Foreign exchange export control covers both firm sale contracts and consignment sales under Section 12(2).

Section 12(2) of the Foreign Exchange Regulation Act, 1947 was construed as applying to exports under firm contracts of sale as well as consignment sales. The phrase "person entitled to sell or procure the sale of the said goods" was treated as descriptive rather than limited to a narrow category of consignment transactions. The construction was preferred because it aligned with the statutory object of conserving foreign exchange and securing effective control over export proceeds, and it was supported by the Sale of Goods Act analogy and the broader reasoning adopted by the Madras view over the narrower literal approach.

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Issues: Whether Section 12(2) of the Foreign Exchange Regulation Act, 1947 applies to exports on sale as well as to consignment sales, and whether the appellate authority was right in preferring the Madras view over the Calcutta view.

Analysis: The provision was construed in the context of the object of the foreign exchange law, namely conservation of foreign exchange resources and effective control of export proceeds. The phrase "person entitled to sell or procure the sale of the said goods" was treated as descriptive and not confined to a narrow class of consignment transactions. The reasoning of the Madras High Court was accepted as consistent with the statutory language, the Sale of Goods Act analogy, and the need for a workable construction in an economic regulatory statute. The contrary literal approach was not preferred.

Conclusion: Section 12(2) applies to firm contracts of sale as well as consignment sales, and the appellate authority was justified in upholding contravention under that provision. The challenge failed.

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