learned Counsel for the Respondent that the provisions of Section 12A af the Jammu & Kashmir Land Grants Act, 1960, as 560 amended in 1969 by the Jammu & Kashmir Land Grants (Amend ment) Act, 1969 provided that if any person holding land on lease granted under that Act or under any of the rules referred to in the said section effects or has ever effected before the commencement of the said Act of 1969, transfer of any right in such land without the permission of the Government or any authority empowered in that behalf, the lease of such land would be determined and would be deemed always to have been determined with effect from the date such transfer is or has been effected.
It was submitted by him that the land held by the Appellants and their predecessors in title from the Government was under a lease granted under some of the rules referred to in Section 12A.
It was contended by him that the sub lease was admittedly granted without the permission of the Government and in view of the said sub lease granted by Guranditta Mal, the title of Guranditta Mal and his successors in the land in question under the lease granted by the Government itself came to an end.
It was urged by him that in these circumstances the title of the Appellants to the said land had itself been extinguished and they were not entitled to sue for recovery of possession of the said land.
In our view, this contention is not open to the Respondent at all.
It was nowhere contended by the Respondent, either before the learned Sub Judge or before the Additional District Judge or even in the Second Appeal before the High Court, that the title of the Appellants and his predecessors in title to the said land under the lease granted by the Government had come to an end in the aforestated circumstances.
Had the plea been taken earlier, it is possible that the Appellants might have pleaded facts to show that their lease had not come to an end or that it had been renewed after the sub lease was granted.
Hence, allowing such a plea at this stage might cause prejudice to the Appellants.
Some decisions of this Court were shown to us by Mr. Anil Dev Singh where a new plea purely based on law was allowed to be taken even at the stage of the Appeal before the Supreme Court.
However, in our view, those decisions can have no application whatever in a case like one before us where allowing of such a plea might cause prejudice to the Appellants.
In our opinion, it is unfortunate that the learned Single Judge of the High Court who decided the Second Appeal did not proceed to consider at all the effect of the sub lease granted to Raghunath being void and we find it difficult to understand how, merely on the basis of the sub lease being void, he came to the conclusion that the suit filed by Indro Devi in the Court of learned Sub Judge was liable to be dismissed.
Had the learned Judge considered this point, he would have surely realised that the Respondent had no title in the said land in view 561 Of the sub lease being void and was liable to be evicted by a party suing on his own title.
Coming to the finding regarding the sub letting by the respondent and his father and the bona fide requirement of Indro Devi, these are both essentially issues of fact and have been decided in favour of Indro Devi, the mother of the Appellants and their predecessors intitle.
Those findings do not appear to have been seriously challenged before the High Court at all and hence there is no reason why we should go into the question as to whether those findings are correct, in this appeal.
In the result, the appeal succceds and is allowed.
The judgment of the learned Single Judge is set aside and judgment and other passed by the learned Sub Judge is restored.
However, consider, all the facts and circumstances of the case, we are of the view that the parties must bear and pay their own costs in this Court are there will be an order accordingly.
G.N. Appeal allowed.

dataset_name: IN-Abs

summary:
The land in question was granted to one A by the Government of Kashmir and as per the practice prevailing there, he was shown as Wasidar in respect of the said land.
On his death, his son inherited the leasehold rights.
On the death of the son, his widow inherited the same.
The appellants are the heirs and legal representatives of the widow.
A 's son, during his lifetime, had granted a sub lease of the said land to the Respondent 's father.
The widow of A 's son instituted a suit for recovery of possession of the said land on the grounds that there was unlawful sub letting by the sub lessee, the land was required for occupation by her and her family, and that the period of sub lease had expired.
The Respondent contended that the sub lease was void ab initio.
The Sub Judge held that the sub lease was valid and the grounds of bona fide requirement of the appellants ' mother as well as unlawful sub letting by the sub lessee had been established.
On these findings the suit was decreed.
on appeal, the Additional District Judge upheld the decision.
In the second appeal before the High Court, it was contended that the transfer made was of a mere interest in the lease hold and did not amount to a transfer of the land leased, as contemplated under Rule 35 of the Wasidar Rules.
Rejecting the contention, but without considering as to what would be the effect of the sub lease being void, the High Court came to the conclusion that in view of the sub lease being void, the suit filed by the appellant must be dismissed.
This appeal, by special leave, is against the aforesaid decision.
on behalf of the appellants, the contentions urged in the Courts below, were reiterated before this Court.
The Respondent relied on Section 12 A of the Jammu Kashmir Land Grants Act, 1960 as amended in 1969 and contended that the sub lease was admittedly 557 granted without the permission of the Government and so the lease granted by the Government had come to an end: the title of the appellants to the said land had extinguished and they were not entitled to sue for recovery of possession of the said land.
Allowing the appeal, ^ HELD: 1.
Even assuming that the sub lease granted was void, the result would be that the Respondent his father would be persons without any legal interest in the said land.
The appellants being the lessees of the said land were suing on their own title and not relying on the sub lease hence they were entitled to evict the Respondent who had no title or interest in the said l .
If a view is taken that the sub lease was valid, in that event, as held by both the Courts below, as grounds for eviction set out in Section 11 of the Jammu & Kashmir Houses and Shops Rent Control Act have been made out, the Respondent ceased to be entitled to the protection of the said Act and was liable to be evicted as the term of his sub lease had expired.
[559E G] 2.
It was not contended by the Respondent in any of the Courts below that the title of the Appellants and his predecessors in title to the said land under the lease granted by the Govermnent had come to an end.
Had the plea been taken earlier, it is possible that the Appellants might have pleaded facts to show that their lease had not come to an end or that it had been renewed after the sub lease was granted.
Hence, allowing such a plea at this stage might cause prejudice to the Appellants.
[560D E] 3.
As regards the sub letting by the Respondent and his father and the bona fide requirement of appellants ' mother, these are both essentially issues of fact and have been decided in favour of the Appellants ' mother and their predecessors in title.
Those findings do not appear to have been seriously challenged before the High Court at all and hence there is no reason to go into the question as to whether those findings are correct, in this appeal.
[561B]


judgement:
Civil Appeal No. 1037 of 1988.
589 From the order dated 14.12.1987 of the Customs Excise and Gold (Control) Appellate Tribunal New Delhi in Appeal No. 469/87A order No. 807/87 A S.N. Kackar, R.K. Habbu, P.G. Gokhale, Ms. Sushma Manchanda and B.R. Agarwal for the Appellant.
The Judgment or the Court was delivered by SABYASACHI MUKHARJI, J. This is an appeal under section 35 L of the (hereinafter called 'the Act ').
The Superintendent of Central Excise returned the price list of the appellant with a covering letter satating that the price should include all the cost of packing and packing charges in terms of section 4(4)(d)(i) of the Act.
The appellant, a private limited company, manufactured various types of glass bottles which were assessed to duty under Item No. 23A of the Central Excise Tariff.
According to the appellant, it sold to the customers on wholesale basis the glass bottles manufactured by it, packed in gunny bags and cartons which it purchases from the market.
According to the appellant further, it has been paying duty on the value of the glass bottles including the cost of gunny bags or the cartons in which these are packed at the time of sale.
It appears, therefore, according to the appellant, that it has been paying duty on glass bottles on the basis of the assessable value which included the costs of packing material, namely, the gunny bags and the cartons.
The case of the appellant further is that the glass bottles are normally sold by it in the packing consisting of gunny bags which are durable and returnable and in several cases the gunny bags are returned by the buyers and are used by the appellant again for packing the glass bottles.
It is only when the customers specifically ask for delivered in cartons instead of in gunny bags that the appellant delivered the glass bottles packed in cartons which are also durable and returnable.
Towards the end of 1977 and early 1978 the appellant submitted price list in regard to the glass bottles manufactured by it for approval by showing separately the price at which such goods were actually sold in the course of "wholesale trade" and "the cost of packing".
By his letter dated 10th January, 1978, the Superintendent of Central Excise returned to the appellant the price list duly approved but nothing therein that the price should be inclusive of the cost of packing and packing charges in terms of section 4(4)(d) of the Act.
Section 4(4)(d)(i) as it stood read as follows: 590 "(4) For the purposes of this section: (a) `assessee ' means the person who is liable to pay the duty of excise under this Act and includes his agent; (b) 'place of removal ' means (i) & (ii) x x x (c) xxx (d) 'value ', in relation to any excisable goods, (i) where the goods are delivered at the time of removal in a packed condition, includes the cost of such packing except the cost of the packing which is of a durable nature and is returnable by the buyer to the assessee.
Explanation: In this sub clause, 'packing ' means the wrapper, container, bobbin, pirn, spool, reel or wrap beam or any other thing in which or on which the excisable goods are wrapped, contained or wound," Since then the appellant has been paying duty on the cost of packing under protest and lodging claims of refund.
The appellant, however, did not receive any refund nor any intimation that the claims of refund are or were being rejected.
Various representations made by the appellant were in vain.
The Assistant Collector of Central Excise wrote a letter dated 8th March, 1980 advising the appellant to file an appeal before the Appellate Collector if the appellant felt aggrieved.
Feeling aggrieved, the appellant filed a writ petition under Article 226 of the Constitution in the High Court of Bombay.
The High Court passed an interim order on 18th July, 1984 remanding the case back to the Assistant Collector of Central Excise and to decide the matter after giving the appellant fair and adequate opportunity to adduce evidence.
After considering the written statements filed by the appellant, the Assistant Collector passed an order on 29th April, 1986 rejecting the appellant 's refund claim for about Rs.17 lakhs for the period from 1st January, 1978 to 31st December, 1980 and demanding duty for the period 6th January, 1981 to 31st December, 1985 in terms of the bank guarantees executed by the appellant.
There was an appeal before the 591 Collector of Central Excise (Appeals).
The Collector on 21st January, 1987 rejected the appeal and upheld the order of the Assistant Collector.
The appellant filed an appeal before the Customs Excise and Gold (Control) Appellate Tribunal (hereinafter called 'CEGAT ').
CEGAT dismissed the appeal.
Aggrieved thereby the appellant filed the appeal in this Court.
The Tribunal noted that the appellant manufactured glass bottles.
It delivered these in two types of packing, namely, in open crates and in cartons and gunny bags.
So far as the crates were concerned, the same belonged to the appellant.
The customer was billed for the cost of glass bottles only.
The crates were returnable to the appellant within 30 days.
The revenue has not included the cost of such crates in the assessable value.
The revenue has also not included the cost of packing, if any, supplied by the customer himself.
There was no dispute about these packings.
So far as the packings hl cartons and gunny bags were concerned, it was noted by the Tribunal, that these belonged to the appellant but their cost was realised from the customer along with the cost of glass bottles.
The appellant 's case was that these packings were also returnable and in many cases they were actually returned and re used by the appellant.
There were no evidence about the durability of the cartons and gunny bags but nothing to show that these were returnable.
The position seems to be as follows.
The Tribunal has rightly applied the returnability test.
In K. Radha Krishnaiah vs Inspector of Central Excise and others, , this Court observed that it cannot be said that the packing is returnable by the buyer to the assessee unless there Is an arrangement between them that it shall be returned.
Therefore, such arrangement has been established.
Actual return or extent of return is not relevant.
What is necessary is that if the buyer chooses to return the packing, the seller should be obliged to accept it and refund the stipulated amount.
In this case after examining the facts, the Tribunal found that there was no clause about returnability of the cartons and gunny bags.
The appellant invited the attention of the Tribunal to the following clause in their standard contractor.
It reads as follows: "6.
All packing cases, other than such as may be supplied or paid for by buyer, shall be returnable in good order and condition within 30 days after receipt. " The Tribunal was of the view that the above clause related to cases".
It could have meant only the crates which belonged to the appellant and for which the customers had not paid anything.
The 592 property in the crates having remained with the appellant all along, the buyers were naturally obliged to return them to their rightful owners.
But that was not the case with the cartons and gunny bags.
The buyers pay for these and the property in these pass on to the buyers.
They could be asked to return them to the appellant only under a term of sale and on payment of the agreed amount and not for the free.
No such contract or agreement was forthcoming.
The Tribunal was not convinced that in the normal course of business anyone could be asked to part with its property, and in addition incur return freight therefor too for nothing.
In those circumstances, the Tribunal held that the cartons and gunny bags were not returnable in the accepted sense of the term.
The Tribunal further noted that since the statute insisted on the packing being returnable, in addition to being durable, the authorities are bound to see whether the transaction fulfilled the tests of returnability as per the Supreme Court and High Court judgments.
In that view of the matter, the Tribunal dismissed the appeal.
As noted above, this Court has considered the meaning of the expression "returnable" in the Section in K. Kadha Krishnaiah 's case (supra).
This Court held that so far as the question of durability is concerned, there cannot be such controversy about it, but a question has been raised as to what is the meaning and connotation of the word "returnable".
Does it mean physically capable of being returned or does it postulate an arrangement under which the packing is return able.
While interpreting this word, we must bear in mind that what section 4(4)(d)(i) excludes from computation is cost of packing which is of a durable nature and is "returnable by the buyer to the assessee".
The packing must be one which is returnable by the buyer to the assessee and obviously that must be under an arrangement between the buyer and the assessee.
It is not the physical capability of the packing to be returned which is the determining factor because, in that event, the words "by the buyer to the assessee" need not have found a place in the section; they would be superfluous.
In that view of the matter we are of the opinion that in the facts found and the expressions used in section 4(4)(d)(i) of the Act which have been set out hereinbefore, there being no evidence of the agreement that the cartons and gunny bags were returnable, we are of the opinion that the Tribunal came to the correct conclusion.
This appeal fails and is rejected accordingly.
G.N. Appeal dismissed.

summary:
The appellant manufactured various types of glass bottles which were assessed to duty under Item No. 23A of the Central Excise Tariff.
It sold the glass bottles to the customers on wholesale basis packed in gunny bags and cartons which were durable and returnable.
According to the appellant it has been paying duty on glass bottles on the basis of the assessable value which included the cost of packing material, namely, the gunny bags and cartons.
The returned gunny bags and cartons were re used by the appellant.
The appellant submitted for approval, price list in regard to the glass bottles manufactured by it showing separately the price at which the goods were actually sold and the cost of packing.
Returning the price list duly approved, the Superintendent of Central Excise noted therein that the price should be inclusive of the cost of packing and packing charges in terms of Section 4(4)(d) of the Act.
The appellant was paying duty on the cost of packing under protest and lodged claims of refund.
As the appellant did not receive either the refund or any intimation rejecting the claim for refund, it filed a writ petition before the High Court which remanded the case back to the Assistant Collector for deciding the matter after giving the appellant fair and adequate opportunity to adduce evidence.
The Assistant Collector, after considering the written statements filed by the appellant rejected the appellant 's claim for refund and demanded duty for the subsequent period.
The appellant filed an appeal before the Collector of Central Excise (Appeals) which was rejected.
The appeal filed before the Customs Excise and Gold (Control) Appellate Tribunal was also dismissed.
This appeal under Section 35L of the Act is against the Tribunal 's judgment.
588 Dismissing the appeal, ^ HELD: 1.
In view of the facts of the case, and the expressions used in Section 4(4)(d)(i) of the Act, there being no evidence of the agreement that the cartons and gunny bags were returnable, the Tribunal was right in coming to the conclusion that the cartons and gunny bags were not returnable in the accepted sense of the term.
[592G, B C] 2.1 The appellant manufactured glass bottles and delivered these in two types of packing, namely, in open crates and in cartons and gunny bags.
So far as the crates were concerned, the same belonged to the appellant.
The customer was billed for the cost of glass bottles only.
The crates were returnable to the appellant within 30 days.
The revenue has not included the cost of such crates in the assessable value.
The revenue has also not included the cost of packing, if any, supplied by the customer himself.
There was no dispute about these packings.
So far as the packings in cartons and gunny bags were concerned, it was noted by the Tribunal, that these belonged to the appellant but their cost was realised from the customer along with the cost of glass bottles.
It cannot be said that the packing is returnable by the buyer to the assessee unless there is an arrangement between them that it shall be returned.
Actual return or extent of return is not relevant.
What is necessary is that if the buyer chooses to return the packing, the seller should be obliged to accept it and refund the stipulated amount.
In this case there was no clause about returnability of the cartons and gunny bags.
[591B F] 2.2.
So far as the question of durability is concerned, there cannot be such controversy about it, but a question has been raised as to what is the meaning and connotation of the word "returnable".
What Section 4(4)(d)(i) excludes from computation in cost of packing which is of a durable nature and is returnable by the buyer to the assessee.
The packing must be one which is returnable by the buyer to the assessee and obviously that must be under an arrangement between the buyer and the assessee.
It is not the physical capability of the packing to be returned which is the determining factor because, in that event, the words "by the buyer to the assessee" need not have found a place in the section; they would be superfluous.
[592D F K. Radhakrishnaiah vs Inspector of Central Excise and others, referred to.


judgement:
Civil Appeal No. 301 of 1984.
From the Judgment and order dated 1.2.1983 of the Punjab and Haryana High Court in Letters Patent Appeal No. 1410 of 1982.
P.D. Sharrna for the Appellant.
623 Parmod Dayal for the Respondents.
The Judgment of the Court was delivered by DUTT, J.
This appeal by special leave is directed against the judgment of the Division Bench of the High Court of Punjab & Haryana whereby the High Court dismissed in limine the letters patent appeal preferred by the appellant against the judgment of a learned Single Judge of the High Court dismissing the writ petition of the appellant relating to his seniority.
The appellant was appointed an Assistant Engineer II with effect from June 10, 1963 in the Punjab State Electricity Board on probation for two years which ended on June 10, 1965.
After the bifurcation of the Punjab State Electricity Board, the service of the appellant was allocated to the Haryana State Electricity Board, hereinafter referred to as 'the Board '.
As a result of a disciplinary proceeding held against the appellant, on April 15, 1968.
a minor penalty for the stoppage of one increment without any future effect was imposed on the appellant by the Board.
After the expiry of one year, the appellant was, however, given the increment.
Although the probationary period of the appellant was completed on June 10, 1965, he was not confirmed within a reasonable time thereafter.
There is also no material to show that his period of probation was extended.
In the meantime, some substantive posts of Assistant Engineers, Class II, fell vacant and by an order dated March 30, 1970 of the Secretary to the Board, the appellant and the respondents Nos. 2 to 19 were confirmed as Assistant Engineers, Class II.
It has been specifically stated in the said order that the officers mentioned therein, that is, the appellant and the respondents Nos. 2 to 19, had satisfactorily completed the probationary period of two years.
It, however, appears from the said order that respondents Nos.2 to 14 were confirmed in the posts of Assistant Engineers, Class II, with effect from April 1, 1969, while the appellant was confirmed in that post with effect from December 1, 1969.
Consequently, the appellant 's name was placed last of all the confirmed officers.
In the seniority list also, the name of the appellant was placed against serial No. 63, that is, below the names of the respondents Nos. 2 to 19, although the seniority list appears to have been prepared on the basis of the respective dates of appointments of the officers.
As the appellant was appointed on June 10, 1963, his name should have been placed below the name of Pawan Kumar Aggarwal (Serial No. 45) respondent No. 3 624 appointed on June 7, 1963 and above the name of Sudesh Kumar Tuli (Serial No. 46) respondent No. 2 appointed on June 21, 1963, but his name was placed below that of Ved Prakash Lalit (Serial No. 62), who was appointed on April 7, 1964.
In other words, the names of the respondents Nos. 2 and 4 to 19, who are all juniors to the appellant, were placed above the name of the appellant in the seniority list without any reason whatsoever.
Being aggrieved by the impugned order of the Board dated March 30, 1970 and also the seniority list wherein the appellant 's name has been placed below the names of his juniors, namely, respondents Nos. 2 and 4 to 19, the appellant filed a writ petition before a Single Judge of the Punjab & Haryana High Court.
As stated already, the learned Single Judge dismissed the writ petition, and the letters patent appeal preferred by the appellant against.
the order of the learned Single Judge was also dismissed.
Hence this appeal.
It may be stated here that respondent No. 4, S.P. Nlidha, is since dead.
The only point that is involved in this appeal is whether the Board was justified in confirming the appointment of the appellant in the post of Assistant Engineer, Class II, with effect from December 1, 1969 and placing him below his juniors, namely respondents Nos. 2 and 4 to 19, in the seniority list.
As has been noticed already, there is no material to show why the appellant was confirmed in the post with effect from December 1, 1969, when he had completed his probationary period of two years satisfactorily.
It is submitted on behalf of the Board that as the minor penalty was imposed on the appellant by way of stoppage of his increment for one year, he was confirmed with effect from December 1, 1969 and placed below the respondents Nos. 2 and 4 to 19 in the seniority list.
We are unable to accept the above contention.
The penalty was imposed on April 15, 1968 and, as a result of which, he was deprived of the monetary benefit of one increment for one year only.
The penalty by way of stoppage of one increment for one year was without any future effect.
In other words, the appellant 's increment for one year was stopped and such stoppage of increment will have no effect whatsoever on his seniority.
Accordingly, the Board acted illegally and most arbitrarily in placing the juniors of the appellant above him in the seniority list and/or confirming the appellant in the post with effect from December 1, 1969, that is, long after the date of confirmation of the said respondents Nos. 2 to 19.
The question of seniority has nothing to do with the penalty that was imposed upon the appellant.
It 625 is apparent that for the same act of misconduct, the appellant has been punished twice, that is, first, by the stoppage of one increment for one year and, second, by placing him below his juniors in the seniority list.
The appellant should have been confirmed on June 10, 1965 on which date he had completed two years of his probationary period.
As has been stated already, the probationary period was not extended.
The Board has not laid down any guideline for confirmation.
There is no rule showing when an officer of the Board will be confirmed.
While there is some necessity for appointing a person in government service on probation for a particular period, there may not be any need for confirmation of that officer after the completion of the probationary period.
If during the period of probation a government servant is found to be unsuitable, his services may be terminated.
On the other hand, if he is found to be suitable, he would be allowed to continue in service.
The archaic rule of confirmation, still in force, gives a scope to the executive authorities to act arbitrarily or malafide giving rise to unnecessary litigations.
It is high time that the Government and other authorities should think over the matter and relieve the government servants of becoming victims of arbitrary actions.
In this connection we may refer to the decision in the case of S.B. Patwardhan & others vs State of Maharashtra & Ors.
[ ; where Chandrachud, C.J. speaking for the Court observed as follows: "Confirmation is one of the inglorious uncertainties of government service depending neither on efficiency of the incumbent nor on the availability of substantive vacancies.
A glaring instance widely known in a part of our country is of a distinguished member of the judiciary who was confirmed as a District Judge years after he was confirmed as a Judge of the High Court.
It is on the record of these writ petitions that officiating Deputy Engineers were not confirmed even though substantive vacancies were available in which they could have been confirmed.
It shows that confirmation does not have to conform to any set rules and whether an employee should be confirmed or not depends on the sweet will and pleasure of the Government.
In the instant case, although the Board found that the appellant had satisfactorily completed his period of probation, yet he was placed below his juniors in the seniority list without any rhyme or reason.
There is no explanation why the confirmation of the appellant was deferred till December 1, 1969.
It is, however, submitted on behalf of 626 the Board that after some substantive posts had fallen vacant on April 1, 1969, the question of confirmation of the appellant and the respondents Nos.
2 to 19 was taken into consideration.
This submission is not supported by any material on record inasmuch as there is nothing to show when these posts had fallen vacant.
It is difficult to accept that all these posts had fallen vacant on the same day, that is, on April 1, 1969.
We have, therefore, no hesitation in holding that the vacancies had occurred before that day, but the Board did not care to take up the question of confirmation for reasons best known to it.
That facts stated hereinabove, disclose that the Board had acted arbitrarily at its sweet will and without any justification whatsoever in making the appellant junior to the respondents Nos. 2 and 4 to 19, who are admittedly juniors in service to the appellant.
For the reasons aforesaid, the judgment of the learned Single Judge and that of the Division Bench of the High Court and the impugned seniority list are set aside.
We direct that a fresh seniority list shall be prepared by placing the appellant immediately below Pawan Kumar Aggarwal and above Sudesh Kumar Tuli within six weeks from date and maintain the seniority of the appellant, as directed, in the post to which the appellant has been promoted in the meantime .
The appeal is allowed with costs quantified at Rs.5,000 G.N. Appeal allowed.

summary:
The appellant was appointed an Assistant Engineer on June 10, 1963 in the Punjab State Electricity Board on probation for two years which ended on June 10, 1965.
On bifurcation of Punjab Electricity Board, the service of the appellant was allocated to Haryana State Electricity Board.
As a result of a disciplinary proceeding held against him in 1968, a minor penalty of stoppage of one increment without any future effect was imposed on the appellant.
After expiry of one year, the appellant was, however, given the increment.
By virtue of an order dated March 30, 1970, the appellant and respondents 2 to 19 were confirmed as Assistant Engineers, class II on satisfactorily completing the probation period of two years.
Though the others were confirmed with effect from April 1, 1969, the appellant was confirmed with effect from December 1, 1969.
Consequently, the appellant 's name was placed last of all the confirmed officers.
The appellant challenged the said order by way of a writ petition before the High Court which dismissed the petition.
This appeal by special leave is against the judgment of the High Court.
G Allowing the appeal, ^ HELD: 1.
The penalty by way of stoppage of one increment for one year was without any future effect.
In other words, the appellant 's increment for one year was stopped and such stoppage of increment will H 622 have no effect whatsoever on his seniority.
Accordingly, the Electricity Board acted illegally and most arbitrarily in placing the juniors of the appellant above him in the seniority list and/or confirming the appellant in the post with effect from December 1, 1969 instead of April 1, 1969.
The question of seniority has nothing to do with the penalty that was imposed upon the appellant.
It is apparent that for the same act of misconduct, the appellant has been punished twice, that is, first, by the stoppage of one increment for one year and, second, by placing him below his juniors in the seniority list.
[624G H; 625A] 2.
There is no explanation why the confirmation of the appellant was deferred till December 1, 1969.
The explanation that after some substantive posts had fallen vacant on April 1, 1969, the question of confirmation was taken into consideration is not supported by.
any material on record inasmuch as there is nothing to show when these posts had fallen vacant.
It is difficult to accept that all these posts had fallen vacant on the same day, that is, on April 1, 1969.
Though the vacancies had occurred before that day, the Board did not care to take up the question of confirmation for reasons best known to it.
While there is some necessity for appointing a person in government service on probation for a particular period, there may not be any need for confirmation of that officer after the completion of the probationary period.
The archaic rule of confirmation, still in force, gives a scope to the executive authorities to act arbitrarily or malafide giving rise to unnecessary litigations.
It is high time that the Government and other authorities should think over the matter and relieve the government servants of becoming victims of arbitrary actions.
[625H; 626B; 625C; D] S.B. Patwardhan & others vs State of Maharashtra & others; , , referred to.
[Setting aside the High Court judgment and the seniority list, this Court directed that a fresh seniority list be prepared within six months on the basis of this judgment and maintain the appellant 's seniority in the post to which he has been promoted in the meantime.] [626D]


judgement:
Special Leave Petition (Civil) No. 7799 of 1988.
From the Judgment and order dated 16.5.1988 of the Delhi High Court in C.W. No. 963 of 1984.
R. Jagtyani and Miss Kamini Jaiswal, for the Petitioners.
547 The Judgment of the Court was delivered by SABYASACHI MUKHARJI, J.
This is an application under Article 136 of the Constitution for leave to appeal against the judgment and order of the Division Bench of the High Court of Delhi, dated 16th May, 1988.
In order to appreciate the contentions urged before us, it is imperative to state a few facts.
M/s. Gems Impex Corpn.
, Bombay, petition No. 3 herein, is a firm engaged in the business of diamonds and precious stones.
Ramchand Udhavdas Bharvani, petitioner No. 2 herein, is a partner in the said firm.
Indru Ramchand Bharvani, petitioner No. 1 herein, is his son.
It is stated that both the father and the son were managing the business of the firm.
The Customs officers received a secret information that smuggled diamonds have been kept by the petitioner Nos. 1 and 2 in the said premises.
After obtaining necessary search warrant the Customs officers searched the business premises on 16th November, 1979.
It may be mentioned that the day was not very auspicious for the firm as well as for the people of Bombay.
On that day a warning had been issued by the Weather office, Bombay, about a possible sea storm that night.
The entire activities came to a half and the public had been advised to rush back to their houses early.
On searching the premises of the petitioner No. 3, the Customs officers found over 2,800 carats of rough diamonds and over 400 carats of cut and polished diamonds in addition to a lot of other items of precious stones, pearls, gold manufactures etc.
The books of accounts of the firm, claimed to be written upto date, however, showed a stock of 11.96 carats of cut and polished diamonds and the stock of rough diamonds and other articles was shown as nil.
On being asked to produce evidence of legal acquisition, import and possession of diamonds, the petitioners Nos. 1 and 2 showed their inability to produce any such documents.
They replied that they had purchased the goods locally through brokers and had already made 50% cash payment.
The cash book, however, revealed no such payment nor were any purchase vouchers produced before the officers.
When asked to name the brokers, the petitioners Nos. 1 and 2 stated that the brokers would not come forward to confirm the deal.
The Customs officers also found various documents which had been described in the initial Panchanama as "various incriminating documents".
In the background of the secret information and the facts and the circumstances aforesaid, the Customs officers formed a prima facie belief under section 110 read with section 123 of the , (hereinafter called 'the Act '), that the unaccounted diamonds were smuggled 548 goods.
They seized various goods including cut and published diamonds and rough diamonds in all valued at Rs.54,42,882,02 under Section 110 of the Act on the reasonable belief that the goods had been smuggled into India.
They also seized Indian currency of Rs.1.40 lakhs and some other incriminating documents found in the premises.
The only question agitated before the High Court was regarding cut and polished diamonds and rough diamonds.
In view of the climatic conditions the goods and the documents seized were put in two cartons in the presence of witnesses and the cartons were sealed with the Customs ' seal and also with the seal provided by petitioners Nos. 1 and 2 and the signatures were also put on the label of the cartons.
A detailed itemwise inventory of the seized goods and documents was prepared in the Customs House, Bombay, later on 20th, 21st and 22nd of November, 1979.
The petitioners Nos. 1 & 2 were asked by the Department to attend preparation of the detailed itemwise inventories but they did not attend, rather the petitioner No. 1 replied that the job could be carried out even in his absence.
The petitioners Nos. 1 and 2 were examined and their statements recorded under Section 108 of the Act.
In his statement recorded on 29th November, 1979 Ramchand Udhavdas Bharvani gave names of the 4 dealers.
The petitioners also produced certain notes issued by the said dealers showing that some quantity of diamonds had been given by the said dealers to the petitioner No. 3 on approval basis.
The approval basis was stated to be known in the business circle as 'Jangad '.
Some of these notes bore dates earlier than 16th November, 1979 but neither these notes nor any packet of diamonds covered thereby had been found with the firm on the date of search and seizure.
The dealers named by the petitioners were questioned under Section 108 of the Act to check the veracity of the notes.
They stated that they had issued anti dated and fake notes in order to help the petitioners.
The diamonds covered by these 'Jangad Notes ' were not found in possession of the firm on the day and these were not seized.
The petitioners gave such explanation for the absence of these diamonds dealers which were not found acceptable by the department.
A show cause notice was, thereafter, issued on 9th May, 1980 on various persons including the petitioners.
By the showcause notice the petitioners were called upon to explain to the Collector of Customs (Preventive) Bombay, as to why goods mentioned in the notice and the Indian currency of Rs.1.40 lakhs be not confiscated and the penalty should not be imposed under Section 112 of the Act.
The petitioners duly filed a reply on 5th March, 1981 stating that the goods seized from their custody were Iying with them on approval basis 549 Or Janged basis and belonged to various other dealers.
The petitioners sought reliance upon affidavits of 7 other diamond merchants, jewellers, customers etc which they filed for the first time along with their reply to show cause notice after about 15 months of the seizure.
These affidavits, however, covered the entire quantity of the goods seized.
So far as the diamonds are concerned, the affidavits of 3 other persons were filed.
It was correctly mentioned by the High Court, if we may say so, that the diamonds were not entered in the books of accounts of the dealers who filed the affidavits, when and from whom these were acquired, and whether any jangad notes were issued and if so, why, these were not mentioned in their affidavits.
The High Court has characterised these affidavits in the judgment as a bald statement about the ownership of diamonds.
The High Court was right.
The Collector of Customs by his order dated 17th April, 1982, directed release of jewellery but ordered absolute confiscation of various other goods including the diamonds in question and also imposed a penalty of Rs.65 lakhs on the petitioners under Section 112 of the Act.
A penalty of Rs.25 lakhs each was imposed on the firm and petitioner No. 1 and a penalty of Rs. 15 lakhs was imposed on petitioner No. 2.
Aggrieved thereby, the parties appealed to the Collector of Customs under Section 128 of the Act but the same was dismissed.
The Customs Excise & Gold (Control) Appellate Tribunal by its order dated 17th January, 1984 confirmed the order of confiscation in respect of both the diamonds.
The Tribunal held that seizure of diamonds was in the reasonable belief that these were smuggled goods and consequently the onus of proof, according to Section 123 of the Act, was on the petitioners and they had failed to discharge it in respect of the seized diamonds.
The Tribunal, however, ordered the release of Indian currency of Rs.1.40 lakhs and of all the confiscated goods except the diamonds.
The penalty on petitioner No. 1 was reduced to Rs. 10 lakhs and on the petitioner No. 2 and the firm, it was reduced to Rs. 5 lakhs each.
The result was that the penalty imposed on the petitioners under Section 112 of the Act was reduced from Rs.65 lakhs to Rs.20 lakhs.
The petitioners challenged the correctness and legality of the Tribunal 's order dated 17th January, 1986, before the High Court of Delhi under Article 226 of the Constitution.
Moreover, on an application filed by the petitioners under Section 130 of the Act, the Tribunal by its order dated 8th January, 1985 referred to Bombay High Court the following two questions: 550 1. "Whether, in the facts and circumstances of the case the Tribunal was justified in holding that the seizing Customs officer had adequate material to form the reasonable belief as contemplated in Section 110 read with Section 123 of the Act, that the diamonds found in the business premises of M/s. Gems Impex Corpn.
were smuggled goods? 2.
Assuming that Section 123 applied and burden of proof was on the appellants, whether the Tribunal should have held that the appellants had discharged this burden by tendering affidavits of persons claiming ownership of the seized diamonds?" By this Court 's order dated 15th July, 1987, it was directed that the reference application pending in the Bombay High Court should stand transferred to the Delhi High Court and be heard along with the writ petition.
The High Court by the impugned judgment dated 16th May, 1988, from which the appeal was sought to this Court, disposed of the writ petition as well as answered the questions.
Two contentions were raised before the High Court, namely, (1) there was no material before the Customs officer to form the reasonable belief that seized goods were smuggled goods and, hence, the seizure itself was bad in law and, therefore, the provisions of Section 123 of the Act could not be applied and it was for the Customs Department to prove that the diamonds in question were smuggled.
The Customs department having failed to prove that the seized diamonds were smuggled the impugned order cannot be sustained.
It was secondly argued that by assuming that the onus was upon the petitioners to prove that the seized diamonds were not smuggled, they had amply discharged the said burden by tendering affidavits.
The first question that had to be considered was whether there was material for forming an opinion as to reasonable belief under Section 110 read with Section 123 of the Act.
Section 110(1) of the Act which deals with seizure of goods, documents and things provides as follows: "(1) If the proper officer has reason to believe that any goods are liable to confiscation under this Act, he may seize such goods: 551 Provided that where it is not practicable to seize any such goods, the proper officer may serve on the owner of the goods an order that he shall not remove, part with, or otherwise deal with the goods except with the previous permission of such officer.
" Section 123 which deals with onus of proof provides as follows: B "(1) Where any goods to which this section applies are seized under this Act in the reasonable belief that they are smuggled goods, the burden of proving that they are not smuggled goods shall be (a) in a case where such seizure is made from the possession of any person, (i) on the person from whose possession the goods were seized; and (ii) if any person, other than the person from whose possession the goods were seized, claims to be the owner thereof, also on such other person; (b) in any other case, on the person, if any, who claims to be the owner of the goods so seized.
(2) This section shall apply to gold, diamonds, manufactures of gold or diamonds, watches, and any other class of goods which the Central Government may by notification in the official Gazette specify.
" Hence, the gist of these two sections is that there must be materials to form a reasonable belief that the goods in question are smuggled.
Section 111 deals with confiscation of property.
The High Court, in our opinion, rightly found that there was evidence to presume that the goods in question were smuggled.
A large quantity of diamonds was found in the possession of the petitioners.
No trustworthy evidence, documentary or oral, was produced in favour of the petitioners as to its legal acquisition/importation or possession.
The learned Acting Chief Justice, Chadha, J & Sabharwal, J who disposed of the matter by the judgment under appeal, found that even a cursory look at the documents was adequate to show that the transac 552 tions were of sale and purchase of diamonds in foreign currencies.
While the stock in the books showed a balance of 11.96 carats of cut and polished diamonds and nil stock of rough diamonds, the stock found in their possession was much more.
In those circumstances the High Court came to a conclusion that there was reasonable belief that the diamonds were smuggled and we cannot say that such conclusion was unwarranted.
It was contended before the High Court and repeated before us in support of the petitioners that there was no profit element in smuggling the diamonds and, hence, no presumption should be inferred against the petitioners.
There was nothing on record to show that profit element was lacking.
Section 123 of the Act itself recognises that diamonds have great potential for smuggling into India and that is why it is mentioned in sub section (2) of Section 123 of the Act.
The onus has been placed on the person from whose possession such articles are acquired.
In that view of the matter the High Court rightly drew the presumption against the petitioners.
However, it was contended on their behalf that reasonable belief could not be based on presumptions.
Reliance was placed on a Bench decision of the High Court of Delhi in the case of Shanti Lal Mehta vs Union of India & ors.
, There it was asserted that the goods in question belonged to Queen Mother of Nepal and that they were duly entered in the account books but the accountant had gone to the Income Tax Department.
The Customs officer did not wait for the accountant to arrive to exp lain the entries in the books of account to him and seized the goods which in the search list were described as 'appearing to be diamonds '.
Due to these facts the learned Single Judge held that it was not a case of reasonable belief but only a case of suspicion.
In the instant case, as per the High Court 's order, the Customs Deptt.
had definite secret information.
Despite petitioners ' assertion that the books of accounts were written up to date it showed a stock of only 11.96 carats of cut and polished diamonds and that of rough diamonds and other articles as nil, the diamonds actually found on search were over 2800 carats of rough diamonds and over 400 carats of cut and polished diamonds apart from various other precious stones etc.
On being asked to produce evidence of legal acquisition, the petitioners expressed their inability.
There was good ground accompanied by rational nexus leading to formation of the belief that the goods were smuggled.
Furthermore, the petitioners stated that they had purchased the goods locally through the brokers and had already made 50% cash payment but the 553 cash book showed no such payment.
They also refused to disclose brokers ' names saying that the brokers would not come forward to confirm the deal.
Besides, various incriminating documents were also found.
The existence of the material is justiciable but not the sufficiency of the material.
In this case there is ample material, their existence cannot be disputed.
There is certainly a nexus between these materials and the formation of the belief that the goods are liable to confiscation.
In the light of the above Section 110 read with Section 123 has been fully complied with.
The reasonable belief as to smuggled goods, as enjoined in the Act, had been explained by this Court in State of Gujarat vs Mohonlal JitamatJi Porwal & Anr., ; There this Court observed whether or not the officer concerned had seized the article under the "reasonable belief" that the goods were smuggled goods, is, not a question on which the Court can sit on appeal.
The circumstances under which the officer concerned entertains reasonable belief, have to be judged from his experienced eye who is well equipped to interpret the suspicious circumstances and to form a reasonable belief.
See also M.A. Rasheed & Ors.
vs State of Kerala, ; and The Barium Chemicals Ltd. Anr.
vs The Company Law Board & Ors., n must be reiterated that the conclusions arrived at by the fact finding bodies, the Tribunal or the statutory authorities, on the facts, found that cumulative effect or preponderance of evidence cannot be interfered with where the fact finding body or authority has acted reasonably upon the view which can be taken by any reasonable man, Courts will be reluctant to interfere in such a situation.
Where, however, the conclusions of the fact finding authority are based on no evidence then the question of law arises and that may be looked into by the Courts but in the instant case the facts are entirely different.
See the principles enunciated by this Court in M/s Mehta Parikh & Co. vs C.l.T., Bombay; , The same view was expressed by this Court in Pukhraj vs D.R. Kohli, [1962] Suppl 3 SCR 866 where while dealing with the provisions of the Customs Act, 1878, this Court held that Section 178 of the said Act imposed the onus of proof that the gold was not smuggled, on the party if it was seized under the Act.
The question whether it was under the reasonable belief or not, was a justiciable one.
The facts of this case certainly warrant the formation of belief.
In any case, once it is held that there was material relevant and germane, the sufficiency of the material is not open to judicial review.
The other contention urged on behalf of the petitioners was that 554 the burden that lay upon the petitioners, had been fully discharged to show that the goods were not smuggled.
The High Court on an analysis of the facts found that the onus was not duly discharged and held that though the burden on the petitioners was not as high as on the prosecution but there must be preponderance of probabilities.
The High Court found that by filing the affidavits in this case, the burden had not been discharged.
We are in agreement with the High Court.
The facts that the affidavits had been filed long afterwards and the names of the parties were not disclosed at the time of search, warrant rejection of the affidavits.
These were filed after a gap of 15 months and the same were examined minutely.
The facts and figures given were checked up and the credibility of the deponents as well as the credence of their version examined.
Furthermore, the affidavits must be looked on the background that those persons who claim that they had given these diamonds on approval basis, made no claim for all these diamonds.
Reliance was placed on a decision in the case of Rabindra Kumar Dev vs State of Orissa, ; This Court while considering this case under the Prevention of Corruption Act and the nature and standard of proof required the accused under Section 105 of the Evidence Act held that the Evidence Act does not contemplate that the accused should prove the case with same strictness and rigour.
But in this case the nature of the evidence on which the reliance could not be placed was rightly rejected by the Customs and the High Court held it properly that the petitioners had not discharged the onus to prove that the goods were not smuggled.
In this case there was no denial of opportunity, the proceedings followed excluded the possibility of denial of opportunity.
The proceedings taken were in order and in consonance with natural justice.
The High Court was right in answering the first question by saying that the Tribunal was justified in holding that the seizing Customs officer had adequate material to form a reasonable belief as contemplated under Section 110 read with Section 123 of the Act and it rightly held that the appellants had failed to discharge the onus.
The High Court answered the second question in the negative.
In our opinion, the High Court was right.
There is, however, one aspect of the matter which was emphasised before us, i.e. that the conclusions of the fact finding body or statutory authority must be arrived at after giving a fair opportunity to the party to be effected by the order to be passed.
As has been reiterated by a Bench decision of the Calcutta High Court in Bal 555 Kissen Kejriwal vs Collector of Customs, Calcutta & ors.
, AIR 1962 Cal.
460 a fair hearing has two justicable elements.
The first is that an opportunity of hearing must be given and the second is that the opportunity must be reasonable.
Whether a person has a fair hearing, can be gone into by the Court and the Court 's conscience must be satisfied that an Administrative Tribuanl charged with the duty of deciding a dispute has conformed to the principles of natural justice.
In that decision the Calcutta High Court was dealing in respect of a proceeding under the .
Counsel for the appellant sought to urge before us that a fair hearing had not been given.
We have set out the facts hereinbefore.
The High Court had also examined this aspect and rejected this challenge.
In our opinion, the High Court was right.
In our opinion, judged by the aforesaid two aspects a reasonable and fair hearing was afforded to the petitioners.
Hence, it cannot be accepted that there was legitimate cause of grievance.
The High Court was right in disposing of the matter in the manner it did.
This application, therefore, fails and is rejected.
R.S.S. Petition Dismissed.

summary:
On receiving secret information that smuggled diamonds had been kept by petitioners Nos. 1 and 2 in the premises of M/s Gems Impex Corporation, Bombay, petitioner No. 3, which firm was being managed by Petitioners Nos. 1 and 2, the Customs officers searched the premises and found large quantities of unaccounted diamonds, precious stones, pearls, gold manufactures, Indian currency etc.
The petitioners showed their inability to produce evidence of legal acquisition of the goods except to state that they had purchased these locally on cash payment.
The cash books however revealed no such payment.
Various incriminating documents were also found.
On these facts, the Customs officers formed a prima facie belief under section 110 read with section 123 of the that the unaccounted diamonds were smuggled goods, and seized them.
In his statement recorded under section 108 of the Act, petitioner No. 2 produced certain notes issued by four dealers saying that some quantity of diamonds had been given to the petitioners on approval basis.
The said dealers when questioned under section 108 stated that they had issued anti dated and fake notes in order to help the petitioners.
The explanation given by the petitioners having been found unacceptable, a show cause notice was issued ' to the petitioners who were called upon to explain as to why the goods be not confiscated and penalty imposed.
In reply, the petitioners stated that the goods were Iying with them on approval basis and relied on affidavits of other diamond merchants and persons.
These transactions were however not entered in the books of accounts of the dealers and persons who filed the affidavits.
545 The Collector of Customs by his order directed release of jewellery but ordered absolute confiscation of various officer goods including the diamonds and also imposed heavy penalties under section 112 of the Act.
An appeal to the Collector of Customs under 128 of the Act failed.
The Customs, Excise & Gold (Control) Appellate Tribunal confirmed the order of confiscation in respect of diamonds.
The Tribunal held that seizure of diamonds was in the reasonable belief that these are smuggled goods and consequently the onus of proof, according to section 123 of the Act, was on the petitioners which they had failed to discharge.
The Tribunal however reduced the penalties imposed under section 112.
The petitioners challenged the Tribunal 's order before the High Court of Delhi under Article 226.
Moreover, on an application filed by the petitioners under section 130 of the Act, the Tribunal referred two questions to the Bombay High Court.
The reference pending in the Bombay High Court was transferred by the supreme Court to the Delhi High Court, and both the Writ Petition and the reference were heard and disposed of together.
The contentions raised before the High Court and reiterated before this Court were (1) that there was no material before the Customs officer to form the reasonable belief that seized goods were smuggled goods, and the seizure was bad in law, and therefore the provisions of section 123 of the Act did not apply, (2) that assuming that the onus was upon the petitioners, they had amply discharged the said burden by tendering affidavits; (3) that there was no profit element in smuggling the diamonds and, hence, no presumption should be inferred against the petitioners; and (4) that the conclusions of the fact finding body or statutory authority must be arrived at after giving fair opportunity to the party.
Dismissing the Special Leave Petition, it was, ^ HELD: (l) Section 123 of the Act itself recognises that diamonds have great potential for smuggling into India and that is why it is mentioned in sub section (2) of section 123 of the Act, and onus placed on the person from whose possession these are recovered.
[552C] (2) The High Court rightly found that there was evidence lo presume that the goods in question were smuggled.
A large quantity of diamonds was found in the possession of the petitioners.
No trustworthy evidence, documentary or oral, was produced in favour of the petitioners as to its legal acquisition/importation or possession.
[551G] 546 (3) In this case there was certainly a nexus between the available material and the formation of the belief that the goods were liable to confiscation.
The existence of the material was justiciable but not the sufficiency.
[553A B] (4) The conclusions arrived at by the fact finding bodies, the Tribunals or the statutory authorities, on the facts, cannot be interfered with where the fact finding body or authority has acted reasonably upon the view which can be taken by any reasonable man.
Courts will be reluctant to interfere in such a situation.
Where however, the conclusions of the fact finding authority are based on no evidence, then the question of law arises and that may be looked into by the Courts.
[553E F] (5) The High Court rightly found the affidavits as merely bald statements to come to the conclusion that by filing the affidavits the burden had not been discharged.
[554B] (6) A fair opportunity has two justiciable elements.
The first is that an opportunity of hearing must be given and the second is that the opportunity must be reasonable.
Whether a person has a fair hearing can be gone into by the Court and the Court 's conscience must be satisfied that an Administrative Tribunal charged with the duty of deciding a dispute has conformed to the principles of natural justice.
Judged by the aforesaid two aspects, the High Court was right that a reasonable and fair hearing was afforded to the petitioners.
[555A C] Shanti Lal Mehta vs Union of India, ; State of Gujarat vs Mohan Lal Jitamalji Porwal, ; M.A. Rasheed vs State of Kerala, ; ; The Barium Chemicals Ltd. & Anr.
vs The Company Law Board and ors.
, ; M/s Mehta Parikh & Co. vs C.l.
T. Bombay; , ; Pukhraj vs D.R. Kohli, [1962] Suppl 3 SCR 866; Rabindra Kumar Dev vs State of Orissa, ; ; Bal Kissen Kejriwal vs Collector of Customs Calcutta & ors., AIR 1962 Cal 460, referred to.


judgement:
ivil Appeal No. 177 (NL) of 1984.
From the Judgment and order dated 5.9.1983 of the High Court of Bombay in Special Civil Application No. 59 of 1983 Dr. Y.S. Chitale and V.N. Ganpule for the Appellant.
G.B. Pai, Parveen Kumar and Vivek Ghambir for the Respondents.
606 The Judgment of the Court was delivered by VENKATARAMIAH, J.
The short question which arises for consideration in this case is whether a teacher employed in a school falls within the definition of the expression 'workman ' as defined in section 2(s) of the (hereinafter referred to as 'the Act ').
The appellant, Miss A. Sundarambal, was appointed as a teacher in a school conducted by the Society of Franciscan Sisters of Mary at Caranzalem, Goa.
Her services were terminated by the Management by a letter dated 25th April, 1975.
After she failed in her several efforts in getting the order of termination cancelled she raised an industrial dispute before the Conciliation officer under the Act.
The conciliation proceedings failed and the Conciliation officer reported accordingly to the Government of Goa, Daman and Diu by his letter dated 2nd May, 1982.
On receipt of the report the Government considered the question whether it could refer the matter for adjudication under section 10(1)(c) of the Act but on reaching the conclusion that the appellant was not a 'workman ' as defined in the Act which alone would have converted a dispute into an industrial dispute as defined in section 2(k) of the Act, it declined to make a reference.
Thereupon, the appellant filed a writ petition before the High Court of Bombay, Panaji Bench, Goa for issue of a writ in the nature of mandamus requiring the Government to make a reference under section 10(1)(c) of the Act to a Labour Court to determine the validity of the termination of her services.
The said writ petition was registered as Special Leave Application No. 59 of 1983.
That petition was opposed by the respondents.
After hearing the parties concerned, the High Court dismissed the writ petition holding that the appellant was not a workman by its judgment dated 5th September, 1983.
Aggrieved by the judgment of the High Court, the appellant has filed this appeal by special leave.
Two questions arise for consideration in this case; (1) whether the school, in which the appellant was working, was an industry, and (2) whether the appellant was a 'workman ' employed in that industry.
It is, however, not disputed that if the appellant was not a 'workman ' no reference under section 10(1)(c) of the Act could be sought.
The first question need not detain us long.
In University of Delhi & Anr.
vs Ram Nath, ; a bench consisting of three learned judges of this Court held that the University of Delhi, which 607 was an educational institution and Miranda House, a college affiliated to the said University, also being an educational institution would not come within the definition of the expression 'industry ' as defined in section 2(j) of the Act.
Section 2(j) of the Act states that 'industry ' means any business, trade, undertaking, manufacture or calling of employers and includes any calling, service, employment, handicraft, or industrial occupation or avocation of workmen.
Gajendragadkar, J., (as he then was) who decided the said case, held that the educational institutions which were predominantly engaged in teaching could not be considered as industries within the meaning of the said expression in section 2(j) of the Act and, therefore, a driver who was employed by the Miranda House could not be considered as a workman employed in an industry.
The above decision came up for consideration in Bangalore Water Supply & Sewerage Board, etc.
vs R. Rajappa & others; , before a larger bench of this Court.
In that case the decision in University of Delhi & Anr.
vs Ram Nath, (supra) was overruled.
Krishna Iyer, J. who delivered the majority judgement observed at Page 283 of the Report thus: "(a) Where a complex of activities, some of which qualify for exemption, others not, involves, employees on the total undertaking, some of whom are not 'workmen ' as in the University of Delhi case or some departments are not productive of goods and services if isolated, even then, the predominant nature of the services and the integrated nature of the departments as explained in the Corporation of Nagpur, will be true test.
The whole undertaking will be 'industry ' although those who are not 'workmen ' by definition may not benefit by the status.
" The learned Judge, however, observed that while an educational institution was an industry it was possible that some of the employees in that industry might not be workmen.
At page 261 of the Report with reference to the case of University of Delhi & Anr.
vs Ram Nath, (supra) the learned Judge observed thus: "The first ground relied on by the Court is based upon the preliminary conclusion that teachers are not 'workmen ' by definition.
Perhaps, they are not, because teachers do not do manual work or technical work.
We are not too sure whether it is proper to disregard, with contempt, manual work and separate it from education, nor are we too sure whether in our technological universe, edu 608 cation has to be excluded.
However, that may be a battle to be waged on a later occasion by litigation and we do not propose to pronounce on it at present.
The Court, in the University of Delhi, proceeded on that assumption viz. that teachers are not workmen, which we will adopt to test the validity of the argument.
" Thus it is seen that even though an educational institution has to be treated as an industry in view of the decision in the Bangalore Water Supply & Sewerage Board, etc.
vs R. Rajappa & others, (supra) the question whether teachers in an educational institution can be considered as workmen still remains to be decided.
Section 2(s) of the Act defines 'workman ' thus: "2(s). 'workman ' means any person (including an apprentice) employed in any industry to do any skilled or unskilled manual, supervisory, technical or clerical work for hire or reward, whether the terms of employment be expressed or implied, and for the purposes of any proceeding under this Act in relation to an industrial dispute, includes any such person who has been dismissed, discharged or retrenched in connection with, or as a consequence of, that dispute, or whose dismissal, discharge or retrenchment has led to that dispute, but does not include any such person (i) who is subject to the (46 of 1940), or the (45 of 1950), or the Navy (Discipline) Act, 1934 (34 of 1934); or (ii) who is employed in the police service or as an officer or other employee of a prison; or (iii) who is employed mainly in managerial or administrative capacity; or (iv) who, being employed in a supervisory capacity, draws wages exceeding five hundred rupees per mensem or exercises, either by the nature of the duties attached to the office or by reason of the powers vested in him, functions mainly of a managerial nature.
" 609 In order to be a workman, a person should be one who satisfies the following conditions: (i) he should be a person employed in an industry for hire or reward; (ii) he should be engaged in skilled or unskilled manual, supervisory, technical or clerical work; and (iii) he should not be a person falling under any of the four clauses, i.e., (i) to (iv) mentioned in the definition of 'workman ' in section 2(s) of the Act.
The definition also provides that a workman employed in an industry to do any skilled or unskilled manual, supervisory, technical or clerical work for hire or reward includes any such person who has been dismissed, discharged or retrenched in connection with, or as a consequence of, an industrial dispute, or whose dismissal, discharge or retrenchment has led to that dispute.
We are concerned in this case primarily with the meaning of the words 'skilled or unskilled manual, supervisory, technical or clerical work '.
If an employee in an industry is not a person engaged in doing work falling in any of these categories, he would not be a workman at all even though he is employed in an industry.
The question for consideration before us is whether a teacher in a school falls under any of the four categories, namely, a person doing any skilled or unskilled manual work, supervisory work, technical work or clerical work.
If he does not satisfy any one of the above descriptions he would not be workman even though he is an employee of an industry as settled by this Court in May and Baker (India) Ltd. vs Their Workmen., [1961] (II) L.L.J. 94.
In that case this Court had to consider the question whether a person employed by a pharmaceutical firm as a representative (for canvassing orders) whose duties consisted mainly of canvassing orders and any clerical or manual work that he had to do was only incidental to his main work of canvassing could be considered as a workman as defined in the Act.
Dealing with the said question Wanchoo, J. (as he then was) observed thus: "As 'workman ' was then defined as any person employed in any industry to do any skilled or unskilled manual or clerical work for hire or reward.
Therefore, doing manual or clerical work was necessary before a person could be called a workman.
This definition came for consideration before industrial tribunals and it was consistently held that the designation of the employee was not of great moment and what was of importance was the nature of his duties.
If the nature of the duties is manual or clerical, then the person must be held to be a workman.
On the other hand if manual or clerical work is only a small part of the duties of 610 the person concerned and incidental to his main work which is not manual or clerical, then such a person would not be a workman.
It has, therefore, to be seen in each case from the nature of the duties whether a person employed is a workman or not, under the definition of that work as it existed before the amendment of 1956.
The nature of the duties of Mukerjee is not in dispute in this case and the only question therefore is whether looking to the nature of the duties it can be said that Mukerjee was a workman within the meaning of section 2(s) as it stood at the relevant time.
We find from the nature of the duties assigned to Mukerjee that his main work was that of canvassing and any clerical or manual work that he had to do was incidental to his main work of canvassing and could not take more than a small fraction of the time for which he had to work.
In the circumstances the tribunal 's conclusion that Mukerjee was a workman is incorrect.
The tribunal seems to have been led away by the fact that Mukerjee had no supervisory duties and had to work under the directions of his superior officers.
That, however, would not necessarily mean that Mukerjee 's duties were mainly manual or clerical.
From what the tribunal itself has found it is clear that Mukerjee 's duties were mainly neither clerical nor manual.
Therefore, as Mukerjee was not a workman, his case would not be covered by the and the tribunal would have no jurisdiction to order his reinstatement.
We, therefore, set aside the order of the tribunal directing reinstatement of Mukerjee along with other reliefs." The Court held that the employee Mukerjee involved in that case was not a workman under section 2(s) of the Act because he was not mainly employed to do any skilled or unskilled manual or clerical work for hire or reward, which were the only two classes of employees who qualified for being treated as 'workman ' under the definition of the expression 'workman ' in the Act, as it stood then.
As a result of the above decision, in order to give protection regarding security of employment and other benefits to sales representatives, parliament passed separate law entitled the .
It is no doubt true that after the events leading to the above decision took place section 2(s) of the Act was amended by including persons doing technical work as well as supervisory work.
The question for consideration is whether even after the inclusion of the above two classes of employees in the definition of the expression 611 'workman ' in the Act a teacher in a school can be called a workman We are of the view that the teachers employed by educational institutions whether the said institutions are imparting primary, secondary, graduate or post graduate education cannot be called as 'workmen ' within the meaning of section 2(s) of the Act.
Imparting of education which is the main function of teachers cannot be considered as skilled or unskilled manual work or supervisory work or technical work or clerical work.
Imparting of education is in the nature of a mission or a noble vocation.
A teacher educates children, he moulds their character, builds up their personality and makes them fit to become responsible citizens.
Children grow under the care of teachers.
The clerical work, if any they may do, is only incidental to their principal work of teaching.
We agree with the reasons given by the High Court for taking the view that teachers cannot be treated as 'workmen ' as defined under the Act.
It is not possible to accept the suggestion that having regard to the object of the Act, all employees in an industry except those falling under the four exceptions (i) to (iv) in section 2(s) of the Act should be treated as workmen.
The acceptance of this argument will render the words 'to do any skilled or unskilled manual, supervisory, technical or clerical work ' meaningless.
A liberal construction as suggested would have been possible only in the absence of these words.
The decision in May and Baker (India) Ltd. vs Their Workmen, (supra) precludes us from taking such a view.
We, therefore, hold that the High Court was right in holding that the appellant was not a 'workman ' though the school was an industry in view of the definition of 'workman ' as it now stands.
We may at this stage observe that teachers as a class cannot be denied the benefits of social justice.
We are aware of the several methods adopted by unscrupulous managements to exploit them by imposing on them unjust conditions of service.
In order to do justice to them it is necessary to provide for an appropriate machinery so that teachers may secure what is rightly due to them.
In a number of States in India laws have been passed for enquiring into the validity of illegal and unjust terminations of services of teachers by providing for appointment of judicial tribunals to decide such cases.
We are told that in the State of Goa there is no such Act in force.
If it is so, it is time that the State of Goa takes necessary steps to bring into force an appropriate legislation providing for adjudication of disputes between teachers and the Managements of the educational institutions.
We hope that this lacuna in the legislative area will be filled up soon.
This appeal, however, fails and it is dismissed.
Before we con 612 clude we record the statement made on our suggestion by the learned counsel for the Management, Shri G.P. Pai that the Management would give a sum of Rs 40,000 to the appellant in full and final settlement of all her claims.
The learned counsel for the appellant has agreed to received Rs 40,000 accordingly.
We direct the Management to pay the above sum of Rs 40,000 to the appellant in six instalment.
They shall pay Rs 6,000 on 1.9.1988, Rs 6,000 on 1.10.1988, Rs 6,000 on 1.11.1988, Rs 6,000 on 1.12.1988, Rs 6,000 on 1.1.1989 and Rs 10,000 on 1.2.1989.
There is no order as to costs.
G.N. Appeal dismissed.

summary:
The appellant was a school teacher and her services were terminated by the Management.
She made several efforts in getting the order of termination cancelled but without success.
Ultimately she raised an industrial dispute before the Conciliation officer under the Act.
The conciliation proceedings failed and the conciliation officer reported accordingly to the Government.
The Government considered the question of referring the matter for adjudication under section 10 of the Act But on reaching the conclusion that the appellant was not a 'workman ' as defined in the Act.
it declined to make a reference.
The appellant filed a writ petition before the High Court for issue of.
a Writ of Mandamus requiring the Government to make a reference under section 10(1)(c) of the Act to a Labour Court to determine the validity of the termination of her services.
The High Court dismissed the petition holding that the appellant was not a workman.
This appeal by special leave is against the Judgment of the High Court.
Dismissing the appeal, this Court, ^ HELD: 1.1 Even though an educational institution has to be treated as an industry the teachers employed by educational institutions whether the said institutions are imparting primary, secondary, graduate or post graduate education cannot be called as 'workmen ' within the meaning of section 2(s) of the Act.
Imparting of education which is the main function of teachers cannot be considered as skilled or unskilled manual work or supervisory work or technical work or clerical work.
Imparting of education is in the nature of a mission or a noble vocation.
A teacher educates children, he moulds their character, builds up their personality and makes them fit to become responsible citizens.
Children grow under the care of teachers.
The clerical work, if any they may do, is only incidental to their principal work of teaching.
[608B C; 610A C] 605 1.2 If an employee in an industry is not a person engaged in doing work falling in any of the categories as mentioned in Section 2(s) of the Act, he would not be a workman at all even though he is employed in an industry.
It is not possible to accept the suggestion that having regard to the object of the Act, all employees in an industry except those falling under the four exceptions (i) to (iv) in section 2(s) of the Act should be treated as workmen.
The acceptance of this argument will render the words 'to do any skilled or unskilled manual, supervisory, technical or clerical work ' meaningless.
A liberal construction as suggested would have been possible only in the absence of these words.
[609C D; 611C E] Bangalore Water Supply & Sewerage Board, etc.
vs R. Rajappa & others; , , relied on.
(2) University of Delhi & Anr.
vs Ram Nath, ; and May and Baker (India) Ltd. vs Their Workmen, referred to.
Teachers as a class cannot be denied the benefits of social justice.
It is necessary to provide for an appropriate machine y so that teachers may secure what is rightly due to them.
In a number of States in India laws have been passed for enquiring into the validity of illegal and unjust terminations of service of teachers by providing for appointment of judicial tribunals to decide such cases.
It is time that State of Goa takes necessary steps to bring into force legislation providing for adjudication of disputes between teachers and the Managements of educational institutions.
[611F G] [At the instance of this Court, the Management of the School agreed to pay the appellant Rs.40,000 which this Court directed to be paid in 6 monthly instalments commencing from September, 1988.] [612B]