State of Kerala v. Sebastian Joseph and Joseph Brothers Marketing Pvt. Ltd.

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT** ## **THE HONOURABLE MR.JUSTICE K.VINOD CHANDRAN** ## **&** ## **THE HONOURABLE MR. JUSTICE ASHOK MENON** **MONDAY ,THE 22ND DAY OF OCTOBER 2018 / 30TH ASWINA, 1940** **WA.No. 754 of 2016** **AGAINST THE ORDER/JUDGMENT IN WPC 29878/2013 of HIGH COURT OF KERALA DATED 17-12-2015** ## **APPELLANT/S:/RESPONDENTS 1 TO 5** - **1 STATE OF KERALA REPRESENTED BY PRINCIPAL SECRETARY TO GOVERNMENT,TAXES DEPARTMENT, THIRUVANANTHAPURAM695 001.** - **2 COMMISSIONER OF EXCISE KERALA, THIRUVANANTHAPURAM-695 001.** - **3 ADDITIONAL EXCISE COMMISSIONER (ENFORCEMENT) THIRUVANANTHAPURAM-695 001.** - **4 DEPUTY EXCISE COMMISSIONER ERNAKULAM, KOCHI-18.** - **5 EXCISE INSPECTOR ERNAKULAM EXCISE RANGE, ERNAKULAM DISTRICT, COCHIN-18.** ## **BY ADV. RENIL ANTO, SR.GOVERNMENT PLEADER** ## **RESPONDENT/S:/PETITIONER:** ## **SEBASTIAN JOSEPH** **MANAGING DIRECTOR, JOSEPH BROTHERS MARKETING PVT.LTD., 3RD FLOOR, NATIONAL RESIDENTS, BANK JUNCTION, EDAPPALLY, COCHIN-24.** **BY ADVS.SRI.T.A.SHAJI (SR.) SMT.NAMITHA JYOTHISH** **THIS WRIT APPEAL HAVING BEEN FINALLY HEARD ON 22.10.2018, THE COURT ON THE SAME DAY PASSED THE FOLLOWING:** WA 754/16 -2- ## **J U D G M E N T** Ashok Menon, J. The State is in appeal aggrieved by the finding of the learned Single Judge in W.P.(C) No.29878/2013 setting aside the confiscation of a vehicle allegedly involved in transporting of excess quantity of Indian Made Foreign Liquor. 2. The facts in brief are thus: On 18.04.2012 the Excise Inspector, Ernakulam with his party, intercepted the writ petitioner's vehicle bearing Reg.No.KL-07-BT-1110 and on inspection, discovered 47.610 litres of liquor, consisting of 3.750 litres of IMFL, 4.5 litres of wine and 39.360 litres of beer. Two persons, including the driver, found inside the vehicle were apprehended, and Crime No.24/2012 was registered at the Excise Range Office, Ernakulam under Section 13 read with Section 63 of the WA 754/16 -3- Abkari Act 1 of 1077 (hereinafter referred to as 'the Act'). The vehicle was produced before the authorised officer. On 12.10.2012, the abkari offence registered against the two persons as accused was departmentally compounded and a fine of Rs.5,000/- remitted. The case of the prosecution is that the liquor was purchased for a party hosted by the writ petitioner for his relatives at his residence without taking FL-6 licence as prescribed under the Act. This was the explanation given by the driver, at the time of initial detention. 3. The illicit transportation of liquor in excess quantity being an offence, the conveyance used for such illicit transportation is liable for confiscation under Section 65 of the Act. Hence, the authorised officer, who is the Deputy Commissioner of Excise, Ernakulam, vide Ext.P4 WA 754/16 -4- order dated 27.02.2013, ordered confiscation of the vehicle under Section 67B(2) of the Act. 4. Statutory appeal preferred by the writ petitioner before the Additional Excise Commissioner challenging Ext.P4 order failed, and vide Ext.P5 order, the confiscation was confirmed. Ext.P6 revision preferred before the Excise Commissioner, Thiruvananthapuram, too was rejected vide Ext.P8, though he had submitted a brief notes of arguments in support of his contention. 5. The argument of the writ petitioner was that the liquor was admittedly purchased from an authorised retail dealer by the petitioner's driver, legally. The twist from the prosecution case is that, the said driver had secured a job abroad and was therefore, entertaining his friends in a party he had arranged at his house and that the petitioner, who is the owner of the vehicle was ignorant about such celebration arranged by his WA 754/16 -5- driver, and that he was away in Kozhikode. The learned Single Judge relying on the decisions of this Court in _**Pareed Musaliyar v. State of Kerala** 2015 KHC 975 : 2015 (4) KLJ 563 : 2015 (4) KLT 791_ and _**Ravindran**_ _**v. Excise Ispector,** 2015 (1) KHC 161 : 2015 (1) KLT 218 : 2015 (1)_ _KLJ 395 : ILR 2015 (1) Ker. 762_ , observed that on appreciation of the statutory scheme of Section 67 of the Act and on appreciation of evidence that the petitioner has successfully discharged the burden by examining independent witnesses before the primary authority, succeeded to establish that he has no knowledge of the alleged crime. More particularly, given the further facts that he was not even in the town on that particular date when the vehicle was seized, the learned Single Judge held that Ext.P8 order on the basis of which Ext.P9 notice was issued for the forfeiture of the amount deposited by the petitioner for interim custody of WA 754/16 -6- the vehicle could not be sustained, and the Writ Petition was allowed. 6. It is this finding of the learned Single Judge that stands challenged before us. The grounds under which the State challenges the impugned judgment are that the learned Single Judge went wrong in placing reliance on Ext.P1 mahazar and also on Exts.P4, P5 and P8 orders to arrive at a conclusion that the respondent was out of town on the particular day when the seizure was effected. In fact, the testimony of the two witnesses were not referred to at all. The finding of the learned Single Judge that the writ petitioner has discharged the burden in terms of Section 67C by examination of the two witnesses is not proper. There is absolutely nothing on record to sustain the version of the petitioner that the driver had hosted the party in celebration of his travelling abroad and that the petitioner was himself ignorant WA 754/16 -7- about such an activity arranged by his driver. It is the contention of the appellant that in view of the fact that the driver is an authorised agent of the writ petitioner, who was entitled to drive the vehicle, the owner-writ petitioner is to be responsible for the acts done by the driver, even if the defence that his driver had committed the offence is to be admitted. 7. It is also submitted by the learned Senior Government Pleader that the driver, the co-accused, who was apprehended along with the vehicle and the contraband, had volunteered to compound the offence and had also paid the compounding fee of Rs.5,000/-. The owner is always responsible for the acts of his agent, and therefore, the petitioner could not be exonerated from the illegal activities of his driver, who had admitted the commission of the offence and had compounded it. It is therefore prayed that the impugned judgment WA 754/16 -8- may be set aside and the confiscation proceedings ordered as per Ext.P8 may be restored. 8. Heard the learned Senior Government Pleader appearing for the appellant and Sri.T.A.Shaji, learned Senior Counsel appearing for the respondent/writ petitioner. 9. The learned Senior Government Pleader submits that there is an admission on the part of the driver in the statement, which he had given at the time of his being apprehended with the contraband, that the liquor was being taken to the house of the writ petitioner in connection with a party organized there. As the writ petitioner is a person involved in Abkari business, he cannot pretend to be ignorant of the provisions of the Abkari laws. He cannot, therefore, be unaware of the consequences of transporting liquor in excess of the quantity permitted. In addition, the learned Senior Government Pleader also submits that WA 754/16 -9- the prosecution case has been, more or less, admitted by the driver of the vehicle and the coaccused, in view of the fact that the offence has been compounded and compounding fee remitted by them. The defence set up by the writ petitioner should, therefore, fall to the ground, is the submission made. 10. On the other hand, the learned Senior Counsel appearing for the Writ Petitioner would argue that the prosecution case is only technical in nature, as only Beer is found to be in excess quantity and for that, a vehicle worth about Rs.18 lakhs cannot be ordered to be confiscated. This, according to him, is an extreme punishment and is not warranted in law. The liquor was also procured from an authorised beverages outlet. In view of the fact that the offence was minor in nature and a technical one, it was allowed to be compounded by remitting a compounding fee of Rs.5,000/-. WA 754/16 -10- 11. The learned Senior Counsel for the writ petitioner submits that the petitioner is the Managing Director of a Company engaged in marketing of liquor products of Beverages Corporation and his credentials are well-known to the Excise Department as well and that for all private parties, on earlier occasions, he used to take permits. It cannot be believed that he had used his vehicle for transporting liquor without obtaining a permit. That apart, it is also argued by the learned Senior Counsel that Section 67B of the Act is only an enabling provision empowering the authorised officer to confiscate the vehicle. There is always a discretion available to the Officer, which ought to have been exercised in favour of the petitioner in this case. The learned Senior Counsel also relies on the decision in _**1988 (2) KLT 16 [Azootty v. State of Kerala]**_ , wherein it is held by this Court that confiscation of vehicle is not mandatory WA 754/16 -11- in each and every case and it depends on the various circumstances as also the seriousness of the offence. Hence, it is highly unjust and harsh to confiscate a vehicle worth Rs.18 lakhs for technical offence under the Abkari Act, which has already been compounded for a fee of Rs.5,000/-. 12. The fact that the vehicle was used for transportation of excess quantity of liquor is not controverted. It would not make any difference if the excess liquor was Beer or hard liquor. The bottled quantity of liquor is what matters and it is admitted that it was in excess. The fact is that the registration of the case against the accused is on the premise that the liquor was being transported for the purpose of a party to be held at the residence of the petitioner. It is only at a later point of time that a defence that his driver was holding a party about which the petitioner was unaware, was set up. The previous WA 754/16 -12- statement of the petitioner's driver admitting that the liquor was being transported for the purpose of the owner of the vehicle by itself is sufficient to conclude that the petitioner had attempted to set up a case only on an after thought. There was also no attempt made to establish that the driver had in fact gone abroad. Even if it is for the driver, who was transporting the liquor, the petitioner cannot be exonerated because the driver is undoubtedly the agent of the petitioner. 13. In _**Sub Inspector of Police, Cherpulassery**_ _**and Others** v._ _**K. Rajesh,**_ **reported in** _**2017 (4) KHC 917 : 2017 (4) KLT 374 : 2017 (4) KLJ 444**_ **,** it is held by the Division Bench of this Court thus: _“The conditions to be satisfied by the owner of the vehicle proving the requirements to get the benefit of S.67C(2) are: i) That the involvement of the vehicle was without the knowledge of the owner, ii) That the involvement of the_ WA 754/16 -13- _vehicle was without the knowledge of the Agent,_ _iii) That it was without the knowledge or connivance of the persons in charge of the vehicle, and_ _iv) Each of them had taken all reasonable and necessary precautions against such misuse._ _In other words, the expression used in the Statute is not with the conjunction 'or' but 'and'. The owner has to satisfy all the four requirements simultaneously, so as to get the benefit of this provision. It is not enough, if the owner satisfies that he was not having any knowledge with regard to the transportation of the contraband in the vehicle. He has also to satisfy with reference to above referred instances in relation to his agent, if any, and also the person who was in charge of the vehicle.”_ 14. In view of the admission that the petitioner or his driver was transporting excess liquor in the vehicle involved, the petitioner cannot discharge his burden and seek the benefit under Section 67C(2) of the Act because the conditions referred to above will have to be satisfied in which he has not succeeded. The WA 754/16 -14- evidence of the driver, is intended at protecting his employer and there can be no credence laid on such self-serving statements without substantiating the same. 15. In view of the above discussion, we cannot agree with the learned Single Judge in exonerating the petitioner altogether. Hence, the impugned judgment of the learned Single Judge is set aside. 16. The only question that remains for consideration now is whether the extreme penalty of confiscation of the vehicle worth Rs.18 lakhs is essential for the purpose or not? Considering the fact that the liquor was purchased from an authorised outlet and that there was only excess of Beer, we do not consider it necessary to confiscate the vehicle as such for that purpose. But considering the fact that the petitioner is a person who is aware of the consequences of such transportation, he cannot be let off with a flea WA 754/16 -15- bite penalty. We find that a sum of Rs.2,50,000/- (Rupees two lakhs and fifty thousand only) as penalty in lieu of confiscation of the vehicle, would suffice in the interest of justice. The Writ Appeal is allowed to that extent. No costs. ## **Sd/-** ## **K.VINOD CHANDRAN** ## **JUDGE** ## **Sd/-** ## **ASHOK MENON** 22/10/18 **JUDGE** jg/dkr [True Copy]