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GIRDHARI LAL GUPTA Versus DN. MEHTA ASSISTANT COLLECTOR OF CUSTOMS

1970 (8) TMI 87 - SUPREME COURT

Order of acquittal set aside - Held that:- While imposing sentence a Court might take notice of the fact that a person is being vicariously punished for an offence and if he shows that it is possible that the contravention of the Act took place without his knowledge or neglect a sentence of imprisonment may not be imposed. In this case he was abroad at the time of contravention and it is possible that the contravention took place without his knowledge or because of lack of diligence. It seems to .....

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tly allowed and the judgment of this Court in Criminal Appeal No. 211 of 1969 modified to the extent that the sentence of six months’ rigorous. imprisonment imposed on Girdharilal is set aside. The sentence of fine of ₹ 2,000/- shall, however, stand. - CRL.A. 211 OF 1969 - Dated:- 18-8-1970 - SIKRI, S.M & DUA, I.D, JJ. For The Appellant : C. K. Daphtary and S. K. Dholakia For The Respondent : V. A. Seyid Muhammad and S. P. Nayar JUDGMENT: The Judgment of the Court on August 18, 1970 wa .....

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₹ 2,000/- each, in default, to rigorous imprisonment' for a further period of three months each. The appellant, Bhagwandeo Tewari was sentenced to rigorous imprisonment for three months and to pay a fine of ₹ 1,000/-, in default, to rigorous imprisonment for two months. The firm was sentenced to pay a fine of ₹ 2,000/-. It does not appear that any special leave was obtained on behalf of the firm. In order to appreciate the contentions made before us it is ncessary to state .....

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ening the parcel and breaking down the case, five hundred ten currency notes of the denomination of hundred rupees each, valuing ₹ 51,0001-, were found. The name of the consignor was Ramghawan Singh at Karnani Mansion, Park Street, Calcutta, but on enquiry no trace could be found of this Ramghawan Singh at Karnani Mansion. In the course of further investigation suspicion fell ,on M/s. Agarwala Trading Corporation of which the appellants Girdharilal Gupta and Fumanmall Jain were the partner .....

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rm were seized. On June 3, 1959, a complaint was lodged at the instance of the Assistant Collector of Customs, Calcutta. After stating the above facts it was alleged, in the complaint that sending out money in Indian currency was prohibited under s. 8(2) of the Act and any attempt to do the same was punishable under s. 23B of the, Act. At the trial a number of witnesses were examined. B. Roy, Customs Preventive Officer, gave evidence regarding the dis- covery of ₹ 51,0001- in Indian curren .....

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Section of the Calcutta Office. Armed with the letter of authority, he took the parcel to the Customs Officer and P.W. 1, B. Roy, asked him to open the parcel and currency notes of the value of ₹ 51,000/-, along, with other things were discovered. R. R. Mukherjee, Traffic Officer of the Indian Airlines Corporation, P.W. 3, is another witness to the recovery of the currency notes. P.W. 4, Ambare Nath Sen, was the Traffic Assistant in the Indian Airlines Corporation, who had typed out the c .....

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was preparing the consignment notes. He further stated that his immediate superior officer, P. K. Chatterjee, was also present at the time this consignment was being booked. Apparently this is not the first time that hiss appellant had gone to the Indian Airlines Corporation because P.W. 4 says that seven days ahead of October 24, 1958, this appellant had called on him with another shipment although that consignment was booked by P. K. Chatterji. Some days after October 25, 1958, this witness P .....

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was not always possible for him to remember all the men who came in contact with him in the course of his work, but 'he said that he had told C. R. Basu who wag investigating the case that the person who brought the parcel was an oldish man and lean one, and had also described his nose. He further admitted that at the place he identified appellant Bhagwandeo Tiwari, he was the only oldish man there. He said that he did not think that he committed a mistake unless the man he identified had a .....

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P.W. 6, Officer of the Customs who investigated the case, said that after making enquiries he applied for the issue of search warrant to search the premises No. 191, Mahatama Gandhi Road. He also applied for a search warrant to search the premises of the partners of the firm at 11-B, Jatindra Mohan Avenue. He did not himself search 11-B, Jatindra Mohan Avenue, but went to execute the search warrant at 191, Mahatma Gandhi Road, where on the identification of P.W.4 he arrested the appellant Bhagwa .....

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just now, are in the same condition to-day as I found them on the day when they were seized. The witnesses to the search I conducted are Radhesyam Gupta and Lalit Kumar Chandu Lal Parekh. Here is the search list over my signature and the signature of the witnesses. (Ext. 10)." In his cross-examined he stated "You are right that Exhibits 9, 9/1 and 9/2 are included in Serial No. 38 of the search list. Ext. 10". The search list does not mention the slips separately but only mentions .....

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because although he was examined before the Chief Presidency Magistrate he was not made available for cross-examination. The learned counsel, Mr. Bhattacharya, suggested that if this witness had been produced for cross-examination he would have deposed against the prosecution. We are unable to draw any such presumption. The other witness was Lalit C. L. Parekh, P.W. 8. He had signed the search list but on cross-examination he stated that "Basu had taken slips of paper from the 'Agal Ba .....

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on the last line and says that these slips do not bear the signature of Lalit C. L. Parekh, and therefore it is clear that these have been fabricated later. We are unable to sustain this contention. The witness had signed a number of documents including the search list and he pay well have thought that he had signed every piece of paper which was seized. No such question was put to the investigating officer. P.W. 11, N. R. Paul, who was the assistant attached to the Appraising Department of the .....

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how that as a matter of fact appellant Bhagwandeo Tiwari had approached some body in Thai Airways but we need not dwell on, this part of the case. The prosecution also produced Shridhar Chatterjee, hand- writing expert, who examined the signature reading as "Ram Chandra" writing in Hindi and in pencil in the two way bills, Ext. 3 and 4, and the specimen writing, He was of the opinion that the writer of the specimen writing was the writer of the signature "Ram Chandra" appeari .....

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elow and goods brought. In Cash (Paper Torn) cases bound (Pettis)(?)................/4/- Case I' (Illegible) /2/- Illegible (Paper tom) Cases (Pettis)(Illegi ble) 2 R.B. -/151- for coming and going to I.A.C. Rs.223/8/. 4/51- 127/73-HongkongShanghai (torn & illegible)" The High Court had to translate it again and the last line was translated into "Hongkong Lagaya" in, place of "Hongkong Shanghai". In the account books of M/s. Agarwala Trading Corporation (Exts. 21 .....

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s entries have been added to ₹ 2/8/to make ₹ 2/14/- as cart charge. Again the entries in Ext. 9/1 are as follows "/1/- But hire for going home. 1/4/- Caine from home to Thai (?) Taxi /12/- Riksha-hire from Thai /1/- Coolie -/4/- Thai Office Colie ______________________ 2/6/- ₹ 147/10/- In Cash" The corresponding entry in the account books are as follows "Rs. 2/6/- (Bus fare /1/Taxi fare ₹ 1/4/- Rickshaw Rs. /12/- Cooli 151-" It is true that the entry o .....

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Ex. 9/2, on the other hand, clearly shows that somebody had gone to the I.A.C. office and paid /15/-for going and coming to the I.A.C. office and paid the incidental charges. Mr. Bhattacharya, who followed Mr. Chagla for the appellants, contends that a serious question of law is involved, the question being that if an investigating officer conducts a search his evidence cannot be relied on unless it is corroborated. It is a novel proposition and he has not been able to cite any authority or pri .....

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d if the entries therein are carried into the account books there is no reason why these things could not be looked at. The learned counsel has taken us through the judgments of the Chief Presidency Magistrate and the High Court. We are in agreement with the conclusions arrived at by the High Court. We have ourselves gone into the evidence as the High Court had reversed the order of acquittal and in one or two places made minor mistakes. Mr. Chagla, while arguing on behalf of the partners, said .....

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ting a contravention is a company, every person who, at the time the contravention was committed, was in-charge of, and, was responsible to, the company for the conduct of the business of the company as well as the company, shall be deemed to be guilty of the contravention and shall be liable to be proceeded against and punished accordingly; Provided that nothing contained in this sub- section shall render any such person liable to punishment if he proves that the contravention took place withou .....

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wledge or that he exercised due diligence to prevent such contravention. The entries were there in his account books and the only thing that, he had to say about these entries in his account books is that they pertain to the routine work of the firm. Under the circumstances we are unable to exonerate him of the charge. As far as the other partner, Puramnall Jain, is concerned' he stated that he does not look after the affairs of the firm and further that he stays all along at Sriganganagar i .....

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Petition No. 37 of 1970 was filed. The judgment of the Court thereon was delivered on February 18, 1971 by] Sikri, C.J. We disposed of Criminal Appeals Nos. 211 and 212 of 1959 by our judgment dated August 18, 1970, whereby the appeals of Girdharilal Gupta, and Bhagwandeo Tewari against. their convictions were dismissed. Girdharilal Gupta put in this review petition stating that the counsel had omitted to bring to our notice the provisions of s. 23C(2) of the Foreign Exchange Regulation Act, 194 .....

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person committing a contravention is a company, every person who, at the time the contravention was committed, was in-charge of, and was responsible to, the company for the conduct of the business of the company as well as the company, shall be deemed to be guilty of the contravention and shall be liable to be proceeded against and punished accordingly : Provided that nothing contained in this subsection shall render any such person liable to punishment if he proves that the contravention took p .....

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be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly. Explanation.-For the purposes of this section,- (a) " company" means any body corporate and includes a firm or other association of individuals; and (b) "director", in relation to a firm, means a partner in the firm. Mr. Daphtary contends that there is no evidence to show that the appellant was in charge of the conduct of the business of the firm at the relevant time a .....

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at s. 23C(2.) also does not apply because there is no evidence that the contravention took place with the consent or connivance of, or was attributable to any neglect on the part of, the appellant. He referred to us a number of authorities of the High Courts in India which have interpreted similar provisions and we shall refer to them later. It seems to us quite clear that s. 23C(1) is a highly penal section as it makes a person who was in-charge and responsible to the company for the conduct of .....

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o us that in the context a person 'in- charge' must mean that the person should be in over all control of the day to day business of the company or firm. This inference follows from the wording of s. 23C(2). It mentions director, who may be a party to the policy being followed by a company and yet not be in-charge of the business of the company. Further it mentions manager, who 75 9 usually is in charge of the business but not in over-all- charge. Similarly the other officers may be in c .....

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for the offence, unless they have contributed to its commission by consent, connivance or neglect." In R. K. Khandelwal v. State ([1964] 62 A.L.J. 625) D. S. Mathur, J., in construing s. 27 of the Drugs Act, 1940, a provision similar to the one we are concerned with, observed : "There can in directors who merely lay down the policy and are not concerned with the day to day working of the Company. Consequently, the mere fact that the accused person is a partner or director of the Compan .....

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e facts of that case the business of selling milk was done by the clerk of the Society and the Secretary was only an honorary Secretary and was not coming to. the Society daily. The only evidence led by the prosecution on this part of the case was of one Sohan Lal Gupta who is a broker. He stated in examination-in-chief : "Who exactly the proprietors of the said firm are, I cannot say. But I can say this much that whenever I had been there I was referred to Girdharilal Gupta (accused No. 2) .....

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anything about the evidence led in this case to the effect that I happen, to be a partner of accused No. 1 firm. To that, Sir, my answer is that I am. " The evidence to that end is correct. I shall only add that I alone look after the affairs of _this firm." Mr. Daphtary says that on this evidence it cannot be held that the appellant was in-charge of the conduct of the business. We are unable to agree with him on this point. The appellant has himself stated that he alone, looked after .....

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