1. This writ appeal has been filed against the judgment of the learned Single Judge dismissing W.P. 1924 of 1977, filed by the petitioner. The prayer in the writ petition was to quash the order dated 8-2-1977, passed by the Government of India, in the following circumstances. On 11-11-1970, the officers of the Customs department, Madras, seized 34 bags of nutmegs without shell and 15 bags of nutmegs with shell from the petitioner in the reasonable belief that the goods were smuggled goods and were imported in contravention of the Customs Act, 1962 (for short the Act). On 28-4-1971, a show cause was issued by the Assistant Collector of Customs to one Tilakar of the petitioner's firm. Thereafter, on 24-3-1971, a notice was sent to the petitioner stating that the 49 bags of nutmegs would be sold as they were deteriorating and the sale proceeds kept in abeyance. It is admitted that on 15-6-1971, the petitioner wrote to the Assistant Collector of Customs agreeing to the goods being sold. Thereafter, on 29-6-1971, the petitioner sent a communication to the Additional Collector of Customs stating that a consignment of nutmegs had been seized from it on 11-11-1970 and that a show cause notice had been issued to Tilakar, who was described as Manager and Accountant in the letter itself and four other members. The said communication further stated that no notice had been sent either in the name of the firm or in the name of the partners of the firm and that since six months had elapsed from the date of seizure on 11-11-1970, the petitioner was entitled to return of the goods. Thereafter, the Assistant Collector of Customs sent another show cause notice on 26-7-1971, to the petitioner. Thereafter, the Assistant Collector of Customs passed an order on 28-2-1972. The Assistant Collector of Customs found that the seized goods were not of Indian origin and are smuggled and imported into the country unauthorisedly in contravention of the Act. Accordingly, the Assistant Collector of Customs imposed a penalty of Rs. 10,000 on the petitioner, Rs. 5000 on Tilakar and Gnanapraksaam and Rs. 2000 on Natarajan. The petitioner preferred an appeal before the Central Board of Excise and Customs. The appeal was dismissed on 31st August, 1973. The petitioner then preferred a further revision to the Government of India, which too was dismissed on 8-2-1977. It is, in these circumstances, the petitioner filed the writ petition, which, as already stated, was dismissed by the learned Single Judge and hence this appeal.
2. Mr. K. C. Rajappa, the learned counsel for the petitioner, raised the following contentions. S. 110(1) of the Act confers powers on the proper officer to seize any goods if he has reason to believe that such goods are liable to confiscation under the Act. S. 124 provides that before ordering confiscation of any goods or imposing any penalty on any person, the owner of the goods or such person should be given notice in writing informing him of the grounds on which it is proposed to confiscate the goods or to impose the penalty and should be given a reasonable opportunity of being heard in the matter. S. 110(2) provides that where any goods are seized under sub-section (1) and no notice in respect thereof is given under clause (a) of S. 124, within six months of the seizure of the goods, the goods shall be returned to the person from whose possession they were seized. In this case, according to the learned counsel though the seizure of the goods was made on 11-11-1970, the show cause notice was issued to the petitioner only on 29-6-1971 six months after the date of seizure. Consequently, the Customs authorities were bound to return the goods to the petitioner. Further, the notice dated 29-4-1971 was served only on Tilakar. Admittedly, according to the Customs authorities such notice was not served on the said Tilakar as an agent of the petitioner within the meaning of Section 147(3) of the Act. The appellate authority had found that the notice issued to Tilakar was valid under S. 229 of the Contract Act and was binding on the petitioner which finding was confirmed by the revisional authority. Mr. Rajappa contended that S. 229 of the Contract Act could not be invoked by the respondents to make the show cause notice served on Tilakar binding on the petitioners. Once it was admitted by the respondents that the show cause notice was not issued under Section 147(3) of the Act, then the authorities should have further found that there was no valid notice on the petitioner and the only valid notice was the one issued after the period of six months. Consequently, the petitioner was entitled to a return of the goods. We may mention at this stage that apart from raising this technical plea that the show cause notice issued to the petitioner was beyond the period of limitation and that the show cause notice issued to Tilakar on 28-4-1971, was not binding on the petitioner, the learned counsel for the petitioner did not canvass the correctness of the findings of the various authorities on the merits of the case.
3. The only question for our consideration therefore is whether the notice dated 22-4-1971 issued to Tilakar was binding on the petitioner. In the judgment of the learned Single, it is observed as follows :
'Admittedly the first show cause notice was issued to the Manager of the petitioner firm it is not disputed that the manger was the agent of the petitioner for the purpose of the goods in question. That being so the said notice was as such a notice to the petitioner as to the manager himself in view of the provisions of S. 229 of the Indian Contract Act.'
In view of the clear statement in the judgment of the learned Single Judge, it is no longer open to the petitioner to contend that the said Tilakar was neither the manager nor the agent of the petitioner. That there could have been such an admission before the learned single Judge is probabilised by the statement given by one Rajagopal, the substance of which is extracted in paragraph 2(a) of the the order of the Collector of Customs. The said Rajagopal has stated that one Tilakar was working in the shop as an agent and that the shop was dealing in country drugs only. He has further stated that normally they did not deal in cleeves nutmegs etc., that they purchased nutmegs from Messes Poonkodi Export Dealers, Messrs Nagalaxmi Enterprises and Kerala Traders and sold them to the parties in Bombay, that these nutmegs were purchased by Tilakar only at Madurai and sent through Southern Roadways. He has further narrated the part played by Tilakar. Further, Tilakar had himself given a statement that he was appointed by one Velusami who was related to him and that the entire responsibility relating to the shop was given to him. Velusami seems to have given a statement of 11-11-1970 to the effect that Tilakar was the manager of the shop and that he was looking after the entire business. He has further added that Tilakar only purchased the nutmegs in Madurai on 7-11-1970 and that Tilakar knew the details regarding the entire transactions. On the basis of this evidence the Additional Collector of Customs had given a clear finding that the statement of Velusami was in fact a clear authorisation that Tilakar was the firm's agent in respect of the consignment of nutmegs seized under the Act. The appellate authority has also found in paragraph 6 that Tilakar was acting on behalf be of the petitioner. It is further significant to refer to the following passage from the order of the revisional authority : - 'The Government of India observes that the show cause notice was issued in this case within the statutory period of six months to Shri Tilakar, who was admittedly the agent of the petitioner and had purchased these goods and arranged for their sale.' In view of this clear admission, it is futile for Mr. Rajappa to contend that Tilakar was not an agent of the petitioner.
4. Once we accept the finding of the respondents that Tilakar was admitted to be an agent of the petitioner and we further find that there was a clear admission before the learned Single Judge that Tilakar was such an agent, we have no difficulty in coming to the conclusion that the notice issued to Tilakar on 29-4-1971, was a valid notice served on the petitioner under S. 229 of the Contract Act. S. 229 of the Contract Act reads as follows :-
'Any notice given to or information obtained by the agent, provided it be given or obtained in the course of the business transacted by him for the principal, shall, as between the principal and third parties, have the same legal consequence as if it has been given to or obtained by the principal.'
5. As observed by Pollock and Mullah in 'Indian Contract and Specific Relief Acts', 9th Edn. at page 775 -
'The rule laid down in this section is intended to declare a general principal of law. It is not a mere question of constructive notice or inference of fact, but a rule of law which imputes the knowledge of the agent to the principal, or, in other words, the agency extends to receiving notice no behalf of his principal or whatever is material to be stated in the course of the proceedings.'
It is not the contention of the petitioner that Tilakar had played any fraud on the petitioner and that consequently a notice served on the said Tilakar could not be imputed to the petitioner. In the circumstances, we hold that Tilakar was an agent of the petitioner and the notice served on the said Tilakar was binding on the petitioner. Consequently, we further hold that the notice is not vitiated under Section 110(2) of the Act. We therefore dismiss the writ appeal. There will be no order as to costs.
The Chief Justice
6. After the judgment was delivered in the above case, dismissing the appeal, learned counsel on behalf of the appellant made an oral prayer for leave to appeal to the Supreme Court under Art. 133(1) of the Constitution of India. We are not satisfied that the case involves any substantial question of law of general importance, which, in our opinion, needs to be decided by the Supreme Court. The prayer for certificate is accordingly refused.