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TMI Blog1965 (10) TMI 85X X X X Extracts X X X X X X X X Extracts X X X X ..... rtation of which any prohibition or restriction is for the time being in force as aforesaid ; .......... 3. The penalty clause thereof reads : such person shall on conviction before a Magistrate be liable to imprisonment for any term not exceeding two years or to fine, or to both . This clause introduces a criminal offence. It is triable by a Magistrate. The person convicted is liable to imprisonment for a term not exceeding two years or to fine to both. The rule of construction of such a clause creating a criminal offence is well settled. The following passage from the judgment of the Judicial Committee in The Gauntlet L.R.(1872) P.C. 184 may be quoted : No doubt all penal statutes are to construed strictly, that is to say, the court must see that the thing charged as an offence is within the plain meaning of the words used, and must not strain the words on any notion that there has been a slip, that there has been a casusomissus that the thing is so clearly within the mischief that it must have been intended to be included, and would have been included if though of. On the other hand, the person charged has a right to say that the thing charged, although within the word ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f such a prohibition or restriction; in additions he shall have the intention to evade such a prohibition or retraction against the import or export of goods, as the case may be. A person who knowingly purchase smuggled goods from an importer cannot have an intention to evade a provision against import, for the prohibited goods have already been imported. A person who receives goods with knowledge that they are stolen goods cannot possibly have an intention to commit theft, for the theft has already been committed, though he may have the intention to receive the stolen goods. Knowledge of an offence cannot be equated with an intention to commit the offence. Such a construction effaces the distinction between the two distinct elements of mens rea, knowledge and intention, laid down in the clause. 6. The only possible way out of the inevitable effect of the plain words used in the said clause is too give a meaning to the expression import which that word cannot bear. To accept the argument of the learned counsel for the appellant is to hold that the process of import continues through innumerable transactions between different persons without reference to time or place and wheth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he contrary construction will lead to the anomaly of a purchaser, even after 20 years of the import, being attributed the intention to evade the prohibition against import. Suppose before the purchase of the goods by a stranger the prohibition was lifted. In such a situation, does the purchaser commit an offence ? If the contention is sound, he does. This illustrates that the crux of the offence is the import of goods with requisite intent contrary to the prohibition. For the said reasons the intention to contravene the prohibition cannot be imputed to subsequent dealers in the said goods after the importer parts with them. 7. It is said that if the constriction suggested by the learned counsel for the appellant be not accepted, many a person who purchased smuggled goods will escape punishment. A fair reading of the Act discloses that the Act makes a distinction between a customs offence and a criminal offence. The smuggled goods in the hands whomsoever they are found can be confiscated and, therefore, the State can always trace the smuggled goods to their ultimate destination. The smuggler and the persons concerned in the smuggling are guilty of both customs and criminal offenc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... constable appealed to the members of the public to help him in securing the Chinese accused and he was secured with the help two college students and one other young man. As the Chinese accused was running away he threw away three packers which were picked up. In the meantime Sergeant Mukherjee came there on a motor-cycle from the opposite direction and detained the Chinese accused. The three packets thrown away by him were also handed over by the three young man to the Sergeant. Thereafter all the three person who were arrested were taken to the police station along with the three packets. It was found in the police station that the three packets contained 23 gold bars of about sixteen tolas each with Chinese inscription thereon. On search of the person of Sitaram Agarwala, a sum of ₹ 49,320 in notes of various denomination was found on him. The Customs authorities were informed and took charge of the gold bars. Eventually, the gold bars were confiscated under s. 167(8) of the Act and thereafter the police after investigation prosecuted the two respondents and the third man in respect of the offence under section 167(81) of the Act. 12. These facts were held to be proved ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cessary, the High Court was of the view that before a person could be convicted under section 167(81) it must be shown that he was either a direct importer or concerned in some was in the import of the smuggled article. In other words, the High Court thought that the section dealt with goods while they were being smuggled; it did not include in its scope a person who subsequently obtained the smuggled goods and then dealt with them, though the smuggled goods themselves might be liable to confiscation when seized. Consequently, the High Court ordered the acquittal of the Chinese accused also. As the interpretation of s. 167(81) was involved, the High Court granted certificates; and that is how the two appeals have come up before us. 14. The facts are not in dispute in this case and have been set out above. Thus the question that arises before us is the interpretation of s. 167(81) and two aspects of that section have to be considered. The first aspect is the ambit of the words in any was concerned in or in any manner dealing with any goods with respect to the importation of which any prohibition or restriction is for the time being in force as aforesaid . The second aspect is wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce to such offences respectively :- 17. It will be seen that s. 167(8) deals with what we have called customs offence while s. 167(81) deals with criminal offences. It is well-settled by the decisions of this Court that goods which have been imported against the prohibition or restriction imposed under Ch. IV of the Act are liable to confiscation at any time after import and this liability extends even in the hands of third person who may not have had anything to do with the actual import. So long as it is proved that the goods had been imported against the restrictions imposed under Ch. IV, the goods remain liable to confiscation whenever found even if this is long after the import is over and even if they are in possession of persons who had nothing to do with the actual import. It is also well-settled by the decisions of this Court that the second part of the penalty relating to any person applies only to a person concerned in the importation or exportation of the goods and does not apply to a person found in possession of the smuggled goods who had nothing to do with the importation or exportation thereof : (see Shivanarayan Mahato v. Collector of Central Excise and La ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was in any way concerned in or in any manner dealing with there goods. Now the evidence which has been accepted by both the courts is that Sitaram had gone with a large sum of money to purchase the gold which was known to be smuggled and to have been imported into India against the restrictions imposed on the import of gold. It has also been proved that Sitaram did so after previous arrangement with the Chinese accused. It the constable who was following Sitaram had not interfered the deal would have gone through and Sitaram would have paid the money and purchased the smuggled gold. This was a case therefore where by means of previous arrangement with a person in possession of a smuggled article, the intending purchaser had gone to purchase it and the deal did not go through only because the police intervened. In such circumstances where by previous agreement or arrangement a person goes to purchase an article which he knows to be smuggled it would in our opinion be a case where such as person must be held to be concerned in dealing with the prohibited goods. Where a person does any overt act in relation to prohibited goods which he knows to be such and the act is done in consequen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... prohibited goods are in the possession of a third person who had nothing to do with the import. For this purchase we shall refer to that part of s. 167(81) which deals with the acquisition of position of prohibited goods and that we say about part will equally apply to the other part of s. 167(81). We may add that we are dealing here with the first half of s. 167(81) and not with the second half. This part of section 167(81) which we have taken for the purpose finding out what is the knowledge and intent that s. 167(81) requires would run thus : If any person knowingly, and with intent to defraud the Government of any duty payable thereon, or to evade any prohibition or restriction for the time being in force under or by virtue of the Act with respect thereto acquires possession of any goods with respect to which duty has not been paid or with respect to the importation of which any prohibition or restriction is for the time being in force . The argument which has found favour with the High Court is that section requires knowledge on the part of the accused that the goods were imported against the prohibition or restriction in force. This is undoubtedly so. The section further req ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rohibited or the goods are dutiable and the duty has not been paid can be said to have the intention of evading the prohibition or to defraud the Government of the duty payable, even though he may not have anything to do with the smuggling of the goods. 21. It seems to us (taking a case of prohibition) that if the prohibition is still in force, the person who acquires possession of prohibition goods knowing them to be prohibited intends to evade the prohibition by the action, even though he may not have been concerned in the actual smuggling of the goods. So long as the prohibition lasts any person who comes into possession of prohibited goods, though he may not be concerned in the actual smuggling would still in our opinion have the intent to evade the prohibition when he remains in possession of the goods which are prohibited. The prohibition in our opinion does not come to an end as soon as the Customs frontier is crossed. So long as prohibition is in force and the goods are prohibition goods any person in possession thereof, even though he may not be concerned with the actual smuggling would still be guilty of evading the prohibition by keeping the goods in his possession. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vaded the prohibition or restriction. The purpose of s. 167(81) is to punish smuggling and stop it if possible. That purpose in our opinion would be completely defeated if the interpretation which has found favour with the High Court were accepted. We cannot therefore accept that the words used in s. 167(81) only apply up to the stage of actual importation and the person who is guilty thereunder must be somehow concerned in the actual importation. It seems to us that they apply in the case of prohibited or restricted goods so long as the prohibition or restriction lasts and whoever is in possession of such goods or comes into possession thereof, even after the smuggling is over must be attributed with the intention of evading the prohibition or restriction provided he knows that the goods were smuggled into the country in spite of the prohibition or restriction. Similarly where the goods are dutiable and the duty has not been paid on them any person acquires them with the knowledge that the duty thereon has not been paid would have the intention to defraud the Government of duty, even though he may not be the person actually concerned in the smuggling. We therefore hold that s. 167 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e said to be carrying the uncustomed goods with intent to defraud His Majesty of the duty because such an offence could only be committed by the actual smugglers or importers of goods or persons engaged in carrying the goods from the ship etc., at the port of importation with intent to evade the payment of duty or tax. This contention was negatived that the court held that the offence of knowingly carrying or in any manner dealing with uncustomed goods with intent to defraud His Majesty of the duty due thereon contrary to s. 186 is not only committed at the port of entry or the place where the goods are actually landed; it is committed anywhere in the realm by a person acting in the manner described by the sub-section . Lord Goddard C.J. made the following observations at p. 252 :- If a person is knowingly carrying uncustomed goods, he is assisting in the smuggled of the goods; for while goods are no doubt smuggled when they are brought into the country it is no good bringing smuggled goods into the country unless something can be done with them. Such a person is intending to defraud His Majesty of the customs as much as anybody else. The intent is there : it is all part of o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tent to defraud Her Majesty of the duty payable thereon being concerned in keeping goods which were chargeable with duty on which duty had not been paid. It was held that the person's conduct clearly amounted to keeping the smuggled goods and there was intent to defraud the revenue. This case was under the English Customs and Excise Act of 1952, but the principle under the English Act of 1876 was followed. 30. These cases clearly indicate that the offence under the corresponding provision of the English Act can be committed long after the actual smuggling is over and even if the person found in possession of goods on which duty had not been paid nothing to do with smuggling. These cases thus clearly support the interpretation we have put on the relevant words of s. 167(81). 31. Further the case of SchneiderL.R. [1960] 2 Q.B. 106 shows that it has always been held in English that if dutiable goods have brought into the country without paying the duty, the duty attaches to the goods brought into the country and though it may not have been paid at the moment of bringing the goods for some special reasons (as, for example, where it is meant for a foreign ambassador) the duty ..... X X X X Extracts X X X X X X X X Extracts X X X X
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