Deeming provision and Scheduled Area powers upheld customs seizure, arrest, and Governor's authority to apply laws.

The Court treated the deeming provision in section 3(2) of the Imports and Exports Control Act, 1947 as incorporating the operative machinery of the Sea Customs Act, 1878 for prohibited imports, so the customs powers of seizure and arrest under sections 173 and 178 were available. It also held that the Fifth Schedule, read with Article 244, empowered the Governor to apply laws to a Scheduled Area, and that Bihar Regulation I of 1951 was within that constitutional competence. On the facts, concealment of cloves, non-payment of duty, border proximity, and their prohibited character gave reasonable suspicion, so the arrest and seizure were lawful and the conviction was not disturbed.

---

---

Issues: (i) Whether the Sea Customs Act, 1878 applied to the place of occurrence through section 3 of the Imports and Exports Control Act, 1947 so as to authorise seizure and arrest under sections 173 and 178; (ii) whether the Bihar Regulation I of 1951 and the Fifth Schedule to the Constitution validly empowered the Governor to apply laws to the Scheduled Area; (iii) whether the customs officers had lawful authority to arrest the accused and seize the cloves on reasonable suspicion.

Issue (i): Whether the Sea Customs Act, 1878 applied to the place of occurrence through section 3 of the Imports and Exports Control Act, 1947 so as to authorise seizure and arrest under sections 173 and 178.

Analysis: Section 3(2) of the Imports and Exports Control Act, 1947 deemed goods covered by import restrictions to be goods prohibited under section 19 of the Sea Customs Act, 1878 and further provided that all the provisions of that Act should have effect accordingly. The Court rejected the contention that only section 19 was attracted. It held that the deeming provision incorporated the Sea Customs Act as a whole for the relevant purposes, so that the remaining provisions of that Act, including the powers of customs officers, could operate in relation to prohibited imports.

Conclusion: The Sea Customs Act, 1878 applied for the relevant purposes, and the powers under sections 173 and 178 were available.

Issue (ii): Whether the Bihar Regulation I of 1951 and the Fifth Schedule to the Constitution validly empowered the Governor to apply laws to the Scheduled Area.

Analysis: The Fifth Schedule, read with Article 244, empowers the Governor to make regulations for the peace and good government of a Scheduled Area and to repeal or amend applicable laws. The Court held that this power includes the authority to apply laws to the Scheduled Area and is not confined to delegated or conditional legislation. The earlier regime under section 92 of the Government of India Act, 1935 had ceased to operate after the Constitution, and the regulation was within the Governor's constitutional competence.

Conclusion: The Bihar Regulation I of 1951 was valid and the Governor had power to apply laws to the Scheduled Area.

Issue (iii): Whether the customs officers had lawful authority to arrest the accused and seize the cloves on reasonable suspicion.

Analysis: The officers were treated as customs officers by the combined operation of the statutory provisions and the relevant notifications. The Court held that the circumstances, including concealment of cloves, non-payment of duty, the proximity to the border, and the prohibited character of the goods, furnished reasonable suspicion for arrest under section 173. It also held that the goods were prohibited goods and were liable to seizure under section 178. The contention based on section 178A did not assist the appellants in the circumstances of the case.

Conclusion: The arrest and seizure were lawful, and the officers acted within their authority.

Final Conclusion: The statutory and constitutional objections failed, the customs action was upheld, and the conviction and sentences were not disturbed.

Ratio Decidendi: A deeming provision stating that goods shall be treated as prohibited under section 19 of the Sea Customs Act, 1878 and that all the provisions of that Act shall have effect accordingly incorporates the Act's operative machinery, including the powers of customs officers, while the Governor's power under the Fifth Schedule extends to applying laws to Scheduled Areas.

---