# RANCHHODDAS ATMARAM v. THE UNION OF INDIA

- **Citation:** [1961] 3 S.C.R. 718
- **Court:** Supreme Court of India
- **Decided:** 1961
- **Case number:** Criminal Appeal No. 107of1958
- **Bench:** B. P. Sinha, s. K. DAS, A. K. Sarkar, N. Rajagopala Ayyangar, J. R. Mudholkar
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/ranchhoddas-atmaram-v-the-union-of-india-2079
- **Pages:** 13

## Headnote

Sea Customs-Import of prohibited goods-Maximum PenaltyWhether can be levied in excess of Rs. r,ooo/--Sea Customs Act,
r878 (VIII of r878), ss. r9, 167, item No. 8.
Item 8 of the schedule to s. 167, Sea Customs Act, 1878,
. provides that any person concerned in the importation or exportation of prohibited goods shall be liable to a penalty "not
exceeding three times the value of the goods. or not exceeding
one thousand rupees."' The petitioner was found to have imported
gold of the value of Rs. 25,000/- and the Customs authorities
imposed a penalty of Rs. 5.000/-. The petitioner challenged the
validity of the order imposing the penalty on the ground that the
maximum penalty that could be imposed under item 8 of s. 167
was Rs. l,ooo/-.
Held, that the orders imposing the penalty was valid. It is
open to the Customs authorities to impose any of the alternative
penalties provided though the amount of it exceeds the amount
of the maximum in the other alternative. None of the previous
decisions of the Supreme Court were authority for the proposition that the maximum penalty which can be imposed under
item 8 of s. 167 is Rs. l,ooo/- as this question did not arise in
those cases. On the plain language of the provision which was
in the affirmative form it gave an option to the Customs authorities to impose any one of the two penalties provided. The relevant
words could not be read as "shall not be liable to a penalty
exceeding three times the value of the goods, or exceeding one
thousand rupees."'
Maqbool Hussain v. State of Bombay [1953] S.C.R. 730, Babula I
Amthalat Mehta v. The Collector of Customs [1957] S.C.R. rrro and
F.N. Roy v. The Collector of Customs, Calcutta [1957] S.C.R. rr51,
explained and distinguished.
The Metropolitan Board of Works v. Steed (1881) L.R. 8 Q.B.D.
445, referred to.
ORIGINAL JURISDICTION: Petition No. 300 of 1960.
Petition under Art. 32 of the Constitution of India.
for enforcement of Fundamental Rights
and
Criminal Appeal No. 107of1958.
3 S,C.R.
SUPREME COURT REPORTS
719
Appeal by special leave from the judgment and
order dated April 5, 1957, of the Bombay High Court
in Criminal Revision Application No. 1100 of 1956.
Por'Us A. Mehta, S. J. Sorabjee, S. N. Andley, J.B.
Dada,chanji, Rameshwar Nath and P. L. Vohra, for the
petitioners.
C. K. Daphtary, Solicitor-Genera! of India, H. R.
Khanna, Y. S. Parmar and G. Gupta, for respondents
(In Petn. No. 300of1960).
N. C. Chatterjee and R. L. Aggarwal, for the appeJ.
!ant.
H. R. Khanna and R.H. Dhebar, for respondents (In
Cr. A. No. 107 of 1958.)
1961. February 3. The Judgment of the Court was
delivered by
Ran&Uodda.r
Almaram
v.
Union of Indi•
SARKAR, J.-These two matters have been heard
S•rA., J.
together as they raise a common question. One of
these matters is a petition under Art. 32 of the Constitution and the other, an appeal from a judgment of the
High Court at Bombay.
The petitioner and the appellant were found by the
Customs authorities in proceedings under the Sea
Custcms Act, 1878, to have imported goods in breach
of s. 19 of that Act. The petitioner had without
authority imported gold of the value of Rs. 25,000/-
and the appellant, steel pipes of the value of
Rs. 1,28,182/-. The Customs authorities by independent orders, imposed a penalty of Rs. 5,000/- on the
petitioner and of Rs. 25,630/- on the appellant for these
offences, under item 8 of the schedule to s. 167 of the
Act. The Customs authorities further confiscated the
petitioner's gold under the same provision. There
was no order of confiscation of the steel pipes for
reasons to which it is unnecessary to refer.
The appeal is against an order the result of which
was to direct realisation of the penalty imposed on the
appellant, by execution of a distress warrant. The
petition challenges the validity of the order imposing
the pecuniary penalty. Neither the petitioner nor the
appellant, however, questions the decisions of the
Customs authorities that they had been guilty of
1961
Ranehhotlda.s
Almar

## Text

r96r
February 3.
718
SUPREME COURT REPORTS
RANCHHODDAS ATMARAM
v.
THE UNION OF INDIA.
(1961]
(B. P. SINHA, C.J., s. K. DAS, A. K. SARKAR,
N. RAJAGOPALA AYYANGAR and
J. R. MUDHOLKAR, JJ.)
Sea Customs-Import of prohibited goods-Maximum PenaltyWhether can be levied in excess of Rs. r,ooo/--Sea Customs Act,
r878 (VIII of r878), ss. r9, 167, item No. 8.
Item 8 of the schedule to s. 167, Sea Customs Act, 1878,
. provides that any person concerned in the importation or exportation of prohibited goods shall be liable to a penalty "not
exceeding three times the value of the goods. or not exceeding
one thousand rupees."' The petitioner was found to have imported
gold of the value of Rs. 25,000/- and the Customs authorities
imposed a penalty of Rs. 5.000/-. The petitioner challenged the
validity of the order imposing the penalty on the ground that the
maximum penalty that could be imposed under item 8 of s. 167
was Rs. l,ooo/-.
Held, that the orders imposing the penalty was valid. It is
open to the Customs authorities to impose any of the alternative
penalties provided though the amount of it exceeds the amount
of the maximum in the other alternative. None of the previous
decisions of the Supreme Court were authority for the proposition that the maximum penalty which can be imposed under
item 8 of s. 167 is Rs. l,ooo/- as this question did not arise in
those cases. On the plain language of the provision which was
in the affirmative form it gave an option to the Customs authorities to impose any one of the two penalties provided. The relevant
words could not be read as "shall not be liable to a penalty
exceeding three times the value of the goods, or exceeding one
thousand rupees."'
Maqbool Hussain v. State of Bombay [1953] S.C.R. 730, Babula I
Amthalat Mehta v. The Collector of Customs [1957] S.C.R. rrro and
F.N. Roy v. The Collector of Customs, Calcutta [1957] S.C.R. rr51,
explained and distinguished.
The Metropolitan Board of Works v. Steed (1881) L.R. 8 Q.B.D.
445, referred to.
ORIGINAL JURISDICTION: Petition No. 300 of 1960.
Petition under Art. 32 of the Constitution of India.
for enforcement of Fundamental Rights
and
Criminal Appeal No. 107of1958.
3 S,C.R.
SUPREME COURT REPORTS
719
Appeal by special leave from the judgment and
order dated April 5, 1957, of the Bombay High Court
in Criminal Revision Application No. 1100 of 1956.
Por'Us A. Mehta, S. J. Sorabjee, S. N. Andley, J.B.
Dada,chanji, Rameshwar Nath and P. L. Vohra, for the
petitioners.
C. K. Daphtary, Solicitor-Genera! of India, H. R.
Khanna, Y. S. Parmar and G. Gupta, for respondents
(In Petn. No. 300of1960).
N. C. Chatterjee and R. L. Aggarwal, for the appeJ.
!ant.
H. R. Khanna and R.H. Dhebar, for respondents (In
Cr. A. No. 107 of 1958.)
1961. February 3. The Judgment of the Court was
delivered by
Ran&Uodda.r
Almaram
v.
Union of Indi•
SARKAR, J.-These two matters have been heard
S•rA., J.
together as they raise a common question. One of
these matters is a petition under Art. 32 of the Constitution and the other, an appeal from a judgment of the
High Court at Bombay.
The petitioner and the appellant were found by the
Customs authorities in proceedings under the Sea
Custcms Act, 1878, to have imported goods in breach
of s. 19 of that Act. The petitioner had without
authority imported gold of the value of Rs. 25,000/-
and the appellant, steel pipes of the value of
Rs. 1,28,182/-. The Customs authorities by independent orders, imposed a penalty of Rs. 5,000/- on the
petitioner and of Rs. 25,630/- on the appellant for these
offences, under item 8 of the schedule to s. 167 of the
Act. The Customs authorities further confiscated the
petitioner's gold under the same provision. There
was no order of confiscation of the steel pipes for
reasons to which it is unnecessary to refer.
The appeal is against an order the result of which
was to direct realisation of the penalty imposed on the
appellant, by execution of a distress warrant. The
petition challenges the validity of the order imposing
the pecuniary penalty. Neither the petitioner nor the
appellant, however, questions the decisions of the
Customs authorities that they had been guilty of
1961
Ranehhotlda.s
Almaram
v.
Union of India
720
SUPREME COURT REPORTS
[1961]
breach of s. 19 or that penalties could be imposed on
them under item 8 in s. 167. The petitioner does not,
further, challenge the order confiscating the gold.
The only contention of the petitioner and the·
appellant is that the orders of the Customs authorities
are invalid as they impose penalties in excess of
Rs. 1,000/-. They contend that the maximum penalty
that can be imposed under item 8 in s. 167 is
Rs. 1,000/-. This contention is based on two grounds.
First it is said that, it has been so held by this Court.
Then it jfi said that, in any case, on a proper construction, item 8 in s. 167 does not premit the imposition
of a penalty in excess·of Rs. 1,000/-.
First, as to the decisions of this Court, we were
referred to three. The earliest is Maqbool Hussain v.
The State of Bombay ('). That was a case in which
the question was whether a person on whom a penalty
of confiscation of goods had been imposed under
item 8 in s. 167, could later be prosecuted on the sa.me
facts for an offence under s. 23 of the Foreign Exchange Regulation Act, 1947, in view of the provisions
of Art. 20(2) of the Constitution aga.inst, what has
been called, double jeopardy. It was held that
Art. 20(2) was no bar to the prosecution under the
Foreign Exchange Regulation Act for, the authority
under the Sea Customs Act imposing the penalty .
under item 8 in s. 167 was not a judicial tribuna.l
and the proceeding resulting in the imposition of the
penalty of confisca.tion was, therefore, not a prosecution. No question arose in that case as to the
maximum penalty that could be imposed under item
8 in s. 167. While discussing whether a Customs
authority exercising the power to order confiscation
and levy a penalty under s. 167 formed a judicial
tribunal, this Court observed at p. 742 :
"Even though the customs officers are invested
with the power of adjudging confiscation, increased
rates of duty or penalty the highest penalty which
can be inflicted is Rs. 1,000/-."
It is quite obvious that this observation was made in
a different context and was not intended to decide
(1) [1953] S.C.R. ?;JO,
3 S.C.R.
SUPREME COURT REPORTS
721
that' the provision did not permit the imposition of a.
higher penalty, a.s to which no question ha.d then
a.risen. It is clear that if the highest penalty which
the Customs officers had the power to impose w·as in
excess of Rs. 1,000/- but subject to another limit, it
would hot have followed that they were judicial tribunals. The judgment of this Court was not based on
the amount of the maximum penalty which the
Customs authorities could impose. It seems ra.ther
to have been assumed that the maximum penalty
was Rs. 1,000/., for the question about maximum
penalty was neither argued, nor discussed in the
judgment at all.
The second case is Bahulal Amthalal Mehta v. The
Collector of Customs (1). The only question that arose
there was whether s. 178A of the Sea Customs Act,
which placed on the person from whose possession
any goods mentioned in the section and rea.sona.bly
believed to have been smuggled were seized, the
burden of proving that they were not so, was void as
offending Art. 14 of the Constitution. In discussing
the scheme of the Act, it was observed in connection
with item 8 in s. 167 that "This Court ha.s held
that the minimum is the alternative: see Ma11bool
Hussain v. The State of Bomhay "('). Here a.gain, it
is clear that the Court wa.s not deciding the question
that ha.a now a.risen before us. It only ma.de a. pa.a.
sing reference to the observation in Maqbool Hussain's
case('). It wa.s not necessary for the decision of Babulal' a
case (1) to have pronounced on the correctness of the
observation in Ma11bool Hussain's case(•) a.nd no such
pronouncement was clearly intended. Nor wa.s it
necessary in Babulal' a case (1) to express a.ny view a.a to
the maximum penalty that could be imposed under
item 8 in s. 167.
The la.st case referred to is F. N. R()]J v. The Colledor
of Customs, Calcutta(')· That wa.s a. case where a.n order
ha.d been ma.de under item 8 in s. 167 co®sca.ting
certain goods imported without authority a.nd imposing a. penalty of Rs. 1,000/- in respect of that import.
The importer filed a. petition in this Court under Art. 32
(r) (19,7] 5.C.R. IIIO, II16.
(a) (19'3] S.C.R. 730.
(l) [19'7] S.C.R. 1151.
Ranchhoddas
AtHIOJ'Otn
v.
Uniox of India
Sarhar J.
Ranchhoddas
Atmaraw
v,
Union of India
Sarkar].
722
SUPREME COtJRT REPORTS
[1961]
of the Constitution challenging the validity of the
penalties levied. The main part of the argument of
the learned counsel for the petitioner was based on the
Imports and Exports (Control) Act, 1947, and raised
questions which do not concern us in the present cases.
It appears however that it was also contended that
item 8 in s. 167 offended Art. 14 of the Constitution, a
point which again does not arise in the cases in hand.
That contention was dealt with in the following words
at p. 1158:
·
·~Another similar argument was that s. 167, item 8
of the Sea Customs Act itself offended Art. 14 in that
it left to the uncontrolled discretion of the Customs
authorities to decide the amount of the penalty to
be imposed. The section makes it clear that the
maximum penalty that might be imposed under it
is Rs. 1,000/-. The discretion that the section gives
must be exercised within the limit so fixed. This is
not an uncontrolled or unreasonable discretion.
Furthermore, the discretion is vested in high
Customs officers and there are appeals from ·their
orders. The imposition of the fine is really a quasijudicial act and the test of the quantum of it is in
the gravity of the offence. The object of the Act is
to prevent unauthorised importation of goods and
the discretion has to be exercised with that object
in view."
It will be observed that the fine imposed was
Rs. 1,000/-. It was not therefore a case in which any
question eould arise as to whether a penalty in excess
of Rs. 1,000/- could be imposed and in fact no such
question arose. The question that arose was, whether
the section offended Art. 14, so that, no penalty could
be imposed under it at all. It was in this connection
that it was observed that item 8 in s. 167 did not leave
it to the uncontrolled discretion of the Customs authorities to decide the amount of the penalty because it
had imposed a limit on that amount. It is _true that
the limit was there mentioned as Rs. 1,000/-. But it
is clear that the reasoning would have held equally if it
had been said that the limit imposed was either three
times the value of the goods or Rs. 1,000/-. The point
3 S.C.R.
SUPREME COUitT REPORTS
723
that was sought to be made in the judgment was that
there was a limit and that that was a reason for saying
that the discretion given was not uncontrolled and,
therefore, there was no violation of Art. 14. For this
purpose, it made no difference what the limit was.
Some of the High Courts have thought that this
Court had decided in these cases that the maximum
penalty permissible under the provision is Rs. 1,000/ ..
The fact is that the question was never required to be
decided in any of these cases and could not, therefore,
have been, or be treated as, decided by this Court. In
Leo Roy Frey v. The Superintendent, District Jail,
Amritsar('), this Court observed that " No question
has been raised as to the maximum amount of penalty
that can be imposed under s. 167(8) and 1w are not
called upon to express any opinion on that point."
This would show that this Court had taken notice of
the fact that the High Courts were interpreting the
judgment in F. N. Roy's case(') and the other cases in
a manner which was not intended and desired to strike
a note of warning against the misconception.
None
of these cases is authority for the proposition that the
maximum penalty which can be imposed under item 8
ins. 167, is Rs. 1,000/-. The argument that this Court
has already held that the maximum penalty that can
be awarded under it is Rs. 1,000/- must therefore fail.
We now come to the construction of the provision,
the relevant portion of whicli is in these terms:
S. 167. The offences mentioned in the first column
of the following schedule shall be punishable to the
extent mentioned in the third column of the same
with reference to such offences respectively:
Sections of
Offences
this Act to
which offence
has reference
Penalties
. . . . . .
.
8, If any goods, the impor·
tation or exportation of which
is for the time being prohibited
or restricted by or under Chapter IV of this Act, be imported
into or exported from India
contrary to such prohibition or
restriction.
(I) [1958] S.C.R. 822, 827.
Such goods shall be liable
to confiscation ; and any person concerned in any such
r8 & 19 offence shall be liable to a
penalty not exceeding three
times the value of the goods,
or not exceeding one thousand
rupees.
12) [1957).S.C.R. rt5r.
Ranchhoddas
.4 lmarani
v.
Union of India
Sarka"].
1961
Ranchhoddas
Atmara1n
v.
Union of India
Sarkar].
724
SUPREME COURT REPORTS
[1961)
The words whic? are material to this case are, "Any
person concerned rn any such offence slrnll be liabie to
a penalty not exceeding three times the value of the
goods. or !lot exceeding one thousand rupees. "
The
quest10i:i 1s whet~ier, in imposing a penalty, the conditions laid down m both the alternative cla11ses joineu
by the word "or" have to be fulfilled or the condition
m any one of them only Y
It is clear that if the words form an affirmative
sentence, then the condition of one of the clauses only
need be fulfilled.
In such a ease "or " really means
" either" " or ". In the Shorter Oxford Dictionary
one of the m0anings of the word "or" is given as "A
participle co-ordin;itiBg two (or more) words, phrases
or clauses between which there is an alternative. " It
is aho there sh;ted, "The alternntive expressed by
"or" is emphasised by prefixing to the first member
or adding after the last, the associated adv. EITHER."
So, even without "either", "or" alone creates an
alternative. If, therefore, the sentence before us is an
affirmative one, then we get two alternatives, any one
of which may be ch,.i:,cn without tho other being considered at all. In such a cn.se it must be held that a
penalty exceeding Rs. 1,000/- c;rn be imposed.
If, however, the st,ntence is a nagative one, then
the position becomes diffc.rent.
The word "or" between the two clauses would then spread the negative
influence over the clause following it. This rule of
grammar is not in dispute. In such a case the comlitions of both the clauses must be fulfilled and the
result would be that the penalty that can be imposed
can never exceed Rs. 1,000/-.
The question then really comes to this: Is the
sentence before us a negntivc or an affirmative one?
It seems to us that the sentence is an affirmative
sentence. The substance of the sentence is that a
certain person shall be liable to a penalty. That is a
positive concept.
The sentence is therefore not
negative in its import.
The learned counsel for the petitioner and the
appellant said that the sentence began with a negative,
namely,the words "not exceeding., and therefore it
3 S.C.R.
SUPREME COURT REPORTS
725
is a negative sentence and the word "or" occurring
later in the sentence must spread the negative
influence over that part of the sentence which follows
it. This contention is clea .. rly fallacious. The word
" not." refers only to the word " exceeding " following
it and th" two together constitute a qualifying clause
limiting tlie amount of the penalty that can be
imposed. There is no negative sense to spread over
and influence the rest of the sentence. If the learned
counsel were right, the words "not exceeding '' would
not have been repeated after the word " or" for the
word" or" would have carried the negative influence
forward and rtnother negative would not have been
necessary. The acceptance of lertrned counsel's argument that "or" cal'ried any negali1·e influenct; forward,
would make nonsense of the sentence.
It seems to us that the learned counsel really wants
us to read the section as if the words were, "shall not
be liable to a penalty exceeding three times the value
of the goods, or ex0eeding one thousand rupees. " So
read the sentence would be a negative one and the
word" or" would c:i,r-ry the negative influence forward.
To do that would, however, here-enacting and not
interpreting. It is cleM. that each time the expression "not exceeding" is used, it qualifies the <>xtent of
the punishment that is stated after it. That expression is really equivalent to the words "up to" and
can be easily. substituted by them without affecting
the Hentence in any way.
There is really no negative
in the sentence anrl what we have, is a purely affirmative provision laying down two alternative penalties
to choose from, with a maximum for each.
The distinction between affirmative and negative
sentences may be illustrated by the case of The
Metropolitan Board of Works v. Steed (1). The provision
there considered was, "No existing road, being of less
width than forty feet, 'hall be ... formed ...... as a street
for the purposes" of carriage traffic, unless such road
be widened to the full width of forty feet ...... or for the
purposes of foot traffic only, unless such road ...... be
widened to the foll width of twenty feet or unless such
(1) (1881) L.R. 8 Q.B.D. 44.1Ranchhoddas
A.tmaram
v.
Union of India
Sarilar ].
,
Ranchhoddas
Atmaram
v.
Union of India
Sarkar J.
726
SUPREME COURT REPORTS
[1961]
streets respectively shall be open at both ends." It
was held that both the conditions had to be fulfilled
and the street had to be of the prescribed width and
also open at both ends.
One of the reasons given for
this view was that the sentence was a negatiYe one
and the word "or" (being the one underlined by us*)
in it carried forward the negative influence and made
it necessary to fulfil both the conditions. It was said
at pp. 447.48:
"We might have referred to authorities by good
writers, shewing that where the word 'or' is
preceded by a negative or prohibitory provision, it
frequently has a different sense from that which it
has when it is preceded by an affirmative provision.
For instance, suppose an order that 'you must have
your house either drained or ventilated. '
The
word '.or' would be clearly used in the alternative.
Suppose again, the order was that ' you must have
your house drained or ventilated,' that conveys the
idea to my mind that you must have your house
either drained or ventilated. But supposing the
order were that 'you must not have your house
undrained or unventilated.' The second negative
words are coupled by the word 'or', and the negative in the preceding sentence governs both. In
s. 98 there is a negative preceding a sentence ; 'no
existing road ' shall be formed."
It is obvious that the sentence before us contains
no negative or prohibitory provision. It only contains
a positive provision empowering one of the two alternative penalties laid down to be imposed. The fact
that the penalties are dirl)cted not to exceed a certain
limit does not change the sentence from affirmative to
negative; the sentence remains permissive and does
not become prohibitory. It follows that any of the
alternative penalties provided may be imposed though
the amount of it exceeds the amount of the maximum
in the other alternative.
A cousideration of the
object of the Act also supports that view. The Act is
vital for the country's economic stability.
It is intended to prevent smuggling in goods and such goods
may be of large value, A Rmall fine of Bs. 1,000/- would
• Here printed in italics.
I
3 S.C.R.
SUPREME COURT REPORTS
727
often be quite inadequate to serve these objects. It
would be in consonance with such objects if power is
given to the authorities concerned to impose a higher
penalty when the occasion requires it.
Th~ learned counsel for the petitioner and the appellant then referred us to Webster's New International
Dictionary (2nd ed.) where one of the meanings of the
word " nor " has been given as "or not ". The )earned
counsel sav that the word "or" and the word " not"
following ·it have to be read together and on the
authority of Webster, ask us to substitute for them the
word " nor " in order to get at the inteution of the
Legislature.
But we do not have here the word
"nor". Nor are we able to find anything in Webster's
Dictionary authorising the substitution of "nor" in
all places for the words" or not". We are clear that
here no "or not~· occurs which can be substituted by
"nor" without doing violence to the sentence. The
word "not ", following the word " or", is really joined
to and qualifies the word "exceeding" which comes
after it and cannot be joined to the preceding word "or"
at all. To read the words "or not " as joined to each
other, and to substitute them by "'nor" would be to
change the structure of the whole sentence and, therefore, its meaning. An interpretation which so radically
alters the meaning of the clause, cannot be accepted.
These were the main arguments advanced by the
learned counsel. for the petitioner and the appellant.
There remain, however, certain other points raised by
them to deal with. It was said that the fact that two
alternative penalties had been provided would indicate that one of them was the maximum. It is somewhat difficult to comprehend this argument.
By
itself it does not show that the maximum penalty
would be Rs. 1,000/- and that is what the learned
counsel want us to hold. We have earlier held that
either of the two penalties provided may be chosen by
the authorities concerned as
they
consider fit.
Suppose three times the value of the goods with which
the offence is concerned, exceeds Rs. 1,0(10/-.
Then
that would be larger of the two penalties that can be
awarded in that case and the present argument does
93
Ranchhoddas
Atmaram
v.
Union of India
Sarkar].
rj16Z
Ranc;hlsoddtis
AtmMam
v.
Union of Jnditi
Sarkar].
728
SUPREME COURT REPORT.3
[1961]
not establish that this larger penalty cannot be
imposed. Which is the maximum in a particular case,
would depend on the value of the goods. Further,
there seems to us to be gQod reason why two alterna.
tive penalties were provided. Where the value of the
goods is very large, it may be that a penalty of
Rs. 1,000/- would be too inadequate a punishment.
Again, it may be that three times the value of the
goods may be much smaller than Rs. 1,000/-. It may
conceivably be necessaiy in such a case by reason, for
example, of the person concerned having on earlier
occasions committed the same offence or having
shown a determined state of mind to commit the
offence, to inflict a penalty higher than three times
that value. Then it. may also happen that the value
of the thing concerned may, in conceivable circum.
stances, not be properly ascertainable. In such a case
the alternative penalty up to Rs. 1,000/· has to be
adopted if any penalty at all is to be awarded.
The learned counsel then said that if both the
alternatives were available to the authorities concerned to choose from, ~hen the provision would give them
a very arbitrary discretion which, whether it offended
Art. 14 or not, there is no reason to think was intend~
ed by the Legislature. We do not think that this
argument is of force.
Each of the alternative penalties ·provided, has a limit attached to it. Therefore
the discretion is neither unlimited nor arbitrary. It
may be that three times the value may amount to an
enormous sum but that will be so only when the value
of the goods with which the offence is concerned, is
high. If goods of high value are the subject matter
of the offence, then there is no reason for. saying that
the provision for imposing a penalty of three times
that value, is not intended by the Legislature •
. Another argument advanced on behalf of the petitioner and the appellant was that no other item in
s. 167 provided for a penalty in money, as distinguished from confiscation, in excess of Rs. 1,000/· and
this indicated the intention of the Legislature not to
impose a higher penalty. It was therefore said that
item S should be co11strued in accordance with this
3 S.C.R.
SUPREME COURT REPORTS
729
intention as not enabling the imposition of a pecuni1961
ary penalty higher than Rs. 1,000/-. The first answer
Ranchhoddas
to this contention is that the intention in item 8 has
Atmaram
to be gathered from the language used in it. If that
v.
language is clear, that must be given effect to what-
·unionof India
ever may have been the intention in other provisions.
In our view, the language in item 8 is clear and it
Sarkar J.
permits the imposition of a penalty in excess of
Rs. 1,000/-. No question of gathering the ·intention
of the Legislature from the other items arises. The
second answer is that the learned counsel are not right
when they say that the other items do not provide
for a pecuniary penalty in excess of Rs. 1,000/-. Thus
under item 29 when goods are found in a boat without
a boat-note as required by s. 76 of the Act, the person
in charge of the boat ~hall be liable to a penalty not
exceeding twice the amount of the duty leviable on
""
the goods.
Now it is conceivable that such duty may
be in excess of Rs. 1,000/-. Provisions for similar
penalty will be found in items 17, 29, 31, 38, 48 and
others. There are also several items which permit
the imposition of a penalty calculated at large sums
like Rs. 500/- and Rs. 1,000/- per package. In these
the amount of· the penalty might easily exceed
Rs. 1,000/-: see items 17, 36, 49, 56. There is another
group of items which permits the imposition of penalty
calculated on the value of the goods, and such penalty
may, of course, be far in excess of Rs. 1,000/-: ~ee
items 58, 59 and 73. It would indeed be strange if a
statute like the Sea Customs Act, on the proper
working of whioh the finances and commerce of the
country largely depend, considered!!- pecuniary penalty
of Rs. 1,000/- enough for a breach of any of its provisions. We feel no doubt that the Act did not intend this.
It was also argued that a penal statute like the one
before us, must be construed in favour of a citizen
and therefor" item 8 should be construed as permitting the imposition of a penalty up to Rs. 1,000/- and
no more. This rule of construction of a penal statute
is applicable only where the meaning of the statute is ·
not clear. This is not the case with the present
statute. The appellant and the petitioner can therefore derive no assistance from this rule.
Ranchhoddas
At1naram
v.
Union of India
Sarkar].
730
SUPREME COURT REPORTS
[1961]
The learned counsel for the petitioner and the appellant also said that the Sea Customs Act was modelled
on 39 and 40 Viet., Ch. 36, an English statute to consolidate the Customs laws, s. 186·of which corresponds
to s. 167 of our Act. They said that the English
section expressly provided that the authority concerned would have the option to choose any of the
punishments specified, but our statute deliberately
departed from this and did not use the words "at the
election of" which occur in the English statute. In
our view, even without these words the meaning in
our provision is plain. It also seems to us that the
English statute used the words "at the election of"
by way of abundant caution. The effect of that
statute wrrnld have been the same even without those
words. It may be that in our statute similar words
were not used because it is somewhat differently
framed; the nse of them may have been considered
inappropriate. The English statute gives a choice
between two fixed penalties of "treble the value of
the goods " and " one hundred pounds." In our
statute, each of the two alternative penalties is flexible ; each penalty is not to exceed a certain limit.
The last argument was based on the word "extent"
appeariug in the main part of s. 167 which, it is said,
indicated that the third column laid down the extent
of the punishment that could be awarded. This
argument does not carry the matter further at all for,
whichever of the two competing interpretations is
accepted, in each case there w.ould be the extent of
the punishment specified and that word cannot" help
in deciding what the correct interpretation is.
For these reasons it seems to us that under item
8 ins. 167 a penalty in excess of Rs. 1,000/- can be
imposed and so the orders that the Customs authorities had made in these cases are not open to any
challenge. It is not in dispute that the penalties
imposed did not excePd three times the ·ralue of the
goods concerned.
The petit.ion nncl the a p1wal are accordingly dismissed. There will be no order for costs.
Petition and appeal dismissed.