- (1.) These appeals are directed against an order of Sri H.N. Sen, Presidency Magistrate, Calcutta, convicting and sentencing the two Appellants Md. Salim and Shamshad Ali Khan under Section 46(a) of the Bengal Excise Act and sentencing each of them to suffer rigorous imprisonment for two months and to pay a fine of Rs, 1,000 in default to suffer rigorous imprisonment for three, months more; also convicting each of them under Section 46(a) of the Bengal Excise Act read with Section 109 of the Indian Penal Code and sentencing each of them to suffer rigorous imprisonment for two months more; and also convicting each of them under Section 120B of the Indian Penal Code read with Section 46(a) of the Bengal Excise Act and sentencing each of them to suffer rigorous imprisonment for two months thereunder. There was an order that the substantive sentences of imprisonment would run concurrently.
(2.) The prosecution case was briefly as follows: Spirituous medicines like spirit chloroform and tincture cardamom compound are manufactured by firms like the Bengal Chemical and Pharmaceutical Works and Smith Stanistreet and Company, Ltd. in bonded laboratory in charge of an excise officer who assesses the quantity of the spirit or alcohol in the spirituous medicines when they are issued and charges excise duty thereon. That system was described in the case by several witnesses like P.W. 10 Panchanan Eakshit and P.W. 15 Kanai Lal Pramanik. Prosecution witness 10; Panchanan Rakshit, a retired excise inspector, was posted as excj?e inspector in charge of the bonded laboratory the Bengal Chemical and Pharmaceutical Works, Ltd., in 1950. He stated that if spirituous medicine manufactured by the firm was to go out of the bonded laboratory it must go out under a pass issued by an excise inspector and on payment of the excise duty. If it was issued for consumption in West Bengal the duty payable was Rs. 40 per L.P. gallon. If, however, spirituous medicine was issued for export to Bihar, the duty payable was only Rs. 5 per L.P. gallon. This made a considerable difference in the retail price of the spirituous medicine in West Bengal and Bihar. According to P.W. 12 Pannalal Chatterjee, an assistant attached to the bonded laboratory of Smith Stanistreet, the price of spirit chloroform during 1949-50 was Rs. 13-8 per lb. for Bengal and only Rs. 3-12 per lb. for Bihar and the price of tincture cardamom compound or tincture cardco was Rs. 7-12 per lb. for Bengal and Rs. 3-6 per lb. for Bihar. This was because the West Bengal Government and the Bihar Government imposed widely different rates of excise duty on Indian-made spirit used for the manufacture of these spirituous medicines, and in view of the proviso to Rule 27 framed under Section 29 of the Bengal Excise Act when the spirituous medicines made in Bengal was exported to Bihar the excise duty was payable only at the Bihar rate. The prosecution case briefly is that the two Appellants Md. Salim and Shamshad Ali Khan took advantage of this wide difference in the price per lb. of spirit chloroform and tincture cardco, and they placed orders with the Bengal Chemical and Pharmaceutical Works, Ltd. and Smith Stanistreet for large quantities of spirit chloroform and tincture cardco for export to Bihar, the name of the consignee being given as Calcutta Medical Stores, Rainjanpur, Monghyr. The required quantity of spirituous medicines ordered for was booked accordingly by Smith Stanistreet or by the Bengal Chemical to Calcutta Medical Stores, Ramjanpur, Monghyr, the railway station for Ramjanpur being Purabsarai. At the Calcutta end Md. Salim used to place orders with the above manufacturers and used to pay the bills which included the Bihar rate or the lower rate of exercise duty. At the other end the accused Shamshad Ali Khan used to receive the consignments and after a day or two he used to rebook the same to M:d. Salim under the name of Z. Ansari and Md. Salim used to take delivery of the railway parcel in Calcutta and then used to distribute the mfedicines in the black market in Calcutta at a large profit. Prosecution witness 16 Bimal Chandra Choudhury, sub-inspector of excise, who was in charge of the bonded laboratory of the Bengal Chemical for sometime, received information in the beginning of November, 1950, that large quantities of spirit chloroform and tincture cardco were being despatched to Calcutta Medical Stores Ramjanpur, Monghyr. He then examined the books of the Bengal Chemical and Smith Stanistreet and found that for over two years between November, 1948 and November, 1950, a large quantity of these two spirituous medicines had been ordered by Md. Salim on behalf of the Calcutta Medical Stores, Ramjanpur, Monghyr, and had been despatched to them. He traced nearly 50 orders for quantities varying from 50 lbs. to over 100 lbs. at a time. From all the passes issued, he found that the duties had been charged at the rate of Rs. 5 per lb. gallon. Sub-inspector Bimal Choudhury decided investigate whether the large despatches of spirituous medicines to the Calcutta Medical Stores, Monghyr, were bona fide exports for Bihar. He obtained an order from the Collector of Calcutta and then ascertained when the next consignments of spirit chloroform or tincture cardco were to be despatched to the Calcutta Medical Store, Monghyr, by the Bengal Chemical and by Smith Stanistreet. He found out that about November, 8 or 10, 1950, one box containing 50 lb. bottles of spirit chloroform had been despatched by Smith Stanistreet to the Calcutta Medical Stores, Ramjanpur, and that about the same time 30 lb. bottles of spirit chloroform had been issued by the Bengal Chemical and also despatched to the Calcutta Medical Stores, Ramjanpur. Along with another excise sub-inspector, namely, P.W. 6 Syamadas Banerjee, he went to Purabsarai which is about 4 miles from Jamalpur, contacted the station master Nani Gopal Biswas and received certain information. Then he found two boxes, one sent by the Bengal Chemical and the other sent by Smith Stanistreet addressed to self. He and Syamadas Banerjee kept a watch for the person who would come to take delivery of the boxes which contained bottles of spirit chloroform. On November 18, 1950', accused Shamshad Ali Khan came to take delivery of the boxes. He presented the railway receipt and signed in the Parcel Delivery Book and took delivery of the two boxes and took them to his house at Sonaikatha which is at some distance from the railway station. Syamadas Banerjee and Bimal Choudhury followed him and then kept watching for the re-booking till November 20, 1950. Bimal Choudhury then left for Calcutta leaving Syamadas Banerjee on the spot. Syamadas Banerjee found that re-booking was done by Shamshad Ali Khan on November 21, 1950 and that Shamshad Ali re-booked the same two packing boxes received from the Bengal Chemical and Smith Stanistreet to Z. Ansari in Calcutta. He took the railway receipt number from the station master and sent the information to Bimal Choudhury. Bimal Choudhury informed his superior officers and arranged to detain the man who would come to take delivery of the two boxes containing the spirituous medicines at Calcutta. On November 27, 1950. at about 4 p.m. the accused Md. Salim came to take delivery of the boxes from the Burra Bazar Booking and Parcels Office. He produced the railway receipt and signed the Parcel Delivery Book as Z. Ansari and then took delivery of the two boxes containing the spirituous medicines. Thereupon Md. Salim was detained by the Excise sub-inspector and the Superintendent of Excise was sent for. On his arrival the two boxes of the spirituous medicines were taken charge of by the excise officers, and opened, and found to contain the medicines described. Regular investigation was then taken up and ultimately charge sheet was submitted against the two accused Md. Salim and Shamshad Ali Khan for conspiracy to import and transport spirituous medicines unlawfully and without payment of the prescribed exercise duty. The charge of conspiracy namely that under Section 120B of the Indian Penal Code read with Section 46(a) of the Bengal Excise Act related to the period from November, 1948 to December, 1950. The specific charge under Section 46(a) of the Bengal Excise Act was made in respect of the 80 bottles of spirit chloroform contained in the two boxes which were seized at Burra Bazar Booking Office on November 27, 1950 and of which the despatch to Bihar and re-despatch to Calcutta had been shadowed by the excise sub-inspector. The charge under Section 109 of the Indian Penal Code read with Section 46(a) of the Bengal Excise Act also related to the specific consignment of 80 lbs. of spirit chloroform of which the movement had been shadowed by the Excise sub-inspectors, the charge being that the two accused aided and abetted each other in the commission of the offence set out in charge No. 2, i.e., the specific offence under Section 40(a) of the Bengal Excise Act relating to the 80 lbs. of spirit chloroform.
(3.) The accused both pleaded not guilty to the charges as framed and the main defence urged was a defence on various points of law. Thus it was urged before the learned Magistrate that Rule 27, which is a notification issued under Section 27 of the Bengal Excise Act imposing excise duty and fixing rates thereof, on various excisable articles, has no application to finished medicinal preparations like spirit chloroform and tincture cardco but applies only to the spirit intended for use in such preparations, that is, it applies to the raw spirit before the same has been compounded into finished medicinal preparations and that accordingly the accused were not liable to pay any duty for transporting and importing the bottles of spirit chloroform and tincture cardco from Bihar to Bengal. It was also urged that Rule 27 was ultra vires in so far as it applied to finished medicinal preparations. It was also urged that sanction of the State Government under Section 92 of the Bengal Excise Act and Section 196A of the Code of Criminal Procedure in respect of the charge of conspiracy was insufficient, as excise duty on medicinal preparation is now a Central subject under the Constitution of India. It was again urged that excise duties were payable by the manufacturers and not by a party who had taken delivery of the medicinal preparations from the manufacturer, and that if extra excise duty was payable for re-import of the bottles of spirit chloroform and tincture cardco to Bengal, the same ought to have been recovered from the Bengal Chemical and Smith Stan street. It was again trigged that the offence was not established because there was nothing to show that the duty was not intended to be paid after taking delivery in Calcutta or that the duty was not paid in Bihar. This argument was based on Section 28 of the Bengal Excise Act which provides that excise duty may be levied on an excisable article imported, by payment upon or before importation in West Bengal or in the province or territory from which the article is brought. It was finally urged that the spirit chloroform and the tincture cardco were meant for bona fide private consumption and therefore no duty was chargeable in view of the exemption under Section 19(2)(b) of the Bengal Excise Act.;