Amar Chandra Chakraborty Vs Collector of Excise (1972)

Abstract

This case is a landmark decision taken by the Supreme Court of India. It was an important case with respect to the subject matter of interpretation of statutes. The principle of ejusdem generis was defined by the court and it also stated the applicability of this principle. The word ‘ejusdem generis’ means denoting a principle for interpreting legal texts that assume that, if there is a general term accompanying a list of specific terms, then the general term is restricted to things of the same character as the specific terms. With the help of this case court laid down some ground rules regarding the application of this rule.

Facts of the Case

The plaintiff in the petition had obtained a license under the Tripura Excise Rule 1962 as he engaged in Excise Wholesale Contractor for Country Liquor. There was an agreement entered by the plaintiff and the Government of Tripura thereupon he was appointed as the Contractor of the warehouse for supply and rectified spirit for Government of Tripura for a period of 5years. He fulfilled all the necessary conditions of the license as well as the agreement made between the parties. But before the expiry of the license granted the Collector of Excise (respondent) allegedly wrongfully withdrew the license granted to the plaintiff as new provisions were added in the Tripura Excise rules 1962. The respondent claimed that the plaintiff had to pay the government due when the plaintiff tried to secure the deposit he had made initially as a condition of the agreement.

Judgment

The plaintiff had filed the petition challenging the order passed by the Judicial Commissioner who stated that:
• The Excise Commissioner officer who had granted the license had full authority to withdraw the license under the interpretation of Sec 42 and Sec 43 of the Act.
• It laid down that the principle of ejusdem generis is applied if …. (1) the statute contains an enumeration of specific words; (2) the subjects, of the enumeration constitute- a class or category; (3) that class or, the category is not exhausted by the enumeration; (4) the general term follows the enumeration and (5) there is no
indication of a different legislative intent…..”
• It also stated that as trade and business are considered under a special category therefore it cannot be considered under Article 14 stating the freedom of trade and business.
These observations were considered to be conforming to the facts that were made during the legal proceeding in the apex court. The Supreme Court stated in its judgment that there was no scope for the appellant to challenge the decision made by the Judicial Commissioner under Art. 136. The court conferred to the observation made by the JC thus the appeal was dismissed.

Case analysis

• This particular case gave a clear interpretation of the rule of ejusdem generis. In the aforesaid case, the plaintiff questioned the power of the Excise Commissioner to withdraw the license. The contention made by the plaintiff was that the interpretation of “any cause other than” in Sec 43 had an arbitrariness that challenged the expression.
• It should be observed that the rule of interpretation states that the meaning of a certain section or a provision should be understood by keeping the intention of the legislature in mind.
• The numerous clauses of Sec.42 cannot be easily construed as constituted by one class or group.
• In the order passed by the Hon’ble court, it states that Liquor business having been governed under special regulatory laws and excise privilege cannot be considered under Art.14 as it may be pointed out, that it forbids class legislation but reasonable classification does not come within the prohibition. Thus the Excise authority has reasonable power to make a decision regarding this subject matter.

Conclusion

Interpretation of Statutes is important as these remove the ambiguity in construing the meaning that confers the object of the Act passed by the government. It is the rightful duty of the court to interpret and understand the purpose of the provisions and the words in the provision, to impart justice and fairness to the public. This case gave a vivid understanding of the applicability of an important principle.

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State Of Maharashtra Vs Mayer Hans George

FACTS:

In this case, Mayer Hans George- Respondent, was found with 34kg of gold in his bank when he was travelling Zurich to Manila on 27^th November 1962. He was a German by Nationality. As bringing such large amount of gold was not allowed in the country without the prior permission of the Reserve Bank of India (RBI). As if someone was to be found with more gold than allowed in the country, it would amount as smuggling under foreign exchange regulations act of 1947. Initially acquitted by high court, the respondent was sentenced to jail by the supreme court after an appeal was filed in the court.

ISSUE:

Section 168 (8) (1) of the Sea Customs act and Section 8(1), 23 (1-A) of Foreign Exchange Regulations act,1947.

PETITIONER CONTENTION:

The petitioner- The state of Maharashtra Contended that, there was complete intention of the Respondent to bring the Gold bars in his cargo and he wanted to smuggle the gold to Manila which was his ulterior destination. Further, looking at the importance of the act it can be said that the Mens rea is an irrelevant element in assuming the culpability of the offender. The strict adherence of the act refutes any such assumptions and shows that mens rea is not a fundamental element of the offence. The petitioner said that the government had published official gazettes two times in 1962 to create awareness in the general public. And the earlier gazette which was published in early November which was erroneous was clarified by a second gazette published in November end, so the contention that the government had not notified the public could not be held valid

RESPONDENT CONENTION:

The respondent- Mayer Hans George contended that, mens rea is a fundamental element of any criminal offence and the respondent was not aware of the notification published by the Reserve Bank. The notice could be said to be enforceable when it comes to the knowledge of the people who is has read it and is affected by it. The main contention of the respondent was that he had no knowledge at all of the law and regulations of the country and so the petitioner saying that all information was published was not fair to him thus, as he was not aware of the Indian Penal codes and laws. He had no intention to bring gold in India cannot be said to possess the intent to break the law and hence should not be prosecuted under the act.

JUDGEMENT:

The bench of Justice K. Subbarao, Justice Rajagopala Ayyangar and Justice J.R. Mudholkar said that to read the sections of the foreign exchange regulations act and apply it to the respondent- Mayer Hans George would be unfair and cruel towards him, the bench acknowledged that mens rea is a necessary element to prove a crime but it can be excluded by the words of the statute. The court further said that the high court failed to establish a precedent and thus the appeal was allowed in the supreme court and the 1-year conviction of the Respondent- Mayer Hans George was restored.

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Chailbihari Trading Private Limited Company v. Union of India

Facts:

The petitioner- Chailbihari Trading Private Limited Company challenged the guidelines dated 25^th June, 2019 issued by the respondent no.2- Central Bureau of Narcotics to regulate import of poppy seeds into India from Turkey. The petitioners stated that the guidelines are an unconstitutional restriction on their right to trade and carry on business. It is not disputed that the Central Bureau of Narcotics regulates poppy seed import into India. The petitioners being registered importers have the necessary license. They agree that there is a cap or quota on the poppy seed import from various points of origin, and there is a cap on the quantity imported for each foreign exporter country. Until recently, the import permissions were by sale of lots. The respondents issued a public notice on 25^th June 2019, in which guidelines for registration of sales contract regarding poppy seed imports from Turkey were laid down. Clause I provide for determining a country cap, which is to be approved by the Department of Revenue based on Narcotics Commissioner’s recommendation, a representative of Directorate General of Foreign Trade and representative of Department of Revenue. The country cap would be based on stock and production of poppy seeds as communicated by the Turkish Grain Board (TMO) or the Turkish Embassy in India, so this cap is not ad hoc or without basis. Clause II provides for the Turkish exporter to be registered with the TMO, the Indian importer has to approach the Narcotics Commissioner for registration of sales contract, conditions for which are prescribed. One condition being each importer can register the quantity applied for or 25 containers (450MT) whichever is less during a particular crop year, along with other detailed provisions for procedure, validity, surrender and penalty.

Issues:

• Whether the Government issued notification to regulate import of poppy seeds in India is unreasonable or discriminatory.
• Whether the notification violates the petitioner’s right to trade and occupation.

Legal Provisions:

• Narcotic Drugs and Psychotropic Substances Act, 1985 section-9 Power of Central Government to permit, control and regulate.
• Constitution of India, 1950 Article 19 (g) to practise any profession, or to carry on any occupation, trade or business.

Petitioner’s Contention:

The petitioner contends that the registration process will create a monopoly and the old system of drawing lots was preferable. They also stated that if the Turkish exporter is registered with the TMO, the requirement for the Indian importer to register is unreasonable and will cause duplication of work. They stated that earlier restriction was of 5 containers and by raising it to 25 the rich and powerful importers will only get the imports. They argued that the time frames are unrealistic and a form of invidious discrimination.

Respondents’ Contention:

The counsel for respondent no.1 referred to the decision of the division bench of Allahabad High Court in Ayurveda Sewashram Kalyan Samiti v. Union of India and others (2014) whereby it was noticed that India is a signatory to the Single Convention on Narcotic Drugs 1961. It was noted that though narcotic and such substances have scientific and medical uses they are also abused and trafficked, beside the constitutional mandate to the state to promote health and nutrition led to the formation of the Indian Policy to Prevent Drug Abuse. India is also a signatory to three other conventions on drug-related matters. The case was regarding import of poppy seeds and the court in that case observed three conditions governing import of poppy seeds- point of origin, importer’s certification that poppy was cultivated legally and the import contacts to be registered with Narcotics Commissioner. 

Observations of the Court:

The court did not find any merit in these contentions. It stated that there was no fundamental right to be an importer or to import poppy seeds, or to import anything without restrictions or without any restrictions only on terms beneficial to a particular person. They stated that the burden of proof is on the petitioner to show how the notification is arbitrary and discriminatory. If a classification is challenged it must be shown that it has no connection to the object of the impugned law, and the petitioner were unable to prove this.  It was clarified that the notification was made pursuant to the MoU between India and Turkey dated 23^rdMay 2018 and by a notification dated 29^th July 2016, the Government of India gave powers to the Department of Revenue to frame guidelines to give effect to the National policy on Narcotic Drugs and Psychotropic Substances controlled by the NDPS Act 1985, the MoU being sovereign cannot be challenged. The notification provides guideline to prevent cartelization, artificial blocking of country caps and artificial raising of re-sale prices. The court noted that no one complained against this notification, also one Ms. Setalvad, an importer had contested this petition. The court noted that the present petition does not question the power to frame such guidelines. The court observed that NDPS Act, chapter III, sec-9 gives Central Government power to control and regulate production, manufacture, import and export of substances including opium poppy cultivation and production all of which is regulated. Chapter III-A of the Foreign Trade (Development and Regulation) Act 1992, inserted by the 2010 amendment which gives powers to the central government to impose quantitative restrictions on import, these restrictions can continue for a maximum period of 4 years expendable by a like period. The court noted that once it is found that there is power to regulate and impose quantitative restriction and there is no challenge to the exercise of that power, nothing remains of the petition. The court criticized the petitioners for filing a petition challenging a government policy framed in a legitimate exercise of statutory power, with no data to support their allegations. The court observed that the petitioner seeks to scrap this new policy and be governed by the old policy without giving any reasons or evidence for the same. The court noted that the objections regarding the registration were not new and the petitioners themselves had followed them in the past. It noted that since the guidelines were issued in furtherance of larger interest then the commercial interest of the petitioners may suffer.

Judgement:

The court did not find merit in the petitioners’ contention and dismissed the petition.

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Maqbool Husain Vs State Of Bombay

FACTS:

The fact of this case is the petitioner bought some gold into India. He did not declare that he had bought gold with him to the customs authority at the airport. The custom authority checked him and they found that he had some amount of gold with him and they confiscated the gold under Sea Customs Act. He was later on charged for having committed an offense under the Foreign exchange Regulation Act. The petitioner contended that the second prosecution violated Article 20(2) as it was for the same offense that is for importing gold into India in contravention of government notification for which he had already been prosecuted and punished as his gold had been confiscated by the Customs Authority.

ISSUES:

Whether he will be punished for the same offense twice under the different act?

LEGAL PROVISIONS:

1. Article 20(2) of the Indian Constitution
2. Sea Customs Act
3. Foreign Exchange Regulation Act.

PETITIONER CONTENTION

The petitioner contended that he had been punished for the same offense under the different activities that are he bought gold into India without saying it to anybody so the custom authority confiscated the gold and punished him under the Sea Customs Act. And after that, he had been punished for the same offense of bringing gold into India so it is violative of Article 22(2) as double jeopardy.

OBSERVATION MADE BY THE COURT:

The observed all the contention of the petitioner and held that the Sea Custom Authority changed into now no longer a courtroom docket or judicial tribunal and the adjudging of confiscation beneathneath the Sea Customs Act did not constitute a judgment of judicial character necessary to take the plea of the double jeopardy. Hence the prosecution under the foreign exchange regulation Act is barred. So the contention of the petitioner that he had been punished for the same offense twice will not come under double jeopardy under Article 22(2) of the Indian Constitution. 

JUDGMENT.       

After all the observation made by the court, the court held that the Sea custom Authority did not constitute a judgment of judicial character so it does not amount to double jeopardy. Hence his plea dismissed.

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