1955 (3) TMI 35 - HC - Indian Laws

Summary

Issues Involved:
1. Validity of the delegation of power to the Chief Controller of Imports.
2. Authority of the Chief Controller of Imports to issue licenses under the Imports and Exports (Control) Act, 1947.
3. Authority of Mr. M. L. Gupta to sign the license and the condition on the license.
4. Competence of the Central Government to impose conditions on the use of imported goods.
5. Whether the contravention of a condition imposed by a license constitutes an offense under Section 5 of the Imports and Exports (Control) Act, 1947.

Detailed Analysis:

1. Validity of the Delegation of Power to the Chief Controller of Imports:
The learned Magistrate held that the delegation of power to the Chief Controller of Imports was ultra vires of the Act. This was based on the premise that the Chief Controller of Imports was acting under Clause (a)(v) of Government Notification No. 2-ITC/48, which allowed the imposition of conditions considered expedient from an administrative point of view. However, the Court found this reasoning flawed, stating that the power to issue licenses is always conferred on a prescribed officer under a statutory provision or an order made under statutory provision, thus having the force of law. Therefore, the delegation to the Chief Controller of Imports was valid.

2. Authority of the Chief Controller of Imports to Issue Licenses:
The Court clarified that Clauses (IX) and (XIII) of Notification No. 23-ITC/43 dated 1-7-1943 were indeed orders under Section 3 of the Imports and Exports (Control) Act, 1947. These clauses authorized the Chief Controller of Imports to issue licenses for specified goods. The Court held that the Central Government could authorize the Chief Controller of Imports to issue licenses under Section 3(1) of the Act, and this did not involve any unlawful delegation of power.

3. Authority of Mr. M. L. Gupta to Sign the License and the Condition on the License:
The learned Magistrate questioned the authority of Mr. M. L. Gupta to sign the license and the condition stamped on it. The Court, however, found that Mr. M. L. Gupta was duly authorized as a licensing officer by relevant Government Notifications. The Notifications were authenticated by competent authorities and were valid despite not being expressed in the name of the Governor-General, as required by Section 17 of the Government of India Act, 1935. The Court referenced the Supreme Court ruling that such provisions are directory, not mandatory. Therefore, Mr. M. L. Gupta had the authority to issue the license and sign the condition.

4. Competence of the Central Government to Impose Conditions on the Use of Imported Goods:
The learned Magistrate held that the Central Government could not impose conditions on the use of imported goods after their importation, as this would fall under the jurisdiction of Provincial Governments. The Court disagreed, stating that the condition restricting the use of imported goods to the licensee's factory was within the competence of the Central Government. The Court emphasized that controlling the purpose for which goods are imported is an essential aspect of import regulation. Therefore, the condition imposed was valid and within the Central Government's powers.

5. Whether the Contravention of a Condition Imposed by a License Constitutes an Offense Under Section 5 of the Imports and Exports (Control) Act, 1947:
The Court examined whether violating a condition imposed by a license amounts to an offense under Section 5 of the Act. Section 5 penalizes the contravention of any order made or deemed to have been made under the Act. The Court held that while the conditions in the license were imposed under statutory orders, the contravention of such conditions did not amount to contravention of the orders themselves. Therefore, the breach of a license condition did not constitute an offense under Section 5 of the Imports and Exports (Control) Act, 1947. The Court noted that similar issues were addressed in Pakistan and the Bengal Excise Act, where the penal sections explicitly included contravention of license conditions as offenses.

Conclusion:
The Court found that the learned Magistrate was wrong on the points regarding the delegation of power, the authority of the Chief Controller of Imports, and the competence of the Central Government to impose conditions on imported goods. However, it upheld the view that the contravention of a condition imposed by a license does not constitute an offense under Section 5 of the Imports and Exports (Control) Act, 1947. Consequently, the prosecution under Section 5 failed, and the application was dismissed.