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2025 (9) TMI 1460
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....ges of 'Classmate' exercise books for the alleged violation of Rule 24(a) of the Legal Metrology (Packaged Commodities) Rules, 2011 ["the 2011 Rules"] which is punishable under Section 36(1) of the 2009 Act. Pursuant to the seizure, a seizure notice and a compounding notice both dated 02.07.2020 were issued to the appellant. Alleging that no search warrant was obtained prior to the entry and that the provisions of Sections 100(4) and 165 of the Criminal Procedure Code ["Cr.P.C"] were not complied with, the appellant preferred Writ Petition No. 8954 of 2020 (GM-RES) under Article 226 of the Constitution of India before the High Court of Karnataka ["the High Court"], seeking to quash the said notices and for a direction to Respondent No. 2 to release the seized goods. 3. After hearing both parties, the learned Single Judge of the High Court, by order dated 04.09.2020, allowed the writ petition, quashed the notices issued by Respondent No. 2, and directed the release of the seized goods, holding that the search and seizure were conducted without jurisdiction. Aggrieved by the said order, the respondents filed Writ Appeal No. 572 of 2020 (GM-RES). 4. Upon consideration, the Divis....
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.... lacks any disclosure of reasons. The simultaneous issuance of both seizure and compounding notices, without due deliberation, indicates non-application of mind on the part of the respondents. While the learned Single Judge rightly acknowledged this lapse, the Division Bench failed to consider it adequately. 7.2. It was also contended that Section 100(4) Cr.P.C requires the presence of two or more independent witnesses during the conduct of a search. In the present case, only one witness - Nagabhushan, a driver employed by Respondent No. 2 - was present. Such a person cannot be considered an "independent witness" within the meaning of Section 100(4). Moreover, there is no record of any "reasons to believe" either before or after the search, nor was any urgency or exigency pleaded to justify immediate seizure. The respondents merely relied on Section 102 Cr.P.C., which does not dispense with the statutory requirement of a warrant or justification for seizure. 7.3. The learned Senior Counsel further contended that the premises in question - namely, a warehouse owned by the appellant - was not open to the public, and access was restricted to authorised personnel. Therefore, the ....
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....inuing further, it was submitted that the inspection and seizure were conducted at the appellant's commercial warehouse during working hours. The premises were neither a private dwelling nor inaccessible. Members of the appellant's staff were present during the inspection. The seizure was limited to pre-packed notebooks, which were found to lack mandatory declarations as required under the Legal Metrology (Packaged Commodities) Rules, 2011. A seizure mahazar was drawn on-site, and notice was served on the authorised person present. 8.2. It was also submitted that the warehouse was a place of business, accessible to others, and not a closed or private premises. Referring to the definition of "premises" under section 2(n) of the 2009 Act, it was contended that the Division Bench rightly distinguished between open and closed premises and held that Section 100 Cr.P.C applies only to closed premises. Thus, the absence of a search warrant does not vitiate the seizure in this case. 8.3. The learned Counsel further argued that the procedural safeguards under the Code of Criminal Procedure, 1973 are not applicable in toto to inspections under the Legal Metrology Act. Section 15(4) of ....
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.... judgment and order of the Division Bench warrant no interference at the hands of this court. 9. We have considered the rival submissions and perused the materials available on record. 10. The principal issue that arises for consideration herein is whether the inspection and seizure conducted by Respondent No. 2 under Section 15 of the 2009 Act, without obtaining a prior warrant, was unlawful and violative of the principles of natural justice, thereby justifying invocation of writ jurisdiction under Article 226 of the Constitution. 11. At the outset, it is relevant to extract Section 15 of the 2009 Act, as follows: "15. Power of inspection, seizure, etc. (1) The Director, Controller or any legal metrology officer may, if he has any reason to believe, whether from any information given to him by any person and taken down in writing or from personal knowledge or otherwise, that any weight or measure or other goods in relation to which any trade and commerce has taken place or is intended to take place and in respect of which an offence punishable under this Act appears to have been, or is likely to be, committed are either kept or concealed in any premises or are in....
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....seize the same under section 15(1)(b). Sub-section (4) provides that such search or seizure shall be carried out in accordance with the provisions of the Code of Criminal Procedure, 1973. Therefore, Section 15, on its face, mandates that there must be reasons to believe both for conducting a search or inspection of premises and for seizure of materials therefrom. In addition, to satisfy the requirements of Section 15, the officials must also comply with the provisions of the Code of Criminal Procedure relating to search and seizure. 12. In the present case, the Division Bench of the High Court, considering the use of the words "search or seizure" in Section 15(4) of the 2009 Act, held that Section 100 Cr.P.C would apply only in respect of closed premises; and since, the business premises were open, the pre-requisites under Section 100 Cr.P.C were not required to be followed. It is, therefore, necessary to examine the scope of "place of inspection" as defined and applied under the 2009 Act. 13. Section 2(n) of the 2009 Act defines the term "premises" and reads as follows: (n) "premises" includes- (i) a place where any business, industry, production or transac....
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....f the Criminal Procedure Code deals with summons and searches. Part A concerns summon to produce, Part B relates to search warrants, Part C lays down general provisions applicable to searches, and Part D contains miscellaneous matters. Section 93 Cr.P.C. empowers a Court to issue a search warrant in three circumstances: (i)where the Court has reason to believe that a person to whom a summons or order under Section 91 Cr.P.C. has been or might be issued, or to whom a requisition under Section 92 has been or might be addressed, would not comply with such summons, order, or requisition; (ii)where the thing for which search is to be made is not known to the Court to be in the possession of any person; and (iii)where a general search or inspection is considered necessary by the Court. A warrant may specify the particular place or part of a place to be searched or inspected, and only such place as is mentioned in the warrant can be entered. Section 93(1)(c) read with sub-section (2) uses the expression "search or inspect", thereby signifying that a warrant is mandatory for both search and inspection, and that the Court must record reasons to believe the necessity of issuing such warrant.....
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....inspection conducted under Section 93 Cr.P.C. Section 102 thus addresses a distinct situation of seizure during a general search, not during a search or inspection under Section 15 of the 2009 Act. A plain reading of Section 15 of the 2009 Act, along with Sections 93 and 100 (4) - (5) Cr.P.C leads to the irresistible conclusion that, in the absence of a search, there cannot be any seizure. 16. The respondents have consistently pleaded before both the writ Court and the Appellate Court that the search and seizure were carried out in accordance with Section 15 of the 2009 Act. Their present attempt to contend that there was no search but merely an inspection cannot aid their case, since the pre-requisites under both Section 15 of the 2009 Act as well as Section 93 Cr.P.C must be satisfied in either event. The expression 'closed premises' denotes premises, where access is locked or otherwise unavailable to the public except with the permission of the occupant, and cannot be construed narrowly to exclude openair premises, if such access is not generally available to unauthorised persons. A distinction must be drawn between premises where the public has access for a limited purpose a....
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...., Section 165 speaks of searches during an investigation; it comes into operation once an investigation commences. 18.1. At this juncture, it will be useful to refer to the judgement of this Court in the State of Madhya Pradesh v. Mubarak Ali MANU/SC/0038/1959 : AIR 1959 SC 707, wherein the High Court had held that the investigation was initiated by the Inspector even before obtaining the mandatory prior permission, which was sought only after a lapse of ten days. This Court upheld the finding of the High Court and categorically held that the requirement of prior permission is a condition precedent for a valid investigation and not a mere procedural formality that can be cured retrospectively. Since the defect went to the root of jurisdiction, the belated sanction could not validate the investigation, and the appeal preferred by the State was accordingly dismissed. While so, the Court elucidated the scope of the term "investigation" in the following terms: "12. In this view no other question arises for consideration. But as the learned Counsel appearing for the State contended that the observations of the learned Judge of the High Court that permission of the Magistrate was o....
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....narily necessary, but there must also be reasons to believe that such a search is required. 19.1. Seizure refers to the act of taking the material object into custody for the purpose of investigation or enquiry. Detention refers to a situation where the owner, though retaining possession of the goods, is restrained from using them. There is also a subtle difference where a search followed by seizure is effected under a special enactment, which contemplates a sequence of mandatory steps. Such proceedings are initiated not merely to charge a person with a violation but also to prevent further violations, as in the present case. 19.2. In every search conducted under a special enactment without a warrant, the requirement of recording reasons to believe is mandatory. The reasons necessitating the search must be relevant and must reflect application of mind based on some information - either from a third party or personal knowledge - and cannot be based on mere presumption or extraneous considerations. Such reasons cannot rest on mere suspicion or subjective satisfaction; something more substantial is required for a prudent person to conclude that a search and/or seizure is necessa....
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....)]. Therefore, the ratio laid down by this Court in the various judgments could not have been ignored by the Division Bench of the High Court. 20. In the present case, the respondent authorities conducted a search and inspection on 02.07.2020 during business hours at a commercial warehouse belonging to the appellant and seized 7,600 pre-packed wholesale packages of exercise books, for alleged violations of Rule 24(a) of the 2011 Rules and Section 36(1) of the 2009 Act. The search was conducted without a warrant, and no reasons were admittedly recorded either for conducting the search or inspection, or for seizure of goods. Therefore, the search and seizure are clearly vitiated by procedural violations. 20.1. Observance of due process of law and the principles of natural justice being intertwined, is a legal necessity to ensure that the action of the authorities does not result in manifest arbitrariness or abuse and misuse of power by those empowered to conduct inspection, search, and/or seizure. When the law prescribes a particular procedure to be followed while taking action, the same must be strictly adhered to. The Constitutional Bench of this Court in State of Punjab v. B....
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....n respect of a search conducted by an Excise Officer under the Central Excise and Salt Act, 1944. The search in that case had been effected without recording reasons as mandated under Section 165 Cr.P.C. The Court observed that Section 18 of the Act expressly stipulated that searches under the Act shall be carried out in accordance with the provisions of the Cr.P.C. Consequently, it was held that Section 165 Cr.P.C was squarely attracted and that the search, having been conducted in violation of the said requirement, was illegal. The following paragraphs are apposite: "7. Now we shall look at the provisions of the Criminal Procedure Code to ascertain which of its provisions regulating the mode of search are appropriate to the power conferred on the Deputy Superintendent under r. 201 of the Rules. In the Criminal Procedure Code there are four groups of sections regulating the searches authorised under it. Sections 47, 48, 51 and 52 appear in Ch. V of the Code which provides for the arrest, escape and retaking of persons. Section 47 provides for the search of a place entered by persons sought to be arrested; s. 48 for procedure where ingress is not obtainable; and Sections 5....
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....er makes a search during the investigation of a cognizable office and in the latter the authorized officer makes the search to ascertain whether a person contravened the provisions of the Act or the Rules which is an offence. There is also no reason why conditions should be imposed in the matter of a search by the police officer under s. 165 of the code, but no such safe-guard need be provided in the case of a search by the excises under the Rules. We think that the legislature, by stating in s. 18 of the Act that the searches under the Act and the Rules shall be carried out in accordance with the provisions of the Code relating to searches, clearly indicated that the appropriate provisions of the Code shall govern searches authorized under the Act and the Rules. We therefore hold that the provisions of s. 165 of the Code must be followed in the matter of searches under s. 201 of the Rules. 8. There are no merits in the second contention either. The recording of reasons does not confer on the officer jurisdiction to make a search, though it is a necessary condition for making a search. The jurisdiction or the power to make a search is conferred by the statute and not deriv....
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.... provides for "reason to believe", either the reasons should appear on the face of the notice or they must be available on the materials which had been placed before him. However, interpretation of the expression will depend on the context in which it is used in a particular legislation. In some statutes like the present one, there is a power to initiate action under the statute if the authority has reason to believe that certain facts exist. The test is whether a reasonable man, under the circumstances placed before him, would be propelled to take action under the statute. Considering the object of the 1994 Act, the expression "reason to believe" cannot be construed in a manner which would create a procedural roadblock. The reason is that once there is any material placed before the Appropriate Authority based on which action of search is required to be undertaken, if the action is delayed, the very object of passing orders of search would be frustrated. Therefore, what is needed is that the complaint or other material received by the appropriate authority or its members should be immediately made available to all its members. After examining the same, the Appropriate authority mu....
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....proached, when such request was made, whether a written request was given, and what further action was taken. The seizure mahazar also fails to support the respondents' case, as it records none of the claims now relied upon in their defence. It is settled law that where the initial proceedings are vitiated, all subsequent proceedings are unsustainable. Any act in violation of law cannot be brushed aside on the ground that no prejudice was caused; every violation of law is deemed to cause some prejudice. 22. Further, there is nothing on record to suggest that the goods in the container differed from the particulars on the label, either in form, quality, or weight. The seizure mahazar only noted that the packages lacked clear and conspicuous declarations as required under Rule 24(a), which mandates that declarations on wholesale packages be printed and not affixed by way of a label. It is not disputed by the respondents that disclosures were made; their contention is merely that they were affixed as labels rather than printed. The appellant contended that the goods were stored in CFCs for transportation and that a label declaring the particulars required under law was duly affixed....