Raghubar Dayal, J.
1. A number of gold bars, held to be smuggled gold, were recovered from theperson of the appellant on September 17, 1957, when he was going in a truckfrom Jaisalmer to Pokaran. The Superintendent of Land Customs issued a noticeto the appellant on December 4, 1957, to show cause why penal action be nottaken against him and as to why the goods should not be confiscated undersection 167(8) of the Sea Customs Act, 1878 (Act 8 of 1878), hereinafter calledthe Act. The appellant showed cause and on March 21, 1959, the Collector ofCentral Excise and Land Customs, hereinafter shortly termed Collector, orderedthe confiscation of the gold seized from the person of the appellant andimposition of a penalty of Rs. 15,000 on him under section 167(8) of the Act.The appellant presented writ application under art. 226 of the Constitution tothe High Court of Punjab praying for the issue of a writ of certiorari quashingthe order of the Collector dated March 21, 1959 and for the issue of a writ ofmandamus directing the respondents not to take any steps against him for therealisation of amount of penalty.
2. The writ petition was allowed by the learned Single Judge on the groundthat the Collector had not recorded a finding that the appellant was concernedin the act of smuggling gold into the country, in view of the decision of theDivision Bench of the Punjab High Court in Balbir Singh v. Collector of CentralExcise & Land Customs, New Delhi . On letters patentappeal the appellate Bench set aside the order of the learned Single Judge anddismissed the writ petition. The appellate Bench relied on the Full Benchdecision of the Punjab High Court in Union of India v. Jagdish Singh . It was held in that case that it was not necessary for theCollector of Customs to record a formal finding to the effect that the personproceeded against was concerned in the importing of the smuggled gold. Theappellant then preferred this appeal, after obtaining special leave from thisCourt.
3. Mr. Sharma, for the appellant, does not question the finding that thegold was recovered from the person of the appellant as alleged or that the goldrecovered was a smuggled gold. His contention is that these findings, bythemselves, do not justify the conclusion to the effect that the appellant wasconcerned in committing the offence of importing gold illegally. His furthercontention is that the Collector did not record any finding to the effect thatthe appellant was concerned in such importation of the gold. It is thereforeurged that the Collector was not competent to impose the penalty on theappellant.
4. Mr. Prem, for the respondent, has urged that on these facts the appellantmust be held to be 'interested in the importation' of the smuggled gold andthat the word 'concerned' in section 167(8) of the Act be construed in thelight of the policy of the Act and the difficulties in establishing the fact ofa person found in possession of smuggled gold being actually concerned in theimporting of it illegally.
5. The relevant portion of section 167(8) reads :
'The offences mentioned inthe first column of the following schedule shall be punishable to the extentmentioned in the third column of the same with reference to such offencesrespectively :-
(Column 1) (Column 3)
8. If any goods, the importation Such goods shall be liable to
or exportation of which is for confiscation, and
the time being prohibited or
restricted by or under Ch. IV any person concerned in any
of this Act, be imported into or such offence shall be liable
exported from India contrary to to a penalty not exceeding three
such prohibition, or restriction, times the value of the
or goods, or not exceeding one
if any attempt be made so to
import or export any such goods,
if any such goods be found in
any package produced to any
officer of Customs as containing
no such goods or
6. The question is, who can be said to be 'concerned' in any such offencefor the purposes of the expression used in the third column relating to penalties.Such a person would be one who is concerned in the importation or exportationof such goods whose importation into or exportation from India is contrary tothe prohibition or restriction placed under Chapter IV of the Act. The offencesdescribed in the first column have reference to sections 18 and 19 of the Act.Section 18 prohibits the bringing into India, whether by land or sea, of thegoods mentioned in its several clauses. Section 19 empowers the CentralGovernment to prohibit or restrict by notification in the Official Gazette, thebringing or taking by sea or land goods of any specified description into orout of India across any customs frontier. It follows therefore that the personwho can be penalised under section 167(8) is one who is in any way 'concerned'in the commission of the offence of bringing into India or taking out of thecountry goods with respect to which certain prohibitions or restrictions exist.It is not disputed that gold cannot be brought into the country without a validpermit from the authority empowered to issue it. It is not disputed also thatthe gold recovered from the appellant was imported into the country illegally.The appellant can therefore be said to be concerned in the commission of theoffence of illegally bringing into the country gold, if he had been in some wayresponsible for such 'bringing into the country'. He cannot be said to be soconcerned in the commission of this offence if he is not responsible in thismanner and if he got possession of the gold after it had been brought into thecountry. His being in possession of such gold, when arrested, can in no wayraise the presumption that he actually brought such gold into the country fromoutside the border or that he was responsible for its being brought into thecountry by taking such action which led to the importing of the smuggled goldprior to its import. There is no evidence about any action taken by theappellant in connection with the import of the gold found in his possession. Itis immaterial what meaning be attributed to the word 'concerned'. It can havethe meaning 'interested' as urged for the respondent. It may have the meanings'involved' or 'engaged' or 'mixed up'. The requirements of the expression'concerned in any such offence' in the penalty part of section 167(8) are thatthe person to be penalised must be interested or involved or engaged or mixedup in the commission of the offence referred to in the first column of section167(8). The interest or the involvement or the engagement or the mixing up ofthe appellant in the commission of the offence must be at a stage prior to thecompletion of the offence of illegal importation of gold into the country. Oncethe gold has been imported, any subsequent interest etc., in the smuggled gold cannotbring in the person showing such interest etc., within the purview of section167(8) for the purposes of the imposition of the penalty. The offence ofimportation of goods is complete when the goods have crossed the customsfrontier. This is clear from the provisions of section 19 and also from thoseof section 18 which, however, does not use the actual expression 'across thecustoms frontier'.
7. We are therefore of opinion that the mere finding of fact recorded by theCollector of Customs in this case about the smuggled gold being recovered fromthe possession of the appellant is not sufficient to conclude, as urged for therespondent, that the appellant was 'concerned' in the illegal importation ofthe smuggled gold into the country and therefore liable for the penalty undersection 167(8) of the Act.
8. The view we have expressed has been taken by the Bombay, Calcutta andMadras High Courts in Pukhraj Jain v. D. R. Kohli I.L.R. 1959 Bom. 1771; Gopal Mayaji v. T. C. Seth A.I.R. 1960 Bom. 478; Addl. Collector of Customsv. Sitaram : AIR1962Cal242 ; Devi Chand J. & Co. v. Collector,Central Excise : AIR1960Mad281 .
9. The Punjab High Court has taken a different view and we may now considerits reasons for the contrary view.
10. In Balbir Singh's Case , there was no disputethat the Collector had not recorded a finding that the petitioner before theHigh Court was concerned in the offence of importation or exportation of goodswhich were for the time being prohibited or restricted. It was therefore heldthat the order imposing a penalty on the person could not be sustained. It wasthis case which was relied on by the learned Single Judge in the present caseas the finding recorded by the Collector was as follows :
'In view of all thisevidence on record I hold that the gold in question is smuggled one and wasrecovered from Shri Radha Kishan while he was taking the same to Pokaran intruck No. RJM 40.
11. I therefore orderconfiscation of the seized gold under Section 7(i) of the Land Customs Act....I also impose upon Shri Radha Kishan a personal penalty of Rs. 15,000 (RupeesFifteen thousand only) under Section 167(8) of the Sea Customs Act, 1878.'
12. The Division Bench, on Letters Patent Appeal, relied on Jagdish Singh'sCase , and held that the finding that Radha Kishan wasconcerned in the importation of gold was implicit in the manner in which theCollector dealt with the case. It observed :
It cannot be gainsaid that here, apart from thefact that the smuggled gold in a large quantity was found concealed on theperson of Radha Kishan, the plea taken by Radha Kishan that it was not takenfrom his person was found to be false and this circumstance taken together withthe recovery of the smuggled gold would be sufficient for the Collector to besatisfied that Radha Kishan was concerned in the importation of the smuggledgold.'
13. The circumstances referred to by the Punjab High Court appellate Benchmay be sufficient for holding that the appellant knew that he was carryingsmuggled gold and that he was thereby committing some offence. But we areunable to say how these circumstances lead to the conclusion that he must be'concerned' in the importation of that gold. It is not invariably the case thatsmuggled things are carried by the smuggler himself or by someone who had takensteps for the smuggling of those goods. They can be carried by persons who hadnothing to do with the smuggling or illegal importation of the goods into thecountry and had come to possess them subsequently even with the knowledge thatthey were smuggled goods.
14. The facts of Jagdish Singh's case , were somewhatdifferent. The conclusion, whose correctness is not before us for decision, aboutJagdish Singh's being concerned in the illegal importation of the foreignwatches was based not only on his being in possession of those watches aftertaking delivery of the parcel from the post office but was based on severalother circumstances. We are however concerned with the other aspect of thedecision in this case and that relates to the findings which a Collector shouldarrive at before he imposes a penalty on the person proceeded against, undersection 167(8) of the Act. The Collector had not recorded any express findingthat Jagdish Singh had been concerned in the illegal importation of thewatches. The High Court held that law does not require any formal finding tothat effect. It is true that an omission to record a formal finding to this effectmay not be fatal to the imposition of the penalty by the Collector, but theorder of the Collector must show that he had considered this aspect of thematter. The order should clearly indicate what matters he had considered tohave a bearing on the question of the person's being concerned in illegalimportation of the goods and why he had concluded there from that that personwas so concerned and therefore liable to pay the penalty under section 167(8)of the Act. The decision of the High Court in Jagdish Singh's case does not appear to hold to the contrary. It is said at p. 486 :
What has to be ascertained is whether theTribunal's mind was directed to a certain matter and whether the Tribunal did,in fact, arrive at a particular conclusion. In the present case, I have nodoubt that the Collector did conclude that Shri Jagdish Singh was responsiblefor the illegal importation of the watches in question and 'could not absolvehimself from the infringement of the regulations'.'
15. The judgment in question mentions that the Collector of Customs, afterrecording the order of confiscating the watches held to be of foreign originand to have been imported through unlawful means, went on to consider thequestion of Jagdish Singh's personal liability and held that he could not beabsolved of the liability of having infringed the Import Trade ControlRegulations. If the Collector had actually done so, his omission to record aformal order about Jagdish Singh's being concerned in the illegal importationof the watches would not have made the order bad in law. The further extractfrom the order of the Collector does not, in our opinion, support this view ofthe High Court as it indicates that the Collector formed this opinion on thebasis of his finding that Jagdish Singh was in possession of the smuggledwatches. The way the Collector recorded his finding indicates that he concludedabout Jagdish Singh's being concerned in the illegal importation of the watchesmerely on the basis of his being in possession of those watches. This he couldnot have justifiably done in view of what we have said above. The extract formthe Collector's order in this connection is :
Shri Jagdish Singh cannot absolve himself from theinfringement of I.T.C. Regulations inasmuch as he was in possession of theoffending watches. I, therefore, impose on Shri Jagdish Singh a personalpenalty of Rs. 7,000..'
16. We do not agree with the High Court that it was implicit in this orderthat the Collector was fully satisfied and Shri Jagdish Singh was concerned inthe offence described in section 167(8) of the Act.
17. We therefore hold that a mere finding of fact that a person is inpossession of smuggled goods does neither imply that the Collector of Customshad considered the question of the person's being concerned in the commissionof the offence of illegal importation of the goods nor in any way justifies theconclusion that the person must have been so concerned. Other circumstancesindicating that the person had some connection with the importation of thegoods prior to their actual import have to be established. In the present caseno such circumstances have been alleged which would connect the appellant withthe actual importing of the smuggled gold recovered from his person. There isno mention of any such circumstances in the order of the Collector or even inthe reply affidavit filed in the High Court by the Assistant Collector ofCentral Excise and Land Customs, New Delhi, though the appellant had said inground no. C of the writ petition that there was absolutely no material beforerespondent no. 3 on which he could have come to a finding that the petitionerhad imported the said gold.
18. We may also mention here that there is no allegation that the appellanthimself smuggled the gold from outside the country.
19. In the result, we allow the appeal with costs throughout, set aside theorder of the appellate Bench of the High Court and restore that of the SingleJudge.
20. Appeal allowed.