M.M. Hassan and T.S. Sajeesh v Union of India and Others

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MR.JUSTICE K.VINOD CHANDRAN** ## **&** **THE HONOURABLE MR. JUSTICE T.R.RAVI** **THURSDAY, THE 01ST DAY OF OCTOBER 2020 / 9TH ASWINA, 1942** ## **WA.No.1023 OF 2020** **AGAINST THE JUDGMENT IN WP(C) 11154/2020(T) DATED 01.07.2020 OF HIGH COURT OF KERALA** ## **APPELLANTS/ PETITIONERS:** **1 M.M. HASSAN, AGED 58 YEARS, S/O. MITHEEN, MUDILUMPALLAYIL HOUSE, KANJIRAMATTAM, AMBALLOOR P.O., ERNAKULAM-682315, PROPRIETOR, MAHIMA JEWELLERY WORKS, MARITHAZHAM POST, KANJIRAMATTOM-682315, ERNAKULAM DISTRICT, KERALA. 2 MR. T.S. SAJEESH, AGED 39 YEARS, S/O. T.G. SHANKARAN, THOTTIPARAMBIL HOUSE, VALLACHIRA P.O., THRISUR-680562, PARTNER, SREEKALEESHWARI GOLD, DOOR NO.IV/1, 16/J. ST. JUDE BUILDING, PERINJERI POST, PIN-680306, TRICHUR DISTRICT, KERALA.** **BY ADVS. SRI.T.ASAF ALI SRI.P.K.SAJEEVAN** ## **RESPONDENTS/ RESPONDENTS:** - **1 THE SUPERINTENDENT OF CUSTOMS, CUSTOMS PREVENTIVE DIVISION, THRISSUR-680001.** - **2 THE COMMISSIONER, CUSTOMS PREVENTIVE COMMISSIONERATE, CATHOLIC CENTRE, ENRKAULAM, KOCHI-682031.** - **3 THE ASSISTANT COMMISIONER OF CUSTOMS (PREV.), OFFICE OF THE COMMISSIONER OF CUSTOMS (PREV.), 5TH FLOOR, CATHOLIC CENTER, BROADWAY, KOCHI-682031.** **WA.1023 of 2020 - 2 -** **4 UNION OF INDIA, REP. BY SECRETARY TO GOVERNMENT, MINISTRY OF FINANCE, DEPARTMENT OF REVENUE, GOVERNMENT OF INDIA, NORTH BLOCK, CENTRAL SECRETARIAT, NEW DELHI-110011.** **R1-R4 BY ADV. SRI.P.VIJAYAKUMAR, ASG OF INDIA R1-R4 BY ADV. Ms. S.KRISHNA, CGC** **THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 01.10.2020, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** **- 3 -** **WA.1023 of 2020** **==> picture [314 x 71] intentionally omitted <==** ## **JUDGMENT** ## **Vinod Chandran, J.** **The appeal is against the judgment of a learned Single Judge, declining interference to the proceedings initiated pursuant to search and seizure evidenced by Exhibit P11 mahazar and Exhibit P19** _**ex parte**_ **order, extending the period for issuing a notice under Section 124, as also release of the gold seized as per Exhibit P11.** **2. On facts, it is only to be noticed that there was a proceeding initiated pursuant to a search and seizure carried out in the premises of the 2[nd] appellant on 16.10.2019. Huge quantity of gold, specifically 4392.05 grams, were recovered from the Air Conditioner in the 2[nd] appellant's business premises. The 2[nd] appellant is carrying on a jewellery and so is the 1[st] appellant. The explanation offered for the seized gold was that the 1[st] and 2[nd] appellants were having regular transactions by which the 1[st] appellant entrusted gold with the 2[nd] appellant for conversion into ornaments. Exhibits P9 and P10 series are** **- 4 -** **WA.1023 of 2020** **produced to establish such transactions having occurred. We immediately observe that we are not called upon to consider the justifiability of the seizure; nor are we called upon to adjudicate the source or ownership of the seized gold. The appellants too are now concerned with only the confiscation and further investigation by the Customs Department. The appellants contend that, the period for issuance of notice for confiscation having expired; the seized gold has to be released and there could be no further proceedings continued. After the seizure a notice was required to be issued within six months as provided under the Customs Act, 1962 ['Customs Act' for brevity]. Though the period was extended there was no notice or hearing granted before the time was extended.** **3. We have heard Sri.Asaf Ali learned Counsel appearing for the appellants, assisted by Sri.P.K.Sajeevan and Sri.P.Vijayakumar, learned Assistant Solicitor General of India, assisted by Ms.Krishna.** **4. Sri.Asaf Ali would specifically refer to Exhibits P9 and P10 series of documents to contend that the source of the gold recovered is very evident. Reading Section 110(2) of the Customs Act, it is argued that the Hon'ble Supreme Court has specifically held that before** **- 5 -** **WA.1023 of 2020** **extension of the time as per the proviso, the persons from whom the goods were seized were to be given a notice and an opportunity for hearing. Further, the extension has to be carried out within the six month period, failing which the goods will have to be released, if no notice is issued under Section 124 within that period provided under sub-section (2). It is argued that Exhibit P19 is the communication dated 26.05.2020 issued to the appellants. The seizure having occurred on 16.10.2019, the six month period expired on 15.04.2020. Before this Court the Department, in the statement filed, has produced Annexure R1(a) dated 11.03.2020. This order has not been communicated to the appellants; nor was any hearing granted before passing this order. The genuineness of the order is also seriously assailed on the ground that Exhibit P18 order issued on 22.04.2020 did not speak of the order dated 11.03.2020. It is argued that the further proceedings have to be found null and void for reason of the time for further proceedings having expired. The appellants rely on the judgments of the Hon'ble Supreme Court in** _**Assistant Collector of Customs and Superintendent, Preventive Service Customs, Calcutta & Others v. Charan Das Malhotra**_ **[** _**(1971) 1 SCC 697**_ **],** _**I.J.Rao, Asstt. Collector of Customs & Others**_ **v.** **- 6 -** **WA.1023 of 2020** _**Bibhuti Bhushan Bagh & Another**_ **[** _**(1989) 3 SCC 202**_ **],** _**S.N.Mukherjee v. Union of India**_ **[** _**AIR 1990 SC 1984**_ **] and** _**C.B.Gautam v. Union of India & Others**_ **[** _**(1993) 1 SCC 78**_ **]. The learned Counsel would seek for immediate release of the gold ornaments and closure of all proceedings pursuant to the subject seizure.** **5. The learned Assistant Solicitor General, however, would contend that the amendment to Section 110(2); as found by the learned Single Judge, takes care of all the grounds raised by the appellants. As per the amendment brought into the Customs Act in 2018, the mandate is only to record reasons and not sufficient cause. This takes away the requirement of a hearing before an extension is granted. It is also submitted that the proviso now available in the enactment requires service of information regarding the extension during the extended period and not within the initial period of six months. It is specifically pointed out that though the appellants have a contention that the gold came into their possession through valid transactions, the recovery was made from the Air Conditioner in the business premises of the 2[nd] appellant, which itself throws suspicion on the source of the gold seized. It is specifically pointed out that the order** **- 7 -** **WA.1023 of 2020** **passed on 11.03.2020 records the additional reason of the pandemic situation, which is unprecedented and ample reason by itself to extend the period as provided under Section 110. The amended provision does not call for any hearing and even if a hearing is found to be mandatory under the provision, it would be an empty formality in the wake of the unprecedented situation brought about due to the spreading virus. The judgment of a Division Bench of the Rajasthan High Court in** _**D.B.Custom Appeal No.1/2019 and connected case**_ **dated 25.07.2019 [** _**Commissioner of Customs (Preventive), Jodhpur v. Swees Gems And Jewellery**_ **] is also relied upon to contend that there is no requirement of a hearing as per the amended provisions. The learned Assistant Solicitor General seeks for dismissal of the appeal.** **6. We are concerned only with the further proceedings carried out after the seizure was effected as per Exhibit P11. Immediately we have to notice that even if we find the impugned proceedings for extension to be bad, that does not vitiate the entire proceedings initiated under the Customs Act. It has been clearly found in** _**Charan Das Malhotra**_ **that** _**'The period laid down in Section 110(2) affects only the seizure of the goods and not the validity**_ **WA.1023 of 2020** ## **- 8 -** _**of the notice (sic-para 5)'.**_ **The consequence then would only be that the goods would have to be restored, but the confiscation proceedings even then could continue.** **7. Admittedly huge quantity of gold was seized from the 2[nd] appellant's premises, that too stashed away in the Air Conditioner. The question before us is as to the validity of the retention of the goods for carrying out the confiscation proceedings. The learned Single Judge found that the various decisions relied on by the appellants were all with respect to the unamended Proviso to Section 110(2). The amended Proviso brings in a totally new procedure where no hearing is required, was the finding leading to rejection of the writ petition. We have to look at the amended and unamended provisions, which are as under:** ## **Prior Amendment** ## **Post Amendment** **Section 110(2): Where Section 110(2): Where any goods are seized under any goods are seized under subsection (1) and no subsection(1) and no notice notice in respect of subin respect of sub-section (1) section (1) and no notice and no notice in respect in respect thereof is given thereof is given under clause under clause (a) of Section (a) of Section 124 within six 124 within six months of months of the seizure of the the seizure of the goods, goods, the goods shall be the goods shall be returned returned to the person from to the person from whose whose possession they were possession they were seized: seized.** **- 9 -** **WA.1023 of 2020** **Provided that the aforesaid period of six months may, on sufficient cause being shown, be extended by the Principal Commissioner of Customs or Commissioner of Customs for a period not exceeding six months.** **Provided that the Principal Commissioner of Customs or Commissioner of Customs, may, for reasons to be recorded in writing, extend such period to a further period not exceeding six months and inform the person from whom such goods were seized before the expiry of the period so specified:** **Provided further that where any order for provisional release of the seized goods has been passed under Section 110A, the specified period of six months shall not apply.”** **Before amendment, the proviso mandated that the extension for a period not exceeding six months shall be on sufficient cause being shown by the Principal Commissioner or the Commissioner of Customs. It is in this background that the Hon'ble Supreme Court in the decisions cited has stressed upon the requirement for a hearing as also the need to pass such order before the initial period of six months, as provided in sub-section (2), expires.** **8. We will first deal with the contention of the** _**audi alteram partem**_ **rule** _**,**_ **being an essential concomitant of a judicial or even a quasi-judicial proceeding.** _**S.N.Mukherji,**_ **citing a number of decisions, found that the concept of natural justice though was thought to have** **- 10 -** **WA.1023 of 2020** **included only two rules that is (i) no man can be a judge of his own cause and (ii) none shall be judged without a proper hearing, is an ever expanding concept. In** _**C.B.Gautam**_ **a Constitution Bench found that, Section 269UD of the Income Tax Act; dealing with compulsory purchase of a property on detection of an intended sale at a price far lower than the market value, despite not specifically providing for a hearing, the requirement has to be read into it. The Bench also noticed the decision of another Bench of equal strength, in** _**Olga Tellis v. Bombay Municipal Corporation**_ **[** _**(1985 (3) SCC 545)**_ **] having found that a statutory power vested to evict with or without notice was valid, but it was intended only to be exercised sparingly; if without notice, '** _**in cases of urgency which brook no delay'(sic)**_ **. Yet another Constitution Bench in** _**Mohinder singh Gill v. Chief Election Commissioner**_ **[** _**(1978 (1) SCC 405)**_ **] held so in para 77:** _**'We have been told that wherever the Parliament has intended a hearing it has said so in the Act and the Rules and inferentially where it has not specificated it is otiose. There is no such sequitur. The silence of a statute has no exclusionary effect except where it flows from necessary implication.…(sic)”**_ **. Hence there could be express exclusion of a hearing and even by** **- 11 -** **WA.1023 of 2020** **necessary implication. This is the principle on which we have to examine the Proviso, before and after amendment, with reference to the precedents squarely on that Proviso.** **9.** _**Charan Das Malhotra**_ **was a case in which a seizure was effected and two extensions were made, of two months each;** _**ex parte**_ **and also after the initial period expired. The Court held that considering the extra ordinary power for seizure the legislature provided that the further proceedings, for confiscation, should be commenced in six months failing which the seized goods should be released. However considering the difficulties in completing an investigation within the period provided, there was a power conferred to extend that period. But that power had to be exercised by a superior officer and it can only be on sufficient cause shown. A dichotomy was found in the words used in Section 110(1) and the Proviso to sub-section (2). While sub-section (1) used the words 'reason to believe' the proviso employed the expression 'sufficient cause shown'. The clear finding was that the former did not contemplate an inquiry at the stage of seizure but the latter did, for the expression requires a determination of whether the materials relied on warrants an extension. When such a determination is required, it cannot be one sided** **- 12 -** **WA.1023 of 2020** **and if the pros and cons are to be considered a notice and hearing is mandatory was the finding.** **10. In** _**I.J.Rao**_ **a Constitution Bench affirmed** _**Charan Das Malhotra**_ **as to the necessity for a hearing in exercise of the power under the Proviso to Section 110(2). That aspect was examined more comprehensively, in the light of the prejudice and injury that may be caused to the person from whom the goods are seized. The possibility of the restoration being eminent in the context of the nature of goods being perishable, the jeopardy caused by reason of the prevailing market conditions changing, the goods being required urgently for a vocational or personal need or any other matter peculiar to the person or the goods, where aspects only the owner of the goods would be able to place before the Commissioner. However it was held that : “** _**But it will not be open to him to question whether the stage of the investigation, and the need for further investigation, call for an extension of time” (sic-para 13)**_ **since the person from whom the goods are seized cannot be permitted to monitor the investigation. The opportunity afforded was held to be one limited to the** _**'pragmatic necessities of the case'(sic).**_ **It was also held that the initial period of six months and an extension by another six months was too** **- 13 -** **WA.1023 of 2020** **short, but the Parliament had so fixed it only considering the hardship caused to the person from whose custody the goods were recovered and the resultant damage and injury. 11. As per the pre-amended provision the mandate was that there should be sufficient cause shown in the order of extension, in which circumstance there was a requirement to apprise the person from whom such seizure was effected as to the cause pleaded by the Investigating Officer to extend the time for issuing a notice under sub-section (1) and under clause (a) of Section 124 within the six month period with respect to goods seized under sub-section (1). The amended provision has done away with the words 'sufficient cause shown' and as of now for extension, what is required is only that reasons be recorded in writing.** **12. In this context, we look at the judgment of the Division Bench of the Rajasthan High Court. We extract paragraphs 14, 15 and 16 of the judgment:** **"14. The reasoning of the Supreme Court was primarily based on the fact that issuance of a show cause notice (i.e. under Section 124) is part of a quasi-judicial or judicial act and consequently, the delay in its issue can at times, be prejudicial to the interests of the party or importer, who has** **- 14 -** **WA.1023 of 2020** **an interest in the goods. The observations of the court are pointed, with respect to the nature of the goods and the information about their condition, which the party likely to be affected might possess. This court is also alive to the fact that Section 110 confers a general power of detention of goods: thus, all classes of articles, including perishables, such as foodstuffs, pharmaceuticals and other goods having limited shelf life can be implicated. Yet, the court has to also be alive to the fact that I.J. Rao (supra) was premised upon the phraseology of Section 110(2), and the power of extension being conditioned "on sufficient cause being shown" which was the subject matter of the court's discussion. Now, the amendment has done away with that expression; the power to extend (the period of detention) after amendment states that, "if the Commissioner of Customs may, for reasons to be recorded in writing, extend such period to a further period not exceeding six months and inform the person from whom such good were seized before the expiry of the period so specified.** **15. The change in the statute, in the opinion of this court, is a significant one. The previous provision required the Commissioner to show sufficient cause, which meant that such cause had to be based on objective considerations. However, the amended provision merely requires the Commissioner to record the reasons in writing and** **- 15 -** **WA.1023 of 2020** **"inform the person from whom such good were seized before the expiry of the period so specified". In this court's considered view, the amended provision deliberately sought to overbear the previous view that a notice before extension was necessary. Now two conditions are to be satisfied: one, the Commissioner has to record his reasons in writing, why the extension is necessary, and two, inform the person from whom such good were seized before the expiry of the period so specified. The latter condition is equally important, in the opinion of this court, because it is a pre-requisite for the exercise of the power of extension. The pre-amended provision was silent on this aspect.** **16. There are other reasons for this court to hold that the amendment brought about a radical change in the law. Parliament had knowledge - or is deemed to have knowledge of the existing state of law, which required notice, before extension. Therefore, the change of terminology is significant; the amendment has resulted in only two conditions, being insisted upon-primarily that the Commissioner should record his reasons, before the expiry of the period of limitation and should inform those reasons to the party concerned".** **13. The learned Judges of the Rajasthan High Court have held the decisions of the Hon'ble Supreme Court to be premised upon the phraseology of Section 110(2) prior to** **- 16 -** **WA.1023 of 2020** **amendment and the power of extension being conditioned 'on sufficient cause being shown'. We respectfully follow the judgment of the Rajasthan High Court. We venture to add that after the seizure which was the subject matter of the decision in** _**I.J.Rao;**_ **but before the date of the decision itself, sub-sections (1A) to (1C) were incorporated in Section 110. Sub-section (1A) conferred power on the Central Government to specify the goods, by reason of their perishable or hazardous nature, depreciation with passage of time, constraints of storage space or any other relevant consideration; on which immediately after seizure, the proper officer was empowered to dispose of in such manner as the Central Government prescribes following the procedure under sub-sections (1B) & (1C). Sub-section (1B)& (1C) speaks of preparation of an inventory and an application before a Magistrate for approval, together with sampling and photographing of goods, in the presence of that Magistrate. These provisions took care of the apprehension expressed in** _**I.J. Rao**_ **as to the prejudice and injury caused to the owner of the goods, if the investigation is not expedited. The dichotomy as noticed in** _**Charan Das Malhotra**_ **between the expressions reasons to believe [Section 110(1)] and 'sufficient cause shown'** **- 17 -** **WA.1023 of 2020** **[Proviso to Section 110(2) prior to amendment] also assumes significance. The Proviso to Section 110(2) after amendment requires only reasons to be recorded, which as available in sub-section (1) contemplates no inquiry as held in** _**Charan Das Malhotra**_ **. By necessary implication the amended Proviso has excluded hearing before an extension is granted.** **14. We also have to notice the contention of the appellants that the order itself has to be served within the initial six month period. As for the position that the order has to be made within the initial period there can be no dispute and in this case it has been so passed. As per the pre-amended Proviso, there was only requirement to show sufficient cause for the purpose of extension. The decisions placed before us have specifically found that the requirement of a hearing has to be read into the proviso and in such circumstance a notice to the person from whom the goods were seized should be issued before the expiry of the initial six months. The Constitution Bench in** _**I.J.Rao**_ **categorically held in Paragraph 14 that** _**“...while notice is issued before the expiry of that period, service of such notice may not be affected on the person concerned in sufficient time to enable the Collector to make the order of extension before that period expires. Service of the**_ **- 18 -** **WA.1023 of 2020** _**notice may be postponed or delayed or rendered ineffective by reason of the person sought to be served attempting to avoid service of notice or for any other reason beyond the control of the customs authorities. In that event, it would be open to the Collector, if he finds that sufficient cause has been made out before him in that behalf to extend the time beyond the original period of six months, and thereafter, after notice has been served on the person concerned, to afford a post-decisional hearing to him in order to determine whether the order of extension should be cancelled or not”(sic).**_ **Hence a reasonable opportunity for hearing which is a pre-requisite could be after the initial period, but the consequential order passed should show sufficient cause for the extension. There hence cannot be any requirement that such an extension order should be served on the person from whom the goods were seized before the expiry of the initial period, even as per the unamended proviso.** **15. The amendment made in the year 2018, as we found, made a sea-change to the Proviso and required only recording of reasons in writing. The amended provision did not provide for a sufficient cause to be shown, as held in** _**Swees Gems And Jewellery**_ **. The sea-change brought in was to** **- 19 -** **WA.1023 of 2020** **ensure that, reasons for extension is shown in the order and the same communicated within the time specified ie: the extended period. Since there is no hearing contemplated, we are of the opinion that the order of extension should be made within the initial period itself. Just as it was held that as per the pre-amended provision, the notice had to be issued within the initial period itself. As to the question of when service has to be effected after amendment, we are of the opinion that it need be only within the extended period; since even an order passed on the last day would be valid. This is the general purport of the specific words used in the amended Proviso too. The proviso specifically provides for an extension to a further period not exceeding six months and information to the person from whom the goods were seized '** _**before the expiry of the period so specified**_ **'. The '** _**period so specified' (sic)**_ **is that in the extension order and not the initial period of six months as provided in Section 110(2). We are, hence, of the opinion that the amended Proviso under Section 110(2) does not require a hearing before the extension is effected and that the information of such extension should be served before the expiry of the extended period. The order of extension has to be made within six months from the date of seizure,** **- 20 -** **WA.1023 of 2020** **but it is to be served only within the period specified therein, i.e., within the extended period.** **16. This does not, however, save the order of extension from being examined in judicial review; within the accepted constraints of such a review, ie: illegality, irrationality or procedural defect. Unless the reasons are so arbitrary and perverse as to shock any reasonable mans conscience there can be no interference to the order passed as irrational. We have held that there is no illegality nor a procedural defect and the question now is only as to whether the reasons are sustainable or can be labelled as irrational. We have looked at Annexure R1(a) order passed by the Commissioner under the proviso to Section 110(2). The reasons stated are that due to the ingenious** _**modus operandi**_ **practiced to evade duty, failure of the person from whose custody the goods were recovered to give proper explanation/proof for illicit possession, the quantum involved and also the nature of the investigation which involves inter-State accomplices; the investigation had proceeded only half-way. The Commissioner also has noticed the specific ground raised by the Investigating Officer as to a number of individuals summoned having intimated their inability to appear before the Investigating Officer due to** **- 21 -** **WA.1023 of 2020** **the prevailing Covid pandemic. We are of the opinion that the reasons cited are not in any manner arbitrary or perverse and are rational enough to amply support the extension as sought for and granted.** **17. We specifically notice the submission of the Assistant Solicitor General and the reason stated of the pandemic situation having put the investigation in reverse gear. Sri.Asaf Ali has a contention that there was no Covid situation as on 11.03.2020; which we are unable to agree with. The news of the spreading pandemic first came out in November, 2019. It had slowly but surely permeated all over the world and India too was on tenterhooks in the early months of this year. The Governments at the Union and State level were mulling over ways and means to manage the situation, which deliberations eventually led to a complete lock-down from 23.03.2020 extending for two months. Even in February and March the situation was tense and the news of the spreading pandemic had percolated down to the general public, some of whom atleast were cautious. The sole reason of the spreading pandemic, we find, more than justifies the extension and that is not to say that the other reasons fall short; which too are perfectly in order.** **- 22 -** **WA.1023 of 2020** **18. It is also pertinent that the Central Government had come out with the Taxation and Other Laws (Relaxation of Certain Provisions) Ordinance, 2020, which provided by Chapter V that the time limits under certain Indirect Tax Laws, including the Customs Act, which falls during the period from 20.03.2020 to 29.06.2020 or any date after 29.06.2020 shall stand extended to 30.06.2020 or such date afterwards as the Central Government may specify. Hence, the proceedings in the present case, which would have normally expired on 15.04.2020, stood automatically extended to 30.06.2020, which may not be very relevant for our purposes since already there was an extension granted on 11.03.2020. We can only say that on 11.03.2020 the Investigating Officer alertly anticipated that the investigation would be prolonged by the very nature of the offence detected and also of the pandemic situation, and sought extension of time. The Commissioner too found the same to be justifiable.** **19. Further in this case, the Investigating** **Officer had considered a representation made by the appellants, though not statutorily provided for, as per the directions issued by this Court in Ext. P17 judgment. The representation as is revealed from Exhibits P17 and P18,** **- 23 -** **WA.1023 of 2020** **urge that they were in possession of the goods validly and in compliance of statutory formalities. There was no contention as could be urged under Section 110 (1A); which were the aspects; then absent in the statute as highlighted by the Constitution Bench in** _**I.J.Rao**_ **to find the requirement of hearing under the un-amended Proviso to Section 110(2).** **20. There is one other allegation raised by the appellants that the order dated 11.03.2020 is one pre-dated after the initial period had expired. To substantiate the said contention, the appellants rely on Exhibit P18, the order passed by the Investigating Officer in compliance of Exhibit P17 judgment. The ground raised is that Exhibit P18 is dated 22.04.2020 and if Annexure R1(a) was issued on the date appearing on it, definitely there would have been a mention of the same in the order passed. At the outset we notice that the date 22.04.2020 is on the covering letter which forwarded the proceedings by which the representations were considered in compliance of the directions in Exhibit P17. The proceedings indicate the personal hearing having been conducted on 19.03.2020 and the order itself issued on 13.04.2020; before the expiry of the initial period provided under Section 110(2), which** **- 24 -** **WA.1023 of 2020** **expires only on 15.04.2020. There was no reason why the order of extension should be referred to in the order passed at Exhibit P18, prior to the initial period specified in Section 110(2).** **21. We have to now apply the law as interpreted, to the facts of the case. Admittedly the seizure was conducted on 16.10.2019 and the six months period provided under Section 110(2) expired on 15.04.2020. On 11.03.2020, Annexure R1(a) was passed by the Commissioner invoking the power under the Proviso to Section 110(2). However, we notice with some distress that Annexure R1(a) order was never communicated to the appellants. The communication issued to the appellants was by Exhibit P19, which is of the Investigating Officer merely informing the extension, again without the reasons being explicitly stated therein. If the order of extension requires reasons to be recorded in writing and information to be given to the person against whom proceedings are taken; such information should necessarily contain the reasons. We would have found Exhibit P19 to be flawed and not in consonance with the proviso to Section 110(2). But, the fact remains that the appellants approached this Court even prior to the expiry of the extended period and the Department produced Annexure** **- 25 -** **WA.1023 of 2020** **R1(a) dated 11.03.2020 along with their statement. Even now the extended period is not over. Since the period stands extended to 14.10.2020, even now there could be a service effected, which would satisfy the mandate under the proviso to Section 110(2). There is however, no warrant to issue a direction to effect such service, since there is a deemed service and information conveyed as to the reasons for extension. We have heard the arguments addressed on that aspect too and declined interference finding the reasons to be perfectly in order.** **We, for all the above reasons, find the refusal of the learned Single Judge to interfere with the impugned order to be perfectly justified and in consonance with the provisions as interpreted by us herein above. We uphold the judgment of the learned Single Judge and reject the appeal. Parties are left to suffer their respective costs.** **Sd/K.VINOD CHANDRAN JUDGE** **Sd/T.R.RAVI JUDGE** **Vku/-** **[ true copy ]**