1966 (9) TMI 43 - HC - Customs

Issues Involved:
1. Legality of the show cause notices issued under the Sea Customs Act, 1878 and Foreign Exchange Regulation Act, 1947.
2. Interpretation of Section 12(1) of the Foreign Exchange Regulation Act, 1947.
3. Validity of the notification dated 4-8-1947 under Section 12(1) of the Foreign Exchange Regulation Act, 1947.
4. Applicability of Section 23A of the Foreign Exchange Regulation Act, 1947 after its amendment by Act 55 of 1964.

Detailed Analysis:

1. Legality of the Show Cause Notices:
The show cause notices were issued by the Deputy Collector of Customs, Visakhapatnam, alleging that the petitioners had exported manganese ore without making a proper declaration as required under Section 12(1) of the Foreign Exchange Regulation Act, 1947. The respondents contended that the documents seized during the searches indicated under-invoicing of mineral ores, constituting offences under the Sea Customs Act, 1878, and the Foreign Exchange Regulation Act, 1947. The court held that contravention of Section 12(1) of the Foreign Exchange Regulation Act is punishable not only under Section 23(1)(a) of the same Act but also under Section 167(8) of the Sea Customs Act, 1878.

2. Interpretation of Section 12(1) of the Foreign Exchange Regulation Act, 1947:
The petitioner argued that Section 12(1) merely required an undertaking that the full export value of the goods would be paid in the prescribed manner, and did not necessitate the declaration of the true export value. The court rejected this argument, stating that Section 12(1) requires a declaration that the amount given is the full export value of the goods and that the value has been paid in the prescribed manner. The court emphasized that the purpose of the enactment is to safeguard the economic and financial interests of the country by ensuring that the best price for exported goods is remitted to India.

3. Validity of the Notification Dated 4-8-1947:
The petitioner contended that the notification prohibiting the export of all goods was beyond the powers conferred under Section 12(1) of the Act, which allowed the prohibition of any goods or class of goods specified in the notification. The court dismissed this contention, interpreting the word "any" to include all goods unless limited by the context. The court relied on the definition of "any" in Stroud's Judicial Dictionary and the High Court of Australia's interpretation in Victorian Chamber of Manufactures v. The Commonwealth, concluding that the Central Government acted within its powers.

4. Applicability of Section 23A of the Foreign Exchange Regulation Act, 1947 After Amendment:
The petitioner argued that after the amendment by Act 55 of 1964 and the repeal of the Sea Customs Act, 1878, no further proceedings could be taken for contraventions that occurred before the amendments. The court referred to Section 6(e) of the General Clauses Act, 1897, which states that the repeal of an enactment does not affect any investigation, legal proceeding, or remedy in respect of any right, privilege, obligation, liability, penalty, forfeiture, or punishment. The court held that the legal proceedings could continue as if the repealing Act had not been passed, thereby rejecting the petitioner's contention.

Conclusion:
The court dismissed the petitions, upholding the validity of the show cause notices and the interpretation of Section 12(1) of the Foreign Exchange Regulation Act, 1947. The notification dated 4-8-1947 was deemed valid, and the applicability of Section 23A after its amendment was confirmed. The petitions were dismissed with costs.

← Previous Next →