Import licence breach does not justify customs confiscation absent clear statutory authority.

Breach of a condition in an import licence did not, by itself, authorise confiscation and penalty under the Sea Customs Act, 1878. Section 167(8) applied to goods whose import was prohibited or restricted under that Act, while Section 3(2) of the Imports and Exports (Control) Act, 1947 treated goods covered by an order under Section 3(1) as prohibited goods for customs purposes. Although the amendment to Section 5 extended penal liability for contravention of a licence condition, it did not enlarge the confiscatory power so as to permit confiscation of goods imported under a valid licence merely because a condition was breached. The proper consequence was prosecution under the amended Section 5.

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Issues: Whether breach of a condition of an import licence could be punished by confiscation and penalty under Section 167(8) of the Sea Customs Act, 1878 read with Section 3(2) of the Imports and Exports (Control) Act, 1947 after the amendment to Section 5 of the Imports and Exports (Control) Act, 1947.

Analysis: Section 167(8) of the Sea Customs Act, 1878 applies where importation is prohibited or restricted by or under Chapter IV of that Act. Section 3(2) of the Imports and Exports (Control) Act, 1947 deems goods covered by an order under Section 3(1) to be goods the import of which is prohibited under Section 19 of the Sea Customs Act, 1878. The amendment to Section 5 of the Imports and Exports (Control) Act, 1947 extended penal liability to contravention of a condition of a licence, but it did not enlarge the confiscatory power under the Sea Customs Act so as to permit confiscation of goods imported under a valid licence merely because a licence condition was breached. The proper consequence for such breach was prosecution under the amended Section 5, not confiscation and penalty in lieu of confiscation under the Sea Customs Act.

Conclusion: Confiscation and penalty under the Sea Customs Act were not authorised for breach of the licence condition, and the impugned order could not stand.

Ratio Decidendi: A breach of a condition of an import licence, even after amendment of the controlling provision, does not by itself attract confiscation under the Sea Customs Act unless the statute expressly enlarges the confiscatory power; penal liability and confiscation must rest on clear statutory authority.

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