The Notification dated the 3rd October, 1964, prohibiting the export of all goods to South Africa, was valid and did not violate Section 11 of the Customs Act, 1962.

Headnote:
CUSTOMS ACT, 1962 - SECTION 11 - NOTIFICATION NO. G. S. R. 1422 (NO-135-CUS/F. NO. 2/3/63-CUSTOMS VIII-CUS-TOMS), DATED THE 3RD OCTOBER, 1964 - PROHIBITION ON EXPORT OF GOODS TO SOUTH AFRICA - VALIDITY - SCOPE AND INTERPRETATION.
Fact of the Case:

The petitioner, Bird and Company (Private) Limited, was exporting lute fabrics to South Africa. The Customs authorities issued a notice to show cause why the goods should not be confiscated and the petitioner held liable to pay penalty under Section 113(d) and 114 of the Customs Act, 1962, respectively, for allegedly misdeclaring the destination of the goods in the shipping bills.
Finding of the Court:

The court held that the Notification dated the 3rd October, 1964, which prohibited the export of all goods to South Africa, was valid and did not violate Section 11 of the Customs Act, 1962. The court also held that the petitioner had not contravened the Notification as the goods were destined for Lourenco Marques in transit to Swaziland, which were outside South Africa.
Issues: 1. Whether the Notification dated the 3rd October, 1964, prohibiting the export of all goods to South Africa, was valid and did not violate Section 11 of the Customs Act, 1962? 2. Whether the petitioner had contravened the Notification by exporting goods to Lourenco Marques in transit to Swaziland.
Ratio Decidendi: 1. The court held that Section 11(1) of the Customs Act, 1962, authorized the Central Government to prohibit the import or export of goods of any "specified description". The court interpreted this to mean that the Notification must specify the goods that are prohibited, and not merely state what goods are not prohibited. 2. The court held that the Notification dated the 3rd October, 1964, satisfied this requirement as it clearly stated that the export of all goods to South Africa was prohibited, subject to certain exceptions. 3. The court also held that the petitioner had not contravened the Notification as the goods were destined for Lourenco Marques in transit to Swaziland, which were outside South Africa.
Final Decision: The court allowed the petition and issued a Writ in the nature of Mandamus directing the respondents to forthwith recall, cancel and withdraw the notice to show cause dated the 30th September, 1967 issued by the respondent No. 1 and a Writ in the nature of prohibition restraining the respondents from giving any effect to the said notice.

T. K. BASU, J.

( 1 ) THE petitioner Bird and Company (Private) Limited carries on business, inter alia, in the purchase and sale and export of lute fabrics.

( 2 ) ACCORDING to the petitioner, by an exchange of telegrams, it agreed to sell and South African Canvas Co. (Pt.) Ltd. , a Company carrying on business, inter alia, in South Africa agreed to buy 50,000 yards of Hessian cloth of certain specifications c and f Lourenco Marques and another consignment of 50,000 yards of Hessian cloth of certain other specifications c and f Lourenco Marques.

( 3 ) IT is the case of the petitioner that the ultimate destination of the goods was unknown to the petitioner at the time the contract was concluded. In any event, the petitioner would have discharged all its obligations under the aforesaid agreement if the petitioner has shipped the said goods to Lourenco Marques and the petitioner was not concerned with their ultimate destination.

( 4 ) THEREAFTER on or about the 5th July, 1967 the petitioner received from the South African Company two purchase notes dated the 29th June, 1967 from which the petitioner came to know for the first time that the ultimate destination of the goods was Swaziland. Owing to an oversight, however, the petitioner did not have the registration of the agreement amended as regards the ultimate destination of the goods.

( 5 ) ON the 25th August, 1967, the petitioner filed two shipping bills with the Customs, authorities in respect of the said shipments. In the shipping bills, the petitioner correctly stated the ultimate destination of the goods as Swaziland.

( 6 ) THE Customs authorities, however, refused to pass the goods for shipment and ultimately issued, on or about the 30th September, 1967, a notice to show cause why the said goods should not be confiscated under Section 113fd) of the Customs Act, 1962 and why the petitioner should not be held liable to pay penalty under Section 114 thereof.

( 7 ) THIS notice to show cause issued bv the Assistant Collector of Customs for Export Department to the petitioner alleges in the opening paragraphs that, in the past, the petitioner had been exporting goods to South Africa by misdeclaring their destination in the relevant shipping bills. This allegation was made with reference to certain files which had been seized by the Customs authorities from the petitioner's custody. Thereafter, the notice to show cause proceeds to state as follows :--"13. It, therefore, appears that M/s. Bird and Co. (P.) Ltd. have been exporting to South African and Southern Rhodesia misdeclaring the destination on the relative shipping bills and G. R. forms and the goods covered by the present shipping bill are also for export to South Africa. 14. Exports to South Africa are prohibited in terms of the Government of India Notification Customs No. 135 dated the 3rd October 1964, which has superseded the earlier Notification No. 2-C (6) 46-1 and 2-C (6)/46-2 dated the 17th July, 1946. This prohibition has been imposed in terms of Section 11 of the Customs Act, 1962. 15. In the context of this prohibition It appears that M/s. Bird and Co. (P.) Ltd. have filed these two shipping bills under reference in an attempt at exporting the goods to South Africa in contravention of the aforesaid prohibition and pursuant to that attempt have misdeclared the destination of the goods on the shipping bills and the relative G. R. Forms Ca. C 382640 and 382642 knowing the declaration to be false. Because of this misdeclaration an attempt at export in contravention of the prohibition under Section 11, Customs Act. 1962 the goods under reference have been rendered liable to confiscation under Section 113 (d) ibid and M/s. Bird and Co. (P.) Ltd. , liable to penal action under Section 114 ibid. "

( 8 ) IT is this notice to show cause which is challenged before me in this application.

( 9 ) P. P. Ginwalla appearing on behalf of the petitioner draws my attention to the Notification No. G. S. R. 1422 (No-135-Cus/f

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1970 Supreme(Cal) 102

HIGH COURT OF CALCUTTAT. K. BasuBIRD AND CO. (PRIVATE) LTD. - AppellantVersusASSISTANT COLLECTOR OF CUSTOMS FOR EXPORT, CALCUTTA - RespondentMatter 461 Of 1968Decided On : MAY 8, 1970

The Notification dated the 3rd October, 1964, prohibiting the export of all goods to South Africa, was valid and did not violate Section 11 of the Customs Act, 1962.

HIGH COURT OF CALCUTTA
T. K. Basu
BIRD AND CO. (PRIVATE) LTD. - Appellant
Versus
ASSISTANT COLLECTOR OF CUSTOMS FOR EXPORT, CALCUTTA - Respondent
Matter 461 Of 1968
Decided On : MAY 8, 1970