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Emperor Vs. Harjivan Valji - Court Judgment

LegalCrystal Citation
Decided On
Case NumberCriminal Reference No. 63 of 1925
Reported in(1926)28BOMLR115
RespondentHarjivan Valji
.....77(2), 59(iv), 48(1(j)-payment of octroi-goods in transit-non-payment of octroi deposit-'intent to defraud'-evidence of similar offences-indian evidence act (i of 1872), sections 15, 114-master's liability for servant's offences- consolidation of complaints-irregularity-criminal procedure code (act v of 1898), sections 537, 342-statement of accused.;the accused, a grocer at bhiwandi, ordered out goods from bombay. the goods were put into a hired motor lorry. to reach bhiwandi, the lorry passed through the limits of the kalyan municipality; but the lorry-driver instead of paying octroi on the goods at kalyan, rapidly drove past the in-going naka and similarly passed out at the other end of the limits. the kalyan municipality had, in virtue of the powers vested in it under section 48(1)(j)..........of octroi under clause (iv) of section 59 of the act, which empowers a municipality to impose an octroi on goods brought within the municipal octroi limits for consumption or use there. this argument entirely ignores the provisions of section 48, sub-section (1)(j), of the same act under which the municipality has power to frame octroi by-laws regulating the system under which refunds are to be made on account thereof when the animals or goods on which the octroi has been paid or articles manufactured wholly or in part from such animals or goods, are again exported; and prescribing a period of limitation after which no claim for refund of octroi should be entertained, and the minimum amount for which any claim to refund may be made. it is no doubt the case that octroi is leviable only.....

Fawcett, J.

1. [After setting out the facts of the case the judgment proceeded:] Before proceeding to consider the applications on their merits, so far as they can be dealt with in revision, I will first notice two objections that have been taken to the legality of the proceedings before the Magistrates. The first of these is that the depositions, by consent of the pleaders both for the Grown and the accused, taken in one of the three cases were admitted as evidence in the other two cases. As to this the Sub-Divisional Magistrate in Appeal No. 7 before him says that the depositions were read out in each of the two other cases, and hence the provisions of the law in that respect were complied with. No doubt this procedure is not regular, but I do not think that we are constrained to hold that it constitutes an illegality which vitiates the trial of the other two cases. I know of no authority to that extent, and in Emperor v. Ghanasham : (1906)8BOMLR538 , which is a somewhat similar case, it was held that the procedure adopted was irregular and was cured by Section 537, Criminal Procedure Code. There is no prejudice to the accused when he himself consented to this being done. Therefore, I think that this ground affords no basis for our interference.

2. The second objection is that the Bench of Magistrates did not comply with the imperative provisions of Section 342, Criminal Procedure Code, inasmuch as they did not examine the petitioner in any of the three cases. No doubt, if there had been an omission to examine him in accordance with the provisions of Section 342, then under the rulings of this Court that is an illegality vitiating the trial and subsequent conviction. But the Sub Divisional Magistrate in his order in Appeal No. 8 says :-

I find that the appellant has given a written statement and the learned pleader for the respondent who was present at the hearing of the case states that the trying Magistrate asked the appellant accused if he had anything to say and he said that he would give a written statement; and that the appellant's present pleader was not conducting the case then. As there is the written statement of the accused (appellant) the provision of Section 342, Criminal Procedure Code, has been complied with.

3. This statement that the Magistrate asked the accused what he had to say, and that he then gave his written statement, has not been contradicted by any affidavit in the present proceedings and is in accordance with probabilities. In these circumstances, it seems to me that it amounts to the accused's saying that he declined to answer any question of the Court and would simply put in a written statement. As that written statement was allowed to be put in, it does not rest in the mouth of the accused to say that there has been any illegality. The provisions of Section 342, so far as they require a personal examination of the accused by the Court, contemplate an accused who is willing to answer questions put by the Court, but under that section he has a right to say that he will not answer any question. So, here again, I do not think that there is any sufficient ground for interfering because of the alleged non-compliance of Section 342.

4. The Sessions Judge has raised three points in his note, and these are the main contentions which have been discussed before us.

5. Sub-section (2) of Section 77 provides:-

If goods passing into a municipal district are liable to the payment of octroi, then every person who, with the intention to defraud the Municipality, causes or abets the introduction of, or himself introduces or attempts to intro-duce within the octroi limits of the said district, any such goods upon which payment of the octroi due on such introduction has neither been made nor tendered, shall be punishable with fine' &c.;

6. The first point raised by the Sessions Judge is that the provisions of this clause cannot apply in the present case, because, in fact, these goods were not brought within the octroi limits for consumption or use therein, and so were not goods liable to the payment of octroi under Clause (iv) of Section 59 of the Act, which empowers a Municipality to impose an octroi on goods brought within the municipal octroi limits for consumption or use there. This argument entirely ignores the provisions of Section 48, Sub-section (1)(j), of the same Act under which the Municipality has power to frame octroi by-laws regulating the system under which refunds are to be made on account thereof when the animals or goods on which the octroi has been paid or articles manufactured wholly or in part from such animals or goods, are again exported; and prescribing a period of limitation after which no claim for refund of octroi should be entertained, and the minimum amount for which any claim to refund may be made. It is no doubt the case that octroi is leviable only on goods which are actually brought in for consumption and use within the municipal limits. But the Act recognizes that provision has to be made for goods in transit through the municipal district, and for safeguarding the municipality from loss owing to any mis-representation that may be made when goods are brought within the Municipal limits that they are only being brought in in transit and not for use or consumption within such limits. Accordingly, the Municipality have framed by-laws which are Appendix F in the pamphlet produced before us. By-law No. 1 says that ' Octroi at the rates specified in the accompanying schedule shall be levied on the articles therein named when imported into the Kalyan Municipal district.' That of course primarily applies to goods imported for use and consumption within those limits. But the wording also covers goods in transit, and subsequent by-laws provide for refunds in such cases, The main by-law is No. 9, which runs as follows :-

Person importing goods in transit which enter the town and pass out of it intact within 24 hours of their entering,shall deposit the amount of duty duo on them at the in-going Naka and receive a receipt for the same. They shall present the receipt at the Naka at the time of export for endorsement as to the goods having passed out of the town intact, and present the endorsed receipt at the Municipal Office, where on satisfying the Managing Committee of the correctness of the endorsement they will obtain refund of the amount of duty deposited by them.

7. By-laws 10 and 11 provide for similar refunds if the goods stayed longer than 2 1/2 hours, and if they are exported within a year of the date of importation, and Rule 12 provides for the procedure under which applications for refund should be made. By-laws 13 and 14 provide for the Managing Committee's passing orders for refund and for an appeal in case of refusal to the General Board, and Rule 16 says that Rule Section 10 to 14 shall not apply to any goods in respect of which arrangements have been made for an account current under Section 80. Therefore, having regard to the provisions of Section 48 that I have referred to and these by-laws, the goods in question were, in my opinion, liable to the payment of octroi within the meaning of Sub-section (2) of Section 77. No dont, in the circumstances, the octroi was to be paid only as a deposit, but that does not affect the fact that legally they were, for the time being, liable to the payment of octroi, and that the owner of the goods had only a right to refund if they were shown to be goods in transit. Therefore, I think, there is nothing in that particular objection.

8. The second point mentioned by the Sessions Judge is stated as follows:-

It is found that the petitioner was not in the lorry in which the goods were carried. It is not even alleged by the prosecution that the petitioner caused or abetted the introduction of the goods by telling the driver to carry them without paying the deposit or the duty. Hence the petitioner cannot be held liable for the non-payment of duty or the deposit. At the most, the driver who was in possession of the goods would be liable, if at all it be held that the goods were liable to the payment of the octroi.

9. Then again he says:-

It is, however, held by the Bench of Magistrates and the Sub-Divisional Magistrate that the common carrier was the servant of the petitioner and that the petitioner was responsible for his acts. But I do not think that the driver of the motor lorry was the petitioner's servant. He was, at the most, a bailee... Hence the petitioner cannot be held responsible for the driver's act even if it be assumed for a moment that the driver was his servant, having regard to the fact that Sub-section (2) of Section 77 does not impose any liability on the master for the acts of his servant done without his knowledge and authority.

10. In this connection should be read the remarks of the Sessions Judge later on, where he considers that the Magistrates acted illegally in admitting evidence as to similar complaints being made against the petitioner in 1921. Apparently, the proceedings of those eases were put on record and were allowed in evidence. Dealing with the last point first, I do not think that the Magistrates did in fact err in allowing that evidence to go in. Section 14 of the Indian Evidence Act provides that facts showing the existence of any state of mind, such as intention or knowledge, are relevant, when the existence of any such state of mind is in issue or relevant; and Section 15 provides Specifically for allowing evidence of similar occurrence, in each of which the person doing the act was concerned, whenever there is a question whether an act is done with a particular knowledge or intention. As regards the applicability of the last named section I may refer to the summary of the law given by Mookerjee J. in Amrita Lal Hazra v. Emperor I.L.R.(1915) Cal. 957. and re-stated by him in Emperor v. Panchu Das I.L.R.(1926) Cal. 671 . I need not repeat this summary in detail, but will merely say that in ray opinion the present case cornea under the following part of his summary (p. 998) :-

In general, whenever it is necessary to rebut, even by anticipation the defence of accident, mistake, or other innocent condition of mind, evidence that the defendant has been concerned in a systematic course of conduct of the same specific kind as that in question may be given.

11. Accordingly, I think that the evidence that the accused had . been connected with similar cases of non-payment of octroi in the case of goods driven by a lorry driver for him to his shop at Bhiwandi is admissible evidence on this question of knowledge and intention. Again it must be remembered that in dealing with a question of the responsibility of the master for the acts of his servant, the Court can have regard not only to evidence of a master's acts which may constitute abetment, but also to his omissions, because under the Indian Penal Code the word 'acts' includes 'omissions,' and in Halsbury's Laws of England, Vol. IX, Article 502, p. 234, it is said :-

In general a person is not criminally liable for an act or omission unless he has himself committed or omitted the act or authorised or known of or shut his eyes to the commission or omission,

12. I think that, having regard to this principle, the evidence in question really amounted to this that the accused knew that the lorry drivers acted in this manner, that is to say, drove straight on through Kalyan without giving the municipal officers a chance of inspecting the contents of their lorries, as they have a right to do under Section 76 of the Act, with even a power of seizure under Section 79-so that the evidence pointed to the accused, who has certainly some responsibility and control as owner of the goods, systematically shutting his eyes to this conduct of the lorry-driver, and so being criminally liable. But it was also open to the lower Courts in considering a case of this kind to have regard to probabilities in the manner permitted by Section 114 of the Indian Evidence Act, and to infer that a course of conduct of this kind could not have gone on without the connivance and consent of the accused. Certainly to my mind that is a reasonable presumption in the present case, especially having regard to the attitude that the accused is shown to have adopted in these proceedings and in his communications with the Municipality. Consequently I do not agree with the Sessions Judge's view that the Magistrates were not justified in finding as a fact that the accused was responsible for the acts of the lorry driver, who was, at any rate, his agent for the transport of these goods; whether he was his servant or not is, to my mind, immaterial. This responsibility has been upheld by the Sub-Divisional Magistrate, and I am not prepared to hold that in so doing the Courts have infrifiged the law as to 'mens rea.

13. It is the third point mentioned by the Sessions Judge which I think is the strongest of those put before us. The Sessions Judge says:-

The third point that must be proved is that the goods were introduced within the octroi limits with the intention to defraud the Municipality, It does not appear from the facts proved that either the petitioner or the driver had any such intention. In this case, the goods were in transit and the Municipality of Kalyan was not to gat any octroi duty in respect of them. Even if the driver had deposited some amount with the Nakedar it would have been paid back to him, as the goods went out of the limits intact within twenty-four hours. So the Municipality had not suffered any loss. There was therefor evidently no intention to deceive the Municipality and by means of that deceit, to obtain any advantage for the petitioner or the driver,

14. I think that in considering this contention the main question is as to the exact meaning of the words ' with the intention to defraud the Municipality ' is this sub section. No doubt if the word 'defraud ' is taken to be used in its ordinary legal sense, as it is, at any rate, used in the Indian Penal Code, then I am of opinion that the conviction of the accused cannot be sustained, because in the ordinary legal sense the expression ' intent to defraud ' implies conduct coupled with an intention to deceive and thereby to injure. The word ' defraud' involves two conceptions, viz , deceit and injury to the person deceived, that is an infringement of some legal right possessed by him, but not necessarily deprivation of property. I quote from the head-note in Surendra Nath Ghose v. Emperor I.L.R. (1910) Cal. 75. If the word ' defraud ' has that meaning, then I think it would be difficult to say, first of all, that there was any real deceit by the accused or his agent, because no false representation was in fact made to the Municipality or any of its officers; and secondly, it would be difficult, in my opinion, to say that there was any real intention to cause loss to the Municipality. It has been contended by Mr. Shingne for the Municipality that inasmuch as the Municipality would Jose the use of the deposit for a certain time, there would, in fact, be a loss. On the other hand, the Municipality would have a certain amount of trouble to undergo in connection with the deposit and the consequent claim for refund, and I am inclined to think that it would be a case of de minimis non curat lex. However that may be, the main question is whether the accused had that intention, and it is, I think, in his favour that his intention would probably be much more one of saving trouble to himself and his agent in bringing his goods than any intention of actually causing loss to the Municipality, so that, even if there was such loss, I should have hesitated about confirming the accused's conviction. But, on further considerution, I have come to the conclusion that the word ' defraud ' is not really intended to be used in that strict legal sense. In Gour's Penal Law, 2nd Edition, volume I, p. 254, the learned author says: ' The word, ' defraud' has at least three meanings: (i) to deprive one of right, either by obtaining something by deception or artifice, or by taking something wrongfully without the knowledge or consent of the owner; (ii) to withhold wrongfully from another what is due to him or to wrongfully prevent one from detaining what he may justly claim; and (iii) to defeat or frustrate wrongfully.' He says that in the Penal Code, Section 25, the term is used rather in the first, than in the second or third sense. It certainly is a popular use of the word to say that a man is defrauded; if thereby he is deprived of some right or property to which he is entitled, and any act done with the intention of wrongfully depriving him of the benefit of such right would, in popular language, amount to an attempt to defraud him. It is for instance, commonly applied to the case of a person travelling on a railway without a ticket. This is referred to as an attempt to defraud the railway company. In that case there is not necessarily any deceit. The offender has no ticket and simply takes the risk of an officer of the railway coming up to him and asking him for his ticket, I think the context of Sub-section (2) supports the conclusion that the word ' defraud' is used in this popular sense, and that being so I think that the intention to prevent the Municipality from getting the deposit; to which they were entitled tinder the by-laws, does amount to an intention to defraud the Municipality.

15. Consequently, I do not think that we should interfere in revision in the present case.

16. But at the same time, I would venture to suggest, though no doubt I am going outside the province of a Judge, that the Municipality should consider whether an easier system of deposits and refunds in the case of goods passing through the municipal district cannot be devised. However much the old system may be suited to the days when goods were mostly transported in bullock-carts and people had plenty of time, it is hardly suitable to the case of goods that are wanted quickly and are transported in motor vehicles. If some speedier system can be devised, the drivers of motor vehicles will not be so inclined to try to avoid being stopped and having the contents of their lorries being inspected.

17.I would also suggest that the Municipality might consider whether cases of this kind could not be more easily dealt with by adding a by-law prescribing a penalty for a person who does not stop his vehicle and allow an inspection of the goods or animals contained therein, as can be done under the provision in Section 48, allowing a municipality to prescribe a fine not exeeding Rs. 500 for the infringement of a by-law.

18. In the present case, we do not see sufficient ground to interfere, but naturally in a case like this there is considerable difficulty in obtaining the requisite proof, and therefore both sides would be benefited if things could be put on a better basis,

Madgavkar, J.

1. The petitioner, a shop-keeper at Bhiwandi, was in the habit of obtaining goods by lorries from Bombay through the limits of the Kalyan Municipality. It is proved that not only in 1921, but in three cases in 1923, the lorries containing his goods were driven by a driver who declined to stop at the Naka of the Kalyan Municipality and passed through without paying the deposit to which they were liable under the municipal rules, which also provide that on proof that the goods did not remain within its limits for more than twenty-four hours, the petitioner should be entitled to a refund. On these facts the Bench Magistrates, as well as the Sub-Divisional Magistrate, has held that the appellant-petitioners had caused the introduction of these goods without payment of the octroi duty and accordingly convicted him in each of the three cases under Section 77, Clause (2), of the Bombay District Municipal Act.

2. The arguments for the petitioner which commended themselves to the Sessions Judge were three : The first, namely, that the deposit was not an octroi by reason of the right to refund, is clearly on the face of it, untenable. Secondly, the argument, that by reason of the petitioner's own absence from the lorry and the absense of evidence of his express instructions, he should not be held liable for non-payment, is also, in my opinion, without substance, It was for the petitioner as a consignee to make all the necessary arrangements including that for payment of octroi which was evaded on no less than three occasions. He does not allege that by instructions or otherwise he had placed the driver in possession of funds for paying the octroi. It was, therefore, practically open to the lower Courts to hold that the non-payment was deliberate and with the previous knowledge of the petitioner so as to make him liable for causing the introduction of the goods.

3. There remains only the third point, namely, whether it can be held that he had an intention to defraud. As to this argument, the definition in Section 25 of the Indian Penal Code hardly carries the matter any further. If the words are used in the narrow sense of merely causing wrongful gain to one or wrongful loss to another in the shape of the deposits, to the use of which, for however a short period, the Municipality is entitled, then the petitioner, in my opinion, is guilty. But, on the other hand, if it is held, that a second element, i.e., fraud, is necessary then the conviction is doubtful. I agree with my learned brother that the words are used in the former and popular sense, and the petitioner, so far as can be judged, wished to avoid the payment of deposits and the trouble it involved, including the trouble of obtaining the refund, and preferred the simpler course of driving the Jorries through without stopping to pay. If so, he comes within the terms. The conviction is, in my opinion, correct and the references must be dismissed.

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