Strict liability under foreign exchange law applies to undeclared gold imports despite no actual knowledge of the notification.

The Foreign Exchange Regulation Act, 1947 was treated as creating strict liability for bringing gold into India in breach of the Reserve Bank permission regime, so mens rea was not essential where the statutory scheme placed the burden of proving permission on the accused. A general RBI notification, once duly published in the Official Gazette, was enforceable without proof of actual knowledge, as ignorance of law was no excuse and no personal notice was required. Gold carried by a passenger was also held to fall within the declaration requirement where the notification required manifest entry, because a narrow reading would defeat the purpose of the control scheme.

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Issues: (i) Whether mens rea was an essential ingredient of an offence under section 8(1) read with section 23(1A) of the Foreign Exchange Regulation Act, 1947. (ii) Whether the Reserve Bank of India notification dated 8 November 1962 could be enforced against the respondent despite his absence of actual knowledge of it. (iii) Whether gold carried on the person of a passenger through India was covered by the requirement that it be declared in the manifest as same bottom cargo or transhipment cargo.

Issue (i): Whether mens rea was an essential ingredient of an offence under section 8(1) read with section 23(1A) of the Foreign Exchange Regulation Act, 1947.

Analysis: The statutory scheme imposed a prohibition on bringing gold into India except with the Reserve Bank's permission, and section 24(1) placed the burden of proving permission on the person prosecuted. The object of the Act was to prevent smuggling and conserve foreign exchange. The majority held that, on the language of the provisions and the subject matter of the legislation, the offence of bringing gold into India in contravention of the permission regime was one of strict liability and did not require proof that the accused knew the legal prohibition.

Conclusion: Mens rea was not required for the offence, and the finding was against the respondent.

Issue (ii): Whether the Reserve Bank of India notification dated 8 November 1962 could be enforced against the respondent despite his absence of actual knowledge of it.

Analysis: The notification was published in the Official Gazette before the respondent arrived in India. The majority distinguished cases involving unpublished or individually addressed orders and held that a general notification, once duly published in India, became operative without proof of actual knowledge by every affected person. The maxim that ignorance of law is no excuse applied, and no statutory requirement of personal notice existed.

Conclusion: The notification was effective against the respondent, and the finding was against the respondent.

Issue (iii): Whether gold carried on the person of a passenger through India was covered by the requirement that it be declared in the manifest as same bottom cargo or transhipment cargo.

Analysis: The majority construed cargo broadly as merchandise carried by air, as distinct from personal luggage, and held that the exemption was conditional upon declaration in the manifest. To confine the proviso only to goods handed over to the carrier would defeat the purpose of the notification. Gold concealed on the person of a passenger was therefore within the condition requiring manifest entry.

Conclusion: The gold was required to be declared in the manifest, and the finding was against the respondent.

Final Conclusion: The appeal succeeded, the acquittal was reversed, and the conviction was restored, with the sentence confined to the period already undergone.

Concurring Opinion: Rajagopala Ayyangar and Mudholkar JJ. agreed that the appeal had to be allowed, the conviction restored, and the sentence reduced to the period already undergone.

Dissenting Opinion: Subba Rao J. held that the respondent was not guilty because mens rea was not excluded and actual knowledge of the notification had not been established; on that view the appeal failed.

Ratio Decidendi: Where a statute and its validly published notification prohibit bringing specified goods into India except subject to prescribed conditions, contravention is complete on a conscious act of bringing without compliance, and proof of actual knowledge of the prohibition is not necessary if the legislative scheme shows strict liability and the notification is duly published.

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