State of West Bengal Vs. Motilal
Kanoria  INSC 76 (15 March 1966)
15/03/1966 HIDAYATULLAH, M.
GAJENDRAGADKAR, P.B. (CJ) WANCHOO, K.N.
CITATION: 1966 AIR 1586 1966 SCR (3) 933
CITATOR INFO :
R 1971 SC1283 (12) RF 1973 SC 106 (146)
Imports and Exports (Control) Act 18 of 1947,
s. 5-Import (Control) Order No. 17 of 1955, cl. (5)-Goods imported under
licence sold without permission from Controller-Such sale whether an offence.
Code of Criminal Procedure, 1898, s.
537-Error, commission of irregularities in complaint-Application of section.
The respondent was the director of a company
and also a partner in the firm managing it. On behalf of the company he made an
application for an import licence under the Imports and Exports (Control) Act
1947, and in May 1955 the licence was granted. At that time the grant of
licence was governed by an Order issued in 1948 issued under s. 32 of the Act,
and under that Order the Controller of Imports and Exports could attach
conditions to licences issued by him.
According to the terms of the licence granted
to the aforesaid company the goods imported under-the licence were to be
employed for the company's own use. In December 1955 the Imports (Control)
Order No. 17 of 1955 was passed.
Under cl. 5(3) of the Order certain
conditions were deemed to be part of every licence and under cl. 5(4) every
licencee was enjoined to observe the condition of the licence. In 1956 the
respondent secured a revalidation of the licence issued to the company.
Thereafter when the goods arrived they were sold by the respondent to another
party. A complaint was filed against the respondent and the company for an
offence under s. 5 of the Imports and Exports (Control) Act 1947 read with cl.
(5) of the Imports (Control) Order 1955. The respondent faced the trial as an
accused and participated in the proceedings without any objection. He was
convicted by the trial Magistrate but the High Court acquitted him on the
ground that at the time when the transaction of sale was entered into i.e. in
December 1956, breach of a condition of licence did not constitute an offence
under s. 5 of the Act of 1947. The State appealed to this Court. The questions
that fell for determination were : (i) whether by disposing of the imported
goods without permission any offence was committed; and (ii) if so whether the
respondent was personally liable.
HELD: (i) Although s. 5 of the Imports and
Exports (Control) Act, 1947 did not, before its amendment in 1960, specially
provide that breach of a condition of licence would be deemed to be a breach of
the Imports (Control) Order, yet by virtue of cls. 5(3) and (4) read with cl.
12 of the Imports (Control) Order 1955 the transfer of a licence was a breach
of the said order and constituted an offence. No distinction could validly be
made in the circumstances of this case between transfer of a licence and
transfer of goods imported under it. [945 E-G; 946 B-C] C.T.S. Pillai v. H. P.
Lohia & Anr. A.I.R. 1957 Cal. 83, referred to.
East India Commercial Co. Ltd. Calcutta v.
Collector of Customs, Calcutta,  3 S.C.R. 338, distinguished.
934 Stare v. Abdul Aziz  1 S.C.R. 830,
(ii) The fact that the licence was obtained
by 'the respondent while the 1948 Order was in operation did not help the
respondent as under cl. 12 of the 1955 Order any licence issued under any of
the earlier Orders was deemed to have been issued under the corresponding
provisions of the 1955 Order. The goods under the licence were, moreover,
imported and sold after 1955. The licence itself was revalidated in 1956 and
that could only have been done by power derived under cl. 7 of the 1955 Order.
[945 B, D] (iii) The respondent was responsible for the issuance of the licence
and for the transfer of the goods imported under it. He was therefore
responsible principally along with the company. The complaint no doubt was not
clear as to whom was really meant to be prosecuted but it described the
respondent as an accused to which he did not object at his trial. The error,
omission or irregularity, if any, in the complaint was curable under s. 537 of
the Code of Criminal Procedure and in the present case could not be said to
have led to a failure of justice. [946 E-H]
CRIMINAL APPELLATE JURISDICTION: Criminal
Appeal No. 108 of 1964.
Appeal from the judgment and order dated
September 4, 1963 of the Calcutta High Court in Criminal Revision No. 396 of
Debrata Mookerjee, B. L. Mehta, R. H. Dhebar
and B. R. G.
K. Achar, for the appellant.
D. N. Mukherjee, for the respondent.
The Judgment of the Court was delivered by
Hidayatullah, J. This is an appeal by certificate under Art.
134 (1) (c) of the Constitution, against the
judgment of the High Court of Calcutta dated September 4, 1963 by which the
conviction of the respondent Motilal Kanoria under s. 5 of the Imports and
Exports (Control) Act, 1947 and the sentence of fine of Rs. 200/(in default
simple imprisonment for one month) imposed by the Presidency Magistrate, 6th
Court, Calcutta, were set aside and an acquittal was entered. The facts of the
case are not in controversy and may therefore be stated briefly. Motilal
Kanoria was a director of Lachminarayan Jute Manufacturing Co. Ltd., Calcutta.
The Company was managed by a firm of the name of Mukhram Lachminarayan and
Motilal Kanoria was one of the partners of the firm. The Company and the
Managing Agents had a common address in Calcutta. Motilal Kanoria used to sign
on behalf of the Managing Agents and also generally to deal with the affairs of
the Company. All transactions in this case were by Motilal Kanoria and he had
signed the documents to which reference will be made presently.
In February 1955 the Government of India
approved of the proposal of the Company to manufacture hackle and combing pins
and sanctioned the import of plant and machinery for the 93 5 purpose. The
Company was permitted to apply to the Chief Controller of Imports, New Delhi
for a licence. The letter of Government is Ex. 2 dated February 4, 1955. On
February II. 1955 the Company applied to the Chief Controller of Imports, New
Delhi, on the proper application form, for an import licence. In that
application the Company stated that the machinery was to be installed or used
at their Mills at Konnaggar, Eastern Railway (Ex. 1). On May 26, 1955 a licence
was issued (Ex. 3). The licence read as follows-- "This licence is issued
subject to the conditions to the goods licensed as detailed in the Policy Book
for the current licensing period and any public notices that may be issued in
this behalf from time to time.
LICENCE NO. 035925 Counterfoil Not available
for foreign exchange unless authorised by Reserve Bank of India.
IMPORT TRADE CONTROL (Valid for all India
Ports) (Not transferable except under a letter of authority from the authority
who issued the licences or from any Import Trade Controller).
Messrs. Shree Luchminarain Jute Manufacturing
Co. Ltd., of 59, Netaji Subhas Road, Calcutta-
1. are hereby authorised to Import the goods
of which particulars are given below:-
1. Country from which consigned: West
2. Quantity & Description Machinery as
per of goods: list attached for the manufacture of Hackling & combing pins.
3. Approximate value C.I.F. Rs. 1,88,000/-
(Rupees One Lakh and Eighty eight thousand only)
4. Period of shipment: Revalidated upto 31st
5. Name & Address of M/s. Schunacher
Metal Manufacturer Shipper or Works Aktiengesche Suppliers: Ilacheft, Aachen,
6. Limiting factor for purpose of clearing
through Customs: Value
7. Name of actual user in Self India This
licence is granted under Government of India, late Commerce Department
Notification No. 23. ITC/43 dated the 1st July 1943 as continued in force by
the Imports and Exports (Control) Act 1947 18 of 1947) and subject to the rules
and orders issued there under. This licence is also without prejudice to the
applications of any other prohibitions or regulations affecting the importation
of the goods which may be in force at the time of their arrival.
Sd. Illegible Section Officer 26-5-55 for
Chief Controller of Imports and Exports.
Issued from file No. L. IV/49 (11) CG/55.
(Space for Endorsements by Import Trade
Control Authorities) This licence is issued with an initial validity period of
one year from the date of issue. It will be revalidated at or before the end of
the said period of one year, for a further period of two years, provided
satisfactory evidence is produced that the order for the goods has been
accepted by the foreign suppliers and a firm contract is made within the
initial period of one year. In no case, however, will the validity period
extend beyond three years from the date of issue." In the covering letter,
which was sent when forwarding the licence, the Chief Controller said inter
alia,- (3). The licence is granted to you subject to the following conditions:-
(a) In case the project involves any capital issue and if such capital issue is
not sanctioned the licence is liable to cancellation.
(b) That if any sanction to the project is necessary
under the laws of the Central, Provincial or a State Government the same should
be obtained and the position reported to this office by the licensee; in the
absence of such sanction being received the licence is liable to cancellation.
4. The licence is liable to cancellation if
particulars as to progress of time in accordance with the detailed instructions
contained in the accompanying slip are not furnished.
5. The Government do not guarantee for supply
of raw materials required for manufacture of the goods.
On June 19, 1956 the Company asked for
"revalidation" of the licence and the licence was extended to May 31,
1957. This extension is mentioned in the licence above reproduced at No. 4. On
December 13, 1956 the Company entered into an agreement (Ex. 25) with Shalimar
Wood Products (P) Ltd. of Calcutta for the sale of the machinery imported by
the Company. The sale, it is submitted, was at invoice price and there was no
profit. On the arrival of the machinery in February of the following year the
Company authorised Shalimar Wood Products to receive the shipping documents
from the Company's bankers and to clear it from the Docks.
The plant and machinery were then cleared by
the Agents of the Shalimar Wood Products and the latter took them with a view
to installing them in their own factory.
On July 30, 1958 the Company wrote a letter
(Ex. 7) to the Chief Controller of Imports informing him that owing to the
death of their director of Sawal Ram Kanoria who was interested in the
production of the said pins the Company was compelled to sell the imported
plant and machinery to Shalimar Wood Products. (P) Ltd., Calcutta and asked for
the approval of the transaction. The Chief Controller of Imports in reply
pointed out that permission ought to have been obtained before the transfer and
that the Company had apparently committed a contravention of the import
A report was made to the police for
investigation and later a complaint under S. 5 of the Import and Exports
(Control) Act, 1947 was filed in the Court of the Chief Presidency Magistrate,
Calcutta, by the Deputy Chief Controller of Imports and Exports. Lachminarain
Jute Manufacturing Company was named as the accused "represented by Shri
Motilal Kinoria". In paragraph 2 of the complaint the Company was stated
to be the accused but in later paragraphs of the complaint Motilal Kanoria was
named as the accused.
In the prayer it was requested that the court
should summon "accused Motilal Kanoria representing the Company and the
Managing Agents" to answer the charge of a breach of the pCI/66-14 938
conditions of the licence which constituted an offence under s. 5 of the
Imports and Exports (Control) Act, 1947 read with clause (5) of the Imports
(Control) Order No. 17 of 1955, dated December 17, 1955. Motilal Kanoria
appeared at the trial, was questioned as an accused, pleaded not guilty and
stood the trial. He does not appear to have objected to being arraigned as an
accused person a point he took later in the High Court and has taken before us.
The prosecution examined a large number of witnesses and filed documents to
prove the above facts none of which is now denied. The Presidency Magistrate,
6th Court, Calcutta, convicted Kanoria under s. 5 of the Imports and Exports
(Control) Act, 1947 for contravention of clause (5) of the Imports (Control)
Order, 1955 and sentenced him to a fine of Rs.
200/- or simple imprisonment for one month.
On revision the High Court acquitted him but certified the case as fit for
appeal to this Court and the present appeal is the result.
As the prosecution is in respect of an
offence under s. 5 of the Imports and Exports (Control) Act, 1947, we shall
begin by examining what the ingredients of that offence are.
Under the scheme of that Act there is a power
to prohibit or restrict imports and by s. 3 the Central Government is enabled
to make provision, by order published in the Official Gazette, for prohibiting,
restricting or otherwise controlling them. Section 5 prescribes penalty for
contravention of an order. The section, as amended by Act 4 1960, is set down
here "5. If any person contravenes or attempts to contravene, or abets a
contravention of, any order made or deemed to have been made under this Act or
any condition of a licence granted under any such order, he shall, without
prejudice to any confiscation or penalty to which he may be liable under the
provisions of the Sea Customs Act, 1878, as applied by sub- section (2) of
Section 3, be punishable with imprisonment for a term which may extend to one
year, or with fine, or with both".
(The words underlined were introduced in
The complaint in this case was filed after
Different orders at different times were
passed by the Central Government under S. 3 and a word may be said about the
orders of 1943 and 1948, although on the date of the transfer of machinery
(December 13, 1956) only the order of 1955 was in force.
The first order was made under sub-rule (3)
of rule 84 of the Defence of India Rules in force in 1943 (Notification No. 23
I.T.C./ 43 dated 1st July, 1943). That order was general and there was no
provision authorising the imposition of conditions in the licence, the breach
of which would be deemed to be a breach of the order.
939 In 1948 another order was issued under s.
3 (Notification No. 2 I.T.C. dated 6th March, 1948). It provided for imposition
of conditions but the provisions of the order did not indicate that any
particular condition would be deemed to be included in a licence if not
expressly included. The provisions of that order may be read here:
"In exercise of the powers conferred by
sub- section (1) and sub-section (3) of section 3 of the Imports and Exports
(Control) Act, 1947 (18 of 1947), the Central Government is pleased to make the
following order namely:- (a) Any officer issuing a licence under clauses
(viii)to (xiv) of the notification of the Government of India in the late
Department of Commerce No. 23 I.T.C./43, dated the 1st July, 1943, may issue
the same subject to one or more of the conditions below:
(i) that the goods covered by the licence
shall not be disposed of or otherwise dealt with without the written permission
of the licensing authority or any person duly authorised by it;
(ii) that the goods covered by the licence on
importation shall not be sold or distributed at a price more than that which
may be specified in any directions attached to the licence;
(iii) that the applicant for a licence shall
execute a bond for complying with the terms subject to which a licence may be
(iv) that the licence shall not be
transferable except in accordance with the permission of the licensing
authority or a person duly authorised by it;
(v) that such other conditions may be imposed
which the licensing authority considers to be expedient from the ad-
ministrative point of view and which are not inconsistent with the provisions
of the said Act.
(b) Where a license is found to have con-
travened the order or the terms and conditions embodied in or accompanying a
licence, the 940 appropriate licensing authority or the Chief Controller of
Imports may notify him that, without prejudice to any penalty to which he may
be liable under the Imports and Exports (Control) Act, 1947 (18 of 1947), or
any other enactment for the time being in force he shall either permanently or
for a specified period be refused any further licence for Import of
goods." By this order the licensing authority was given the power to
include conditions in a licence.
On December 7, 1955 an order was issued
(Notification No. 17/55 dated December 7, 1955). It consolidated all the rules
in one place and by clause 12 read with Schedule IV repealed the earlier two
orders and some others but while effecting this repeal it added a saving
clause-- "Provided that anything done or any action taken, including any
appointment made or licence issued under any of the aforesaid Orders, shall be
deemed to have been done or taken under the corresponding provision of this
Order. " The order of 1955 also included several new provisions regarding
conditions which may be introduced in licences and others which would be deemed
to be so introduced. Conditions relevant here may be noticed.
"5. Conditions of Licence.
(1) The licensing authority issuing a licence
under this Order may issue the same subject to one or more of the conditions
stated below:- (i) that the goods covered by the licence shall not be disposed
of, or otherwise dealt with, without the written permission of the licensing authority
or any person duly authorised by it;
(ii) that the goods covered by the licence on
importation shall not be sold or distributed at a price exceeding that which
may be specified in any directions attached to the licence;
(iii) that the applicant for a licence shall
execute a bond for complying with the terms subject to which a licence may be
(2) 941 (3) It shall be deemed to be a
condition of every such licence, that:
(i) no person shall transfer and no person
shall acquire by transfer any licence issued by the licensing authority except
under and in accordance with the written permission of the authority which
granted the licence or of any other person empowered in this behalf by such
(ii) that the goods for the import of which a
licence is granted shall be the property of the licensee at the time of import
and thereafter upto the time of clearance through Customs.
(iii) the goods for the import of which a
licence is granted shall be new goods unless otherwise stated in the licence.
(4) The licensee shall comply with all
conditions imposed or deemed to be imposed under this clause." Conditions
5 (1) (i), (ii) and (iii) and 5 (3) (i) are the same as conditions (a) (i) to
(iv) of the 1948 Order but 5 (3) (ii) and (iii) and 5 (4) are new. Conditions 5
(3) (i), (ii) and (iii) become a part of every licence and further the licensee
has to comply with all the conditions imposed or deemed to be imposed under
clause 5. The effect of these clauses has to be considered in relation to the
licence granted in this case but in this context the provisions of clause 7 are
also relevant and the clause may be set down here:
"7. Amendment of Licence.-- The
licensing authority may, of its own motion or on application by the licensee,
amend any licence granted under this Order in such manner as may be necessary
to make such licence conform to the provision of the Act or this Order or any
other law for the time being in force or to rectify any errors or omissions in
the licence; Provided that the licensing authority may, on request by the
licensee, amend the licence in any manner consistent with the Import Trade
Control Regulations." 942 Much of the argument in this case is based on
the dates of these notifications and of the amendment of the section 5 of the
Act, considered in relation to the dates on which the several facts in this
case took place. The Presidency Magistrate applied the Order of 1955 because
the licence was "revalidated" on June 27, 1956, and according to him,
this was apparently done under powers derived from clause 7 of that Order.
According to the Presidency Magistrate the Company had imported the plant and
machinery for its own use (vide No. 7 of the licence) and this was an express
condition of the licence. He also pointed out that the licence was expressly
made subject to such restrictions as might be imposed from time to time and the
Order of 1955 imposed conditions which made the transfer of machinery an
offence being a breach of subclause (3) clause (5) of the 1955 Order. The High
Court held that s. 5 of the Act as it stood on December 13, 1956 when the
alleged offence was committed, did not make breach,of a condition of a licence
an offence and, therefore, there was no offence. The Division Bench relied
principally on the observations of Sen and Mitter JJ. in C. T. S. Pillai v. H.
P. Lohia and Anr.(1) to the following effect :
"It is clear, therefore, that the
section penalises only contravention of any order made or deemed to have been
made under the Act.
But the question is whether contravention of
a condition imposed by a licence issued under the Act or issued under a
statutory order made under the Act is also an offence under section 5, Imports
and Exports (Control) Act, 1947.
Although license is granted under a statutory
order made under the Act and conditions may be imposed in the license under
another statutory order made under the Act, it is difficult to hold that the
license or the conditions in the license amount to an order made or deemed to
be made under the Act. Notification No. 23.
I.T.C./43 dated 1-7-1943 merely provides that
no goods shall be imported except goods covered by special license issued by an
authorised officer. Notification No. 2- I.T.C./48 dated 6-3-1948 authorises a
licensing officer to impose one or more conditions prescribed in that order and
a licensing officer, therefore may impose a condition in view of the provision
of Notification No. 2-I.T.C./48. But if the licensee contravenes the condition
imposed by the license it can hardly be said that he has contravened the order
under this Act, that is, the Notification No. 2-I.T.C./48. The order No.
2-I.T.C./48 does not directly impose any duty but it gives power to the
licensing officer to impose certain conditions. But contravention of condition im-
(1) A. I. R. 1957 Cal. 83.
943 posed by the licensing officer cannot
prima facie be regarded as contravention of the notified order itself.... When
there is a special license covering certain goods and there is a condition
imposed in the special license it cannot be said that by breach of the
condition imposed in the special license it cannot be said that by breach of
the condition there has been any breach of Order 231 I.T.C./43 or of the
subsequent Notification No. 2-I.T.C./ 48. It may be mentioned that the
difficulty apparently was realised in Pakistan and therefore the Imports and
Exports (Control) Act, 1947, was first amended by an ordinance and then by the
Imports and Exports (Control) Act, 1950, of Pakistan. Section 3(2) of that Act
provides that 'no goods of the specified description shall be imported or
exported except in accordance with the conditions of a license to be issued by
the Chief Controller or any other Officer authorised in this behalf by the
Central Government. The penal section 5, refers not only to contravention of an
order or Rule made under the Act but also to the contravention of any condition
imposed by the License........ It is clear that unless the penal section itself
includes the contravention of a condition of the license as an offence, it is
not possible to hold that the licensees by merely committing breach of a
condition imposed by a license has committed the offence which consists in
contravention of an order made or deemed to be made under this Act. In this
view, therefore, although the reasons given by the learned Magistrate have not
been considered by us as sound, it is clear that the prosecution of the
opposite party under s. 5 of Imports and Exports (Control) Act, 1947, must
These observations were referred to by the
majority decision of this Court in East India Commercial Co. Ltd., Cakutta v.
Collector of Customs, Cakutta (1) in the following words :- before a division
Bench of the Calcutta High Court, consisting of Mitter and Sen. JJ., and the
learned Judges, by their judgment dated March,3, 1955 dismissed the revision
holding that there had been no contravention of the order made or deemed to be
made under the Act.
The learned Judges construed s. 5 of the Act
and held that the said section penalised only a contravention of an order made
or deemed to have been made under the said Act, but did not penalise (1) 
3 S.C.R. 338 at 356, 369, 372.
944 the contravention of the conditions of
licence issued under the Act or issued under a statutory order made under that
Act, and dismissed the revision.
It will be seen from this order that it does
not provide for a condition in the licence 'that subsequent to the import the
goods should not be sold. Condition (v) of cl. (a) only empowers the licensing
authority to impose a condition from an administrative point of view. It cannot
be suggested that the condition, with which we are now concerned, is a
condition imposed from an administrative point of view, but it is a condition.
which affects the rights of parties.
It follows from the above that the
infringement of a condition in the licence not to sell the goods imported to
third parties is not an infringement of the order..................
The Division Bench considered that the
earlier Calcutta case was approved. Following the above observations the
learned Judges applied them to this case. They noted that the breach of a
condition became an offence only after the 17th of March, 1960 when Act 4 of
1960 was passed and as it could not be an offence before, even if the Order of
1955 deemed certain conditions to be a part of the licence, their breach was
not an offence. They- distinguished the decision of the Bombay High Court ill
State v. Abdul Aziz(1) on the ground that the licence in that case was granted
on January 2, 1956, that is to say, after the coming into force of the Order of
1955. The Division Bench therefore held that no offence was committed.
Adverting also to the fact that there was confusion as to which of the two-the
Company or Motilal Kanoria-was the accused the learned Judges held that the
Presidency Magistrate was further wrong in convicting Kanoria although the
prosecution was really against the Company.
The questions that arise in this case are
really two and they are :
(a) whether by disposing of the plant and
machinery without permission an offence was committed; and (1) A.L.R. 1962 Bom.
945 (b) if so, by whom ? In our judgment both
these questions must be answered in favour of the State of West Bengal. It was
overlooked in the High Court that under the proviso to clause 12 of the Order
of 1955 the licence, although granted before that Order was brought into force,
came under its terms. The words of that proviso refer to a 'licence issued'
under any of the earlier orders as something done or action taken under the
corresponding provision of the 1955 Order. The corresponding conditions were
those we have extracted from the Order of 1955 and set down earlier. By the
terms of the licence (item No. 7) the licensee undertook to use the goods himself.
He further bound himself by "any other prohibitions or regulations
affecting the importation of the goods which may be in force at the time of
their arrival" and not to transfer the licence "except under a letter
of authority from the authority who issued the licence or from any Import Trade
Controller". The goods arrived long after the Order of 1955 came into
force. By the operation of the revalidation under clause 7 and the conditions
of the licence, even as they were, the provisions of the Order of 1955 were
attracted. As clauses 5(3) and (4) became a part of the licence, their breach
was a breach of the Order and an offence was, therefore, committed.
It was decided in Abdul Aziz v. State of
Maharashtra(1) (on appeal from the case sub. nom. State v. Abdul Aziz of the
Bombay High Court) that if the licence was issued under the Order of 1955, the
provisions of sub-cl. (4) of cl. 5 made it obligatory upon the licensee to
comply with all the conditions imposed or deemed to be imposed under clause 5
and that the contravention of any condition of a licence amounted to the
contravention of the provision of sub-cl.
(4) of cl. 5 of the Order and consequently to
the contravention of the order made under the Imports and Exports (Control) Act
and therefore the licensee became liable to the penalty under s. 5 of the Act.
The only distinction between Abdul Aziz's case and this lies in the fact that
the licence in the former was given after, and in this case before, the coming
into force of Order of 1955.
But this distinction loses significance when
the provisions of clause 12 of the Order of 1955 are read in conjunction with
the licence itself. Between them they bring into operation clause 5 of the
Order of 1955 and the result reached by this Court in Abdul Aziz's case obtains
here also. The fact that the licence was revalidated presumably under clause 7
of the Order of 1955 further fortifies the above conclusion. The submission of
Mr. D. N. Mukherji that this extension was under the last paragraph of the
licence is not the whole of the matter. A power might have been reserved by
that paragraph but it could only be (1)  1 S.C.R. 830.
946 exercised by the licensing authority
after December 7, 1955 by virtue of the Order of 1955 because all previous
orders were repealed. There was thus an offence under S. 5 of the Imports and
Exports (Control) Act for the breach of clause 5 of the Order of 1955. Mr. D. N
' Mukherjee seeks to distinguish between the transference of the licence and
that of the machinery. This argument is not acceptable to us.
The licence created its own conditions that
the goods would be used by the licensee and the transfer of goods in
circumstances is tantamount to transfer of the licence. It would be refining
matters too finely to distinguish between the transfer of the licence and the
transfer of the goods.
Even if a distinction can be drawn the
licence was for the actual use of the licensee. When the goods were sold
condition No. 7 was broken and so would be a breach of the 1955 Order which had
come into force.
The final question is whether Kanoria can be
said to have committed any offence and whether he was prosecuted at all.
The section as amended in 1960 makes the
abetment of contra- vention an offence. If the amendment applied because the prosecution
was after the amendment (a point we need not decide) Kanoria would be
definitely guilty at least of abetment. In our opinion it is not necessary to
decide this point because Kanoria is guilty as a principal offender and the
section as it originally stood, must apply to him. The section said "if
any person contravenes any order made or deemed to have been made..........
"he shall be punishable with imprisonment for a term which may extend to
one year, or with fine, or with both." The question is whether Kanoria was
such a person. Kanoria was responsible for the issuance of the licence and for
the transfer of the goods covered by the licence. He wrote every document
connected with these two matters. He was, therefore, responsible principally
along with the Company. In fact the Company could not have committed the
offence of contravention if Kanoria had not acted as he did. Abetment, of which
the section now speaks, is an act of a different kind. The act of Kanoria was
not abetting any one else but one which by itself led to the contravention of
the Order of 1955 and he was, therefore, liable principally. The complaint no
doubt was not clear as to who was really meant to be prosecuted but it
described Kanoria as an accused. Under the Explanation to S. 537 of the Code of
Criminal Procedure no error, commission or irregularity in the complaint should
have led to a reversal of the finding that Kanoria was guilty unless there was.
a failure of justice. The objection that he was not named. as an accused throughout
the complaint and that he was thus not an accused could have been raised at the
trial but it was not. On the contrary Kanoria entered a plea of not guilty on
his own behalf and also stood examination as an accused.
It is obvious 94 7 that he was regarded as
the accused and he understood his own position. The objection could not be
entertained in revision in the High Court as it was belated and the defect, if
any, had not occasioned a failure of justice. This ground also has no force.
For the above reasons we are satisfied that
the High Court erred in interfering with the conviction of the respondent.
We accordingly allow the appeal, set aside
the acquittal ordered by the High Court and restore the conviction under s. 5
of the Imports and Exports (Control) Act, recorded by the Presidency Magistrate
together with the fine of Rs. 200 or simple imprisonment for one month.