The breach of a condition of a license granted under the Imports and Exports (Control) Act, 1947 is an offence under S. 5 of the Act.

Headnote:
IMPORTS AND EXPORTS (CONTROL) ACT, 1947 - SECTION 5 - CONDITIONS OF LICENCE - BREACH - OFFENCE - WHO CAN COMMIT - ABETMENT - CODE OF CRIMINAL PROCEDURE, 1898 - SECTION 537 - EXPLANATION - ERROR OR IRREGULARITY IN COMPLAINT - WHEN NOT FATAL.
Fact of the Case:

Motilal Kanoria, a director of Lachminarayan Jute Manufacturing Co. Ltd., Calcutta, was granted a license to import plant and machinery for the manufacture of hackle and combing pins. The license was subject to the condition that the goods would be used by the licensee. Kanoria, however, sold the machinery to Shalimar Wood Products (P) Ltd., without obtaining permission from the licensing authority. He was prosecuted under S. 5 of the Imports and Exports (Control) Act, 1947 for contravention of the condition of the license.
Finding of the Court:

The court held that Kanoria was guilty of contravening the condition of the license and was, therefore, liable to be punished under S. 5 of the Imports and Exports (Control) Act, 1947. The court also held that the objection that Kanoria was not named as an accused throughout the complaint and that he was thus not an accused 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.
Issues: 1. Whether the breach of a condition of a license granted under the Imports and Exports (Control) Act, 1947 is an offence under S. 5 of the Act? 2. Whether Kanoria was the person who committed the offence?
Ratio Decidendi: 1. The court held that the breach of a condition of a license granted under the Imports and Exports (Control) Act, 1947 is an offence under S. 5 of the Act. The court relied on the provisions of Cl. 5 of the Imports (Control) Order, 1955, which made it obligatory upon the licensee to comply with all the conditions imposed or deemed to be imposed under the Order. The court also held that the contravention of any condition of a license 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. 2. The court held that Kanoria was the person who committed the offence. The court noted that Kanoria was responsible for the issuance of the license and for the transfer of the goods covered by the license. He wrote every document connected with these two matters. He was therefore, responsible principally along with the Company.
Final Decision: The court allowed the appeal, set aside the acquittal ordered by the High Court and restored 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.

Judgement

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.

2. In February 1955 the Government India approved of the proposal of the Company to manufacture hackle and combing pins and sanctioned the import of plant and machinery for the 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 11, 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 issue 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 Germany.

2. Quantity and Description of goods. - Machinery as per list attached for the manufacture of Hackling and Combing pins.

3. Approximate value C. I. F. - Rupees 1,88,000 (Rupees One Lakh and Eighty-eight thousand only).

4. Period of shipment. - Revalidated upto 31st may 1957.

5. Name and Address of Manufacturer Shipper or Suppliers. M/s. Schunacher Metal Werke Aktiengeschellacheft. Aachen, Germany.

6. Limiting factor for purpose of clearing through Customs. - Value.

7. Name of actual user in India. - Self.

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 (XVIII of 1947) and subject to the rules and orders issued thereunder. 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.

26th May 1955.

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

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Judicial Analysis