TaxTMI 
TaxTMI 
TaxTMI 
1964 (1) TMI 69
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....e Customs Department. The Additional Chief Presidency Magistrate granted the prayer and the Customs Department took possession of the seized goods from the police. The petitioner applied before the Magistrate to recover possession of the goods after his discharge out the Additional Chief Presidency Magistrate refused the prayer. 2. On November 17, 1962, the respondent Superintendent of Land Customs issued a notice to the petitioner to the following effect: "Whereas on the evidence indicated hereinbelow there is reason to believe that the goods mentioned in the attached schedule (which were found in the premises of M/s. Hard Sales Agency, 34, Armenian Street, Calcutta) have been imported (by you) and other associate by land from foreign territory into India on or about 3-8-62 without- (i) a valid permit under Section 4 of the Land Customs Act, 1924; (ii) a valid import licence as required under Imports/Exports Control Order 1955 dated 7-12-55 issued by the Government of India, Ministry of Commerce and Industry, under Section 3(i) of the Imports and Exports (Control) Act, 1947; and accordingly the said goods are liable to be confiscated and you are liable to a penalty under-....
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....ds into India, although ample opportunities were afforded to do so. I am, therefore, satisfied that the goods under seizure were illicitly imported into India." 6. Aggrieved by the order the petitioner moved this Court under Article 227 of the Constitution, and obtained this Rule. 7. Mr. Samarendra Kumar Dutt, learned advocate for the petitioner, contended, in the first place, that the goods had been seized from the possession of the petitioner by the police and not by the Customs Authorities and thereafter the goods were caused to be delivered to the customs authorities under orders of the Additional Chief Presidency Magistrate; and therefore. Section 178A of the Sea Customs Act, dealing with burden of proof, which applied to goods seized under the Sea Customs Act from the person in possession, would not apply. He strongly relied on the following observations in the judgment of the Supreme Court in Gian Chand v. State of Punjab 1983(13)ELT1365(SC) in support of his contention. The last part of Sub-section (1) of Section 178A lays the burden of proving that the goods are not smuggled on 'the person from whose possession the goods are taken. Assuredly when the goods are ....
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....he Sea Customs Act 1878 and all the provisions of that Act shall have effect accordingly." * * * * * He also invited our attention to Clause (3) of the Imports (Control) Order 1955, which reads as follows: "Save as otherwise provided in this order, no person shall import any goods of the description specified in Schedule I, except under, and in accordance with a licence or a Customs clearance permit granted by the Central Government or by any officer specified in schedule II." Item 6 in part V of Schedule I reads as follows: "Dyeing and tanning substances, all sorts, not otherwise specified, excluding wattle extract and articles specified in serial No. 5 of this part of this schedule." He lastly invited our attention to Section 167(8) of the Sea Customs Act which reads as herein-below quoted: "The offences mentioned in the first column of the following schedule shall be punishable to the extent mentioned in the third column of the same with reference to such offences respectively. Offences Section of this Act to which offence has reference Penalties 8. If any goods, the importation or exportation of which is for the time being prohibited or re....
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....iminal jurisprudence and of natural justice must necessarily apply. If so, the burden of proof is on the Customs Authorities and they nave to bring home the guilt of the person alleged to have committed a particular offence under the said Act by adducing satisfactory evidence. * * * *. * But it is said that the onus shifted to the appellant for three reasons, namely, (i) by reason of Section 178A of the Sea Customs Act (ii) by reason of Section 5 of the Land Customs Act, and (iii) by reason of Section 106 of the Evidence Act." 11. We have already observed that Section 178A of the Sea Customs Act does not apply to the facts of this case. Section 5 of the Land Customs Act is not of relevant consideration in this case. So far as Section 106 of the Evidence Act is concerned the Supreme Court observed in the judgment referred to above as follows: "We cannot accept the contention that by reason of the provisions of Section 106 of the Evidence Act the onus lies on the appellant to prove that he brought the said items of goods in India in 1947. Section 106 of the Evidence Act in terms does not apply to a proceeding under the said Acts. But it may be assumed that the principle....
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....y own on the question of onus and on the theory of 'offending goods', in particular, which was relied upon by Mr. Mukherjee on behalf of the Opposite Party. 17. The impugned order is one of confiscation of goods, to wit some tins of imported dye-stuff, under Section 167(8) of the Sea Customs Act, 1878, read with Section 3(2) of the Imports and Exports (Control) Act, 1947,--by an Order made under which Act the importation of such goods has been prohibited, save under a licence. Before proceeding further, it would be useful to refer to the provisions of Section 167(8) of the Sea Customs Act, which reads as follows: Offences Section of this Act to which offence has reference Penalties 8. If any goods, the importation or exportation of which is for the time being prohibited or restricted by or under Chapter IV of this Act, be imported into or exported from (India) contrary to such prohibition or restriction; 18 & 19 Such goods shall be liable to confiscation; and any person concerned in any such offence shall be liable to a penalty not exceeding three times the value of the goods, or not exceeding one thousand rupees. 18. It is evident that before any goods may be confis....
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....he goods are liable to be confiscated, and that it is not incumbent on the Customs Authorities to establish further that the goods have been imported by the person from whose possession they have been seized, or by some other person and that such person had no lawful authority for such importation. 21. I shall deal with these two contentions separately: A. The goods in question were seized from the godown of the petitioner who deals in dye-stuff, by the Police, and the Customs Department later took possession of the goods through the Criminal Court, by making a prayer under Section 180 of the Sea Customs Act. 22. The Superintendent of Land Customs next issued the notice in Ann. G, calling upon the petitioner to show cause, under Section 167(8) of the Sea Customs Act and Sections 5(3) and 7(1) of the Land Customs Act, why the goods should not be confiscated and penalty should not be imposed upon him, under those provisions. A plain reading of this notice will show that the Customs Officer threw the burden upon the petitioner of showing that he or some other person had lawfully imported the goods seized. The relevant portions of the notice may be reproduced: "Whereas on the....
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....glish law', of which Viscount Sankey spoke in Wool-mington v. Director of Public Prosecutions, 1935 AC 462 at pp. 481, 482. In the words of Viscount Sankey, in that case, "it is the duty of the prosecution to prove the prisoner's guilt". The corollary which follows from this proposition is that when a law lays down several ingredients to constitute an offence, the burden of establishing all those ingredients or the facts which are required to be proved for the purpose, is on the prosecution, subject, of course, to statutory exceptions, if any. Viscount Sankey illustrates this corollary with reference to the offence of murder. If this rule be applicable to an offence under Section 167(8), it goes without saying that the ingredient that the goods were 'imported into' India 'contrary to such prohibition or restriction' must be established by the Customs Authorities and it is not for the petitioner to prove the negative, namely, the goods were lawfully imported, either by himself or by somebody else. There is indeed a statutory exception which is relevant in this context, namely, that introduced by Section 178A. Because it is difficult for the Customs ....
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....tely difficult" for the prosecution to establish such fact, and not to the case of such facts as are as much available to the prosecution with due diligence as to the accused. In the case before us, had it been admitted or proved that it is the Petitioner who had imported the goods in question, the rule in Section 106 might certainly have been available to call upon him to show that he had a licence for such importation, for, whether he had a licence or not was a fact specially within his knowledge. But where there is no such admission or proof, the burden remains with the prosecution to prove that the goods have been imported without licence either by the Petitioner or by someone else. (iii) That it is not 'impossible or disproportionately difficult' for the prosecution to prove the fact of illicit importation in the generality of cases follows from the Supreme Court decisions such as AIR 1961 SC 264 or 1983ECR2198D(SC) . On the other hand, as the Supreme Court had pointed out in the earlier case of Babulal v. Collector of Customs, 1983ECR1657D(SC) after an article has passed several hands and comes to an innocent purchaser it would be throwing a very 'heavy and ....
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....atisfactory evidence." Even a clearer authority is to be found in the case of 1983(13)ELT1365(SC) where the Supreme, Court has laid down in unmistakable terms: "It will be seen from the terms of Section 167(8} that there are two distinct matters which have to be established before a person could be held guilty of the offence there set out. .... .It is clear that in the absence of any valid statutory provision in that behalf onus of establishing the two ingredients necessary to bring home the offence to an accused is on the prosecution." 30. B. The theory of 'offending goods' is founded on the difference in the language of the two parts of the third column of Section 167(8) of the Sea Customs Act: While the second part says that the penalty specified can be imposed upon "any person concerned in any such offence", the first part merely says that "such goods shall be liable to be confiscated." From this, it is contended that while in the case of imposition of the penalty, the authorities must establish that there has been an illegal importation and that the person sought to be penalised has been concerned in such illegal importation for th....
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....he goods, and in AIR 1961 SC 264 at p. 266 it has been definitely laid down that such proceedings are 'penal' in character and that, accordingly, the principles of criminal jurisprudence in so far as they are based on natural justice are attracted to such proceedings. As pointed out in the passage quoted by my learned brother, if the principle underlying Section 106 of the Evidence Act is to apply, so will the general principle of criminal jurisprudence that the burden of proving the offence is upon the prosecution. I have also referred to the observation, in Giau Chand's case 1983(13)ELT1365(SC) where the rule of criminal jurisprudence that the ingredients of an offence must be proved by the prosecution has been applied by the Supreme Court to a proceeding under Section 167(81) of the Sea Customs Act. 34. As I have stated, at the outset, there is no question of applying either part of col. 3 of Section 167(8) unless the 'offence' specified in col. I is established. In fact, the very expression 'offending goods' speaks of an 'offence'. If so, the burden of establishing the ingredients of this offence lies upon the State, as in the case of any ot....
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....at it has been violated, so as to justify the deprivation of individual property, there cannot be any such deprivation before such conditions are satisfied. As explained by Viscount Simonds in the modern case of East Riding County Council v. Park Estate (1956) 2 All ER 669 at p. 672 even where the Legislature has evinced an intention to encroach upon private rights, "the court must insist on strict and rigid adherence to formalities." 38. Under our Constitution, the above principle has been enshrined as the 'fundamental right' of a person, in two Articles, namely, Article 21, relating to life and personal liberty, and Article 31(1), relating to property. The latter says- "No person shall be deprived of his property save by authority of law." No logic is required to assert that confiscation of goods seized from the possession of a person is deprivation of his property, within the meaning of Article 31(1). If any authority is required, I may refer to the Supreme Court decision such as Ananda Behera v. State of Orissa [1955]2SCR919 ; Wazir v. State of Himachal Pradesh, 1954CriLJ1029 . In Wazir's case, 1954CriLJ1029 goods were seized from his possessi....
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....ed, the extent and urgency of the evil sought to be remedied thereby, the disproportion of the imposition, the prevailing conditions at the time, should all enter into the judicial verdict". State of Madras v. V. G. Row 1952CriLJ966 . 41. That the reversal of the onus of proof in a penal proceeding is a serious inroad upon the cherished rights of the people, whether in England or in India,--where the Anglo-Saxon common law rights of the individual have been further fortified by a constitutional guarantee--has been already demonstrated by the foregoing discussion. Nevertheless, in 1983ECR2198D(SC) , the Supreme Court upheld the reasonableness of such reversal by Section 178A of the Sea Customs Act in view of the extraordinary circumstances relating to the smuggling of gold and similar valuable articles which can be 'easily smuggled'. It is to be noted that the argument of the Solicitor-General, which their Lordships upheld was that, "the impugned provision had to be judged in the light of the widespread smuggling in commodities like gold which if not checked was calculated to destroy national economy and hamper economic stability and progress, and that no reason....
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....own cash memo and is unable to trace from whom he purchased it, he is liable to be 'diseased' of his pen, watch and numerous like articles, though they were imported goods sold under the authority of law. Nor has it been demonstrated, as in the case of gold and similar articles to which Section 178A relates, that the importation without lawful authority of other goods is "not possible of being effectively checked" but by throwing the burden of proof upon the person from whom the goods are seized, for, the Central Government has not exercised the power which has been vested in it by Section 178A(2), exactly to meet such a situation whenever it arises in respect of particular goods other than those specified by the Legislature itself. In this state of affairs, Section 167(8) would offend against Article 19(1)(f), upon the authority of the decision in Sampathu's case it-sell 1983ECR2198D(SC) , if we were to reverse the onus of proof and to hold that the burden of showing lawful importation is upon the person whose goods are sought to be confiscated, even though the special statutory exception in Section 178A is not attracted. No Court would give such an interpret....