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Universal Imports Agency and anr. Vs. the Chief Controller of Imports and Exports and ors. - Court Judgment

LegalCrystal Citation
SubjectCommercial
CourtSupreme Court of India
Decided On
Judge
Reported inAIR1961SC41; [1961]1SCR305
ActsConstitution of India - Articles 10, 17, 32 and 286(1); Foreign Jurisdiction Act, 1947 - Sections 4; French Establishments' (Application of Laws) Order, 1954; Sea Customs Act, 1879; Reserve Bank of India Act, 1934; Imports and Exports Trade (Control) Act, 1947; Foreign Exchange Regulation Act, 1947; Indian Tariff Act, 1934
AppellantUniversal Imports Agency and anr.
RespondentThe Chief Controller of Imports and Exports and ors.
Cases ReferredAbbott v. Minister
Excerpt:
commercial - confiscation - articles 10, 17, 32 and 286 (1) of constitution of india, section 4 of foreign jurisdiction act and paragraph 6 of french establishments' (application of laws) order, 1954 - petitioner objected against confiscation of goods imported by him prior to transfer of power in pondicherry from french to indian government - under paragraph 6 petitioner is protected as imports arriving in india after transfer of powers is legal consequence of ''things done'' previously i.e. effecting a contract to import - also according to article 17 of indo-french agreement all licenses provided by competent authorities prior to date of de facto transfer were to be fulfilled by government of india - held, confiscation for want of license is bad in law and respondent directed to refund.....subba rao, j.1. these four petitions are filed under art. 32 of the constitution forquashing the orders of the assistant controller of imports and exports, thecollector of customs and central excise, pondicherry, the board of revenue, andthe government of india, and for an appropriate direction requiring therespondents to refund the amount realised from the petitioners. 2. messrs. universal imports agency and the proprietor of the agency are thepetitioners in the first three petitions and messrs. victory traders are thepetitioners in the last one. the chief controller of imports and exports,pondicherry, the collector of customs and central excise, pondicherry, thecentral board of revenue and the government of india are the respondents in allthe petitions. 3. messrs. french india importing.....
Judgment:

Subba rao, J.

1. These four petitions are filed under Art. 32 of the Constitution forquashing the orders of the Assistant Controller of Imports and Exports, theCollector of Customs and Central Excise, Pondicherry, the Board of Revenue, andthe Government of India, and for an appropriate direction requiring therespondents to refund the amount realised from the petitioners.

2. Messrs. Universal Imports Agency and the proprietor of the agency are thepetitioners in the first three petitions and Messrs. Victory Traders are thepetitioners in the last one. The Chief Controller of Imports and Exports,Pondicherry, the Collector of Customs and Central Excise, Pondicherry, theCentral Board of Revenue and the Government of India are the respondents in allthe petitions.

3. Messrs. French India Importing Corporation and Messrs. B. S. & Co.intervened in the Writ Petitions.

4. Pondicherry was a French possession in India. On October 21, 1954, theGovernment of India and the Government of France entered into an agreement(hereinafter called the Indo-French Agreement), whereunder there was a de factotransfer of the administration of the French Settlements to the Government ofIndia (hereinafter called the merger) as and from November 1, 1954. The de juretransfer was postponed.

5. Messrs. Universal Imports Agency are a proprietary concern registeredwith the Services Des Contribution, Pondicherry, having its principal place ofbusiness at Pondicherry. Sri Mohanlal B. Gandhi is the proprietor of the saidAgency. They are established importers and general merchants dealing in ballbearings, mill stores, porcelain ware, glass marbles, beltings and variousother goods. They commenced their business at Pondicherry on or about April 14,1954, under 'patente' No. 70 of 1954 issued by the Controller of theContributions Department of the French Government at Pondicherry. In the middleof August 1954, they placed 8 indents with Messrs. Shimada Trading Co., Ltd.,Osaka, Japan for importing porcelain wares, glass marbles and belting and thetotal value thereof amounted to Rs. 57,418-2-0. About the end of August 1954,they opened three irrevocable Letters of Credit with Messrs. Banque De L'Indo-Chine in favour of the said suppliers. The bankers obtained authorizationfrom the Bureau Des Affaires Economique, Pondicherry, for the requisite foreignexchange from the open market and sold the same to the petitioners for theamount involved in the Letters of Credit. The petitioners made full payment forthe said foreign exchange and the said Bank kept the said foreign exchange andcredit irrevocably available with their Overseas Agent at Japan for the benefitof the suppliers against full set of shipping documents. All the said Lettersof Credit were valid for three months and under the agreement the supplierswere to ship the goods within the said time. On or about November 1, 1954, thesaid goods were in different stages of shipment; in some cases they were in thecourse of shipment, and in others awaiting shipment in a matter of a few daysand indeed a large part of the goods had already been placed on board 'S.S. Shillong' and 'S. S. Cambodge' and the balance of the goodswere in the course of being loaded in 'S. S. Sunda'. In January andFebruary, 1955 and thereafter the goods arrived at the Port of Pondicherry. TheCollector of Customs confiscated all the goods on the ground that they were importedwithout a licence and gave an option to the petitioners to pay in lieu ofconfiscation fine amounting to Rs. 30,390/-. The petitioners took up the matterwith the Government of India without any success and finally they paid the saidpenalty under protest and cleared the goods.

6. On or about September 1954 the petitioners placed several indents withtheir overseas suppliers, Messrs. Shimada Trading Co., Limited, Osaka, Japan,and others and the total C.I.F. value thereof amounted to Rs. 40,470-14-0. Theyarranged for the full payment of eight cheques to the said suppliers of thevalue of the goods through the Banque De L' Indo-Chine. Their bankers dulyobtained authorization from the Bureau Des Affairs Economique, Pondicherry, forthe requisite foreign exchange and sold the same to the petitioners for theamount involved in cheques, and the said foreign exchange was kept available tothe suppliers. On or about November 1, 1954, the goods ordered were indifferent stages of shipment and in some cases the goods were in the course ofshipment and in others awaiting shipment in a matter of a few days. In Januaryand February, 1955, the goods arrived at the port of Pondicherry. The Collectorof Customs treated the imports of the goods as unauthorized and confiscated thesame and gave the petitioners an option to pay in lieu of confiscation apenalty amounting to Rs. 20,700/-. The petitioners carried the matter to theGovernment without any success. Ultimately the petitioners paid the penaltyunder protest and cleared the goods.

7. The petitioners again in the middle of August 1954 placed several indentswith their overseas suppliers for importing hair belting, torches, beltfasteners, electric lighting torch bulbs and primus stoves, and the totalC.I.F. value was Rs. 52,572-12-0. They opened irrevocable Letters of Credit andissued cheques against full advance remittance in favour of their suppliersthrough the said Banque De L' Indo-Chine. Their bankers arranged through theBureau Des Affairs Economique, Pondicherry, for the requisite foreign exchangefrom the open market and sold the same to the petitioners for the amountinvolved in the said Letters of Credit and cheques. The petitioners made fullpayment for the said foreign exchange and the Letters of Credit irrevocablyavailable with their overseas agents for the benefit of the suppliers againstfull set of shipping documents and the cheques issued by the bank on overseasbanks were sent to the suppliers as full advance remittance against thecontracts. In January and February, 1955, the goods arrived at the port ofPondicherry. The Collector of Customs confiscated the goods and gave thepetitioners an option to pay in lieu of confiscation fine amounting to Rs.24,210. Though the petitioners took up the matter with the Government of India,nothing came out of it. They paid the penalty under protest and cleared thegoods.

8. Messrs. Victory Traders, the petitioners in Petition No. 118 of 1959, arecarrying on business of import and export and general merchandise inPondicherry from the year 1949. The petitioners were importing into Pondicherrya number of articles from various countries under 'patente' No. 126of 1954 granted by La Controleur, Pondicherry. On August 20, 1954, they appliedto the Chief Bureau Economique, Pondicherry, requesting them to grant permitsto import goods from foreign countries. The said Bureau replied that no importlicence was required for goods to enter the territory. Thereafter thepetitioners placed orders with foreign dealers. In the middle of August, 1954and early in September, 1954, they placed a number of indents with theirprincipals in foreign countries for importing fan belts, corn emery, soda waterbottles, glass marbles, etc., of value pounds 13,870. The orders were backed byfull payments in many cases and at least half the payments in others. Thesepayments were made by demand drafts issued by the Banque De L' Indo-Chine. InJanuary and February, 1955 and thereafter the goods arrived at the port ofPondicherry, and they were confiscated by the Collector of Customs who gave thepetitioners an option to pay in lieu of confiscation fine aggregating to Rs.91,100. After filing appeals to the Central Board of Revenue and, thereafter, arevision to the Government of India with no success, the petitioners clearedthe goods after paying the penalty under protest.

9. It is clear from the foregoing facts that the petitioners entered into,before the merger, firm contracts of sales by import with foreign sellers, madeavailable foreign exchange either under Letters of Credit or otherwise, and thegoods were shipped either before or after the merger, thought they reachedtheir destination after the merger. The said goods were confiscated by theCollector of Customs under the following circumstances. Under the Indo-FrenchAgreement, the entire administration of the French Settlements was vested withthe Government of India from November 1, 1954, though de jure transfer had beenpostponed. In pursuance of the Indo-French Agreement, the Ministry of ExternalAffairs published a Notification No. S.R.O. 3315 dated October 30, 1954,purporting to be under s. 4 of the Foreign Jurisdiction Act, 1947, and calledthe French Establishments' (Application of Laws) Order, 1954, (hereinafter referredto as the Order). Under paragraph 3 of the said Order, the Sea Customs Act,1879, the Reserve Bank of India Act, 1934, the Imports & Exports Trade(Control) Act, 1947, the Foreign Exchange Regulation Act, 1947 and the IndianTariff Act, 1934, were extended to Pondicherry. On November 1, 1954, theGovernment of India appointed a Controller of Imports & Exports for theFrench Establishments, and paragraph 4 of the same notification gave thefollowing information and guidance to the public :

'As regards orders placedoutside the Establishments and finalised through the grant of licence by thecompetent French Authorities in accordance with the Laws and Regulations inforce prior to 1st November, 1954, licence-holders are advised to apply to theController of Imports & Exports for validation of licences held by them. Nofees will be charged for these applications. The applications should beaccompanied by the original licence and should give particulars about..........'.

'Licence-holders are advisednot to arrange for shipments of goods until the licences held by them have beenvalidated by the Controller of Imports and Exports at Pondicherry.'

10. The petitioners by way of abundant caution applied to the ChiefController of Imports & Exports for licences for clearance of goods, butthey were all rejected and the petitioners were told that their goods would betreated as unauthorized imports and they were advised to approach the Collectorof Customs and Central Excise for conditions regarding their release. As statedsupra, after the goods arrived at the port of Pondicherry, the Collector ofCustoms and Central Excise made the various orders confiscating the goods andgiving the petitioners option to pay penalties in lieu of confiscation. All ofthem paid the penalties, under protest, and cleared the goods. The appealsfiled to the Central Board of Revenue were dismissed and the revisions filedagainst the orders of the Central Board of Revenue to the Government of Indiawere also dismissed. The petitioners filed the petitions under Art. 32 of theConstitution questioning the validity of the orders of confiscation.

11. The respondents in their counter-affidavits claim that the orders madeby them are valid and in accordance with law.

12. Learned counsel for the petitioners raised many contentions in supportof their petitions. It is not necessary to enumerate them as the petitions caneffectively be disposed of on the basis of one of the contentions. The saidcontention may briefly be stated thus : The petitioners have the fundamentalright to hold and to carry on their import trade and that the Notification No.S.R.O. 3315 dated October 30, 1954, on the basis of which the orders ofconfiscation were issued has a saving clause which excludes the operation of thesaid Notification in respect of transactions whereunder the confiscated goodswere purchased and imported. The said saving clause embodied in paragraph 6 ofthe Order reads :

'Unless otherwise specifically provided in theSchedule, all laws in force in the French Establishments immediately before thecommencement of the Order, which correspond to enactments specified in theSchedule, shall cease to have effect, save as respect things done or omitted tobe done before such commencement'.

13. Relying on this paragraph, it is contended that the transactions enteredinto by the petitioners with the foreign dealers were 'things done'within the meaning of this paragraph and, therefore, they were saved from theoperation of this Order. For the respondents it is argued that as theconfiscated goods were brought into India after the commencement of the Order,the goods confiscated were outside the pale of the saving clause. The questionraised falls to be decided on a true interpretation of the terms of paragraph 6of the said Order.

14. In order to apply the said paragraph 6 to the present case, thefollowing facts have to be ascertained : (1) What are the laws specified in theSchedule (2) What were the laws in force in the French Establishments before thecommencement of the Order corresponding to the enactments so specified (3)What were the 'things done' or omitted to be done under the said laws?

15. It is not necessary to enter into any elaborate survey of the lawsspecified in the Schedule. Broadly stated, the Imports & Exports (TradeControl) act enables the Central Government to make an order making provisionsfor prohibiting, restricting or otherwise controlling the import or export ofgoods of any specified description. It makes the infringement of suchrestrictions an offence and a person contravening the same is punishable withimprisonment for a term which may extend to one year or with fine or with both.The Act further says that the goods imported in violation of the restrictionsshall be deemed to be goods the import of which has been prohibited orrestricted under s. 19 of the Sea Customs Act. In exercise of the powersconferred by s. 3 and s. 4A of the Imports & Exports (Trade Control) Act,the Central Government made an order dated December 7, 1955. Under s. 3 of thatorder, no person shall import any goods of the description specified inSchedule 1, except and in accordance with a licence or a customs clearancepermit granted by the Central Government or by any authority specified in Schedule2 to that order. There are also provisions prescribing the procedure forobtaining licences, the conditions of the licences and for their cancellationor modification. It is, therefore, clear that under the said Act, no goods canbe imported into India without a licence obtained in the prescribed manner fromthe prescribed authorities. The Sea Customs Act provides for the levy of seacustoms duty, imposes prohibitions and restrictions on imports and exports inrespect of certain goods and imposes punishment for infringement of theprovisions of the Act. Under s. 167(8) of the said Act, read with s. 3(2) ofthe Imports and Exports Trade (Control) Act, 1947, if any goods, theimportation or exportation of which is prohibited or restricted, are importedinto or exported out of India contrary to such restrictions or prohibitions,the goods concerned are liable to be confiscated and the persons involved arealso liable to penalty. The Foreigner Exchange Regulation Act, 1947, providesfor the regulation of payments, dealings in foreign exchange and securities,and the import and export of currency and bullion. It prohibits dealings inforeign exchange except by persons authorized to deal in the same and itfurther provides penalties for contravention of any of the provisions of theAct. Briefly stated, the Indian law as disclosed by the aforesaid Acts is thatimports into India without a licence are prohibited, the goods so imported incontravention of the restrictions imposed are liable to be confiscated and thatforeign exchange cannot be obtained otherwise than under the provisions of theAct. Persons infringing the laws are liable to prosecution in addition toconfiscation of the goods involved.

16. What was the pre-existing law in Pondicherry corresponding to theenactments specified in the Schedule Neither the Acts governing the importsnor any authoritative text-books disclosing the relevant law have been placedbefore us. But from the affidavits filed in the case the state of lawcorresponding to the relevant Acts referred to in para. 3 of the Order caneasily be ascertained. Pondicherry had been a free port, there being norestrictions on imports except on a few items like gold, rock-salt etc. Foreffecting payment for the imports, the importers of Pondicherry could acquireforeign exchange either at the official rate or at the open market rate,whichever might be conveniently available, both methods being recognised by theFrench Government as valid. In the counter-affidavit filed by the State the mannerof acquiring the foreign exchange for imports has been clearly stated. Twokinds of permits for obtaining official exchange by importers were issued bythe Chief Commissioner in Pondicherry, which were known as authorization andattestation respectively. They were signed by the Governor-General of theFrench Indian Establishments himself or by his Secretary-General. TheGovernment of France used to make an overall allotment of foreign exchange tothe French territories. Apart from that allotment, it made other currencyallotments in the light of trade agreements entered into by France with othercountries. Authorizations were issued in respect of goods imported fromcountries with which France had entered into trade agreements and attestationsin respect of goods imported from France and other French colonies. Further, inrespect of other transactions exchange was arranged by importers through banksdealing in foreign exchange. The Department of Affaires of Economics used toauthorize the banks in respect of such transactions. Shortly stated,Pondicherry was a free port without any restrictions on imports, except on afew items, and the importers could acquire foreign exchange either at theofficial rate in respect of some transactions or at the open market in respectof others.

17. What were the 'things done' by the petitioners under thePondicherry law The petitioners in the course of their import trade, havingobtained authorization for the foreign exchange through their bankers, enteredinto firm contracts with foreign dealers on C.I.F. terms. In some casesirrevocable Letters of Credit were opened and in others bank drafts were senttowards the contracts. Under the terms of the contracts the sellers had to shipthe goods from various foreign ports and the buyers were to have physicaldelivery of the goods after they had crossed the customs barrier in India.Pursuant to the terms of the contracts, the sellers placed the goods on boardthe various ships, some before and others after the merger, and the goodsarrived at Pondicherry port after its merger with India. The prices for thegoods were paid in full to the foreign sellers and the goods were takendelivery of by the buyers after examining them on arrival. Before the merger ifthe Customs Authorities had imposed any restrictions not authorized by law, theaffected parties could have enforced the free entry of the goods in a court oflaw. On the said facts a short question arises whether paragraph 6 of the Orderprotects the petitioners. While learned counsel for the petitioners contendsthat 'things done' take in not only things done but also their legalconsequences, learned counsel for the State contends that, as the goods werenot brought into India before the merger, it was not a thing done before themerger and, therefore, would be governed by the enactments specified in theSchedule. It is not necessary to consider in this case whether the concept ofimport not only takes in the factual bringing of goods into India, but also theentire process of import commencing from the date of the application forpermission to import and ending with the crossing of the customs barrier inIndia. The word 'things done' in paragraph 6 must be reasonablyinterpreted and, if so interpreted, they can mean no only things done but alsothe legal consequences flowing therefrom. If the interpretation suggested bythe learned counsel for the respondents be accepted, the saving clause wouldbecome unnecessary. If what it saves is only the executed contracts, i.e., thecontracts whereunder the goods have been imported and received by the buyerbefore the merger, no further protection is necessary as ordinarily no questionof enforcement of the contracts under the pre-existing law would arise. Thephraseology used is not an innovation but is copied from other statutoryclauses. Section 6 of the General Clauses Act (X of 1897) says that unless adifferent intention appears, the repeal of an Act shall not affect anythingduly done or suffered thereunder. So too, the Public Health Act of 1875 (38& 39 Vict. c. 55) which repealed the Public Health Act of 1848 contained aproviso to s. 343 to the effect that the repeal 'shall not affect anythingduly done or suffered under the enactment hereby repealed'. This provisocame under judicial scrutiny in The Queen v. Justices of the West Riding ofYorkshire (1876) 1 Q.B.D. 220 There notice was given by a local board ofhealth of intention to make a rate under the Public Health Act, 1848, andamending Acts. Before the notice had expired these Acts were repealed by thePublic Health Act, 1875, which contained a saving of 'anything dulydone' under the repealed enactments and gave power to make a similar rateupon giving a similar notice. The board, in ignorance of the repeal, made arate purporting to be made under the repealed Acts. It was contended that asthe rate was made after the repealing Act, the notice given under the repealedAct was not valid. The learned Judges held that as the notice was given beforethe Act, the making of the rate was also saved by the words 'anything dulydone' under the repealed enactments. This case illustrates the point thatit is not necessary that an impugned thing in itself should have been donebefore the Act was repealed, but it would be enough if it was integrallyconnected with and was a legal consequence of a thing done before the saidrepeal. Under similar circumstances Lindley, L.J., in Heston and IsleworthUrban district Council v. Grout (1897) 2 ch. 306 confirmed the validity ofthe rate made pursuant to a notice issued prior to the repeal. Adverting to thesaving clause, the learned Judge tersely states the principle thus at p. 313 :'That to my mind preserves that notice and the effect of it'. On thatprinciple the Court of Appeal held that the rate which was the effect of thenotice was good.

18. It is suggested that the phraseology of the saving clause of the EnglishStatutes and of the General Clauses Act of 1897 are of wider import than thatof paragraph 6 of the Order and, therefore, the English decisions are not ofany assistance in considering the scope of the saving clause of the Order. Itis further stated that the English decisions apply only to a saving clause ofan Act which repeals another but preserves the right created by the latter. Wedo not see any reason why the same construction cannot be placed upon thewording of paragraph 6 of the Order which is practically similar in terms asthose found in the relevant saving clause of the English Statute and that ofthe General Clauses Act.

19. Nor can we find any justification for the second criticism. In theinstant case the legal position is exactly the same. By reason of theIndo-French Agreement the Government of India made the Order under the ForeignJurisdiction Act applying the Indian laws to Pondicherry. The effect of thatOrder was that the French laws were repealed by the application of the Indianlaws in the same field occupied by the French laws subject to a saving clause.The position is analogous to that of a statute repealing another with a savingclause. If the English decisions apply to the latter situation, we do not seehow they do not apply to the former. In both the cases the pre-existing lawcontinues to govern the things done before a particular date. We, therefore,hold that the words 'things done' in paragraph 6 of the Order arecomprehensive enough to take in a transaction effected before the merger,though some of its legal effects and consequences projected into thepost-merger period.

20. Now what was the inter-relation between the said 'things done'and the act of import or bringing of the goods into India The effect of thecontracts under the pre-existing law was that the terms thereof could have beenimplemented without any customs bar placed against the import. This Court had,in the context of Art. 286(1)(b) of the Constitution, to consider theconnotation of the words 'in the course of export or import' in Stateof Travancore-Cochin v. The Bombay Co. Ltd. : [1952]1SCR1112 Patanjali Sastri,C.J., described the nature of export sale thus at p. 1118 :

'Such sales must of necessity be put through bytransporting the goods by rail or ship or both out of the territory of India,that is to say, by employing the machinery of export. A sale by export thus involvesa series of integrated activities commencing from the agreement of sale with aforeign buyer and ending with the delivery of the goods to a common carrier fortransport out of the country by land or sea. Such a sale cannot be dissociatedfrom the export without which it cannot be effectuated, and the sale andresultant export form parts of a single transaction.'

21. The same principle has been restated by the learned Chief Justice inState of Travancore-Cochin v. Shanmugha Vilas Cashew Nut Factory (1954) S.C.R.53 The learned Chief Justice stated at p. 63 thus :

'The phrase 'integrated activities' wasused in the previous decision to denote that a sale, that is, a sale whichoccasions the export, cannot be dissociated from the export without which itcannot be effectuated and the sale and resultant export form parts of a singletransaction'.

22. Applying the said principles to an import sale it may be stated that apurchase by import involves a series of integrated activities commencing fromthe contract of purchase with a foreign firm and ending with the bringing ofthe goods into the importing country and that the purchase and resultant importform parts of a same transaction. If so, in the present case the bringing ofthe goods into India and the relevant contracts entered into by the petitionerswith the foreign dealers form parts of a same transaction. The imports,therefore, were the effect or the legal consequence of the 'thingsdone', i.e., the contracts entered into by the petitioners with theforeign dealers.

23. This conclusion is also reinforced by the terms of the Indo-FrenchAgreement. It is common case that the terms of the said Agreement cannot beenforced in a municipal court in India. We are only referring to it as theterms thereof throw some light on the proper understanding of the savingclause. By Art. 17 of the Agreement, in so far as material for out purpose, allorders placed outside the Establishments and finalised through the grant of alicence by competent authorities in accordance with laws and regulations inforce prior to the date of the de facto transfer were to be fulfilled by theGovernment of India and the necessary foreign exchange granted if the goodswere imported within the period of validity of the relevant licences subject topayment of customs duty and other taxes normally leviable at Indian ports. Thatis, orders placed outside the Establishments and finalised through the grant ofa licence were to be honoured by the Government of India. The word 'licence'in this Article may be construed rather widely to take in a permit or anauthorization; otherwise it would lead to the anomaly that when a licence,strictly so called, is required for a transaction and therefore obtained, thetransaction is protected by the Article, whereas the transaction which requiresonly a permit is excluded therefrom. It may be recalled that the petitionersobtained authorizations of the Economics Department in respect of their orders.This Article indicates the intention of the two Governments that the orders soplaced outside the Establishments should be honoured. If paragraph 6 of theOrder is construed in the manner suggested by the State, we would be imputingto the framers of the Order a conscious breach of the terms of the Agreementbetween the two countries, for even the orders covered by Art. 17 of theAgreement would be excluded from the operation of the saving clause.

24. We would, therefore, hold that paragraph 6 of Order saves thetransactions entered into by the petitioners and that the respondents had noright to confiscate their goods on the ground that they were imported withoutlicence. In this view, no other question arises for consideration.

25. In the result, the orders of the respondents 2, 3 and 4 are quashed andthey are directed to refund to the petitioners the amounts illegally collectedfrom them. The petitioners in all the petitions will have their costs.

Sarkar J.

26. I think that these petitions should fail.

27. Sometime in the latter half of 1954, the petitioners had in Pondicherry,then a French establishment in India, entered into certain agreements withforeign suppliers for the import into Pondicherry of diverse goods. It is saidthat at that time licences were not required for such imports from the Frenchauthorities. It appears however that these authorities granted a certain amountof foreign exchange for the imports. The importers who failed to secure anallotment of foreign exchange from the French authorities often obtained itfrom the open market through banks. The French authorities however prohibitedthe banks in Pondicherry with effect from July 1, 1954, from acquiring withouttheir permission, foreign exchange in the open market for their constituentsfor financing imports. The petitioners had with the consent of the Frenchauthorities obtained through the banks foreign exchange from the open market tofiance their imports and had with the foreign exchange so acquired, openedirrevocable letters of credit in favour of their foreign suppliers on accountof the price of the goods to be supplied. They did this shortly prior to thetransfer of administration of Pondicherry and other French establishments inIndia on November 1, 1954, to India pursuant to an agreement made on October21, 1954, between the Governments of France and India. The goods covered by theaforesaid imports were shipped and arrived in Pondicherry port after November1, 1954, and were confiscated by the Government of India who had by that timetaken over the administration of Pondicherry. The orders of confiscation gavean option to the petitioners to obtain a release of the goods by payment of afine which option was availed of by them.

28. These petitions have been filed under Art. 32 of the Constitutionchallenging the validity of the confiscation and claiming a refund of the finepaid on the ground that the confiscation was an illegal violation of thepetitioners' rights under the Constitution to hold property and to carry onbusiness.

29. The orders of confiscation had been made under s. 167 (8) of the SeaCustoms Act, 1878. That section authorised the confiscation of goods importedin contravention of orders prohibiting imports made under s. 19 of the sameAct. Section 3 of the Imports and Exports (Control) Act, 1947, also authorisedthe Central Government to prohibit by orders made by imports of goods of anyspecified description and provided that the goods to which the orders appliedwould be deemed to be goods of which the import had been prohibited under s. 19of the Sea Customs Act and that the provisions of the latter Act would haveeffect accordingly. Section 4 of the Imports and Exports (Control) Act providedthat all orders made under r. 84 of the Defence of India Rules and in forceimmediately before the commencement of the Act, would be deemed to have beenmade under the Act. There was an order made by the Government of India under r.84 of the Defence of India Rules by Notification of the Department of CommerceNo. 23 I.T.C. 43 dated July 1, 1943, which prohibited the import of the goodswhich the petitioners had imported.

30. The orders of confiscation would be unexceptionable if the statutes andOrder mentioned in the preceding paragraph applied to these imports. That theyapplied to Pondicherry as from November 1, 1954, would seem to be plain fromthe Order passed by the Government of India on October 30, 1954, under theForeign Jurisdiction Act, 1947, to take effect from the date of the transfer ofadministration, namely, November 1, 1954, called the French Establishments(Application of Laws) Order and being Ministry of External Affairs NotificationNo. S.R.O. 3315. This Order had been passed in view of the Indo-Frenchagreement and the transfer of administration provided thereby. Its validity isnot challenged. Paragraph 3 of the Order provided that the enactments mentionedin the Schedule to it and all Orders made under those enactments and in forceon November 1, 1954, would apply to the French Establishments subject to thesubsequent provisions of the Order. The enactment mentioned in the Scheduleincluded the Sea Customs Act and the Imports and Exports (Control) Act. It isnot in dispute that the Order under the Defence of India Rules mentionedearlier was in force on this date.

31. The Application of Laws Order therefore made the Sea Customs Act, theImports and Exports (Control) Act and the Order made under the Defence of IndiaRules applicable to Pondicherry as from November 1, 1954. The petitioners havehowever contended - for reasons which I will examine presently - that the Ordermade under the Defence of India Rules had not been applied to the FrenchEstablishments by the Application of Laws Order, but they have not disputedthat the Sea Customs Act and the Imports and Exports (Control) Act were appliedto Pondicherry. The petitioners rested their case mainly on the saving clausecontained in paragraph 6 of the Application of Laws Order which so far asmaterial, was in these terms :

'All laws in force in the French Establishmentsimmediately before the commencement of this Order, which correspond to theenactments in the Schedule, shall cease to have effect save as respect thingsdone or omitted to be done before such commencement'.

32. The petitioners have raised three points, two of which can be disposedof at once. It is said that the Order made under the Defence of India Rules didnot apply to the French Establishments for only Order made under the enactmentsmentioned in the Schedule were applied to them by paragraph 3 of theApplication of Laws Order, and the Defence of India Act and Rules were notenactments mentioned in the Schedule. It is true that the Defence of India Actand Rules are not mentioned in the Schedule. But as already stated, under s. 4of the Imports and Exports (Control) Act, Orders made under r. 84 of theDefence of India Rules are to be deemed to have been made under that Act. I amunable to accept the contention that an Order which has to be deemed to be madeunder the Imports and Exports (Control) Act is not an Order made under the Actfor the purposes of paragraph 3 of the Application of Laws Order. It seems tome that when an Order is required to be deemed to have been made under anenactment, it is as good as an Order made under the enactment. If it were notso, the deeming provision would lose much of its value. That being so, para. 3would make the Order applicable to Pondicherry.

33. Then it is said that the imports were made before the commencement ofthe Application of Laws Order because the contracts in respect of them had beenconcluded and the letters of credit opened before then though the goods had notbeen taken across the customs barrier at Pondicherry by that time. Therefore,it is said, the imports by the petitioners would be within the saving clause inparagraph 6 as things done before the commencement of the Application of LawsOrder, to which the Sea Customs Act, the Imports and Exports (Control) Act andthe Order made under the Defence of India Rules would not apply. This argumentalso seems to me to be ill-founded.

34. These Acts and the Order were applied to Pondicherry as from November 1,1954. The effect of that was to prohibit imports thereafter and to render thegoods imported in contravention of that prohibition liable to confiscation.What is an import - and this is what was prohibited - has therefore to bedecided by reference to these Acts and the Order. They defined import asbringing goods into India, which in the present case would include the FrenchEstablishments by virtue of paragraph 4 of the Application of Laws Order.Therefore goods brought across the customs' barrier into Pondicherry would begoods imported into Pondicherry. To the goods so brought into Pondicherry afterNovember 1, 1954, the Acts and the Order made under the Defence of India Rulesmust apply irrespective of whether the goods were brought under contractsconcluded and letters of credit opened, before that date. It is not in my viewpermissible to ascertain the meaning of the word 'import' for the purpose ofthis case by reference to other statutes or notions and to contend that therehas been an import by the making of the contract and the opening of the letterof credit without the bringing of the goods into Pondicherry as the learnedcounsel for the petitioners sought to do.

35. The main argument on behalf of the petitioners is however, that thewords 'save as respects things done or omitted to be done' in paragraph 6 ofthe Application of Laws Order saved not only the things done prior to thecommencement of the Order, that is, the placing of the indents and the openingof the letters of credit but also the effect thereof and the rights accruedtherefrom. It is said that the indents had been legally placed and the lettersof credit legally opened with foreign exchange acquired with the expresspermission of the French Administration which foreign exchange could not havebeen acquired without such permission. It is contended that the saving clausewould make the French laws applicable to the imports which were the effect of thesethings done before November 1, 1954, and also protect the rights acquired fromthe things so done, from the operation of the Indian Laws. So it is said thatthe confiscations under the Indian laws were wholly illegal.

36. Now it has to be noted that the saving clause does not say that theFrench laws would apply to the effect of things earlier done or protect rightsaccrued therefrom. I see no warrant in the absence of the necessary words toextend the application of the French laws to the effect of things done orrights acquired from the doing of them. It was said that otherwise the savingclause would be idle. I am unable to agree. If any question as to anythingearlier done arose after the transfer, that question would under the savingclause have to be decided by the French laws. In the absence of the savingclause it would have been open to argument what the effect of the transfer waswith regard to things previously done. I may also point out that s. 6 of theGeneral Clauses Act provides that when one enactment is repealed by another,then, in the absence of a different intention, the repeal shall not affectanything duly done or suffered under the repealed enactment nor any rightaccrued thereunder. It strikes me that if the saving of a thing done under therepealed enactment also necessarily saved what is called the effect of it orrights acquired from it, it would not have been necessary to expressly providealso for the saving of the rights acquired under the repealed enactment.Therefore, it seems to me that the saving of things done does not automaticallysave the effect of them or rights acquired therefrom.

37. The argument that the saving clause operated to protect the imports was basedon two English cases, namely, The Queen v. Justices of the West Riding ofYorkshire (1876) 1 Q.B.D. 220 and Heston and Isleworth Urban District Councilv. Grout (1897) 2 ch. 306 These cases considered the terms of statutesanalogous to s. 6 of our General Clauses Act, providing that a repeal of oneenactment by another shall not affect anything duly done or suffered under therepealed enactment or any right acquired thereunder. These provisions weretherefore materially different from the saving clause now before us, as theyexpressly saved rights acquired under a repealed statute. The first mentionedcase held that as the two statutes were substantially for the same purpose,namely, making a rate, the notice to make a rate under the repealed Act shouldhave effect after the repeal in view of the saving clause, as it could havebeen given under the repealing Act for the same purpose. It would be difficultto apply the principle of this case where two statutes have not the samepurpose. Apart from the fact that we have here no two statutes, the Indianenactments with which we are concerned, would seem to have made a completedeparture from the position existing on the same subject during the FrenchAdministration. In the other case it was held that when a thing duly done undera repealed enactment was saved by a saving clause in the repealing Act, theeffect of it was also saved. But the effect of the thing done would be saved bythe express provision contained in the saving clause, namely, that the repealshall not affect any right acquired under the repealed enactment and thejudgment in this case was also based on this express provision to remove anydoubts that might arise as to the other reasoning employed. The thing done inthis case was the giving of a notice by a local authority to certain houseowners to sewer and make up a private street. The effect saved was the recoveryby the local authority from the owners of the expenses of the sewering andmaking of the street which it had to incur on the owner's failure to carry outthe terms of the notice. These things naturally took time and in the meantimethe Act under which the notice was given had ceased to be applicable. Theobservation made in this case cannot be applied to a case like the present.

38. Then again it seems to me that there is considerable difference betweenthe terms of the saving clause, considered in the English cases and the savingclause with which we are concerned. The saving clause in the English cases asalso s. 6 of our General Clauses Act, applies where a subsequent statuterepeals a previous stature passed by the legislature of the same country. Thatis not the position here. We have here laws of the Indian legislature replacingFrench laws. Indeed it is at least arguable whether without more, the Frenchlaws would have been of force after the transfer; it would seem that thisdifficulty was realised and so it was expressly provided by paragraph 5 ofanother Order called the French Establishments (Administration) Order, made byNotification No. 3314 dated October 30, 1954, issued by the External AffairsMinistry of the Government of India, that all laws in force in the FrenchEstablishments and not repealed by para. 6 of the Application of Laws Orderwould continue to be in force until repealed.

39. Further, the saving clauses considered in the English cases preservedunaffected by the repeal, only things done under the repealed enactment and therights acquired thereunder. The saving clause that we are considering saves thingsdone before the commencement of the Application of Laws Order whether the thingwas done under any law or not; it does not purport to preserve a right acquiredunder a statute repealed. In Hamilton Gell v. White (1922), it was observedthat s. 38 of the English Interpretation Act, 1889, which corresponds to s. 6of out General Clauses Act, 'was not intended to preserve the abstractrights conferred by the repealed Act .......... It only applies to specificrights given to an individual upon the happening of one or other of the eventsspecified in the statute.' Likewise in Abbott v. Minister for Lands(1895) A.C. 425 it was observed about a saving clause which protectedrights accrued under repealed enactments, that, 'the mere right (assumingit to be properly so called) existing in the members of the community or anyclass of them to take advantage of an enactment, without any act done by anindividual towards availing himself of the right, cannot properly be deemed a'right accrued' within the meaning of the enactment'. Theprinciple of the English cases on which the petitioners relied would not applyexcept to protect rights acquired under repealed statutes. In the case beforeus the petitioners could not say that they had acquired any right under anyFrench law, to import the goods. There was admittedly no law which gave thepetitioners any right to import any goods. The position was only that there wasan absence of was prohibiting import. That clearly did not give the petitionersany right and certainly not a right under a statute which was repealed. Allthat the French authorities had done was to permit the petitioners to acquireforeign exchange in the open market for financing their imports. It would beimpossible to say that thereby the petitioners acquired any right under anyFrench law to import any goods.

40. Lastly, the principle of the two English cases applies admittedly onlywhere there is no intention to the contrary. Now it seems to me that here thereis indication of an intention to the contrary. Clause 17 of the agreementbetween India and France provided that imports finalised through the grant oflicence prior to the transfer would be fulfilled but the goods would be liableto customs duty normally leviable in Indian ports. Clearly, therefore, it wasnot intended that after the transfer, Pondicherry would remain a free port inrespect of imports made even under agreements concluded prior to the transferunder a licence. On such imports duty had to be paid after the transfer. The rightto import freely was not therefore intended to be preserved. If so there couldhave been no intention, in any event, to protect a right to import freely underan agreement made prior to the transfer, where there was no licence granted forthe import. Admittedly, the petitioners had not obtained any such licence.

41. For all these reasons it seems to me that the English decisions reliedon are of no assistance in the present case. I am unable to read the savingclause in this case as if it is the same as s. 6 of our General Clauses Act orthe corresponding clause in the English Interpretation Act, 1889, and to obtainguidance from the decisions based on these statutes. I have therefore come tothe conclusion that the saving clause in paragraph 6 of the Application of LawsOrder does not protect the imports made by the petitioners, from the operationof the Indian laws applied to the French Establishments.

42. I would dismiss these petitions.

Shah J.

43. Petition No. 123 of 1957 : Prior to November 1, 1954, Pondicherry wasone of the French Establishments in India administered by the Government ofFrance. Under the French administration, except specified categories like gold,rock-salt and certain medicinal preparations, all commodities could be importedinto the Pondicherry Port without a licence. The French Administrationexercised control on import of commodities into Pondicherry indirectly bymaking allotment of the requisite foreign exchange. The Government of Francemade an overall allotment of foreign exchange for the French Establishments inIndia, and persons desiring to import goods in Pondicherry and other FrenchIndian settlements were, on applications addressed to the Chief Commissioner,French Settlements, granted foreignb exchange facility for financing imports,out of that allotment. Besides the allotment of foreign exchange for financingimports into the French Establishments in India, certain other currencyallotments were made by the Government of France in the light of TradeAgreements between the French Government and other countries. The ChiefCommissioner of Pondicherry issued permits for the import of commoditiesspecified in the Trade Agreements upto the current ceilings fixed in theAgreements. Two kinds of permits for obtaining official exchange by importerswere issued by the Chief Commissioner which were known as'Authorisation' and 'Attestation'.'Authorisation' was issued for import of goods from countries withwhich France had Trade Agreements and 'Attestation' for import of goodsfrom France and from countries with which the Government of France had not madeTrade Agreements. By issuing 'Authorisation' and'Attestation', the Government undertook to provide foreign exchangefor financing the imports made pursuant thereto. Since April 1, 1954, the ChiefCommissioner of Pondicherry allowed intending importers to purchase foreignexchange in the open market for financing imports of merchandise. TheDepartment of Affairs, Economiques, endorsed 'authorise' on theapplication submitted by the importers' banker in respect of such transactions,but the Government did not undertake thereby to provide foreign exchange. Asofficial exchange for imports was freely released, only a few imports werefinanced before July 1954 with the aid of exchange purchased in the openmarket.

44. Negotiations were proceeding between the Government of India and theGovernment of France for transfer of the France Establishments in India to theUnion of India, and when it came to be known that the transfer was imminent,there was feverish activity goods into the French Settlements with the aid offoreign exchange purchased in the open market, and in the months of August,September and October orders were placed by importers with foreign suppliersfor purchase of commodities of the value of Rs. 280 lakhs to be financed byforeign exchange procured from the open market. Traders who were not normallydoing business in Pondicherry and who had no business interest in FrenchEstablishments also opened officers in Pondicherry and started indenting goods,to be financed with the aid of foreign exchange in the open market.

45. An agreement for the de facto transfer of the administration of theFrench Establishments in India was executed between the Government of India andthe Government of France on October 21, 1954. This agreement became effectiveon November 1, 1954. In exercise of the powers conferred by s. 4 of the ForeignJurisdiction Act, 1947, on October 31, 1954, the Government of India issued twoorders - S.R.O. 3314, the French Establishments (Administration) Order, 1954,and S.R.O. 3315, the French Establishments 1954, and S.R.O. 3315, the FrenchEstablishment (Application of Laws) Order, 1954. By S.R.O. 3315, certainenactments specified in column (3) of the Schedule which included the SeaCustoms Act, 1878, The Reserve Bank of India Act, 1934, The Imports and ExportsTrade (Control) Act, 1947, The Foreign Exchange Regulation Act, 1947, and TheIndian Tariff Act, 1934, were applied to the French Establishments ofPondicherry, Karaikal, Mahe and Yanam, with the modification that references inthe enactments, notifications, orders and regulations which were applied to theFrench Establishments, to India or to the States were to be construed asreferring to the French Establishments also. These orders came into force onNovember 1, 1954.

46. The petitioners who carried on trade in diverse commodities in Bombayopened a place of business in Pondicherry on April 14, 1954, and placed eightindents with Messrs. Shimada Trading Co., Ltd., Osaka, Japan, for importingporcelain ware, glass marbles and beltings. On an application submitted byBankque D.L' Indo-China on behalf of the petitioners, the Bureau Des AffairsEconomique, Pondicherry, endorsed 'authorise' for the requisiteforeign exchanger was sold purchased in the open market. This exchange was soldto the petitioners for the amount involved in the letters of credit. BetweenAugust 28, 1954, and August 31, 1954, three revocable letters of credit of theaggregate value of Pounds 12,850 were opened by the petitioners and pursuant tothese letters, M/s. Shimada Trading Co., Ltd., shipped goods to Pondicherry. OnNovember 30, 1954, the shipping documents were received by the petitioners fromMessrs. Shimada Trading Co., Ltd. Admittedly the goods were shipped by theforeign suppliers after the de facto transfer of Pondicherry. The applicationssubmitted by the petitioners for the issue of customs permits sanctioningclearance of the goods were rejected by the Controller of Imports and Exportsat Pondicherry. On January 5, 1955, the Chief Controller of Imports and Exportsissued a public notification that on a consideration of the representationsmade by some of the importers asking for permission to import goods for which necessaryforeign exchange had been obtained in the open market through bankers inPondicherry and in consultation with the authorities concerned, it was'clarified for information' that open market transactions of thenature referred to in the representations were not covered by the Indo-FrenchAgreement, and that the import of goods against open market transactions afterNovember 1, 1954, must be treated as unauthorised; but having regard to thehardship likely to be caused to genuine importers who had placed orders inpursuance of their normal trading operations, the Collector of Customs,Pondicherry, was being authorised to accord certain concessions to genuineimporters. By one of such concessions, goods shipped before November 1, 1954,were permitted to be cleared 'without penalty' irrespective of theirorigin and value, and consignments fully paid for in foreign currency andshipped after November 1, 1954, and ordered before August 15, 1954, were alsopermitted to be cleared 'without penalty'.

47. The goods indented by the petitioners were confiscated by the customsauthorities exercising powers under s. 167 (8) of the Sea Customs Act, on theground that the same had been imported without a valid licence and incontravention of the Department of Commerce and Industries Notification No.43-1 T.C./43 dated July 1, 1943, (as amended) read with sub-s. 2 of s. 3 of theImports and Exports Trade (Control) Act, 1947. The petitioners were by orderspassed between February 28 and March 4, 1955, given an option to clear thegoods for 'home consumption' on payment of customs duty and finespecified in the order. These orders were confirmed in appeal by the Board ofRevenue and by the Government of India in exercise of revisional jurisdiction.In the meanwhile the petitioners paid the duty and the fine imposed by thecustoms authority and cleared the goods.

48. The Union Government having rejected the Revision applications, thepetitioners submitted this petition under Art. 32 of the Constitution for awrit or direction in the nature of certiorari requiring and commanding theChief Controller of Imports and Exports, Pondicherry, the Collector of Customsand Central Excise, Pondicherry, the Central Board of Revenue and the Union ofIndia and quashing the orders passed by the Customs authorities and the Unionof India and for a mandamus requiring the respondents to forbear from givingeffect to or otherwise acting upon the orders passed by the Customs authoritiesand the Union of India, and for a further writ or order directing therespondents to restore to the petitioners the sum of Rs. 30,890 paid as penaltyfor releasing the goods.

49. Undoubtedly, the petitioners had before November 1, 1954, placed indentsfor importing goods of diverse descriptions form foreign suppliers and for thatpurpose, they had acquired foreign exchange through their bankers in the openmarket. The petitioners had also opened irrevocable letters of credit in favourof the Japanese suppliers. It may be assumed, every though there is no clear evidencein that behalf, that the petitioners were after opening irrevocable letters ofcredit, unable to cancel the indents. Section 167, clause (8), of the SeaCustoms Act, in so far as it is material, provides that if any goods, theimportation of which is for the time being prohibited or restricted by or underChapter IV of the Act, are imported into India contrary to such prohibition orrestriction, such goods shall be liable to confiscation. By s. 3 of the Importsand Exports Trade (Control) Act, XVIII of 1947, the Central Government isauthorised by order published in the official Gazette to prohibit, restrict orotherwise control in all cases or in specified classes of cases, the import,the bringing into any Port or place in India of goods of any specifieddescription. By s. 4, all orders made under r. 84 of the Defence of India Rulesor that rule as continued in force by the Emergency Provisions (Continuation)Ordinance, 1946, and in force immediately before the commencement of the Act,in so far as they were not inconsistent with the provisions of that Act,continued to remain in force and we to be deemed to have been made thereunder.Under the rules framed under the Defence of India Rules, the import of goods ofthe description indented by the petitioners, was, it is not disputed,prohibited, and the rules framed under the Defence of India Rules continued inforce by the operation of s. 4 of the Imports and Exports Trade (Control) Act,1947. The rules and orders made under r. 84 of the Defence of India Rules wereon November 1, 1954, operative as if they were made under the Imports andExports Trade (Control) Act, 1947, and when that Act was extended to the FrenchEstablishment of Pondicherry, these rules and orders became also applicable tothat area. By s. 19 of the Sea Customs Act, the Central Government may bynotification prohibit or restrict the bringing by sea, goods of any specifieddescription into India across any customs frontier as defined by the CentralGovernment. By s. 2 (b) of the Imports and Exports Trade (Control) Act, 1947,import is defined as bringing into India by sea, land or air. Import of goodstherefore means carrying goods across the customs frontier declared by theGovernment of India. There is no dispute that under s. 19, the Port ofPondicherry was declared a customs frontier. Admittedly, the goods indented bythe petitioners were brought into India, i.e., imported into India afterNovember 1, 1954. Importation of these goods without a licence in that behalfbeing prohibited under a notification under the Imports and Exports Trade(Control) Act, by bringing the goods into the Pondicherry Port, prima facie s.167 (8) of the Sea Customs Act was contravened.

50. But the petitioners contend that in view of the agreement between theGovernment of India and the Government of France and the two orders issued inexercise of the powers conferred by s. 4 of the Foreign Jurisdiction Act, 1947,the provisions of the Sea Customs Act and the orders made or deemed to be madeunder the Imports and Exports Trade (Control) Act, 1947, did not apply to thegoods in question. By clause 3 of the agreement dated October 21, 1954, theGovernment of India succeeded to the rights and obligations resulting from suchacts of the French Administration in these Establishments as were binding onthe territory. By para. 5 of Art. 10, acts or deed constitutive of rightsestablished prior to the date of the de facto transfer in conformity withFrench law retained the value and validity conferred at that time (by the samelaw). By Art. 17, in so far as it is material, all orders placed outside theestablishments and finalised through the grant of a licence by competentauthorities in accordance with the laws and regulations in force prior to thedate of the de facto transfer were to be fulfilled by the Government of Indiawho were to grant the requisite foreign currency, if the goods were importedwithin the period of validity of the relevant licence subject to payment ofcustoms duty and other taxes normally leviable at Indian Ports. This agreementis between the Government of India and the Government of France, and thecovenants thereof do not purport to an cannot confer any rights enforceable atthe instance of citizens of Pondicherry or of India. By s. 3, certain obligationsenforceable against the French Administration were undertaken by the Governmentof Indian, but no obligations thereby enforceable were undertaken by the IndianGovernment which the petitioners could enforce. Para. 5 of Art. 10 falls in thechapter headed 'Judicial Matters' and only declares that acts anddeeds which constitute rights in conformity with the French Law shall retainthe same value after merger with the Union of India and by Art. 17, theobligation is undertaken by the Government of India to fulfil the orders placedoutside the Establishments and finalised through the grant of a licence bycompetent authorities. But the petitioners had obtained no license from anycompetent authority for importing or even for indenting the goods.

51. It was urged that the orders S.R.O. 3314 and S.R.O. 3315 issued underthe Foreign Jurisdiction Act should be construed in the light of the agreementbetween the Government of India and the Government of France. By S.R.O. 3314,provision is made by the Government of India for the administration of theerstwhile French Establishments. By clause 5 of that notification, all laws inforce in the French Establishments or any part thereof immediately before thecommencement of the order and not repealed by clause 6 of the FrenchEstablishments (Application of Laws) Order, 1954, shall continue to remain inforce until repealed or amended by a competent authority. The law, if any,relating to the import of goods into India applicable in the FrenchEstablishments prior to November 1, 1954, stood expressly repealed by clause 3of S.R.O. 3315 which provided that the enactments specified in column 3 of theSchedule as in force before the commencement of this order shall be applied toand shall be in force in the French Establishments subject to (a) anyamendments to which the enactments are for the time being generally subject inthe territories to which they extend; (b) the modifications, if any, specifiedin column 4 of the schedule; and (c) the subsequent provisions of the order. Bycolumn 3 of the schedule to this order, the Sea Customs Act, the Reserve Bankof India Act and the Imports and Exports Trade (Control) Act were expresslyapplied to the French Establishments, and under the provisions of these Actsand notifications issued thereunder as form November 1, 1954, no person couldwithout a license in that behalf import goods of the nature indented by thepetitioners. By clause 6, it was enacted that 'unless otherwisespecifically provided in the schedule, all laws in force in the FrenchEstablishments immediately before the commencement of this order, whichcorrespond to the enactments specified in the schedule, shall cease to haveeffect, save as respects things done or omitted to be done before suchcommencement'. The Sea Customs Act and the Imports and Exports Trade(Control) Act were expressly made applicable to the French Establishment ofPondicherry and all corresponding law in that territory ceased to have effectsave as respects things done or omitted to be done before such commencement.Clause 6 does not authorise the doing of things expressly forbidden by theprovisions of the Acts made applicable by schedule 3 in the PondicherryEstablishment, and by the use of the expression, 'things done or omittedto be done' in the clause, to the rights or legal consequences which maybut for the application of the enactments specified in schedule 3 have flownfrom the acts done or omitted to be done the French law does not continue toapply. The clause undoubtedly protects French laws which correspond to theenactments specified in schedule 3 in so far as they concern things done oromitted to be done before the commencement of S.R.O. 3315. In superseding theFrench law in force on the prescribed date, the clause 6 emphasises that theenactments specified in schedule 3 have no retrospective operation, and ascounterpart thereof provides that all transactions which have been concludedbefore November 1, 1954, will continue to be governed by the French lawnotwithstanding the enactment of the Acts specified.

52. Since the date of the de facto transfer of the French Establishments tothe Indian Union, all imports of goods across the customs frontier atPondicherry were subject to the provisions of the Sea Customs Act and theImports and Exports Trade (Control) Act; and goods shipped after November 1,1954, in pursuance of indents before that date were not expressly saved fromthe operation of the restrictive provisions of those Acts. On and from November1, 1954, the law if any relating to the import of goods operative in the Frenchterritory was superseded and the goods having been brought into the PondicherryPort after November 1, 1954, the import was governed by the Sea Customs Act andthe Imports and Exports Trade (Control) Act and not by any law of the Frenchterritory. The supersession of the French laws by the application of thestatutes set out in schedule III was, on November 1, 1954, complete, 'saveas respects things done or omitted to be done'. Does the expression'things done' include consequences which may have ensued in futurebut for the supervention of the merger agreement Ex facie, by clause 6, theFrench law is kept alive in respect of 'things done or omitted to bedone', i.e., things done or omitted to be done in the past; it has not theeffect of keeping alive that law in respect of things to be done or omitted tobe done in future. All transactions completed after November 1, 1954, will, onthe plain words of clause 6, be governed by the statutes made applicable byvirtue of clause 3 of S.R.O. 3315.

53. Section 6 of the General Clauses Act, 1897, has in terms no applicationwhen the court is called upon to ascertain the effect of supersession of Frenchlaw by the application of the specified statutes by clause 6 of S.R.O. 3315. Interms s. 6 of the General Clauses Act applies to the effect of repeal ofenactments of the Indian legislature, and there is nothing in S.R.O. 3315 whichsupports the plea that the section applies as if the French law in operationbefore merger of the French Establishments is to be regarded as a statuteenacted by the Indian legislature. In that premise, it is difficult toappreciate how the principle of cases decided by the courts in England on thewords of s. 38 of the Interpretation Act, 1889 (52 and 53 Vict. ch. 63) - whichare substantially the same as those used in s. 6 of the General Clauses Act,1897, can lend any assistance in interpreting the meaning of the expression'things done or omitted to be done' in clause 6 of S.R.O. 3315. Byenacting S.R.O. 3315, the French law after its supersession has not beenexpressly kept alive in respect of any right or privilege acquired or accruedunder the things done under that law; and it would be an unwarranted incursioninto the field of legislation to attempt to extend the protection of that lawto transactions which have taken place after the prescribed date relying uponthe General Clauses Act.

54. Nor is the interrelation between the agreement of purchase with aforeign seller, and the various processes leading to the delivery of goods to acommon carrier and the ultimate import of goods sufficient to include withinthe expression 'things done' used in clause 6 of S.R.O. 3315consequences of the things done which may ensue in future. Within theexpression 'in the course of import of the goods into the territory ofIndia' used in Art. 286(1)(b) of the Constitution, a series ofintegrated activities resulting in the taking of goods across the customsfrontier may be involved. But import as defined in the Imports and ExportsTrade (Control) Act is bringing a commodity in the territory of India;preliminary steps even if they are closely integrated therewith are notincluded in that definition. If steps preliminary to import are not included inthe concept of import, in dealing with the provisions of the Sea Customs Actand the Imports and Exports Trade (Control) Act, it would be difficult toafford protection of the French laws expressly granted by virtue of clause 6 ofS.R.O. 3315 to such of the preliminary steps as have taken place before theprescribed date, and to create an exemption in favour of imports consequentialupon those preliminary steps, which the legislature has declined to do.

55. In my view, therefore, by the use of the expression 'things done oromitted to be done before such commencement' in clause 6 of S.R.O. 3315French law applies to acts and omissions before November 1, 1954, and not tolegal consequences of those acts and omissions ensuing after that date, and henceimport of goods across the customs frontier in the Pondicherry Port afterNovember 1, 1954, without a licence in that behalf is contrary to theprovisions of the Sea Customs Act and the Imports and Exports Trade (Control)Act.

56. The provisions of the Sea Customs Act and the Imports and Exports Trade(Control) whereby restrictions are imposed upon the import and export of goodsare not by themselves unreasonable. If the petitioners are not entitled to thebenefit of clause 6 of the Indo-French Agreement, there is no other ground onwhich they can successfully impugn the validity of the orders imposing duty andpenalty.

57. I am therefore of the view that this petition should be dismissed withcosts.

58. For reasons set out in the principal petition, petitions Nos. 124 and125 of 1957 and 118 of 1959 should also be dismissed with costs.

59. BY COURT : In view of the majority Judgment, the petitions are allowed.The petitioners in all the petitions will have their costs.

60. Petitions allowed.


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