GROVER - (1.) , J.:. - This is an appeal by certificate from a judgment of the Bombay High Court upholding the conviction and sentence of the appellant under Section 167 (81) of the Sea Customs Act, 1878, hereinafter called the 'Act' and Section 120-B of the Indian Penal Code read with the aforesaid section and Section 5 of the Imports and Exports (Control) Act, 1947. The main point for determination is whether Section 187-A of the Act is unconstitutional on the ground that it is violative of Article 14 of the Constitution. The facts to the extent they are necessary may be set out.
(2.) THE appellant carried on business in the name of M/s Jaihind Ex-Import Corporation as its sole proprietor. He also carried on business as a partner in another firm run under the name and style of Alran Optics (India) Corporation. THE offices of the two firm were situate at New Charni Road, Bombay. According to the case of the prosecution the appellant with the object of defrauding the Government of customs duty payable on certain goods and with a view to evading prohibition imposed on the import of such goods was a party to criminal conspiracy, some of the other parties being M/s O and K Heydegger and M/s Winter Optics in West Germany. THE conspiracy was stated to have been entered into for the purpose of acquiring possession of contraband goods such as spectacle frames, welding glasses etc. THE import of spectacle frames was totally prohibited and the import of welding glasses was greatly restricted. It was alleged that in pursuance of the conspiracy the appellant imported three consingnments by three different ships; the first one arrived by S. S. Bialystock and the other two came on 22/09/1960 and March 5, l960 by two other ships S. S. Fraunfels and S. S. Laurensherk. Out of the four cases which arrived in the first consignment two cases contained contraband goods. As regards the other two consignments one case in each consignment contained goods the import of which was prohibited. THE modus operandi was highly ingenious and interesting but we need not recapitulate the same. The defence of the appellant was that it was owing to the mistake of shippers that the cases containing contraband goods arrived. It may be mentioned that no bill of entry was lodged by the appellant regarding the cases which contained contraband goods of the first consignment and the other consignment which were not got cleared. The learned Presidency Magistrate found the appellant guilty and sentenced him to six months' rigorous imprisonment and a fine of Rs. 1000.00 for each of the four charges directing the substantive sentences to run concurrently. The appellant filed an appeal to the High Court and the State preferred a petition for revision for enhancement of the sentence. The High Court dismissed both the appeals and the revision. The High Court further directed that the contraband goods should stand confiscated in favour of the, Government of India. During the pendency of the appeal in this Court a petition was filed on behalf of the respondent (Cr. Misc. Petition No. 362/70). It was prayed therein that a constitutional point as to the vires of Section 187-A read with Section 167 (81) of the Act be allowed to be raised. Thereupon the Division Bench made an order that the appeal be placed before a larger bench. The question being one of constitutional validity of Section 187-A of the Act counsel for the appellant has addressed arguments before us with our permission on the aforesaid point. It has been contended inter alia that the offences of smuggling of goods and in particular, the acts with which the appellant has been charged could be dealt with by the customs authorities by proceeding under Section 167 (8) of the Act as well as in the alternative or in addition by instituting a prosecution in a criminal Court by filing a complaint under Section 187-A read with Section 167 (81) of the Act. The former can result only in the imposition of a fiscal penalty not exceeding three times the value of the goods and confiscation of the goods themselves. The latter can result it in a sentence of imprisonment upto two years or fine or both. Thus it has been left to the unfettered and unguided discretion of the customs authorities to proceed against certain persons under Sec. 167 (8) and others under Section 167 (81) or under both the sections. In a large number of cases no criminal prosecutions were filed at all and proceedings under Section 167 (8) alone were taken which resulted in imposition of penalties. This leads to discrimination and has actually resulted in discrimination.
(3.) WE may now refer to Section 187-A of the Act. It provides that no Court shall take cognizance of any offence relating to smuggling of goods punishable under item 81 of the Schedule to Section 167 except upon complaint in writing made by the Chief Customs Officer or any other officer of customs not lower in rank than an Assistant Collector of Customs.Items 8 and 81 of Section 167 to the extent they are material are as follows:- JUDGEMENT_119_2_1971Html1.htm Even though Item 8 of S. 167 does not empoly the word "knowingly" which is to be found in item 81 intentional smugglers are bound to be covered by both the items. The argument on behalf of the appellant is based on there being no guidelines in Sec. 187-A in the matter of filing a complaint for an offence under item 81. It is suggested that if there is an option to the officers mentioned therein to file a complaint or not to file the complaint then there will be clear infringement of Article 14. Counsel for the appellant has gone to the extent of submitting that the power to give sanction or to make a complaint without any guidelines would itself be hit by Article 14. Our attention has been invited to Rayala Corporation (P) Ltd. v. Director of Enforcement, New Delhi, (1970) 1 SCR 39 = (AIR 1970 SC 494), in which one of the points canvassed was that Section 23 (1) (b) of the Foreign Exchange Regulation Act, 1947 as amended by the Foreign Exchange Regulation (Amendment) Act, 1957 was violative of Art. 14 of the Constitution inasmuch as it provided for punishment severer than the punishment or penalty, provided for the same acts under S. 23 (1) (a) of that Act. It was pointed out in the judgment of this Court that two different proceedings could be taken for contravention of certain provisions of the aforesaid Act. Under Section 23 (1) (a) a person was liable to a penalty only and that penalty could not exceed three times the value of foreign exchange in respect of which contravention had taken place or Rs. 5,000/. whichever was more. That penalty could be imposed by adjudication made by the Director of Enforcement in the manner provided in Section 23D of the said Act. The alternative punishment provided by Section 23 (1) (b) upon conviction by a Court was a sentence ot imprisonment for a term which could extend to two years or with fine or with both. The argument that the section laid down no principles for determining when a person concerned should be proceeded against under Section 23 (1) (a) and when under Section 23 (1) (b) and that it was left to the arbitrary discretion of the Director of Enforcement to decide which proceeding should be taken was repelled by relying on the provisions of Section 23D. Under that section the Director of Enforcement was first to hold an inquiry for the purpose of adjudging whether there had been contravention under Section 23 (1) (a) and if he was satisfied that the person had committed a contravention he could impose a penalty provided thereby. According to the proviso, however, if at any stage of the enquiry he was of the opinion that having regard to the circumstances of the case the penalty would not be adequate he was bound to make a complaint in writing to the Court instead of imposing any penalty himself.;