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TMI Blog1966 (2) TMI 28X X X X Extracts X X X X X X X X Extracts X X X X ..... r 5, 1964 from Messrs. British Bloodstock Agency Ltd., London, informing him that one of its clients was interested in obtaining a foal by his stallion "Pieta" from the said client's Brood Mare. It was eventually agreed by and between the appellant and the said Messrs. British Bloodstock Agency Ltd., that one of its clients, the Glasgow Stud Farm would lease a brown English mare to the appellant, which would be shipped to India and would be kept there pending her producing two foals by the appellant's breeding race-horse "Pieta", after which the mare would be returned to England. The petitioner returned to Calcutta on November 7, 1964 by air and submitted at Dum Dum Airport an international passenger's Baggage Declaration indicating that 7 unaccompanied baggages would follow him by sea or air. Eventually, a brown mare by the name of "Jury Maid" was shipped to Calcutta by S.S. "Chinkoa", which was due to arrive at Calcutta on or about December 25, 1964. On or about January 7, 1965 the appellant through his clearing agents submitted to the Customs authority a second Baggage Declaration for clearance of the said mare which was stated to be arriving at the Port of Calcutta by the said ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5, the Assistant Collector of Customs issued a show cause notice which is annexure I to the petition and appears at pages 35 to 36 of the Paper Book. Firstly, it states that the imported mare was a high pedigree animal used for breeding purposes and the value was under-estimated. No proper certificate from the Director of Animal Husbandry of the State of West Bengal had been produced. Secondly, the importation of such a horse required an I.T.C. licence but no such licence had been produced. The goods, therefore, had been imported in contravention of Government of India, Ministry of Commerce and Industries Order No. 17/55 dated 7th December, 1955 read with section 3(1) of the Imports & Exports (Control) Act 1947. The notice concluded as follows : "You are called upon to show cause to the Collector of Customs within 7 days from the date of issue why the goods should not be confiscated and action taken against you under sec. 3(2) of the Imports & Exports (Control) Act, you are also asked to state whether you would require to be heard in person. If you desire a personal hearing, this can be arranged by previous appointment with the Collector of Customs. All corroborative evidence in s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s without I.T.C. restrictions. It is true that pet animals brought in by passengers are exempt from I.T.C. restrictions, but in the circumstances of this case I am unable to accept that the mare in question is a pet animal of Shri Omer. The mare does not belong to Shri Omer. It has been leased to Shri Omer for producing two foals in India and later return to England duly tested positively pregnant to Pieta. It is quite clearly a business deal and not a case of importation of a pet animal. In this connection, it is also relevant that pet animals of passengers for purposes of I.T.C. exemption would be those which passengers carry with them even during their travels and which invariably stay with the passengers in their houses. From that point of view too, this particular animal cannot be considered as a pet brought by a passenger. Under the circumstances an offence warranting penal action under section 111(d) of the Customs Act is clearly established. Since Shri Omer arranged for the importation of this animal he rendered himself liable for action under section 112 of the Customs Act, 1962. In view of the foregoing, I confiscate the animal in question under section 111(d) of the Cus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1962 and has inter alia repealed the whole of the Sea Customs Act 1878 (Act VIII of 1878). The first provision to be considered is the definition in section 2(33) of the said Act which defines the expression "prohibited goods". The said definition is as follows :- "(33) "prohibited goods" means any goods the import or export of which is subject to any prohibition under this Act or any other law for the time being in force but does not include any such goods in respect of which the conditions subject to which the goods are permitted to be imported or exported have been complied with." The next section is Section 11 of the said Act, which is contained in Chapter IV, with the heading "Prohibitions on importation and exportation of goods". Sub-section (1) runs as follows :- "11(1) If the Central Government is satisfied that it is necessary so to do for any of the purposes specified in sub-section (2), it may, by notification in the Official Gazette, prohibit either absolutely or subject to such conditions (to be fulfilled before or after clearance) as may be specified in the notification, the import or export of goods of any specified description." 6. Sub-section (2) specifie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... I now come to the provisions of the Imports and Exports (Control) Act, 1947. This is stated to be an Act to continue for a limited period powers to prohibit or control imports and exports. The relevant section is section 3(1) and (2) which runs as follows :- "3. Powers to prohibit or restrict imports and exports. - (1) the Central Government may, by order published in the Official Gazette, make provisions for prohibiting, restricting or otherwise controlling, in all cases or in specified classes of cases, and subject to such exceptions if any, as may be made by or under the order :- (a) the import, export, carriage coastwise or shipment as ships stores of goods of any specified description; (b) the bringing into any port or place in India of goods of any specified description intended to be taken out of India without being removed from the ship or conveyance in which they are being carried. (2) All goods to which any order under sub-section (1) applies shall be deemed to be goods of which the imports or export has been prohibited or restricted under section 19 of the Sea Customs Act, 1878 (VIII ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y, 1961 the above mentioned notification of the Central Board of Revenue dated 19-11-1960 was explained. The relevant part is clause 4 which runs as follows :- "4. The clearance of one dog, pet animals and birds in a limited number may be allowed without import Trade Control restrictions on furnishing the following health certificates to the Customs authorities :- (i) A health certificate from a Veterinary Office authorised to issue a valid certificate by the Government in the country of export to the effect that the dog imported is free from Aujossky's disease, Distemper, Rabies, Leishmaniasis and Leptospirosis and in the case of cats from Rabies and Distemper. (ii) In the case of import of dogs and cats originating from countries where Rabies infection is known to exist, a health certificate containing a record of vaccination, the vaccine used, brew of the vaccine and the name of the production laboratory and to the effect that the dog/cat was vaccinated against Rabies more than one month, but within 12 months prior to actual embarkation with nervous tissue vaccine or within 36 months prior to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... business proposition. The appellant deals in horses, especialy racing horses. It was intended that he would take a lease of the mare "Jury maid" and it would be impregnated by his stallion "Pieta" and then it would be returned to its owner together with the foals. This operation would be within the ordinary scope of the appellant's business, the word "pet" has been defined in various recognised dictionaries, inter alia as follows : - Concise Oxford Dictionary :- The Shorter Oxford Dictionary :- Chamber's Twentieth Century Dictionary :- "Animal tamed and kept as favourite or treated with fondness" "Any animal that is domesticated or tamed and kept as a favourite or treated with fondness, esp. applied to a lamb reared by hand." "Any animal tame and fondled". 11. There is no such species of animal known as "pet animal". What happens is that certain kind of animals or birds are often domesticated and when a particular person becomes fond of such an animal or bird it may be said to have become a "pet" of that person, and may be called a 'pet animal'. It is a subjective expression. In the present case, the mare "Jury Maid" was not the "pet" of any particular person. So far as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that under Section 111(d) of the said Act, any goods which are imported contrary to any "prohibition" imposed by or under the said Act or any other law for the time being in force, would be liable to confiscation. The prohibition, if any, is under Section (1) and (2) of the Imports and Exports (Control) Act, 1947 read with clause 3 of the Imports (Control) Order, 1955 read with the Schedule set out above. It is argued that under Section 3 of the Imports and Exports (Control) Act, 1947 the heading is "powers to prohibit or restrict imports and exports". Under sub-section (1) of Section 3 of the Imports and Exports (Control) Act, 1947, three expressions are used "prohibiting", "restricting" and "otherwise controlling". It is argued that these are three different categories altogether. In other words, 'prohibition' means absolute prohibition which is to be differentiated from restriction or control. Coming now to clause 3 of the Import (Control) Order, 1955 it is pointed out that the heading is "restriction on import of certain goods". Sub-clause (1) provides that in the case of restricted goods, a licence or customs clearance permit must be obtained as a pre-condition of import. It i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich have been cited before us. The first case which is almost on all fours with the point in the instant case, is a decision of the Kerala High Court - Bernado Steenholf Ultrich v. Collector of Customs, Cochin A.I.R. (1960) Kerala 170. In that case the facts were as follows : - 14. The petitioner, a national of Bolivia, was a passenger from Colombo to Genoa on the Italian passenger vessel M. V. Australia, which called at Cochin during its voyage to Genoa. The customs authorities got information that he was smuggling currency. At Cochin, the customs officers boarded the vessel and asked the petitioner to declare if he had any currency. He staled that he did not have anything to declare, excepting a small sum in his possession. Upon investigation it was found that he was taking with him in the ship, a motor car in which there was a secret chamber in which was concealed more than three lakhs of Indian currency, as also a large amount of American dollars. Thereupon, the same was confiscated. It was inter-alia argued that under Section 167(73) of the said Act, there could be confiscation only if the importation of the goods was prohibited. It was argued that prohibition meant abs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as been obtained, then it may be said that the goods are "prohibited goods" and, therefore, under Section 111(d) of the said Act the said goods are liable to confiscation. Light is thrown upon this point by several other decisions cited before us. In the Supreme Court decision - State of Maharashtra v. Mayer Hans George A.I.R. (1965) S.C. 722 the court was considering Section 8(1) of the Foreign Exchange Regulation Act, 1947 which prohibited the bringing of gold etc., into India except with a special or general permission of the Reserve Bank and after satisfying the conditions, if any, prescribed therefor. 15. In exercise of the powers conferred by the said section on the Central Government, a notification was issued on 25th August, 1948 to the effect that except with the general or special permission of the Reserve Bank no person shall bring or send into India, any gold etc. The Reserve Bank issued notification dated 25th August, 1948 whereby conditions were laid down for granting permission for the importation of gold etc. The object of citing this decision is to consider how the Supreme Court viewed the case of a prohibition with a condition attached. This is how Ayyangar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1 W. L. R. 522 at 527. In that case, the facts were as follows : Article 1 of the Hire Purchase and Credit Sale Agreements (Control) Order, 1956, provided as follows : "A person shall not dispose of any goods to which this order applies, in pursuance of a hire purchase or credit sale agreement..... unless the requirements specified in the Second Schedule hereto are or have been satisfied in relation to that agreement". The Second Schedule required inter alia, that certain specified percentages of the cash price of the goods must be paid before the signing of the agreement. The nature of this restriction or conditional prohibition came to be considered in the case. In course of his judgment, Donovan J. said-" The words of the order themselves are an express and unqualified prohibition of the acts done in this case by St. Margarets Trust Ltd." What was alleged in that case was that St. Margarets Trust Ltd. had contravened the conditions laid down in the Second Schedule. Thus, we find that a prohibition with a condition, where the condition was not fulfilled was described as an "Express and unqualified prohibition". With reference to the Supreme Court decisions mentioned above, Mr. G ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ication and under Section 23A such restriction will be deemed to be imposed under Section 11 of the said Act, and so a notification under Section 8 of the Foreign Exchange Regulation Act, 1947 would be deemed to be a notification under section 11(1) of the said Act. He, however, points out that in the instant case we are dealing with Section 3 of the Imports and Exports (Control) Act, 1947 and sub-section (2) of Section 3 which makes Section 11 applicable, does not refer to any notification but states that all "goods" to which any order under sub-section (1) applies, shall be deemed to be goods of which import or export has been prohibited or restricted under Section 19 of the Sea Customs Act, 1878, which has been replaced inter alia by Section 11 of the said Act. The argument is that since there is no reference to any notification in Section 3(2), there can be no prohibition or restriction in the instant case, because no notification has been issued under Section 11 relating to horses. In fact, in the only two notifications issued under Section 11, there is no mention of horses. It is argued that unless such a notification is issued under Section 11 there cannot be said to be any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d prohibition with a condition and includes restriction, then it will cover the entirety of Section 111 of the said Act and nothing will be left from the operation of the latter part of Section 125(1) namely - "in the case of any other goods", that, however, is not so. For example, 111(c) speaks about - "any dutiable .... goods brought into any bay, gulf, creek or tidal river for the purpose of being landed at a place other than a customs port". In such a case, the bringing of the goods into India is not prohibited, only duty has to be paid, yet there is a provision for confiscation if the goods are landed at a place other than a customs port. Another example is clause (h) which speaks of "any dutiable goods unloaded or attempted to be unloaded in contravention of the provisions of Section 33 or Section 34". In such a case, the import is not prohibited, and yet there is a provision for confiscation if the unloading is done in contravention of Section 33 or Section 34. Mr. Gorai has also argued that the obtaining of a licence cannot be called a condition. I am unable to accept this argument. If goods are prohibited from being imported except under a licence, the obtaining of a licen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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