The penalty imposed under Section 167, Item 8 of the Sea Customs Act, 1878 can exceed Rs. 1,000/-.

JUDGMENT - Chagla, C.J.

1. These three appeals raise a common question and the question is with regard to the power of the Customs Authorities under Section 167 item 8 of the Sea Customs Act, 1878, to impose a penalty exceeding Rs. 1,000/- in respect of goods which have been imported into India contrary to there being a prohibition against importation of the goods or restriction upon the importation of the goods.

2. Now, Section 167 provides that the offences mentioned in the first column of the following schedule shall be punishable to the extent mentioned in the third column of the same with reference to such offences respectively; and the penalty mentioned in the third column with regard to item 8 is that such goods shall be liable to confiscation and that any person concerned in any such offence shall be liable to a penalty not exceeding three times the value of the goods, or not exceeding one thousand rupees. In each of these three appeals, the Customs authorities have imposed a penalty exceeding Rs. 1,000/-. Their contention is that the penalty they have imposed does not exceed three times the value of the goods and that it is open to them either to impose the penalty which does not exceed three times the value of the goods or which does not exceed Rs. 1,000/-. On the other hand, the contention of the other side is that there is a limitation upon the power of the Customs Authorities with regard to the imposing of the penalty and that limitation is that they cannot impose a penalty which exceeds Rs. 1,000/-. In other words, it is contended that whatever may be the value of the goods, the maximum penalty that the customs authorities can impose is Rs. 1,000/-.

3. This very point came before me for consideration when I was dealing with Criminal Revisional Application No. 1203 of 1951, decided on 14th December 1951. In that case, the Collector of Central Excise had imposed a penalty upon the petitioner in the sum of Rs. 10,000/- under item 8 of the Section 167. The petitioner did not pay the penalty. An application was made for enforcing the penalty by the Collector, and the Chief Presidency Magistrate ordered a distress warrant to issue for recovery of the same by attachment and sale of the property of the petitioner. A notice was taken out by the petitioner for raising the attachment and that notice was discharged by the learned Chief Presidency Magistrate. It was against that order of the learned Chief Presidency Magistrate that the revisional application was preferred and the same argument which is now being advanced was advanced before me with regard to the power of the Collector to impose the penalty. In that judgment I pointed out that item 8 confers jurisdiction upon the appropriate authority to impose a fine which may either be regulated by the value of the goods, in which case it must not exceed Rs. 1,000/-; and that, if the order of penalty satisfied either of these two conditions, then the order is valid. I also pointed out in my judgment why this alternative was provided. There may be goods which may have very small value, they may be worth a rupee or two. In such cases, if the only penalty which the officer could impose was a penalty not exceeding three times the value of the goods, then his power to impose a penalty would be of a very small amount. In such a case, the officer could fall back upon the latter part of the item and impose a penalty on the person contravening Sections 18 and 19 in a sum not exceeding Rs. 1,000/- or there may be a case where it would be difficult, if not impossible, to value the goods, in which case also the officer could exercise his power under the latter part of the item. I also pointed out that in asking me to limit the power conferred upon the customs authorities, I was being asked to read in item 8 words to this effect : "shall be liable to a penalty not exceeding three times the value of the goods or not exceeding Rs. 1,000/- whichever is less", and I stated that I saw no warra

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