The Judgment of the Court was as follows:

Banerjee, J.:— The petitioner carries on business under the trade name of Hard Sales Agency, at no. 34, Armenian Street, Calcutta. On August 3, 1962, the office and godown of the petitioner was searched by the police and certain tins of dyes, all manufactured in foreign countries, and certain other articles were seized. On the same date the petitioner was arrested by the police, on a charge of retaining stolen properties, and was prosecuted before the Additional Presidency Magistrate, Calcutta. After a long and protracted enquiry by the police, the petitioner was discharged on September 11, 1962. While the police investigation was going on, a Deputy Superintendent of Land Customs applied before the Additional Chief Presidency Magistrate, under section 180 of the Sea Customs Act, praying that the seized goods be delivered to the Customs Department. The Additional Chief Presidency Magistrate granted the prayer and the Customs Department took possession of the seized goods from the police. The petitioner applied before the Magistrate to recover possession of the goods after his discharge but the Additional Chief Presidency Magistrate refused the prayer.

1. On November 17, 1962, the respondent Superintendent of Land Customs issued a notice to the petitioner to the following effect:

“Whereas on the evidence indicated hereinbelow there is reason to believe that the goods mentioned in the attached schedule (which were found in the premises of M/s. Hard Sales Agency, 34, Armenian Street, Calcutta) have been imported (by you) and other associate by land from foreign territory into India on or about 3.8.62 without—

(i) a valid permit under section 4 of the Land Customs Act, 1924;

(ii) a valid import licence as required under Imports [Exports Control Order 1955 dated 7.12.55 issued by the Government of India, Ministry of Commerce and industry, under section 3(i) of the Imports and Exports (Control) Act, 1947;

and accordingly the said goods are liable to be confiscated [and you are liable to a penalty under—

(i) section 5(3)/Section 7(1) of the Land Customs Act, 1924;

(ii) section 167(8) read with section 19 of the Sea Customs Act, 1878 as made applicable by section 3(2) of the Imports and Exports (Control) Act, 1947;

Brief outline of the evidence:—

(Evidence is enclosed in separate sheet)

You are, therefore, called upon to show cause before the Assistant Collector of Land Customs, Calcutta at Multistoried Buildings (2nd floor) 15/1, Strand Road, Calcutta-1 within ten days from the date hereof why penalty should not be imposed upon you and why the said goods should not be confiscated under the aforesaid provisions of law.”

2. The petitioner showed cause to the notice, in writing, inter alia, denying the allegations and stating affirmatively that he was a bonafide purchaser of the seized goods (excepting one item, of which he denied ownership). The respondent No. 1, Assistant Collector gave a hearing to the petitioner. At the hearing it was contended on behalf of the petitioner (i) that inasmuch as the goods had at first been seized by the police and thereafter delivered to the customs authorities there was no seizure of the goods under the Sea Customs Act and, therefore, section 178A of the Sea Customs Act had no application, (ii) that the onus of proving that the goods were smuggled goods was ton the Customs authorities and that in the absence of such proof, the goods were not liable to confiscation under section 167(8) of the Act. In support of his case that he was a bonafide purchaser of the seized goods, the petitioner alleged that he produced certain bills and documents. This last allegation is not admitted in the affidavit-in-opposition, nor are copies of the documents annexed to the petition before this court. We, therefore, take no notice of this last allegation.

3. The respondent No. 1, by his order dated April 16, 1963, directed confiscation of the goods under section 167(8) read with section 19 of the Sea Customs Act as made applicable under section 3(2) of the Imports and Exports (Control) Act, with the following observation:

“I have gone through the facts of the case leading to the seizure and have also heard the party in person. I am not satisfied with the explanation given by the party as regards the acquisition of foreign-made goods under seizure. They could not produce any documents to show the licit importation of these goods into India, although ample opportunities were afforded to do so. I am, therefore, satisfied that the goods under seizure were illicitly imported into India.”

4. Aggrieved by the order the petitioner moved this court, under article 227 of the Constitution, and obtained this Rule.

5. Mr. Samarendra Kumar Dutt, learned Advocate for the petitioner, contended, in the first place, that the goods had been seized from the possession of the petitioner by the police and not by the Customs authorities and thereafter the goods were caused to be delivered to the Customs authorities under orders of the Additional Chief Presidency Magistrate; and, therefore, section 178A of the Sea Customs Act, dealing with burden of proof, which applied to goods seized under the Sea Customs Act from the person in possession, would not apply. He strongly relied on the following observations in the judgment of the Supreme Court in Gian Chand v. State of Punjab, (A.I.R 1962 S.C 496) in support of his contention:

“The last part of sub-section (1) of section 178A lays the burden of proving that the goods are hot smuggled, on ‘the person from whose possession the goods are taken’. Assuredly when the goods are delivered to the Customs authorities by the Magistrate they are not taken from the possession of the person accused in a criminal, case so as to throw the burden of proof on them and that it would lead to an absurdity, to hold that the section contemplated proof to the contrary by the Magistrate under whose orders the delivery was effected.”

It would, therefore, follow that having regard to the circumstances in which the gold came into the possession of the Customs authorities, the terms of section 178A, which requires seizure under the Act were not satisfied and consequently that provision cannot be availed of to throw the burden of proving that the gold was not smuggled on the accused.”

6. He also contended that the tins of dye-stuff seized, as aforesaid, did not fall within the category of goods specified in sub-section 2 of section 178A nor were they notified goods within the meaning of that sub-section and, therefore, the burden of proving that they were smuggled goods was on the Customs authorities. Since the Customs authorities adduced no evidence about the illicit importation of the goods, it was contended, the charge was not brought home and the goods could not be confiscated.

7. We hold that Mr. Dutt is right in his contention that section 178A of the Sea Customs Act would not apply and that the burden of proving that the goods were smuggled goods was on the Customs authorities.

8. Mr. Amiya Kumar Mukherjee, learned Advocate for the respondents, tried to justify the order of confiscation on the following line of reasoning. He argued that the seized goods were all of foreign manufacture. Under section 19, in Chapter IV of the Sea Customs Act:

“The Central Government may from time to time, by notification in the Official Gazette, prohibit or restrict the bringing or taking by sea or by land goods of any specified description into or out of India, across any customs frontier as defined by the Central Government.”

9. He also invited our attention to sub-section (1) of section 3 of the Imports and Exports (Control) Act, 1947, which also similarly invested the Central Government with power to prohibit or to restrict imports and exports. Sub-section (2) of section 3 of the Act reads as hereunder set out:

“All goods to which any order under sub-section (1) applies shall be deemed to be goods of which the import or export has been prohibited or restricted under section 19 of the Sea Customs Act, 1878 and all the provisions of that Act shall have effect accordingly.”

10. He also invited our attention to clause 3 of the Imports (Control) Order 1955, which reads as follows:

“Save as otherwise provided in this order, no person shall import any goods of the description specified in Schedule I, except under, and in accordance with a licence or a Customs clearance permit granted by the Central Government or by any officer specified in schedule II.”

11. Item 6 in part V of Schedule I reads as follows:—

“Dyeing and tanning substances, all sorts, not otherwise specified, excluding wattle extract and articles specified in serial No. 5 of this part of this schedule.”

12. He lastly invited our attention to section 167(8) of the Sea Customs Act which reads as hereinbelow quoted:

“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,”

Offences Section of this Act to which offence has reference. Penalties 8. If any goods, the importation or exportation of which is for the time being prohibited or restricted by or under Chapter IV of this Act, be imported into or exported from (India) contrary to such prohibition or restriction; 18 & 19 Such goods shall be liable to confiscation; and 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.”

13. Basing on the aforesaid provisions of law, Mr. Mookerjee contended that the customs authorities discharged the initial onus upon them by proving that the seized goods were of the type of which the importation was restricted by licence; the onus thereafter, he contended, shifted on the person, in whose possession the goods were found, to prove that the same had been lawfully imported. He further contended that even if the unlawful importer may not be detected, penalty of confiscation may be imposed upon the goods unlawfully imported under section 167(8) of the Sea Customs Act. In support of this last proposition, Mr. Mookerjee referred to two decisions of this court in (2) Shew Pujan Rai v. Collector of Customs, (A.I.R 1952 Cal. 789) and in (3) W.C Khaw v. Additional Collector of Customs, (66 C.W.N 273) and also to two decisions of the Supreme Court in (4) Shew Pujan Rai v. Collector of Customs, (A.I.R 1958 S.C 845) and in (5) Pukhraj v. D.R Kohli, (A.I.R 1962 S.C 1559).

14. Once it is established that certain goods have been unlawfully imported, then in whose-so-ever possession the same may be found, the goods may be confiscated. But the burden of establishing unlawful importation is on the Customs Authorities and does not ordinarily shift on the person charged with the offence. That this is so, will appear from the following observations by the Supreme Court in (6) Ambalal v. Union of India, (A.I.R 1961, S.C 264):—

“The appropriate customs authority is empowered to make an enquiry in respect of an offence alleged to have been committed by a person under the said Acts (meaning the Sea Customs Act and the Land Customs Act), summon and examine witnesses, decide whether an offence is committed, make an order of confiscation of the goods in respect of which the offence is committed and impose penalty on the person concerned, see sections 168 and 171A of the Sea Customs Act and Sections 5 and 7 of the Land Customs Act. To such a situation, though the provisions of the Code of Criminal Procedure or the Evidence Act may not be applicable, the fundamental principles of criminal jurisprudence and of natural justice must necessarily apply. If so, the burden of proof is on the Customs authorities and they have to bring home the guilt of the person alleged to have committed a particular offence under the said Act by adducing satisfactory evidence.

But it is said that the onus shifted to the appellant for three reasons, namely, (i) by reason of section 178A of the Sea Customs Act (ii) by reason of section 5 of the Land Customs Act, and (iii) by reason of section 106 of the Evidence Act.”

15. We have already observed that section 178A of the Sea Customs Act does not apply to the facts of this case, section 5 of the Land Customs Act is not of relevant consideration in this case. So far as section 106 of the Evidence Act is concerned the Supreme Court observed in the judgment referred to above as follows:—

“We cannot accept the contention that by reason of the provisions of section 106 of the Evidence Act the onus lies on the appellant to prove that he brought the said items of goods in India in 1947. section 106 of the Evidence Act in terms does not apply to a proceeding under the said Acts. But it may be assumed that the principle underlying the section is of universal application. Under that section when any fact is specially within the knowledge of any person, the burden of proving that fact is upon him. This court in Shambu Nath Mehra v. State Of Ajmer., 1956 S.C.R 199, after considering the earlier Privy Council decisions on the interpretation of section 106 of the Evidence Act observed thus:

“The section cannot be used to undermine the well-established rule of law that save in a very exceptional class of cases the burden is on the prosecution and never shifts. If section 106 of the Evidence Act is applied, then by analogy the fundamental principles of criminal jurisprudence must equally be invoked. If so, it follows that the onus to prove the case against the appellant is on the customs authorities and they failed to discharge the burden.” ***”

16. We have, therefore, to repel the contention of Mr. Mookerjee that after proof, by the customs authorities, that the importation of the goods was restricted, the burden of proof shifted on the petitioner. Otherwise, the position in life may become intolerable. Take for example, an innocent buyer goes to the Fountain pen market to buy one “Parker 51” pen, a fountain pen of reputed foreign manufacture. If by chance, the importation of such pens be restricted by licence, then the customs authorities may any day seize the pen and call upon the buyer to prove the lawful importation of that pen in this country. This the buyer can seldom do and this will be all the more so if by efflux of time, the cash memo evidencing the purchase has been lost or destroyed or mislaid.

17. A buyer, who with the knowledge that the goods have been smuggled in this country, keeps or buys the goods may be liable to penalty. But not an innocent buyer, unless the Customs Authorities prove by affirmative evidence that the goods seized formed part of smuggled goods. In the instant case the customs authorities have failed to prove that the goods are smuggled goods. Nor have they proved that the petitioner purchased or acquired the goods with guilty knowledge of their illicit importation.

18. We, therefore, make this Rule absolute and set aside the order of confiscation.

19. The petitioner is entitled to costs, which we assess at five gold mohurs.

D. Basu, J.:— Agreeing with the judgment pronounced by my Lord, I would add a few words of my own on the question of onus and on the theory of ‘offending goods’, in particular, which was relied upon by Mr. Mukherjea on behalf of the Opposite Party.

20. The impugned order is one of confiscation of goods, to wit, some tins of imported dye-stuff, under sec. 167(8) of the Sea Customs Act, 1878, read with sec. 3(2) of the Import & Export (Control) Act, 1947,—by an order made under which Act the importation of such goods has been prohibited, save under a licence. Before proceeding further, it would be useful to refer to the provisions of sec. 167(8) of the Sea Customs Act, which reads as follows:—

Offences Section of this Act to which offence has reference. Penalties. 8. If any goods, the importation or exportation of which is for the time being prohibited or restricted by or under Chapter IV of this Act, be imported into or exported from (India) contrary to such prohibition or restriction; 18 & 19 Such goods shall be liable to confiscation; and 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.”

It is evident that before any goods may be confiscated under the above provision, the ‘offence’ specified in the first column must have been committed, and that in order to establish that such offence has been committed, three conditions must be satisfied namely:—

(a) that the importation (or exportation, as the case may be) of certain goods has been prohibited or restricted by or under Ch. IV of this Act;

(b) that the goods in question, belonging to such category, have been imported into India;

(c) that such importation has been contrary to such prohibition or restriction.

21. That the goods seized in the case before us have been imported by somebody may be inferred from the fact that they are of a foreign brand. It is also not disputed before us that the importation of dye-stuff has been duly prohibited or restricted and that if the petitioner be the importer of the goods, he has contravened the prohibition or restriction because he has no licence for the import as is required by the Imports (Control) Order.

22. But the Petitioner's case before the Customs authorities as well as before us is that he was a bona fide purchaser of the goods. The plea of the Petitioner may be stated as follows: that he himself was not the importer of the goods and that he has acquired it from somebody else on the good faith that they have been imported lawfully. It has been seen that the offence specified in column 1 of sec. 167(8) is not committed unless it is shown that the goods in question have been imported in violation of the prohibition or restriction, that is to say, that they have been illegally imported, and this has been stated by me, earlier, as ingredient (c) of the offence. The question before us is—upon whom does the onus to establish this ingredient lie? On this question, Mr. Mukherjea has advanced a twofold argument:

Firstly, it is contended that the goods in question having been seized from the possession of the petitioner, the onus lies on him to prove that they have been lawfully imported and that as he has failed to show this, the goods are liable to be confiscated.

23. Secondly, it has been contended that sec. 167(8) of the Sea Customs Act is a proceeding in rem against the ‘offending goods’, and that once it is shown that the goods seized are of foreign manufacture and belong to a class of goods, the importation of which is prohibited or restricted, the goods are liable to be confiscated, and that it is not incumbent on the Customs authorities to establish further that the goods have been imported by the person from whose possession they have been seized, or by some other person and that such person had no lawful authority for such importation.

24. I shall deal with these two contentions separately:

A. The goods in question were seized from the godown of the Petitioner who deals in dye-stuff, by the Police, and the Customs Department later took possession of the goods through the Criminal Court, by making a prayer under sec. 180 of the Sea Customs Act.

The Superintendent of Land Customs next issued the notice in Ann. G, calling upon the Petitioner to show cause, under sec. 167(8) of the Sea Customs Act and Ss. 5(3) and 7(1) of the Land Customs Act, why the goods should not be confiscated and penalty should not be imposed upon him, under those provisions. A plain reading of this notice will show that the Customs Officer threw the burden upon the Petitioner of showing that he or some other person had lawfully imported the goods seized. The relveant portions of the notice may be reproduced:

“Whereas on the evidence indicated hereinbelow there is reason to believe that the goods mentioned….have been imported (by you) and other associates by land from foreign territory on or about 3.8.62, without a valid permit…… Evidence on which show cause

Memo is based.

Acting on an information, on 3.8.62, the Police Officers….searched the premises of M/s Hard Sales Agency…., and recovered the tins of Dye-stuff of foreign origin ….The Proprietor of the said firm….could not adduce any evidence…. in support of his licit possession and legal importation of the Dye-stuff of foreign origin….

Failure of the party to adduce any evidence…. in support of the bona fide procurement and legal importation of the aforesaid dye-stuff only points to the fact that the Dye-stuff. …were illegally imported from foreign territory and hence the same were contraband. The tins of Dye-stuff in question are, therefore, liable to confiscation under the relevant provisions of laws as mentioned in the Show Cause Memo.”

It is evident that the notice required the Petitioner to establish that the goods seized had been imported by him under legal authority. Para. 11 of the Affidavit-in-opposition further makes it clear that the goods were confiscated under section 167(8) because the Petitioner failed to discharge this onus,—to be more precise,—

“as the petitioner could not adduce any evidence that the goods were legally imported.”

The Petitioner's plea before the Customs authorities as well as before us is that he was not the importer but a purchaser of the goods. According to the Respondents, the onus to prove all the facts necessary to escape confiscation is upon the Petitioner. These facts are that—

he has acquired the goods from a third person and that such person lawfully imported the goods, i.e, by virtue of a licence and in compliance with all the restrictions imposed upon the importation of such goods by the law for the time being in force.

25. The goods in question were confiscated because he failed to prove these facts.

26. The general rule relating to all criminal proceedings is that, subject to-statutory exceptions, “a criminal charge has to be established by the prosecution” (7) Lawrence v. The King, (1933) A.C 699 (707)]. This is the ‘golden thread’ running through ‘the web of the English law’, of which Viscount Sankey spoke in Woolmington's case [(1935) A.C 462 (481-2)]. In the words of Viscount Sankey, in that case, “it is the duty of the prosecution to prove the prisoner's guilt”. The corollary which follows from this proposition is that when a law lays down several ingredients to constitute an offence, the burden of establishing all those ingredients or the facts which are required to be proved for the purpose, is on the prosecution, subject, of course, to statutory exceptions, if any Viscount Sankey illustrates this corollary with reference to the offence of murder. If this rule be applicable to an offence under s. 167(8), it goes without saying that the ingredient that the goods were ‘imported into’ India ‘contrary to such prohibition or restriction’ must be established by the Customs authorities and it is not for the Petitioner to prove the negative namely, the goods were lawfully imported, either by himself or by somebody else. There is indeed a statutory exception which is relevant in this context, namely that introduced by sec. 178A. Because it is difficult for the Customs authorities to discharge the onus just mentioned in the case of goods which can be easily smuggled and because the smuggling of gold and similar valuable commodities was affecting the economic security of the country, this statutory exception was introduced, and the reasons why the Legislature was induced to engraft this exception upon the ‘golden thread’ have been explain ed by the Supreme Court in Collector of Customs v. Sampathu Chetty, A.I.R 1962 S.C 316. The provision in sec. 178A, in short, is that in respect of goods to which that section is made applicable, the State will be relieved of the burden of proving ingredient (c) under sec. 167(8) as has been referred to by me earlier, that is to say—

“the burden of proving that they are not smuggled goods shall be on the person from whose possession the goods were seized.”

27. In other words, from the mere fact of possession of any of the specified goods, the presumption will be drawn that they have been illegally imported.

28. It is, however, conceded in, the proceeding before us that sec. 178A has not been extended to the goods seized, i.e, dye-stuffs. Nevertheless, it is contended by Mr. Mukherjee that even without the aid of sec. 178A, the position should be the same, for other reasons.

29. It is argued that under sec. 106 of the Evidence Act, the burden is upon the Petitioner, from whose possession the goods have been seized, to explain how he has obtained the goods, and, if so, he is the best person to show that the goods have been lawfully imported. There are several answers to this argument:

(i) The Evidence Act does not apply to other than judicial proceedings, and, as pointed in (6) Ambalal's case [A.I.R 1961 S.C 264], it would not, in terms apply to proceedings under the Customs Act.

(ii) Even if it be held that the principle underlying the section applies, we cannot forget the explanation given to that principle by the Privy Council (10) Attygalle v. R., (1936) 2 All E.R 116] as well as the Supreme Court [(11) Shambhu v. State of Aimer, (1956) S.C.R 199 (203-4)]. It has been observed in these cases that the rule embodied in this section does not abrogate the general principle of criminal law that the burden lies on the prosecution to prove the guilt of the accused. It refers only to those cases where any fact is ‘specially’ within the knowledge of the accused, so that it is “impossible or disproportionately difficult” for the prosecution to establish such fact, and not to the case of such facts as are as much available to the prosecution with due diligence as to the accused. In the case before us, had it been admitted or proved that it is the Petitioner who had imported the goods in question, the rule in s. 106 might certainly have been available to call upon him to show that he had a licence for such importation, for, whether he had a licence or not was a fact specially within his knowledge. But where there is no such admission or proof, the burden remains with the prosecution to prove that the goods have been imported without licence either by the Petitioner or by someone else.

(iii) That it is not ‘impossible or disproportionately difficult’ for the prosecution to prove the fact of illicit importation in the generality of cases follows from the Supreme Court decisions such as (6) Arriba Lal v. Union of India, A.I.R 1961 S.C 264 or (9) Collector of Customs v. Sampathu, A.I.R 1962 S.C 316. On the other hand, as the Supreme Court had pointed out in the earlier case of (12) Babulal v. Collector of Customs, A.I.R 1957 S.C 877 (880), after an article has passed several hands and comes to an innocent purchaser it would be throwing a very ‘heavy and onerous’ burden upon him if he is asked to prove that the article was not smuggled or that it was imported lawfully, at some remote point of time. In the generality of cases, therefore, the facts relating to importation are not in the ‘special knowledge’ of the person in whose hands the goods may be found at a particular point of time,— may be, after numerous dealings in the goods since the importation.

(iv) Wherever the general rule as to burden of proof of the guilt has been reversed, it has been done by specific legislation. The English decision in (13) R. v. Fetzpatrick, (1948) 1 All E.R 769 (772), which was referred to by Mr. Mukherjee, rests on the terms of sec. 259 of the (U.K) Customs Consolidation Act, 1876 and does not introduce any general exception to the ‘golden thread’ as to the burden of proof in criminal proceedings. The observations at p. 772 of this very Report show that if sec. 259 did not apply, the onus would have remained on the prosecution.

(v) If the position were the same without sec. 178A of the Sea Customs Act, there was no sense for the Legislature enacting that section. The justification for the special exception introduced by sec. 178A, as explained in (9) Sampathu's case, A.I.R 1962 S.C 316 (324) is that there are certain valuable articles like gold which can be ‘easily smuggled’- and as to the smuggling of which a national problem had arisen. If any similar problem has arisen with respect to dye-stuff or other commodity, the solution open to the State is to bring them within the protection of sec. 178A; but unless such notification is made, it does not lie in the mouth of the Customs Department to say that the presumption of guilt from the mere fact of possession, embodied in sec. 178A, which cuts ruthlessly through ‘the golden thread’, should be available even with respect to goods to which sec. 178A does not extend, (6) Amba Lal's case [A.I.R 1961 S.C 264 (266-7)] was, in fact, a case to which sec. 178A was not attracted and the Supreme Court had no hesitation in holding that the presumption of guilt from possession could not be drawn with respect to such goods and that, accordingly,

“the burden of proof is on the customs authorities and they have to bring home the guilt to the person alleged to have committed a particular offence under the said Acts by adducing satisfactory evidence.”

30. Even a clearer authority is to be found in the case of (1) Gian Chand v. State of Punjab, A.I.R 1962 S.C 498, where the Supreme Court has laid down in unmistakable terms:

“It will be seen from the terms of sec. 167(8) that there are two distinct matters which have to be established before a person could be held guilty of the offence there set out…. It is clear that in the absence of any valid statutory provision in that behalf onus of establishing the two ingredients necessary to bring home the offence to an accused is on the prosecution.”

B. The theory of ‘offending goods’ is founded on the difference in the language of the two parts of the third column of sec. 167(8) of the Sea Customs Act: While the second part says that the penalty specified can be imposed upon “any person concerned in any such offence”, the first part merely says that “such goods shall be liable to be confiscated”. From this, it is contended that while in the case of imposition of the penalty, (the authorities must establish that there has been an illegal importation and that the person sought to be penalised has been concerned in such illegal importation, for the purpose of confiscation of the goods it is enough if the goods of which importation has been prohibited or restricted are found to be imported and it is not necessary further to establish that there was no lawful authority for the importation, whether it was the person from whose possession the goods have been seized or some other person from whom the former may have acquired them who made the importation.

31. I may at once observe that this theory may be partially good but not wholly. If the goods are res nullius and they are not seized from anybody's custody or possession, it may be open to the State to confiscate them as soon as it is found that they are goods of a foreign manufacture which could not but have been imported and that the importation of such goods is prohibited or restricted. But when the goods are seized from the possession of an individual, the State may be entitled to confiscate them only on the showing that the importation has been made in contravention of the prohibition or restriction. The reason is patent, namely, that, as stated by me earlier, both parts of col. 3 of sec. 167(8) are controlled by col. 1 thereof. In other words, so long as the ‘offence’ as specified in col. 1 is not established, there is no case either for imposing the penalty upon a person as specified in the second part of col. 3 or of proceeding against the goods themselves, by confiscating them. It follows that no goods can be confiscated unless the State discharges its onus in establishing the offence, or that it has been unlawfully imported. When the goods are not seized from the possession of any person, there will obviously be no person to challenge the act of the State and to call upon the State to establish that the ingredients of the ‘offence’ have been proved. The position is otherwise where there is a person who is affected by such confiscation.

32. It has been vehemently urged by Mr. Mukherjee that the analogy of the criminal law should not be drawn where the State is not proceeding against an individual but against the goods and the State is not purporting to punish anybody. This plea is unsound for several reasons:

It has been settled by a number of decisions of the Supreme Court that the proceedings under sec. 167(8) of the Sea Customs Act are quasi-judicial whether the State proceeds against the offending person or the goods, and, in (6) Amba Lal v. Union of India, A.I.R 1961 S.C 264 (266), it has been definitely laid down that such proceedings are ‘penal’ in character and that, accordingly, the principles of criminal jurisprudence in so far as they are based on natural justice are attracted to such proceedings. As pointed out in the passage quoted by my learned brother, if the principle underlying sec. 106 of the Evidence Act is to apply, so will be general principle of criminal jurisprudence that the burden of proving the offence is upon the prosecution. I have also referred to the observation, in (1) Gian Chand's case [A.I.R 1962 S.C 496 (498)] where the rule of criminal jurisprudence that the ingredients of an offence must be proved by the prosecution has been applied by the Supreme Court to a proceeding under sec. 167(8) of the Sea Customs Act.

33. As I have stated, at the outset, there is no question of applying either part of col. 3 of sec. 167(8) unless the ‘offence’ specified in col. 1 is established. In fact, the very expression ‘offending goods’ speaks of an ‘offence’. If so, the burden of establishing the ingredients of this offence lies upon the State, as in the case of any other offence. That forfeiture or confiscation of goods as a punishment for a statutory offence is a ‘penal’ measure is hardly open to question. It follows, if not from anything else, from sec. 183, under which the owner of the goods has the option of getting back the confiscated goods on payment of such fine as the Customs Authority thinks fit. Hence, when any goods are sought to be taken away from the possession of an individual and sought to be confiscated under sec. 167(8), he is entitled to demand the Customs Department to show that the offence specified in the first column of that section has been committed in respect of such goods.

34. There is a more deep-seated reason behind the foregoing conclusion. From the dawn of Anglo-Saxon jurisprudence, as is evidenced by the Magna Carta (and affirmed by the Confirmation Cartarum), it has been acknowledged as an essential requisite of freedom that—

“No freeman…. shall be disseized of his freehold….save by….the law of the land.”

35. The other part of the clause is—

“No man shall be taken or imprisoned….save by ….the law of the land.”

36. Thus, life, liberty and property are alike placed on the same footing, to assert that a person cannot be deprived by the State of these essentials of human existence except under the authority of the law. As explained by the Privy Council in Eshugbavi's case, A.I.R 1931 P.C 248 (252)—

“In accordance with British jurisprudence no member of the Executive can interfere with the liberty or property of a British subject except on the condition that he can support the legality of his action before a Court of Justice. And it is the tradition of British justice that Judges should not shrink from deciding such issues in the face of the Executive.”

37. Paraphrased by Dicey, the doctrine means that no man can be punished whether in respect of his life, liberty or property, except for violation of a ‘law’, that is, after an ‘offence’ is established in the ordinary legal manner (Dicey, Law of the Constitution, 1959, pp. 202-3). This also follows from the celebrated dictum of Lord Campden on the early case of (15) Entick v. Carrington, (1765) 10 St. Tr. 1067. It follows that if the law itself has laid down the conditions which must be satisfied before it can be held that it has been violated, so as to justify the deprivation of individual property, there cannot be any such deprivation before such conditions are satisfied. As explained by Viscount Simonds in the modern case of (16) East Riding County Council v. Park Estate, (1956) 2 All. E.R 699 (672), even where the Legislature has evinced an intention to encroach upon private rights, “the court must insist on strict and rigid adherence to formalities.”

38. Under our Constitution, the above principle has been enshrined as the ‘fundamental right’ of a person, in two Articles, namely, Art. 21, relating to life and personal liberty, and Art. 31(1), relating to property. The latter says—

“No person shall be deprived of his property save by authority of law.”

39. No logic is required to assert that confiscation of goods seized from the possession of a person is deprivation of his property, within the meaning of Art. 31(1). If any authority is required, I may refer to the Supreme Court decisions such as (17) Ananda v. State of Orissa, (1955) 2 S.C.R 919, (18) Wazir v. State of U.P, (1955) 1 S.C.R 408. In Wazir's case, goods were seized from his possession by the Police for the purpose of investigation into an alleged offence. Wazir made an application under Art. 226, challenging the act of the Police as being, inter alia, in contravention of Art. 31(1). It was found that the Police had taken no orders from the Magistrate for the seizure and that there was no law under which the seizure could be justified. Wazir's title to the goods was questioned by the Police, but it was held by the Supreme Court that since the goods were taken from the possession of Wazir, it was the duty of the Police to establish that they had legal authority for the deprivation. Irrespective of the title of the person from whose possession the goods have been taken, he has, under Art. 31(1) the fundamental right to challenge the act of the Police and to demand proof of the legal authority under which the deprivation has been made.

40. A citizen has another fundamental right with respect to the property in his possession, and that fundamental right would be infringed if we accept the interpretation sought to be given to sec. 167(8) on behalf of the Opposite Party, namely, that even outside the sweep of sec. 178A, the presumption that the goods have been unlawfully imported could be drawn from the mere fact of possession of goods of a foreign manufacture, thus throwing the burden to prove that sec. 167(8) has not been violated, upon the person from whose possession the goods has been seized for confiscation. That fundamental right is embodied in Art. 19(1)(f) of the Constitution which says that—

“A citizen shall have the right to acquire, hold and dispose of property.”

41. It is obvious that the power of the State to seize and confiscate any property in the possession of a citizen is an infringement of this fundamental right. Clause (5) of the same Article, however, authorises the State to impose ‘reasonable restrictions’ upon this right ‘in the interests of the general public’, by making laws in that behalf. It is settled since the case of (19) Chintamanrao v. State of W.P, (1950) S.C.R 759 that a restriction in excess of the requirement or object of the legislation cannot be said to be ‘reasonable’. It is also settled that in determining the reasonableness of a restriction.

“the nature of the right alleged to have been infringed, the underlying purpose of the restrictions imposed, the extent and urgency of the evil sought to be remedied thereby, the disproportion of the imposition, the prevailing conditions at the time, should all enter into the judicial verdict” [State of Madras v. Roto, (1952) S.C.R 597(607)].

42. That the reversal of the onus of proof in a penal proceeding is a serious inroad upon the cherished rights of the people, whether in England or in India,- where the Anglo-Saxon common law rights of the individual have been further fortified by a constitutional guarantee,— has been already demonstrated by the foregoing discussion. Nevertheless, in (9) Collector v. Sari path, A.I.R 1962 S.C 316, the Supreme Court upheld the reasonableness of such reversal by sec. 178A of the Sea Customs Act in view of the extraordinary circumstances relating to the smuggling of gold and similar valuable articles which can be ‘easily smuggled’. It is to be noted that the argument of the Solicitor-General, which their Lordships upheld was that

“the impugned provision had to be judged in the light of the widespread smuggling in commodities like gold which if not checked was calculated to destroy national economy and hamper economic stability and progress, and that no reasonable alternative to the provision would achieve the desired end.”

43. Accepting this argument, their Lordships, speaking through Ayyangar, J., observed—

“In this connection he (the Solicitor-General) drew our attention to the Report of the Taxation Enquiry Commission…… which pointed out the factual position regarding the existence of widespread smuggling in certain commodities including, inter alia, gold…. it is not in dispute that the prevention and that this is sought to be achieved by the relevant law. If therefore for the purpose of achieving the desired objective and to ensure that the intentions of Parliament shall not be defeated a law is enacted which operates somewhat harshly on a small section of the public, taken in conjunction with the position that without a law in that form and with that amplitude smuggling might not be possible of being effectively checked, the question arises whether the law could be held to be violative of the freedom guaranteed by Art. 19(1)(f) and (g)….We would answer this in the negative….”

44. Had Parliament considered that the situation as to the importation of all commodities had reached the same gravity as in the case of gold, diamond, precious stones, cigarettes and cosmetics, it would certainly not have mentioned only these particular items in sub-sec. (2) of sec. 178A. Nor has the Central Government in whom power is vested by the sub-section to add to the list by issuing a notification, realised any such position to all importable commodities or with respect to dye-stuff in particular.

45. The reasonableness of sec. 178A has been upheld on the ground, inter alia, that, being applicable to particular specified goods, it would operate harshly only on a small section of the public. But the same cannot be predicated if the same reversal of onus is extended to any or all importable goods, the import of which has been prohibited or restricted by the Government. Even the Customs authorities themselves sell confiscated goods by public auction and these auctioned goods find their place into the open market. If an honest purchaser, while purchasing such articles from a retailer, does not insist on the production of proof of lawful importation or of such purchase at public auction or misses his own cash memo and is unable to trace from whom he purchased it, he is liable to be ‘disseised’ of his pen, watch and numerous like articles, though they were imported goods sold under the authority of law. Nor has it been demonstrated, as in the case of gold and similar articles to which sec. 178A relates, that the importation without lawful authority of other goods is “not possible of being effectively checked” but by throwing the burden of proof upon the person from whom the goods are seized, for, the Central Government has not exercised the power which has been vested in it by sec. 178A(2), exactly to meet such a situation whenever it arises in respect of particular goods other than those specified by the Legislature itself.

46. In this state of affairs, sec. 167(8) would offend against Art. 19(1)(f), upon the authority of the decision in Sampathu's case itself, A.I.R 1962 S.C 316, if we were to reverse the onus of proof and to hold that the burden of showing lawful importation is upon the person whose goods are sought to be confiscated, even though the special statutory exception in sec. 178A is not attracted. No court would give such an interpretation to a statute as would render it unconstitutional.

47. Mr. Mukherjee, lastly, has relied very much upon the observations of the Supreme Court in (5) Pukhraj v. Kohli, A.I.R 1962 S.C 1559, in support of his theory of ‘offending goods’. But those observations, as I read them, go against him. It is to be noted that that was a case of confiscation of gold to which sec. 178A was applicable. Their Lordships, speaking through Gajendragadkar, J. (as he then was), first explained how the offence under sec. 167(8) was to be established in the generality of cases and then the modification of that general principle as introduced by sec. 178A. The general proposition relating to confiscation of goods under sec. 167(8) is as follows:—

“Section 167(8) clearly provides, inter alia, that if any goods, the importation of which if for the time being prohibited or restricted by or under Chapter IV of the Act, be imported into India contrary to such prohibition or restriction such goods shall be liable to confiscation. If sec. 167(8) applies, then there can be no doubt that as soon as it is shown that certain goods have been imported contrary to the statutory prohibition or restriction, they are liable to confiscation and the confiscation of the said goods is not based on the fact that they are necessarily found with a person who was concerned with their imporation. Therefore, once sec. 167(8) is held to be applicable, the validity of the order directing the confiscation of the smuggled goods is beyond any challenge.”

48. The novelty introduced by sec. 178A is the reversal of the burden of proof as explained above. This is as follows:—

“Now sec. 178A places the bur — of proving that the goods are not smuggled goods on the person from whose possession the said goods are seized, where it appears that the said goods are seized under the provisions of the Sea Customs Act in the reasonable belief that they are smuggled goods. Once it is shown that the goods were seized in the manner contemplated by the first part of sec. 178A, it would be for the appellant to prove that the goods were not smuggled goods.”

49. It is evident from the foregoing observations that the court expressed the definite opinion that outside sec. 178A, the onus of establishing that the goods in question “have been imported contrary to the statutory prohibition or restriction” and so long as this burden is not discharged by the Government, there is no question of confiscation of the goods under sec. 167(8). Of course, the so-called theory of ‘offending goods’ has a meaning, if properly understood, namely, that for the purpose of confiscation of the goods, under the first part of col. 3—

(a) it is not necessary to establish further that the person from whose possession the goods have been seized, is concerned with the illegal importation, as it is necessary for awarding penalty under the second part of col. 3;

(b) the question of bona fides of the person from whose possession the goods have been taken is immaterial, once it is shown that the goods, by whomsoever the importation may have been made, were imported in contravention of the statutory prohibition or restriction, referred to.

50. But the Customs authorities are not relieved from their burden, in cases where sec. 178A is not attracted, of establishing that the prohibition or restriction has been contravened in the importation of the goods, merely because they want to proceed against the goods and not against the person from whose possession the goods have been seized or any other person.

51. I, therefore, concur in the order proposed by my learned brother.

S.K.B