Masud, J.@mdashThis appeal has been preferred against the judgment and order of B. Banerjee J. dated May 3, 1969, on a writ petition, setting aside the impugned order of the Collector of Customs dated May 25, 1963, whereby the Respondent No. 1 was asked to pay to the Appellant a sum of Rs. 1,00,000 as penalty u/s 112 of the Customs Act, 1962. The facts of the case may briefly be stated as follows:
The Union Steamship Co. of New Zealand, the Respondent No. 2, carried on the business of carriage of goods and passengers by sea. One of the ships belonging to the said Steamship Co. was named M.V. Wairimu. M/s. Mackinnon and Mackenzie Pvt. Ltd., the Respondent No. 3 of premises No. 16 Strand Road, Calcutta, acted as the steamer agents at the port of Calcutta for the ships of the said Steamship Co. The Respondent No. 1 was the master of the said ship who on February 14, 1963, brought the said ship and cargo at the port of Calcutta from Wellington after calling at several intermediate ports. After the arrival of the said ship at the port of Calcutta the Customs officers examined the cargo of the said ship and discovered large quantities of contraband goods such as transistors, radios, wrist watches, fountain pens, cosmetics and other consumer goods. After several notices dated February 21, 1963, February 23, 1963 and March 22, 1963, the Respondents were called upon to show cause why the said goods and the ship should not be confiscated under Sections 111 and 115 of the Customs Act, 1962 and also why penalty should not be imposed on the master of the ship u/s 112 of the said Act, by affidavits and declarations the Respondents denied any knowledge of ownership of the said goods and also the existence of the same in the said ship. The said goods were kept concealed in such a way that the master of the said ship would not be reasonably expected to have any idea about the said contraband goods. It has also been stated that the master and all the officers had taken all reasonable precautions to prevent smuggling of those contraband goods. On May 21, 1963, Mr. S.P. Srivastava, the then Collector of Customs, gave a hearing to the Respondents and/or their agents and on May 25, 1963, the said Collector of Customs passed the order No. 38 in respect of the charges in the said notices giving his reasons for his decision. The order was communicated to the Respondent on June 27, 1963. By the said order it was held that the said ship was not liable to confiscation u/s 115(2) of the said Act. The Collector of Customs, however, held the master to be guilty of the offence u/s 112 of the Act and accordingly, imposed upon the latter a personal penalty of Rs. 1,00,000 u/s 112(a)(1). As the Customs authorities could not allow the said ship to leave the Calcutta port until the payment of the said penalty was made by the master, the said sum of Rs. 1,00,000 was paid. Thereafter, the ship left the port of Calcutta. On November 8, 1963, the master filed an application under Articles 226 and 227 of the Constitution for setting aside the said order No. 38 dated May 25, 1963. On April 23, 1968, Banerjee J. set aside and quashed that part of the order which imposed the said penalty of Rs. 1,00,000. On May 2, 1969, the present appeal was filed against the said order of Banerjee J.
2. Admittedly, the Collector of Customs has held that the said ship has not become liable to confiscation u/s 113 of the said Customs Act. There is also no dispute that the goods seized by the Customs officers are dutiable and prohibited. It is also obvious that in the course of rummaging of the ship the contraband goods were seized under very suspicious circumstances in four sizeable gunny bags, in the engine room of the vessel which did not bear any mark or number whatsoever, nor have they been declared in the import general manifest or stores list or personal list or any other ship''s paper. There bags contained, inter alia, 500 pieces Nelson wrist watches, 1740 pieces lipsticks, 3599 pieces watch bands, 20 pieces mini sharp stereophonic transistor radios and a tape recorder transistor radio. Similarly, from the ice and meat ''chambers of the thaw room on board the ship similar goods were found out. The key to lock of the thaw room was produced by Mr. W.H. Thynne, chief cook. The Customs officers also opened the plate of bilge separator situated in the workship of the engine room and brought out several card-board boxes and 18 bottles of after-shave lotion, 15 Koda colour films, M.T. radio cases and M.T. camera cases were found. Besides, movie camera, still camera, nylon fabrics, fountain-pens, many other dutiable and apprehended goods were seized. For obvious reasons everybody in the ship denied the existence or ownership of the said goods nor were they claimed by any person. Consequently, the Collector of Customs by the impugned order dated May 25, 1963, confiscated them. By the said order, however, the Collector of Customs held the master of the ship guilty of the offence u/s 112 of the said Act and imposed on the master a personal penalty of Rs. 1,00,000 u/s 112(i) of the said Customs Act. The question to be decided, therefore, is limited to the short point whether in the facts and circumstances of this case that part of the order imposing personal penalty of Rs. 1,00,000 can be sustained under the provisions of the law in force between February 15, 1963 and February 23, 1973.
3. The material provisions of Section 112 of the Customs Act, 1962, read as follows:
112. Penalty for improper importation of goods, etc. Any person--
(a) Who, in relation to any goods, does or omits to do any act which act or omission would render such goods liable to confiscation u/s 111 or abets the doing or omission of such an act, or
(b) who acquires possession of or in any way is concerned in carrying, removing, depositing, harbouring, keeping, concealing, selling or purchasing or in any other manner dealing with any goods which he knows or has reason to believe are liable to confiscation u/s 111 shall be liable,
(i) in the case of goods in respect of which any prohibition is in force under this Act or any other law for the time being in force, to a penalty not exceeding five times the value of the goods or one thousand rupees whichever is the greater;
The penalty imposed under this Section obviously attracts any person which must include the master also in relation to any act or omission which would render such goods liable to confiscation u/s 111. The relevant provisions of Section 111 are stated as follows:
111. Confiscation of improperly imported goods, etc.
The following goods brought from a plate outside India shall be liable to confiscation--
* * * *
(d) Any goods which are imported or attempted to be imported or are brought within the Indian customs water for the purpose of being imported, contrary to any prohibition imposed by or under this Act or any other law for the time being in force;
(e) Any dutiable or prohibited goods found concealed in any manner in any conveyance;
(f) Any dutiable or prohibited goods required to be mentioned under the Regulations in the Import Manifest or Import Report which are not so mentioned;
(i) Any dutiable or prohibited goods found concealed in any manner in any package either before or after the unloading thereof;
Thus, imposition of penalty u/s 112(i) can be made if the master against whom the penalty has been imposed had done or omitted to do anything which would make the goods liable for confiscation u/s 111(d), (e), (f) and (i).
4. Mr. G.P. Kar, with Mr. P.K. Das, counsel for the Appellant, has submitted that the learned Judge has erred in holding that the penalty cannot be imposed on the master u/s 112 read with Section 111(f). According to them, the learned Judge has erred in overlooking the provisions of Section 111(d), (e) and (i). It is also argued that even assuming that the goods were not properly confiscated u/s 111(f) the said goods cannot escape confiscation u/s 111(d), (e) and (i). Reference has also been made to Section 30(3), relevant portions of which read as follows:
30. Delivery of Import Manifest or Import Report--
* * * *
(3) If the proper officer is satisfied that the Import Manifest or Import Report is in any way incorrect or incomplete and that there was no fraudulent intention, he may permit it to be amended or supplemented.
It is also contended by them that the learned Judge was wrong in construing the word ''may'' in Section 30(3) as ''shall''. It has also been submitted that the imposition of penalty on the master is justified u/s 112(i) inasmuch as the said Section imposes an absolute liability and as such, the proof of mens rea is not at all necessary in the said Section. In support of the said contention reliance has been placed on
5. Mr. B. Das with Mr. S. Mazumdar and Netai Das, counsel for the Respondent No. 1, has justified the order of Banerjee J. on various grounds. References have been made by them to the notice dated February 21, 1963, two nodes dated February 23, 1963 and also a notice dated March 22, 1963. According to them, on a construction of the said notices read with the impugned order, it is clear that the Collector of Customs imposed the penalty on the master u/s 112(i) read with Section 111(f) only. It is also urged that in the facts of this case the learned Judge is correct in holding that there is a statutory duty on the part of the Collector of Customs to have the import manifest amended u/s 30(3). They have also drawn our attention to Section 115(2) of the Customs Act, 1962, to show that the said ship was released by the impugned order on the basis of the finding of the Collector of Customs that the master had no knowledge of the existence of the prohibited goods and he had taken all precautions against the use of the ship for carriage of smuggled goods. According to them, the fact that the ship ''Wairimu'' was not made liable for confiscation u/s 115(2) clearly substantiates the fact that the owner of the ship or his agent or the master discharged the onus to prove that the ship had not been used for importing smuggled goods with the knowledge or connivance of the owner or his agent or the master. They have, therefore, contended that the Collector of Customs having found that the master had no knowledge of the existence of those smuggled goods in the ship and that all precautions were taken by the master, the latter cannot be made liable to pay the penalty imposed on him by the Collector u/s 112(i). In view of the said finding, the only course that was left open for the Collector of Customs was to allow the import manifest or import report submitted by the master to be modified or supplemented u/s 30(3).
5. In our view, there is some force in some of the contentions of the counsel for both the parties. The operative part of the impugned order reads as follows:
I hold the master''s guilty of the offence attracting the provision of Section 112 of Customs Act, 1962, in respect of the goods covered by all the aforesaid show-cause notices except the Notice No. Section 12(iv)-178/63p dated 21.1.1963, in respect of which he was not so charged and I impose on the master a personal penalty of Rs. 1,00,000 (Rupees one lakh) only u/s 112(i) of the Customs Act, 1962.
6. This order shows that the said penalty has been imposed on the master in respect of the goods mentioned in the four show-cause notices--no. Section 12(iv)-178/63p dated February 21, 1963, No. Section 12(iv)-188/63p dated February 23, 1963, No. Section 12(iv)-223/63p dated March 22, 1963 and No. Section 12(iv)-226/63p dated March 23, 1963. The notice No. Section 12(iv)-178/63p dated February 21, 1963, refers to seizure of transistor radio, wrist watches, fountain-pens and various other unauthorized goods. A copy of this notice was forwarded to the master who was called upon to explain the matter in writing within 15 days from the date of receipt of this notice to show cause why the goods in question should not be confiscated under Clause (d) and Clause (f) of Section 111 of the Customs Act, 1962, read with Section 3(2) of the Imports and Exports (Control) Act, 1947 and why action should not be taken against him u/s 112(1) of the Customs Act. This notice was addressed to M/s. Union Steamship Co. of New Zealand, Wellington, New Zealand, owners-agents of ''S.S. Wairimu''. On the same day, another notice i.e. Section 12(iv)-188/63p dated February 23, 1963, was also addressed to the master of ''S.S. Wairimu'', King George''s Dock, East Buoys, Calcutta. Clause 8 of this notice specifically mentions:
The Master of S.S. Wairimu is hereby called upon to explain the matter in writing within 7 days of the receipt of this memo and to show cause within the same period why the goods in question shall not be confiscated under Clauses (d), (e), (f) and (i) of Section 111 of Customs Act, 1962. He is further called upon to explain within the aforesaid time why penal action should not be taken against him u/s 112 of Customs Act, 1962.
The next notice, i.e. No. Section 12(iv)-223/63p was addressed to the master and also to M/s. Mackinnon and Mackenzie Pvt. Ltd., Calcutta. Clauses 5 and 6 of this notice also called upon the master to show cause why he should not be liable to penal action u/s 112(a) of the said Act. The last notice, i.e. No. 12(iv)-226/63p was addressed to the said M/s. Union Steamship Co. Pvt. Ltd., New Zealand and M/s. Mackinnon and Mackenzie Pvt. Ltd., Calcutta. This notice or a copy was not served upon the master, but in Clause 7 it is stated that the master was also liable to penal action u/s 112(a) of the said Act for omission to inclusion of the dutiable and prohibited goods in the import general manifest. All these facts show that at least by the notices dated February 23, 1963 and March 23, 1963, the master was expressly asked to show cause why a penalty should not be imposed u/s 112 in respect of the goods confiscated u/s 111(d), (e), (f) and (i).
7. The Collector in the impugned order has stated:
In the circumstances of the present case I am of the view that the ship has not become liable to confiscation u/s 115 of Customs Act, 1962. I, however, hold the Master liable for action u/s 112 of the said Act. The goods seized by the Customs officers are clearly dutiable and prohibited. It was duty of the Master to declare the goods in the Manifest. The Master cannot be absolved of his liability in the present case merely on the ground that he was ignorant about the existence of these goods on board the vessel. It is evident in the present case that due diligence for ensuring that all that was on board was declared in the Manifest was not exercised.
Section 115(2), as set out above, provides that the ship is liable to confiscation unless its owner proves that it was carrying the smuggled goods without the knowledge or connivance of the owner, its agent and person in charge of the ship and that each of them had taken all such precautions against such use of the ship as are for the time being specified in the rules. Person in charge of conveyance u/s 2(31) means the master of the vessel. Thus, the question arises whether the Collector having himself come to the conclusion that the master had no knowledge of the existence of the smuggled goods in the vessel and that having taken all precautions against the carriage of the smuggled goods as provided under the rules could be held by the same officer to be liable u/s 112 of the said Act. In our view, there is a fallacy in this contention. Section 115 deals with confiscation of conveyances including any vessel within the Indian customs water. Under Sub-section (2) such vessel could be confiscated if it carries smuggled goods, unless conditions for exemption from confiscation are satisfied. Smuggling has been defined in Section 2(39) which, in relation to any goods, means
any act or omission which will render such goods liable to confiscation u/s 111 or Section 113.
It is quite correct that the vessel cannot be confiscated, u/s 115(2) unless the owner of the conveyance...proves that it was so used without the knowledge or connivance of the owner himself as agent, if any and the person in charge of the conveyance...and that each of them had taken all such precautions against such use as are for the time being specified in the rules....
The liability to confiscation of vessel is a liability of its owner and Section 115 does not deal with the liability of the master of the vessel. Thus the sub-section only makes it clear that the ship will be liable to confiscation, if the owner allows the ship to be used for carrying smuggled goods with the knowledge or connivance of himself, the agent and the master and that each of them had taken all such precautions against the use of the vessel as are specified in the rules. As the vessel has not been made liable to confiscation, the Collector must come to the conclusion on the ground that he was satisfied that the owner had acted bona fide and that he had no knowledge or connivance of himself, his agent and his master in connection with the use of the vessel for importation or carriage of smuggled goods. But it cannot be contended, as urged by the counsel for the Respondent that the Collector must have also been convinced that the owner, his agent and the master had taken all such precautions against such use of the vessel. The two conditions for exemption of liability u/s 115(2) can be stated to be (a) the owner must prove that the vessel was not used with the knowledge or connivance of himself, his agent and the master; and (b) the owner, his agent and the master had taken all precautions against such use in accordance with the rules, if any.
8. The two conditions are conjunctive and the exemptions from confiscation can be made not only because the owner, his agent and the master had no knowledge or connivance in the existence of the said smuggled goods in the vessel but also the owner, his agent and the master had taken all precautions against the carriage of smuggled goods as provided under the rules. Thus, Section 115 imposes liability only on the owner of the vessel by confiscating the same unless the owner proves the two conditions of the exemption of liability. But the findings of the Collector vis-a-vis Section 115, as set out above in the order of the Collector, need not necessarily be an absolute bar to the liability of a penalty on any person including the master u/s 112 of the said Act. Section 115 does not refer to Section 111 or to Section 112 at all. Section 111 provides for the circumstances under which goods improperly imported can be confiscated. There is no question of any personal liability of any person in Section 111. Section 112 imposes a penalty upon any person who has acted or omitted to do any act in relation to the goods confiscated u/s 111. The Collector of Customs has held that the ship has not become liable to confiscation u/s 115. But in coming to the said conclusion he has also held that the master is liable for penalty u/s 112. One of the grounds he has mentioned is that the goods seized by the Customs officers are admittedly dutiable and prohibited. A plea of ignorance about the existence of those goods in the ship does not necessarily exonerate personal liability of the master. If the contention of the counsel for the Respondent is accepted, then in every case where a vessel is released and not confiscated, the master cannot be held liable to pay penalty at all u/s 112. In the context of the liability of the owner of the ship the Collector of Customs might have been satisfied that there was no knowledge or connivance of the owner in the importation of the smuggled goods. Thus, first condition for exemption of the liability of the owner by confiscating his vessel has been complied with by the owner. But it does not follow that the Collector has also come to the finding that the master had taken all precautions to prevent such importation. In fact, in the order of the Collector, the Collector has not expressly come to a definite finding that the master took all such precautions as provided under the rules nor can it be said that the exemption of liability u/s 115 by necessary implication leads to the conclusion that the master was diligent in the discharge of his duties.
On the contrary, in the said impugned order he has stated:
The ship has not become liable to confiscation u/s 115 of the Customs Act, 1962. I, however, hold the master liable for action u/s 112 of the said Act.
9. On a construction of the operative part of the order of the Collector, as set out earlier, it is clear that the Collector has come to the following conclusions:
(a) There has been no knowledge or connivance of the owner of the ship, its agent and the master and as such, the vessel is not liable to confiscation;
(b) the goods seized by the Customs officers are dutiable and prohibited;
(c) the master has not declared the goods in the import manifest; and
(d) the master has not exercised due diligence by not declaring the smuggled goods in the manifest.
It is true that these findings are mixed question of law and fact. But it cannot be said that by not confiscating the vessel the Collector has come to a finding of fact that the master has exercised all diligence in preventing the importation of the smuggled goods or in not declaring them in the manifest. The second limb of Section 115(2) provides that the ship is liable to confiscation if the owner, his agent or master has taken all precautions against the use of the ship as specified in the rules. But there is nothing to show before the Collector or this Bench that any rules about precautions were in force in February 1963. In the absence of any rules the condition of exemption in the second limb of Section 115(2) becomes non-existent and inoperative and therefore, there is no force in the contention of the counsel for the Respondent that in not confiscating the ship u/s 115(2) the Collector by necessary implication came to the finding that the master took all precautions against use of the ship for carrying smuggled goods. Thus, in the absence of any rules the second limb having become ineffective the ship could not be confiscated. I, therefore, hold that the order u/s 115 of the said Act, releasing the said vessel, does not follow as a matter of course that the master cannot be held liable u/s 112.
10. The operative part of the impugned order of the Collector expressly mentions the fact that the goods were confiscated under Clauses (d) and (f) of Section 111. The counsel for the Respondent has not challenged the validity of the confiscation of those goods, ft cannot be said that here is a legal nexus between the liability of any person u/s 112 and the liability of confiscation of the vessel u/s 115. But the counsel for the Respondent has argued strenuously that the act or omission to do an act within the meaning of Section 112 must have reference at least to a voluntary or conscious act or omission on the part of the person who would be liable for penalty. It has been suggested that the Collector must prove mens rea on the part of the master before imposition of any penalty u/s 112. Relying upon the State of Maharastra v. M.H. George Supra (para. 35) it is contended that as the master had no awareness or knowledge of the existence of the smuggled goods which might have been planted by some unknown persons in spite of the master''s due diligence, the master could not be said to have acted consciously in carrying those prohibited goods or omitting to declare the same in the import manifest. Reliance has also been placed by the counsel for the Respondent on
11. The said Bench Division of this Court has made the following observations in connection with imposition of penalty u/s 112 of the Customs Act. The learned Judges has made the following observations Supra (34):
Where any goods are smuggled the authorities are entitled to seize and confiscate the same wherever they found it. In other words, it is the goods that are tainted and it does not matter how and where they are found. But penalty u/s 112 is another matter altogether. Penalty can only be inflicted when in relation to such goods a person has done something or omitted to do something according to law. In
The learned Judges have made the said observation relying upon the principles laid down in the said case of
If any persons knowingly and without an intent to defraud the Government of any duty payable thereon ... acquires possession of or in any way concerned with carrying, removing, deposition, harbouring, keeping or concealing or in any manner dealing with any goods...such person shall on conviction before a Magistrate be liable to imprisonment for any term not exceeding two years or to fine or to both.
It is obvious that the charging Section of the Sea Customs Act specifically mentions the fact that a mental element such as knowledge or intention to defraud the Government is necessary. Further, in that case the accused were convicted by the First Class Magistrate of Jullunder of an offence of the said Section 167(81) for having acquired possession of smuggled gold and for carrying, keeping and a concealing the said gold with the intent to defraud the Government knowing that the gold was smuggled into India from outside and that no duty had been paid thereon. Thus, the facts of the said Supreme Court decision are distinguishable from the facts of the Calcutta case. The principle of law laid down in the State of Maharastra v. M.H. George Supra are relied upon by counsel for both the parties. This decision was based upon imposition of penalty under Sections 8(1), 23(1A) and 24(1) of the Foreign Exchange Regulations Act, 1947.
It has been held in this decision that mere voluntary act of bringing gold into India without permission of the Reserve Bank constitutes an offence. It is also held that mens rea is not an essential ingredient of an offence u/s 23(1A) read with Section 8(1). In that case the accused, a German national by birth, was a sailor by profession. In the statements that he made to the Customs authorities when he was apprehended, he stated that some persons not named by him met in Hamburg and engaged him on certain terms of remuneration for transporting clandestinely gold from Geneva to the place in the Far East. Admittedly, he was wearing a jacket which concealed in its specially designed pockets 34 bars of gold each weighing a kilo, lie handed over the gold according to has assignment to a person who contacted him at Tokyo. He made other trips subsequently being engaged in like adventures as he had succeeded in the past. The said German smuggler, as in previous trips, left Zurich by plane for Manila where he was to deliver the gold to a person there. This plane arrived in Bombay on way to Manila. The Customs authorities found out that he did not come out of the plane to the Airport lounge and accordingly, entered the plane and found him sitting there. He was asked if he had any gold with him. He denied to have any gold in his possession. Thereafter, the gold was found out from his jacket which had specially made compartments where bars of gold could be kept. This incident happened on November 28, 1902. On that date the Foreign Exchange Regulation Act, 1947, contained the following provision:
8(1). The Central Government may, by notification in the Official Gazette, order that subject to such exemptions, if any, as may be contained in the notification, no person shall except with general or special permission of the Reserve Bank and on payment of the fee, if any prescribed, bring or send into India any gold or silver or any currency notes or bank notes or coins whether Indian or foreign.
Explanation--The bringing or sending into any part or place in India of any such article as aforesaid intended to be taken out of India without being removed from the ship or conveyance in which it is being carried shall nevertheless be deemed to be bringing or, as the case may be, sending into India of that article for the purpose of this Section.
It was on the basis of this Section read with Section 23(1A) of the Foreign Exchange Regulation Act, 1947, he was prosecuted and sentenced to rigorous imprisonment for one year. His counsel before the Supreme Court contended that the intention of the accused was to smuggle gold to Manila. He had no mens rea to bring the gold into India. It is in this connection Ayyangar J. has made it clear that there is no scope for the invocation of the rule of mens rea in such cases inasmuch as there was statutory prohibition on November 28, 1962, for bringing gold in Indian water. The plea that the said German smuggler intended to smuggle gold to Manila or any other place outside India is irrelevant. But the learned Judge has made it clear that although the accused had no guilty intention of importing the gold into India a person cannot be prosecuted unless the act of smuggling is voluntary and a conscious act. Applying the said principles the counsel for the Respondents has strongly argued that as the master had no knowledge of the smuggled goods in the instant case, the master cannot be said to have consciously acted or omitted to do any act u/s 112 in connection with the confiscated goods u/s 111.
12. It is well-settled now that an offence under the Customs Act is quasi-criminal in nature. One of the common defences in the cases of criminal offences is that the accused has no mens rea in committing the crime. A person might be instrumental in causing an injury or harm to an individual or to a member of the public, but he cannot be held criminally liable if he has not committed the offence with guilty intention. But there are exceptions to this general rule as in the case of special statutes which provide for offences punishable in public or national interest. Previously these offences were described as offences enjoining absolute liability of certain acts of commission or omission. But the modern jurists of the criminal jurisprudence such as Smith and Hogan preferred to use the expression ''strict liability'' in place of ''absolute liability'' in such cases. These special statutes sometimes use expressions in the charging sections such as ''intentionally'', ''wilfully'', ''knowingly'', ''without any fraudulent intent'' etc. which would show that the Legislature even in offences therein introduced an eminent of mens rea. It may be added here that in India even general crimes under Indian Penal Code are always statutory offences. In my view, to determine the question whether mens rea is necessary or not in connection with any statutory offences the words used in the statute should be the only guiding factor. Ordinarily in all criminal cases the burden of proof of an offence lies on the prosecution. But, there may be special statutes where the burden of proof may be on the accused. '' To illustrate, such special provisions are mentioned in Section 24(1) of the Foreign Exchange Regulation Act, 1947. Even in the Customs Act the onus of proof that a vessel or conveyance is not liable to be confiscated u/s 115 has been placed on the owner of such vessel or conveyance. Section 112 of the Customs Act does not, however, enjoin such burden of proof on the accused. Nor does this Section mention any such expression as ''knowingly'' or ''wilfully'' which would indicate that the Customs authorities will have to prove mens rea in the act of commission or omission of the accused. In my view, therefore, no mens rea is required for the purpose of imposition of penalty on any person u/s 112 of the Customs Act. But, at the same time, as Ayyangar J. has stated in the said Supreme Court case that the absence of such words would only show that offences relating to such acts or omissions are neutral in character. Thus, the absence of such words do not necessarily mean that there is an absolute liability of the offender and that the Customs authorities could impose penalty in all cases. But, at the same time the provisions in Section 112 of the Customs Act are not only criminal in character but also the statute imposes a very strict liability on the offender. Improper importation of goods under the Customs Act are not only anti-social and anti-national measures but also a very onerous liability has been imposed on the offender under the Imports (Control) Order. 1955, whereunder Clause 3 there has been a statutory restriction on import of prohibited goods. Clause 3 of the said order of 1955 reads as follows:
Restriction on import of certain goods--
(1) 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 an officer specified in Schedule II.
Admittedly, in the instant case, the goods confiscated u/s 111 are mentioned in the said schedule I, mentioned in Clause 3. Thus, it cannot be denied that the penal provisions in Section 112 relate to cases of a very strict liability on the part of the offender.
13. As discussed earlier there is no force in the argument of the counsel for the Respondent that as the ship was not confiscated there must have been a finding of the Collector, by necessary implication, that the master has taken all precautions against the use of the said vessel for carrying smuggled goods. But, at the same time, the contentions of the counsel for the Respondent must be accepted that as the ship has not been confiscated, the Collector must have been satisfied that the master had no knowledge or connivance of the use of such vessel for carriage of smuggled goods. But this fact by itself does not necessarily exonerate the master from being liable u/s 112. Section 112 read with Section 111 does not absolutely absolve such person of his liability if in respect of the confiscated goods he has acted or omitted to act in contravention of Section 111. Apart from the fact that the smuggling of goods has been prohibited under the Import (Control) Order, 1955, the nature of the offence involves a strict liability on the part of such person who is in charge of the vessel. Section 112 does not use the words such as ''wilfully'', ''knowingly'' or ''fraudulently''. All these facts show that there is no statutory duty for the Customs authorities to prove mens rea of the master.
14. Banerjee J. in the order under appeal has accepted the contention of the counsel for the Respondents that there is no act or omission on the part of the master within the meaning of Section 112 which makes him liable under that Section. I respectfully do not agree with the said conclusion for the following, inter alia, reasons :
15. The Collector of Customs in the operative part of the order has confiscated the smuggled goods under Clause (d) and (f) of Section 111 only, but he has held the master guilty u/s 112 in respect of the goods covered by all the show-cause notices excepting the notice No. Section 12(IV)-178/63P dated February 21, 1963. The notice to the master dated February 23, 1963, has referred to goods confiscated under Clause (d), (e), (i) and (f) of Section 111. The Collector, however, has justified his order on the ground that due diligence was not exercised by the master in not declaring the smuggled goods in the import manifest. It is true that the Collector in not confiscating the ship has by necessary implication come to the conclusion that the master had no knowledge about the smuggled goods. But, as discussed earlier, the immunity from confiscation u/s 115 has some reference to mens rea as an ingredient of an offence under that Section. But u/s 112 any person can be made liable if he has acted or omitted to act which would render the prohibited goods liable to confiscation u/s 111. As proof of mens rea is not necessary in respect of the penalty u/s 112 and as the goods admittedly involve illegal importation due diligence was expected from the master in submitting the import manifest which he is required to do under the regulations as operative on the date of the seizure. The learned Judge was right in holding that although no regulation was in force on that date under the Customs Act, the regulation under Sea Customs Act would be operative u/s 160(3). In fact, a copy of such regulations under the latter Act has been handed over to us u/s 55, Clause (34) in the Sea Customs Manual where there are mandatory provisions which require the master to declare all the goods on board. But, it is argued that, if the master had no knowledge of the existence of the prohibited goods, he cannot be made guilty of not declaring such goods or of lack of diligence on his part. It is difficult to accept this argument. The master may not have necessary knowledge required u/s 115. But, Section 112 does not exonerate him from declaring all the goods in the ship correctly. Under the regulation in force, it was incumbent upon the master to declare that the import manifest was required to be submitted at the time of the entry to the Calcutta port
a full and true account of all goods, merchandise, private luggage and parcels, all goods and properties of the crew and all ship stores : vide p. 211-13 of the Paper Book.
The import manifest in the present case has been signed by him and therefore, it cannot be said that it is an involuntary act on his part. u/s 30(1) of the Customs Act the master shall within twenty four hours after arrival of the ship at the Port shall deliver to the Customs officer an import manifest. He might not have necessary knowledge of the existence of the smuggled goods which is a relevant factor for the purpose of immunity from confiscation of the vessel. But, some degree of diligence must be required before signing the import manifest. Further, the construction put by the counsel for the Respondent would invariably exempt all masters of the ship on the plea that the ship has been released and therefore, the master had no knowledge of the existence of smuggled goods. In the facts of the present case, however, the master has not only acted but has also omitted to act in accordance with law.
He has declared the import manifest incorrectly and he has also omitted to mention the smuggled goods. Even assuming that it was not possible for him to declare the smuggled goods in the manifest in view of the fact that he had no knowledge of the existence of those goods, even u/s 30(3) he did not seek the permission of the Customs authorities to have the said manifest amended or supplemented. He exercised no diligence in filling the import manifest form. Even assuming that he had no ''fraudulent intention'' within the meaning of Section 30(3) he should have asked the Customs authorities to allow him to amend the said manifest at the time when the smuggled goods were discovered, that is, the period between February 15, 1963 and February 23, 1963. There is only a belated suggestion in the reply of the Respondents to the Appellant''s notices that the Customs authorities could have amended the import manifest u/s 30(3). But, this suggestion was made in the said reply as late as in April 1963. It may be stated here that I find no justification in the learned Judge''s conclusion that the word ''may'' in Section 30(3) should be construed as ''must''. It is quite possible that the Customs authorities may not be satisfied in a proper case that the goods were smuggled without any fraudulent intent and in such a case it is the discretion of the Customs authorities to allow the master to have the manifest amended at the time when the smuggled goods were discovered. We are not satisfied that the master in the present case applied to the Customs authorities for amendment of the manifest at the time of the seizure of the goods.
16. There is another reason why the master should have been more careful in checking up the cargo in the vessel before the declaration of the manifest. This very ship ''Wairimu'' left Singapore on February 1, 1963 and Port Swettenham on February 6, 1963 and Penang on February 9, 1963. At the said ports, investigations were carried out and smuggled goods were found concealed on board the said ship. These facts would appear from the statutory declarations filed by Nicolas Allen Harvay of Singapore, Paul Brian Shove of Swettenham and George Charles Randell of Penang, all of whom are responsible officers of shipping agents in those places. These declarations were made only for the purpose of proving that the shipping agents of the owners of the said vessel of those ports had no knowledge of the existence of the smuggled goods. But, it is difficult to believe that the master did not come to know the results of the earlier investigations at the said three ports.
17. Further, it is extra-ordinary that the Respondents have relied upon a document dated March 2, 1963, where the master is alleged to have made a declaration before a Notary Public to the following effect:
That no interference with their personal privacy would be tolerated by the New Zealand crews nor would they assist in rummaging unless and until expressly required to do so by rules made by the Indian authorities under the provisions of the Indian Customs Act, as aforesaid.
It is significant that save and except the declaration of the master before the Notary Public at Colombo on March 2, 1963, no affidavit has been filed by him in this matter. Be that as it may, it is difficult to accept the explanation of the master that it was not possible for him to check up the cargo in the vessel on account of the strong pressure of the Trade Union of the crewmen involving interference with their privacy. There is a great danger in accepting such a plea as otherwise every master will escape the liability u/s 112 and smuggled goods can be carried freely on the ground of inability to interfere with the privacy of crewmen.
18. I am, therefore, satisfied that the master has submitted the import manifest incorrectly or has omitted to declare the dutiable or prohibited goods required to be mentioned under the regulations relating to the import manifest and has thus caused improper importation of goods u/s 111(f). I also agree with the findings of the Collector of Customs that the master cannot be absolved of his liability merely on the ground that the latter was ignorant about the existence of these goods in the vessel. He is also correct in his views that due diligence was not exercised by the master in not declaring in the manifest all the cargo in the said vessel.
19. For all the reasons stated above, the order of Banerjee J. is set aside and the appeal is allowed. The parties will bear their own costs.
S.K. Mukherjea J.
20. As my Lord has stated in his judgment the facts of the case in some detail, it is only necessary for me to address myself to those aspects of the case which, in my opinion, deserve attention. Before I do so, in order to dispel certain misapprehension I should like to allude to the declarations made before the Notary Public by the steamer''s agents at the intermediate ports of Penang and Swettenham which were relied on by the Petitioners in the proceedings before the Collector of Customs. The declarations are in identical terms. Paragraph 7 of the declaration made at Penang reads as follows:
Investigations were carried out at Penang by the said Agents of the said motor vessel ''Wairimu'' and the result of these investigations show that the transistor radios, watches and other consumer goods found concealed in various parts of the said motor vessel were carried concealed on board the said motor vessel without the knowledge or connivance of the said agents of the said motor vessel.
21. From this it was sought to be argued that these investigations revealed that at the port of Penang the smuggled goods were found concealed on board. If para. 7 is Mad with the paragraph immediately preceding it, it will be clear that the steamer''s agents intended to say, relying on the result of rummaging at Calcutta, that the goods were found concealed on board in the Port of Calcutta. If these smuggled goods had been discovered at Penang, the master would have surely known about it and if he carried those goods on board to Calcutta with the knowledge that the ship was so being used, the ship would have been liable to confiscation u/s 115 (Customs Act). The Collector did not read the declaration in that manner. It seems to me that by the declarations the agents did not mean that any smuggled goods were found concealed at any of the intermediate ports.
22. On rummaging, the Customs officers found a considerable quantity of prohibited goods concealed on board. Those goods were not, as was to be expected, declared in the import manifest. No one claimed property in these goods and the Collector of Customs, after hearing of the case, confiscated the goods under Sections 111(d) and 111(f) by the order dated May 25, 1963, without any objection. By the said order he also held that the ship was not liable to confiscation u/s 115 (Customs Act) by which the Collector presumably meant Sub-section (2) of Section 115 the material portion of which reads as follows:
Section 115(2) : Any conveyance or animal used as a means of transport in the smuggling of any goods or in the carriage of any smuggled goods shall be liable to confiscation, unless the owner of the conveyance or animal proves that it was so used without the knowledge or connivance of the owner himself, his agent, if any and the person in charge of the conveyance or animal and that each of them had taken all such precautions against such use as are for the time being specified in the rules.
In the context of the sub-section, if a ship is found not liable to confiscation, the finding necessarily implies that the Collector was satisfied that (i) the owner of the ship had proved that the ship was used as a means of transport in the carriage of the smuggled goods or as a means of transport in the smuggling of any goods without the knowledge or connivance of the owner himself, his agents, if any and the person in charge of the ship, that is to say the master and (ii) that the owner, his agents and the master had taken all precautions against such use as are, for the time being, specified in the rules.
23. It should be borne in mind that under the sub-section the owner, his agents and the person in charge of the ship are under no obligation to take all imaginable precautions against use of the vessel as a means of transport for smuggling of any goods or in the carriage of smuggled goods; the sub-section merely imposes the duty to take such precautions as are specified in the rules. We invited counsel to produce before us such rules either under the Customs Act, 1962, or under the Sea Customs Act, 1878, but in vain. In these circumstances, we have to proceed on the basis that no such rules are in existence. That, of course, does not mean that in the absence of the rules, the owner, his agents and the master have no duty in the matter. They have a duty to take all reasonable precautions against such use of the vessel. The duty is there independently of rules because taking such precautions has a direct bearing on the proof of the fact that the person concerned had no knowledge of the kind spoken of in the first limb of Sub-section (2). If reasonable precautions are not taken, disclaimer of knowledge may not be of any assistance to the persons concerned in discharging the onus placed on them under the sub-section. We may only point out that sooner the rules contemplated in the sub-section are made and brought into force, the better it will be for administration of the Customs Act.
24. In the absence of the rules, I am of opinion that in the facts of the present case the Collector was satisfied that reasonable precautions against improper use of the ship had not been taken.
25. The Collector by his order imposed on the master a personal penalty of Rs. 1,00,000. He said in course of his report:
I, however, hold the master is liable for action u/s 112 of the said Act. The goods seized by the Customs officers are clearly dutiable and prohibited. It was the duty of the master to declare the goods in the manifest. The master cannot be absolved of his liability in the present case merely on the ground that he was ignorant about the existence of these goods on board the vessel. It is evident in the present case that due diligence for ensuring that all that was on board was declared in the, manifest was not exercised.
26. The master, who is the Respondent No. 1 before us, successfully challenged the order for personal penalty before the learned Judge. It is clear from the order that the penalty was imposed on the master for omission to declare the smuggled goods in the import manifest which made those goods liable to confiscation u/s 111(f) (Customs Act). In fact, the goods were confiscated u/s 111(f) as also u/s 111(d).
27. It was contended that having regard to the findings of the Collector that the master had no knowledge that the ship was being used as a means of transport in the smuggling of any goods or in the carriage of any smuggled goods, the master could not be reasonably expected to declare those goods in the manifest. A finding that due diligence for ensuring that all that was on board was declared in the manifest was not exercised is, therefore, clearly unjustified. The argument is that the findings contradict each other.
28. In my opinion, there is no substance in these submissions. The master has a duty u/s 30 to deliver the import manifest within twenty four hours after arrival of the ship at a Customs station. Apart from whether he has any knowledge that the ship had been used as a means of transport for smuggling of any goods or in the carriage of any smuggled goods, when the ship arrives at the Port the master must also open his eyes wide enough. Before delivering the import manifest he has a duty to check up and ascertain what goods the ship has brought to the Customs station so that he may declare them fully and truly in the manifest. On the basis of the Collector''s findings it must be held that he failed to discharge that duty. A finding that the ship is not liable to be confiscated u/s 115 does not, therefore, necessarily protect the master from an adverse finding u/s 112.
29. A great deal was said at the Bar on the question of mens rea. It is not necessary to embark upon a discussion on the precise meaning of the term, a subject not entirely free from difficulty. As has been pointed out in a legal classic, the term is often loosely translated as ''a guilty mind'' but this translation is often misleading. A man may have mens rea, as it is generally understood, without any feeling of guilt on his part. He may, indeed, be acting with a perfectly clear conscience believing his act to be morally and even legally right and yet to be held to have mens rea. [Smith and Hogan on Criminal Law, 3rd ed., p. 42.] Therefore, it is said that a definition of mens rea would include intention or recklessness with respect to all those circumstances and consequences of the act or the state of affairs which constitute the actus reus of the crime in question. It has been consistently held that an offence u/s 112 of the Customs Act, 1962, is an offence of strict liability in which mens rea is not a relevant consideration. The Section does not expressly, or by necessary intendment, introduce mens rea as an element in the offence.
30. It is necessary to remember, all the time, the broad distinction between mens rea, the knowledge of the implications and consequences of the act or omission and mere knowledge or in other words the consciousness of the commission of the act or omission as the case may be. Bare knowledge or consciousness of the act or the omission is enough to attract the operation of Section 112. In this context, knowledge means not only what one knows but also what one is reasonably expected to know. In the present case, the finding is that the master was lacking in diligence in ensuring that all the goods on board were declared in the manifest. It is not the finding that in spite of his having done all that he should have reasonably done, he could not declare the smuggled goods in the manifest. He cannot be permitted to take advantage of his lack of diligence and plead ignorance of the existence of the smuggled goods to justify his omission to declare the smuggled goods in the import manifest.
31. A faint attempt was made at one stage to argue that there was no duty in the master to declare the prohibited goods in the manifest. Section 111(f) itself is a complete answer to such an argument. Moreover, there is a duty u/s 30 to deliver to the proper officer an import manifest in the prescribed form. The prescribed form in use requires all goods on board to be declared in the manifest. It only remains for me to add that I cannot persuade myself to agree with the learned trial Judge that in the absence of any fraudulent intention not to declare any goods in the manifest, the proper officer is duty-bound under the provisions of Section 30, Sub-section (3) to permit the manifest to be amended or supplemented. In my opinion, in the context of the sub-section ''may'' does not mean ''must''. The officer has a discretion to permit or not to permit the amendment in the facts and circumstances of a particular case. With great respect, to construe the sub-section, as the learned Judge has construed it, will be to put a premium on negligence on the part of the master in declaring the goods on board in the import manifest.
32. In the view I have taken, I agree that the order should be as proposed by my Lord.
