M/S. STANDARD ESSENTIAL OIL INDUSTRIES & ANR. versus FOREST RANGE OFFICER KASARGOD & ORS. on 19 April 2018

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[2018] 3 S.C.R.

AM/S. STANDARD ESSENTIAL OIL INDUSTRIES & ANR.

v.

FOREST RANGE OFFICER KASARGOD & ORS.

(Civil Appeal No. 1747 of 2008)

BAPRIL 19, 2018

[R. K. AGRAWAL AND SANJAY KISHAN KAUL, JJ.]

Kerela Forest Act, 1961: ss. 61A and 69 – Confiscation byforest officers in certain cases – On facts, order of confiscation of125 kgs of sandalwood oil by the Divisional Forest Officer – SaidCorder dismissed by the Single Judge, however, the Division Benchof the High Court upheld the order of confiscation u/s. 61A –Correctness of – Held: Order by the Divisional Forest Officersufficient to show that the order of confiscation was passed u/s 69and not u/s. 61A – Perusal of the order of Single Judge of the HighDCourt shows that Single Judge rejected the idea of confiscation ofsandalwood oil u/s. 61A and held that though the order ofconfiscation cannot be passed u/s. 61A but by virtue of s. 69, unlessa fact to the contrary is proved, it can be presumed that the seizedproperty belongs to the Government and it enables the Governmentto possess the same – Thus, the Division Bench misdirected itself inEframing the issue and upholding confiscation u/s. 61A and, hence,the order is bad in law – Furthermore, s.69 operates only as a toolto help the government in proving its title to the property but thesaid Section cannot be read as to give any power of confiscation ofthe property – Power of confiscation of sandalwood oil get vestedFin the authorities through s. 61A only after the Kerala Forest(Amendment) Act, 2010 when certain specific provisions relating toSandalwood were inserted through Chapter VI A and Section 47H– Instant case being related to the situation prior to the time ofamendment in 2010 was made, the amended provisions do not apply– Thus, the order of confiscation of sandalwood oil set aside.G

Allowing the appeal, the Court

HELD: 1.1 The order passed by the Divisional forest Officeris in itself sufficient to show that the order of confiscation is passedunder Section 69 of the Kerela Forest Act, 1961 and not under H

Section 61A. Further, a perusal of the order of Single Judge ofthe High Court shows that Single Judge rejected the very idea ofconfiscation of sandalwood oil under Section 61A of the Act andheld that though the order of confiscation cannot be passed underSection 61A of the Act but by virtue of Section 69 of the Act,unless a fact to the contrary is proved, it can be presumed thatthe seized property belongs to the Government and it enablesthe Government to possess the same. Further, the Division Benchmisdirected itself in framing the issue and upholding confiscationunder Section 61A and, hence, on that account, the order is badin law. [Para 13] [538-B-C]

1.2 Section 61A of the Act was inserted to prevent the illicitremoval of timber, charcoal, firewood and ivory belonging to thegovernment from the forests. The said provision confers powerof confiscation on Forest Officers authorised by the Governmentin certain cases. The essence of the Section lies in the fact thatwhen forest offence is satisfactorily believed to have beencommitted in respect of timber, charcoal, firewood and ivory whichis the property of the Government then the authorized officermay confiscate the property irrespective of the pendency of anycriminal proceedings in this regard. [Para 15] [539-C-D]

1.3 A perusal of the definition of forest produce, as givenby Section 2(f) of the Act, shows that other than timber, charcoal,firewood it includes wood oil, gum, resin, natural varnish bark,roots of sandalwood etc. However, the use of the specific words“timber, charcoal, firewood and ivory” under Section 61A insteadof “any forest produce or ivory” makes it clear that the intentionof the legislature in providing armory under Section 61A is onlywith regard to certain category specified therein and not for everyforest produce as defined under Section 2(f) of the Act.Undoubtedly, sandalwood oil is a forest produce but Section 61Aof the Act is limited only to the categories specified therein anddoes not give power of confiscation of sandalwood oil. [Para 16][539-F-G]

1.4 Section 69 of the Act is only a rule of evidence whichraises a mandatory presumption that a forest produce, unlessproved otherwise, is a property of the government in case whereany proceedings are going on under the Act or anything is done AB

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Aunder the Act. The Section operates only as a tool to help thegovernment in proving its title to the property but the said Sectioncannot be read as to give any power of confiscation of the property.The power of confiscation of sandalwood oil get vested in theauthorities through Section 61A only after the Kerala Forest(Amendment) Act, 2010 when certain specific provisions relatingBto Sandalwood were inserted through Chapter VI A and Section47H. The instant case being related to the situation prior to thetime of amendment in 2010 was made, the amended provisionsdo not apply. Hence, the order of confiscation of sandalwood oilis liable to be set aside. The High Court erred in upholding theCorder of confiscation. The order of confiscation is set aside. [Paras17, 18, 19] [539-H; 540-A-B; E-G]CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1747of 2008.

From the Judgment and Order dated 01.03.2005 of the High CourtDof Kerala at Ernakulam in WA. No. 1458 of 2004.

Sanjay R. Hegde, Sr. Adv., Panjal Kishore, A. Raghunath,Ms. M. G. Yogamaya, Advs. for the Appellants.

Pallav Sisodia, Sr. Adv., G. Prakash, Jishnu M. L., Ms. PriyankaEPrakash, Ms. Beena Prakash, Vijay Shankar V. L., Advs. for theRespondents.

The Judgment of the Court was delivered by

R. K. AGRAWAL, J. 1. The present appeal has been filed againstthe impugned judgment and order dated 01.03.2005 passed by the HighFCourt of Kerala at Ernakulum in W.A. No. 1458 of 2004 whereby theDivision Bench of the High Court dismissed the appeal preferred by theappellants-herein while confirming the order of confiscation of sandalwoodoil which was upheld by learned single Judge of the High Court in O.P.No. 15114 of 1998, vide order dated 19.05.2004.

G2. Brief facts :-

(a) The appellant-firm is engaged in the business of purchase andsale of sandalwood oil. N. A. Abdulrahiman (Appellant No. 2) and N.A.Abdulla Haji are partners in the firm and also running a factory atVidyanagar, Kasargod, for the extraction of sandalwood oil. On H

16.04.1993, at about 10:30 P.M., the Kasargod Police conducted a searchin the premises bearing door No. C.P. 31/786 called “Rahmith Manzil”and seized 125kgs of sandalwood oil kept in five barrels and removedthe same to the local police station.

(b) The above premise also happens to be the residence of themanaging partner of the appellant firm and his family members. Theseizure of the oil was reported to the Superintendent, Central Excise,Kasargod apprehending violation of the Central Excise Rules in removingthe oil from the factory to the residential premises.

(c) Consequently, the partners of the appellant-firm were servedwith show cause notice by the Authorized Officer under the KeralaForest Act, 1961 (hereinafter referred to as ‘the Act’) proposing toconfiscate 125 kgs of sandalwood oil seized from the aforementionedresidential building.

(d) The appellants replied to the show cause notice and contendedthat the above quantity is the accounted stock of the firm i.e., 75 kgs. ofsandalwood oil was manufactured in the factory premise itself assupported by stock register whereas 50 kgs of sandalwood oil waspurchased from M/s Punjab Aromatic, A.G. Road, Calicut-2 on 15.04.1993and in support of this claim, invoice of the said purchase was alsoproduced.

(e) It is the case of the appellants herein that this quantity of 125kgs of sandalwood oil has been removed to the residence of the managingpartner on account of maintenance work carried out in the factory whichis in the adjacent compound. After considering the objections put forwardin reply to the show cause notice, the Divisional Forest Officer, videorder dated 03.07.1998, ordered confiscation of the 125 kgs ofsandalwood oil.

(f) The appellants being dissatisfied with the order dated03.07.1998 filed a writ petition before the High Court bearing OP. No.15114 of 1998 which came to be dismissed vide order dated 19.05.2004.

(g) The appellants, being aggrieved by the order dated 19.05.2004,preferred an appeal to the Division Bench of the High Court being No.1458 of 2004. The Division Bench, vide order dated 01.03.2005 upheldthe order of confiscation and dismissed the appeal.

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(h) Consequently, the appellants have filed this appeal by way ofspecial leave before this Court.

3. Heard Shri Sanjay R. Hegde and Shri Pallav Sisodia, learnedsenior counsel for both the parties and perused the relevant materialplaced before us.BPoint(s) for consideration:-

4. The issue arises for consideration is as to whether the HighCourt erred in upholding the order of confiscation under Section 61-A ofthe Act and whether confiscation of sandalwood oil can be ordered underSection 61A or 69 of the Act?

CRival contentions:-

5. Learned senior counsel appearing for the appellants contendedthat the High Court has misdirected itself in framing the question whicharises in the present case to the effect that the order of confiscation ofsandalwood oil passed under Section 61A of the Act is illegal and withoutDjurisdiction. It is further contended that the entire judgment proceeds onthe basis that the confiscation is made under Section 61A of the Act,which is patently and factually incorrect. It is further contended that theconfiscation has admittedly been made under Section 69 of the Act afterthe Authorized Officer finds that confiscation under Section 61A of theAct will not lie and the same was also confirmed by learned single JudgeEof the High Court.

6. Learned senior counsel further contended that the High Courterred in upholding the order of confiscation under Section 61A of theAct because the said Section authorize the confiscation where Forestoffence is believed to have been committed in respect of timber, charcoal,Ffirewood or ivory, which is the property of the Government. TheAuthorized Authority accepted the legal position that sandalwood oil isnot a commodity included under Section 61A of the Act.

7. He further contended that the Division Bench of the High Courtcommitted a grave error in not appreciating the fact that Section 69 ofGthe Act is only a rule of evidence which facilitates the proceedings underthe Act and the said Section nowhere gives the power to confiscate.Even otherwise, documentary evidence available are sufficient to rebutthe presumption under Section 69 of the Act and to hold that sandalwoodoil did not belong to the Central or the State Government and the same isHthe property of the appellants herein.

8. Learned senior counsel finally contended that the judgmentand order of the High Court being adverse in law, is liable to be setaside.

9. Per contra, learned senior counsel appearing on behalf of therespondents submitted that the High Court has rightly upheld the orderof confiscation under Section 61A of the Act which empowers theauthorized officer to confiscate the property in respect of which a forestoffence is believed to have been committed.

10 .He further contended that the authorized officer was wellwithin his powers to order confiscation even under Section 69 of the Actas Section 69 of the Act enables him to presume that the property belongsto the Government and the appellants have not forwarded any reliableevidence to support his claim to the seized quantity of the sandalwood oiland in the absence of any such evidence, the order of confiscation waswell within the parameters of law and should not be disturbed.

11. Learned senior counsel for the respondents finally submittedthat the order and judgment of the Division Bench of the High Court is inaccordance with law and no interference is sought for in this regard.

Discussion:-

12. The very first issue that arises for consideration is whetherthe judgment and order of the High Court is bad in law for framing awrong issue and to uphold the order of confiscation under Section 61Aof the Act. The appellants herein contended that the High Court hasmisdirected itself in framing the question as to the validity of the order ofconfiscation under Section 61A of the Act in the present case when boththe authorities below rejected the idea of order of confiscation underthat Section and passed order under Section 69 of the Act only.

13. To address the said issue, it is worthy to reproduce the operatingpara of the decision of the order dated 03.07.1998 by the DivisionalForest Officer which is as under:- “In the light of the decision of the Hon’ble Supreme Court in C.A.423/93, sandalwood oil will also come within the purview of woodoil as per Sec. 2 (F)(1) of Forest Act. Hence sandalwood oil canbe confiscated under Section 69 of the Forest Act. The accusedhave failed to prove the ownership of the 125 kgs of sandalwoodoil seized in the above case. Hence, I, K.K. Chandran, the A

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AAuthorized Officer, presume that it is illegally acquired and henceordered for confiscated under Section 69 of the Forest Act.”

The above order is in itself sufficient to show that the order of confiscationis passed under Section 69 of the Act and not under Section 61A. Further,a perusal of the order of learned single Judge of the High Court datedB19.05.2004 shows that learned single Judge rejected the very idea ofconfiscation of sandalwood oil under Section 61A of the Act and heldthat though the order of confiscation cannot be passed under Section61A of the Act but by virtue of Section 69 of the Act, unless a fact to thecontrary is proved, it can be presumed that the seized property belongsto the Government and it enables the Government to possess the same.CHaving gone through the judgment of the authorities below, it can beconcluded that the Division Bench has misdirected itself in framing theissue and upholding confiscation under Section 61A and, hence, on thataccount, the order is bad in law.

14. Moving further to the next question, whether in the light ofDfact and circumstances of the present case, the order of confiscation ofsandalwood oil can be passed under Section 61A or Section 69 of theAct. To appraise the said question, it is appropriate to discuss the contoursof Section 61A and Section 69. Section 61A states as under:

“61A. Confiscation by Forest Officers in certain cases -ENotwithstanding anything contained in the foregoing provisions ofthis Chapter, where a forest offence is believed to have beencommitted in respect of timber, charcoal, firewood or ivory whichis the property of the Government, the officer seizing the propertyunder sub-section (1) of Section 52 shall, without any unreasonableFdelay, produce it, together with all tools, ropes, chains, boats,vehicles, and cattle used in committing such offence, before anofficer authorised by the Government in this behalf by notificationin the Gazette, not being below the rank of an Assistant Conservatorof Forests (hereinafter referred to as the authorised officer).

G(2) Where an authorised officer seizes under sub-section (1) ofSection 52 any timber, charcoal, firewood or ivory which is theproperty of the Government, or where any such property isproduced before an authorised officer under sub-section (1) ofthis section and he is satisfied that a forest offence has beencommitted in respect of such property, such authorised officer H

M/S. STANDARD ESSENTIAL OIL INDUSTRIES v. FORESTRANGE OFFICER KASARGOD [R. K. AGRAWAL, J.]

may, whether or not a prosecution is instituted for the commissionof such forest offence, order confiscation of the property so seizedtogether with all tools, ropes, chains, boats, vehicles and cattleused in committing such offence.

69. Presumption that timber or forest produce belongs toGovernment.- When, in any proceedings taken under this Act,or in consequence of anything done under this Act, a questionarises as to whether any forest produce is the property of theCentral or State Government, such produce shall be presumed tobe the property of the Central or State government, as the casemay be, until the contrary is proved.”

15. Section 61A of the Act was inserted to prevent the illicitremoval of timber, charcoal, firewood and ivory belonging to thegovernment from the forests. The said provision confers power ofconfiscation on Forest Officers authorised by the Government in certaincases. The essence of the Section lies in the fact that when forest offenceis satisfactorily believed to have been committed in respect of timber,charcoal, firewood and ivory which is the property of the Governmentthen the authorized officer may confiscate the property irrespective ofthe pendency of any criminal proceedings in this regard. The question iswhether the said Section also gives the power to confiscate sandalwoodoil.

16. A perusal of the definition of forest produce, as given by Section2(f) of the Act, shows that other than timber, charcoal, firewood it includeswood oil, gum, resin, natural varnish bark, roots of sandalwood etc.However, the use of the specific words “timber, charcoal, firewood andivory” under Section 61A instead of “any forest produce or ivory” makesit clear that the intention of the legislature in providing armory underSection 61A is only with regard to certain category specified therein andnot for every forest produce as defined under Section 2(f) of the Act.Undoubtedly, sandalwood oil is a forest produce but Section 61A of theAct is limited only to the categories specified therein and does not givepower of confiscation of sandalwood oil.

17. Further, we find force in the contention of the appellants thatSection 69 of the Act is only a rule of evidence which raises a mandatorypresumption that a forest produce, unless proved otherwise, is a propertyof the government in case where any proceedings are going on under A

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Athe Act or anything is done under the Act. The Section operates only asa tool to help the government in proving its title to the property but thesaid Section cannot be read as to give any power of confiscation of theproperty.

18. The power of confiscation of sandalwood oil get vested in theBauthorities through Section 61A only after the Kerala Forest(Amendment) Act, 2010 when certain specific provisions relating toSandalwood were inserted through Chapter VI A and Section 47H whichspecifically provides as under:

“47H. Seizure of sandalwood, sandalwood oil etc. andCconfiscation thereon.—Notwithstanding anything contained inany law for the time being in force or in any judgment, decree ororder of any court, where an offence is believed to have beencommitted in respect of any sandalwood, the sandalwood, thesandalwood oil, mill, distilling unit, boiler-plant, tools, ropes, chains,boats, vehicles or any other contrivance used in the manufactureDor distillation of sandalwood oil, or in the process of sale ofsandalwood or sandalwood oil shall be liable to be seized undersection 52 and the provisions contained in sections 61A, 61B, 61C,61D, 61E and 61F shall mutatis mutandis apply to the seizure andconfiscation thereof”.

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(Emphasis supplied by us)

The present case being related to the situation prior to the time ofamendment in 2010 was made, the amended provisions do not apply.Hence, the order of confiscation of sandalwood oil is liable to be setaside.

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19. In view of the above detailed discussion, we are of theconsidered view that the High Court erred in upholding the order ofconfiscation. Accordingly, this appeal is hereby allowed and the order ofconfiscation is set aside. The parties to bear cost on their own.

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Nidhi Jain

Appeal allowed.

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