TMI Blog1972 (1) TMI 45X X X X Extracts X X X X X X X X Extracts X X X X ..... ce it is found that there has been a contravention of any of the provisions of the Foreign Exchange Regulation Act read with Sea Customs Act by a firm, the partners of it who are in-charge of its business or are responsible for the conduct of the same, cannot escape liability, unless it is proved by them that the contravention took place without their knowledge or they exercised all due diligence to prevent such contravention. The charges and expenses incurred in connection with the despatch found in the entries in the books of account of the firm were the same as those relating to the offending package which was being despatched to Hongkong. The freight mentioned in the account slip is the exact amount which appears on the consignment note in respect of that offending package. The amount sought to be sent is half a lakh of rupees which can hardly be within the means of the Cashier, leading to the inescapable inference that the firm through its partners was concerned in the attempt to transgress the restrictions under Section 8 of the Foreign Exchange Regulation Act and liable to penal action by virtue of Section 23A under the provisions of the Sea Customs Act. On these facts as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... earch, account books and other documents were seized. This investigation revealed that the cashier, Bhagwandeo Tiwari had signed the consignment note as Ramchandra which as the subsequent writings showed, were in his hand. Even consignment note appears to have been typed on the typewriter of the appellant firm. It was further alleged that from a comparison of the consignment note with a letter admittedly sent out by the appellant firm and signed by one of its partners Girdhari Lal Gupta, it became evident that the slip seized from the office of the appellant firm had contained entries, to show that Bhagwandeo Tiwari was the person who actually transported and booked the offending consignment in question and that he made an entry of Rupees 123.73 being the Air freight paid for its transport to Hongkong which was the exact amount shown on the consignment note. Bhagwandeo Tiwari, it was said, had in fact admitted that the account slip was in his hand writing, and that the expenses and charges shown therein were also found in the books of account of the appellant firm. In view of this evidence, the Customs authorities served a notice on the appellant firm on April 2, 1959 by which afte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rency notes are not `goods' and therefore the provisions of Sections 167(3), (8) and (37) of the Sea Customs Act are not attracted. (2) A `firm' is not a legal entity and, therefore, it cannot be a person within the meaning of any of the above provisions of law. (3) Even if a firm be a person within the meaning of the said provisions no penalty can be imposed on the firm or any of its members unless it appears from the evidence that the members of the firm had consciously taken any steps to violate the provisions of law : even so only the particular member against whom there is evidence of guilt can be held liable. 5. Before dealing with the above contentions it will be necessary to consider the relevant provisions of the Foreign Exchange Regulation Act as also those under the Sea Customs Act. Sections 8(1), 23(1)(a), (b) (1-A), 23A, 23B and 23C of the Foreign Exchange Regulation Act and Sections 19, 167(3), (8) and (37) of the Sea Customs Act are relevant for the purpose of this appeal. These are given below :- "8. (1) The Central Government may, by notification in the Official Gazette, order that, subject to such exemption, if any, as may be contained in the notification, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provision, rule, direction or order, as the case may be. 23-C (1). If the person committing a contravention is a company, every person who, at the time the contravention was committed, was incharge 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 without his knowledge or that he exercised all due diligence to prevent such contravention. (2) Notwithstanding anything contained in sub-section (1), where a contravention under this Act has been committed by a company and it is proved that the contravention has taken place with the consent or connivance of or is attributable to any neglect on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other office shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly." Sea Customs Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vessel for exportation contrary to such prohibition or restriction. 37. If it be found, when any goods are entered at, or brought to be passed through a custom house, either for importation or exportation, that 86 137 such packages, together with the whole of the goods contained therein, shall be liable to confiscation, and every person concerned in any such offence shall be liable to a penalty not exceeding one thousand rupees. (a) the packages in which they are contained differ widely from the description given in the bill-of-entry or application for passing them; or (b) the contents there of have been wrongly described in such bill or application as regards the denominations, characters, or conditions according to which such goods are chargeable with duty or the being imported or are being imported or exported; or (c) the contents of such packages have been mis stated in regard to sort, quality, quantity or value; or (d) goods not stated in the bill-of-entry or application have been concealed in, or mixed with, the articles ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h Court thought that there is no definition of goods in the General Clauses Act and that contained in the Sale of Goods Act and which excludes money is inapplicable inasmuch as that Act was much later statute than the Sea Customs Act. It is, however, unnecessary to consider this aspect because even if the currency notes are not goods, the restrictions prescribed in Section 8 of the Foreign Exchange Act cannot be nullified by Section 23A thereof which incorporates Section 19 of the Sea Customs Act. We cannot attribute to the Legislature the intention to obliterate one provision by another provision of the same Act. On the other hand, we construe it as furthering the object of the Act which is to restrict the import into or export out of India of currency notes and to punish contraventions of such restrictions. 7. The second contention that because the firm is not a legal entity, it cannot be a person within the meaning of Section 8 of the Foreign Exchange Regulation Act or of Section 167(3), (8) and (37) of the Sea Customs Act, is equally untenable. There is of course, no definition of `person' in either of these Acts but the definition in Section 2(42) of the General Clauses Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l and the writ petition was dismissed. This Court held that the concern of the Appellant in the commission of the offence must be at a stage prior to the completion of the offence of illegal importation of gold into the country. The mere finding of fact recorded by the Collector of Customs about the smuggled gold being recovered from the person of the appellant was not sufficient to conclude that the appellant was concerned in the illegal importation of gold into the country and, therefore, liable for penalty under Section 167(8) of the Act. What the order of the Collector of Customs must show is that he had considered the question of the person being concerned in the commission of the offence of illegal importation of the goods. It should further indicate that the matters he had considered had a bearing on the question and the reasons for arriving at that conclusion. This has really no bearing on the question before us because under Section 23B, even an attempt to contravene any of the provisions of the Act or of any rule, direction or order made thereunder shall be deemed to have contravened the provision, rule, direction or order as the case may be. In respect of this very incid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , to which the High Court has referred, while dismissing the appeal from the judgment of the Calcutta High Court, this Court had stated that "the High Court was right when it observed that if any one is interested of consciously takes any step whatever to promote the object of illegally bringing bullion into the country, then even if no physical connection is established between him and the thing brought he will be guilty". In that case, the respondent, Sita Ram Agarwal who was seen moving in the company of the Bhola Nath Gupta on the western pavement of Jatindra Mohan Avenue, Calcutta, had proceeded in the direction of taxi which had come to the place where they were, and on a signal being flashed, a Chinese national alighted therefrom, shook hands with the respondent, after which all the three boarded the taxi. A police constable who was on the spot raised an alarm and secured the respondent and his companion with the help of the members of the public. All of them were taken to the police station for the purpose of interrogation but the Chinese national tried to get away and started to run. He was chased and eventually secured. Before his apprehension, however, he was seen to dro ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
