TaxTMI 
TaxTMI 
1987 (5) TMI 337
X X X X Extracts X X X X
X X X X Extracts X X X X
....ctor of Enforcement dated August 17, 1978, holding the appellants guilty of contravention of section 12(2) of the Act read with the notification issued by the Government of India in the Ministry of Finance, New Delhi, dated April 22, 1952, and levying a penalty of Rs. 15,00,000. By its order, the Foreign Exchange Regulation Appellate Board held that there could be no levy of penalty on the appellant-firm for failure to repatriate foreign exchange on shipments of manganese ore made prior to September 20, 1957, i.e., prior to the amendment of section 23(1) of the Act and the introduction of section 23C by the Amendment Act and accordingly reduced the amount of penalty to Rs. 3,10,000. As a result of the decision of the High Court, the order of the Director of Enforcement levying a penalty of Rs. 15,00,000 on the appellants has been restored. The facts giving rise to the appeal are as follows. Messrs Rai Bahadur Seth Shreeram Durgaprasad were a partnership firm engaged in the business of winning, extracting and getting manganese ore from their manganese mines at Tumsar on a very large scale. During the period from 1952 to 1958, the partnership firm made 52 shipments of manganese or....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nforcement and accepted the contention of the appellants and accordingly reduced the amount of penalty to Rs. 3,10,000. Shri Asoke Sen, learned counsel appearing for the appellants, with his usual fairness frankly concedes that article 20(1) of the Constitution would not in terms apply, but he contends that the principles embodied therein would still govern. He has confined his submissions to only one point, namely, that the word "whoever" in sub-section (1) of section 23, before its amendment by Act XXXIX of 1957, connoted only a natural person, i.e., those who actually contravened the provisions of section 12(1) of the Act by failure to repatriate the full value of foreign exchange earned on exports and would not take in corporate liability and, therefore, an association of persons, such as a firm, would not fall within the connotation of the word "whoever". Learned counsel further contends that by the Amendment Act, new section 23(1) was substituted and section 23C introduced with effect from September 20, 1957, and the effect of these provisions was that after that date, adjudication proceedings or criminal proceedings could be taken in respect of a contravention mentioned i....
X X X X Extracts X X X X
X X X X Extracts X X X X
....or the goods representing the full amount as aforesaid has not been made in the prescribed manner." Section 23(1), prior to its amendment and the original sub-section (3) now renumbered as section 23(4), are as follows : "23(1) Whoever contravenes any of the provisions of this Act or of any rule, direction or order made thereunder shall be punishable with imprisonment for a term which may extend to two years or with fine or with both, and any court trying any such contravention may, if it thinks fit and in addition to any sentence which it may impose for such contravention, direct that any currency, security, gold or silver, or goods or other property in respect of which the contravention has taken place, shall be confiscated. 23. (4) If the person committing an offence punishable under the section is a company or other body corporate, every director, manager, secretary or other officer thereof shall, unless he proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent its commission, be deemed to be guilty of such offence." Sub-section (1) of section 23C is as follows: "23C(1) Offences by companies.-If the person co....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rm or an artificial or a legal entity like a company. It is, therefore, idle to contend that the appellants were not liable to pay penalty for failure to repatriate foreign exchange on 52 shipments of manganese ore effected through the years 1952 to 1958. Upon that view, the learned single judge was right in setting aside the order of the Foreign Exchange Regulation Appellate Board and restoring that of the Director of Enforcement levying a penalty of Rs. 15,00,000 on the appellants for failure to repatriate foreign exchange in contravention of section 12(2) of the Act. The contention of learned counsel that recourse could not be had to the amended section 23(R) read with section 23C of the Act in respect of the contravention of section 12(2) for failure on the part of the appellants to repatriate foreign exchange on shipments of manganese ore made prior to September 20, 1957, and there could be no initiation of adjudication proceedings under the amended section 23(1) read with section 23C or levy of penalty on the appellants must also fail for another reason. In Sukumar Pyne's case [19661 2 SCR 34 ; AIR 1966 SC 1206, this court reversed the decision of the Calcutta High Court i....