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TMI Blog1971 (8) TMI 100X X X X Extracts X X X X X X X X Extracts X X X X ..... 28,631 should be treated as unauthorized importation. A show cause notice dated 11-11-1964 was issued to the firm. After considering the explanation, the goods were confiscated subject to redemption fine of Rs. 55,000 for home consumption and a personal penalty of Rs. 12,000 was also imposed on the firm by the Collector of Customs, Bombay, by order dated 11-1-1965 under Section 112 of the Customs Act, 1962 (hereinafter referred to as the Act). The firm filed an appeal to the Central Board; but the same was rejected on 7-4-1967. The revision filed against that order was rejected by the Government of India by order dated 30-8-1968. The firm sent a petition to the President of India. The same was also turned down by order dated 18-3-1969. As the personal penalty of Rs. 12,000 remained unpaid, action was initiated for recovery of the same as provided in Section 142 of the Act. The Revenue Officer, Pondicherry who was requested to effect recovery under Section 142 was able to recover only Rs. 4000 leaving the balance, namely Rs. 8,000. This writ petition is filed impugning the validity of these proceedings and praying for an order of prohibition to restrain the Union of India, the firs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the provisions of the Act is not disputed. That it was the firm that imported, is also not disputed. That the importation was made in the regular course of business of the firm is also not disputed. Action was taken under Section 112 of the Act, which reads: "112 Penalty for improper importation of goods etc. Any person : (a) who in relation to any goods, does or omits to do any act which act or omission would render such goods liable to confiscation under Section 111, or abets the doing or omission of such an act, or (b) who acquires possession of or is in any way concerned in carrying, removing, depositing, harbouring, keeping, concealing, selling or purchasing, or in any other manner dealing with any goods which he knows or has reason to believe are liable to confiscation under Section 111, shall be liable (i) in the case of goods in respect of which any prohibition is in force under this Act or any other law for the time being in force, to a penalty not exceeding five times the value of the goods or one thousand rupees, whichever is the greater (ii) in the case of dutiable goods, other than ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roceedings of a penal nature". Section 124 of the Act requires notice to be given to the owner of the goods or such person meaning thereby the person contemplated in Section 112. In the case of a firm, the firm is the owner of the goods. The firm is a legal entity and is also a person within the meaning of Section 3(42) of the General Clauses Act, 1897. The question is whether a notice to a firm represented by the managing partner is sufficient compliance of the requirement of notice under section 124. Before adverting to the provisions made in the Act dealing with offences and prosecutions, I shall refer to the position of law as regards the effect of notice to a partner as to obtaining under the law of partnership as contained in the Indian Partnership Act, 1932, Section 24 reads : "24. Notice to a partner who habitually acts in the business of the firm of any matter relating to the affairs of the firm operated as notice to the firm, except in the case of a fraud on the firm committed by or with the consent of that partner." Section 25 dealing with the liability of a partner for acts of the firm reads : "Every partner is liable, jointly with all the other partners and also s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any loss or injury caused to a third party by the wrongful acts or omissions of a partner if they were done by him while acting (a) in the ordinary course of the partners and (b) with the authority of the partners. To bring a case within the purview of Section 26, it is necessary to show either that the act of the partner was authorized by his co-partners or that in doing it he was acting in the ordinary course of the business of the firm. It is not incumbent on the party seeking to charge the firm for the wrongful act of a partner to show that the particular act is within the usual course of dealing or practice of others carrying on a similar business. What is essential is that the act must be shown to have been done by a partner in the ordinary course of the business of the particular firm. 7.As already pointed out, it is not in dispute in this case that the consignment in question was obtained for the benefit of the firm. It is also not in dispute that the order for importation was made by the third respondent for and on behalf of the firm in the usual course of the business of the firm. Emphasis may also be laid upon the fact that it is not the case of the petitioner, that wit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e goods or such person as the one referred to in Section 112, Chapter XVI deals with offences and prosecutions. Section 140, which deals with offences by companies lays down as to who shall be deemed to be guilty of the offences if the person committing the offence is a 'company'. It says that every person who, at the time of the offence was committed, was in charge of, and was responsible to, the company for the conduct of business of the company as well as the Company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly. Sub-section (2) of that section provides inter alia that where an offence under that chapter has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to any negligence on the part of any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall be deemed to be guilty of that offence. The explanation to that section says that for the purpose of this section (a) "company" means a body corporate and includes a firm or other association of individuals and (b) "direct ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Central Excise - 1962 II M.L.J. 499 the principle laid down is that the penal provision in the Sea Customs Act should be construed strictly and that the authorities issuing a show cause notice should comply strictly not only with the letter of the law but also with the spirit of it. In that case, the notice merely mentioned the statutory provision without mentioning the facts on the basis of which certain contravention was sought to be made out. It was held that the person was entitled to be told that he should show cause against the imposition of such penalty. In Devichand v. Collector, Central Excise 1965 11 A.W.R. 102 the principle laid down is that before passing the order of confiscation of the goods or imposition of penalty, a reasonable opportunity of being heard to the person concerned should be given. There is no controversy about this principle in the instant case, because all the prescribed notices were given to the firm and were acknowledged by the managing partner and were also replied to. The decision in Collector of Customs v. Sitaram, 1999 (110) E.L.T. 292 (S.C.) = (1966) 2 S.C.R. I was concerned with the meaning of the expression "in any way concerned in or in any ..... X X X X Extracts X X X X X X X X Extracts X X X X
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