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PETITIONER: UNION OF INDIA

       Vs.

RESPONDENT: SUKUMAR PYNE

DATE OF JUDGMENT: 06/10/1965

BENCH: SIKRI, S.M. BENCH: SIKRI, S.M. GAJENDRAGADKAR, P.B. (CJ) WANCHOO, K.N. HIDAYATULLAH, M. SHAH, J.C.

CITATION:  1966 AIR 1206            1966 SCR  (2)  34  CITATOR INFO :  RF         1979 SC 478  (93)  F          1987 SC1364  (3)

ACT: Foreign Exchange Regulation Act, 1947 (7 of 1947), vs. 23(1) and  23D -Amending Act 39 of 1957-Whether violates Arts.  14 and 20 of the Constitution--Contravention before  amendment- Whether amending Act applicable-Retrospectivity.

HEADNOTE: In  1954  some foreign currency and Travelers  Cheques  were recovered from the respondent’s premises.  By Act 39 of 1957 the  Foreign Exchange Regulation Act was amended,  s.  23(1} was  substituted and s. 23D was added.  After the  amendment either  adjudication  proceedings  or  criminal  proceedings could be taken up in respect of a contravention mentioned in s.   23(1),  while,  before  the  amendment  only   criminal proceedings before a court could be instituted to punish the offender.  The Director of Enforcement in 1958 issued a show cause notice to the respondent why adjudication  proceedings be not held against him for contravention of s. 23(1) of the Foreign  Exchange  Regulation Act.   The  respondent  showed cause, on consideration of which the Director of Enforcement concluded that adjudication proceedings should be held,  and therefore,  required  the respondent to appear  before  him. Thereupon, the respondent filed a petition under Art. 226 of the  Constitution challenging the  adjudication  proceedings on.  the  grounds  : (i) s. 23( 1 )(a) as  well  as  s.  23D contravened Art. 14 of the Constitution; (ii) the  amendment in  1957  did not apply to contravention  which  took  place before  it came into force; and (iii) s 23(1)(a) of the  Act was ultra vires of Art. 20(1) of the Constitution.  The High Court  upheld  the objections and quashed  the  adjudication proceedings, In appeal to this Court; HELD:     The appeal must be accepted. (i)  Section  23(1)  and s. 23D of the Act did  not  violate Art. 14 of the Constitution. [36 F] Shanti  Prasad  fain v. Director of  Enforcement,  [1963]  2 S.C.R. 217, followed.

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(ii) A person accused of the commission of an offence had no vested  right  to  -be, tried by a  particular  court  or  a particular  procedure  except  in so far  as  there  is  any constitutional  objection  by way of discrimination  or  the violation of any other fundamental right is involved.  There is no principle underlying Art 20 of the Constitution  which makes a right to any course of procedure a vested right. [38 F-H] Rao Shiva Bahadur Singh v. State of Vindhya Pradesh,  [1953] S.C.R. 1188 followed. it is not necessary that there should be a special provision to  indicate that the new procedural law  is  retrospective. No  right  of appeal under the Criminal  Procedure  Code  is affected because no proceedings had even been started  under the Criminal Procedure Code. [39 A]                              35 (iii)     The  new section does not prescribe  any  minimum. What  it prescribes is a maximum.  No greater  penalty  than might have been levied under the old section has been prescribed by the new section 23(1)(a), and consequently there is no breach of Art.  20(1) of the Constitution.. [39 C-D] The words "not exceeding"  in s. 23 (1) (a) of the Act cover not  only  the  expression "three times  the  value  of  the foreign exchange" but also the words "five thousand rupees." [39 C]

JUDGMENT:  CIVIL APPELLATE JURISDICTION: Civil Appeal No. 701 of 1964. Appeal from the judgment and order dated August 10, 1961  of the Calcutta High Court in Civil Rule No. 1428 of 1958.  S. V. Gupte, Solicitor-General, R. Ganapathy Iyer and R. H. Dhebar, for the appellant. G. S. Chatterjee and P. K. Chatterjee, for the respondent. The Judgment of the Court was delivered by Sikri,  J  This is an appeal by certificate granted  by  the High Court of Calcutta under art. 132(1) of the Constitution and  is.  directed against the judgment of  the  High  Court accepting a petition under art. 226 of the Constitution  and quashing adjudication proceedings under the Foreign Exchange Regulation  Act, 1947 (VII of 1947)-hereinafter referred  to as the Act. The relevant facts are as follows: Following the recovery in 1954  of some foreign currency and Travelers Cheques at  No. 311,  Bow  Bazar  Street,  Calcutta,  where  the  respondent alongwith  his, mother and brother, carried on the  business of jewellers, the Director of Enforcement issued a notice on April  23, 1958,on the petitioner calling upon him  to  show cause  within  10  days of the receipt  of  the  notice  why adjudication proceedings should not be. held against him for contravention  of s.23(1)of the Act.  On May 10,  1958,  the respondent  replied  to  the  above  memorandum  giving  his version  as  to how he came into possession of  the  foreign currency, but he denied having sold any travellers  cheques. He  prayed  that  the proceedings may  be  dropped  and  the currency   seized   returned  to  him.   The   Director   of Enforcement,  after  considering  the  cause  shown  by  the respondent  came  to the conclusion  that  the  adjudication proceedings  should ’be held.  He, therefore, requested  the respondent  to  arrange to be present either  personally  or through,  his authorized representative before the  Director on May 13, 1958, in the office of the Calcutta Branch of the Directorate.   On,  this, on May 13,  1959,  the  respondent

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filed   a  petition  under  art  226  of  the   Constitution challenging the adjudication proceeding& 36 -on various grounds, the principal grounds being that s.  23 (1) (a) and s. 23D of the Act were ultra vires of art. 20(2) of  the  Constitution,  and that  the  offence  having  been committed  in 1954, the -proposed adjudication  was  illegal and entirely without jurisdiction. Before the High Court, at the time of the final hearing, the petitioner  was allowed to raise the point that s. 23 ( 1  ) (a)   as  well  as  s.  23D  contravened  art.  14  of   the Constitution. Mitter,  J. held that s. 23 (1) (a) violated art. 14 of  the Constitution   and   was   accordingly   ultra   vires   the Constitution, and that the relative provision of s. 23D must also  be  condemned.  Regarding the  second  point,  namely, whether  s.  23  (1) (a), having, been  substituted  by  the Amending  Act  XXXIX  of  1957,  would  have   retrospective operation  in  respect of the alleged  offence,  which  took place  in 1954, the High Court came to the  conclusion  that the  petitioner  "had  a  vested right to  be  tried  by  an ordinary  court of, the land with such rights of  appeal  as were  open  to  all",  and  although  s.  23  (1)  (a)   was procedural, where a vested right was affected, prima  facie, it  was not a question of procedure.  Thea, the  High  Court came to the conclusion that the provision as to adjudication by   the  Director  of  Enforcement  could  not   have   any retrospective  operation.  The learned Judge  observed  that "the  impairment  of a right by putting  a  new  restriction thereupon is not :a matter of procedure only.  It impairs  a substantive  right  and an enactment which does  so  is  not retrospective  unless it says so expressly or  by  necessary intendment." Accordingly, is stated before, the adjudication proceedings were quashed being without jurisdiction. This  Court  held  in  Shanti Prasad  Jain  v.  Director  of Enforcement(1)  that  s.  23(1) and s. 23D  of  the  Foreign Exchange  Regulation  Act  did not violate art.  14  of  the Constitution.   Mr.  P.  K.  Chatterjee,  counsel  for   the respondent,  properly  concedes that he  cannot  press  this point. The learned Solicitor-General, who appeared on behalf of the appellant,  contends  that the High Court was  in  error  in holding  that the accused had a vested right to be tried  by an ordinary criminal court.  He says that the amendment only changed the venue of trial from a Magistrate to the Director of  Enforcement  in  some  cases and  no  vested  right  was affected.   He refers to the decision of this Court  in  Rao Shiv Bahadur Singh v. The State of Vindhya Pradesh(2)  where Jagannadhadas, J., speaking for the Court, observed at p. 1200 as follows (1) [1963] 2 S.C.R. 297. (1) [1953] S.C.R. 1188. 37               "In  this  context it is necessary  to  notice               that  what is prohibited under article  20  is               only  conviction or sentence under an ex  post               facto  law  and not the trial  thereof.   Such               trial  under a procedure different  from  what               obtained at the time of the commission of  the               offence  or  by a court  different  from  that               which  had competence at the time cannot  ipso               facto  be  held  to  be  unconstitutional.   A               person accused of the commission of an offence               has  no  fundamental  right  to  trial  by   a               particular court or by a particular procedure,

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             except   in  so  far  as  any   constitutional               objection  by  way of  discrimination  or  the               violation  of any other fundamental right  may               be involved."               Before its amendment by Act XXXIX of 1957,  s.               23(1) of the Act read as follows :               "23(1)   Whoever   contravenes  any   of   the               provisions  of  this  Act  or  of  any   rule,               direction  or order made thereunder  shall  be               punishable  with imprisonment or a term  which               may  extend to two years or with fine or  with               both,   and   any  Court   trying   any   such               contravention  may,  if it thinks fit  and  in               addition  to any sentence which it may  impose               for   such  contravention,  direct  that   any               currency,  security, gold or silver, or  goods               or  other  property in respect  of  which  the               contravention   has  taken  place   shall   be               confiscated........               After  the  amendment by Act  XXXIX  of  1957,               another  s. 23(1) was substituted and  s.  23D               was added, which read as follows               "23(1)-If    any   person   contravenes    the               provisions of section 4, section 5, section 9,               section  10,  sub-section (2) of  section  12,               section  17, section 18A or section 18B or  of               any rule, direction or order made  thereunder,               he    shall               (a)  be liable to such penalty  not  exceeding               three times the value of the foreign  exchange               in  respect  of which  the  contravention  has               taken   place,   or  five   thousand   rupees,               whichever  is more, as may be adjudged by  the               Director   of   Enforcement  in   the   manner               hereinafter provided, or.............."               "23D.  (1) For the purpose of adjudging  under               clause (a) of  sub-section (1) of  section  23               whether any person   has      committed      a               contravention  the  Director  of   Enforcement               shall hold an inquiry in the prescribed manner               38               after   giving   that  person   a   reasonable               opportunity  of  being heard and if,  on  such               inquiry,  he is satisfied that the person  has               committed  the  contravention, he  may  impose               such  penalty as he thinks fit  in  accordance               with the provision of the said section 23;               Provided that if, at any stage of the inquiry,               the Director of Enforcement is of opinion that               having  regard  to the  circumstances  of  the               case,  the  penalty which he is  empowered  to               impose  would  not  be  adequate,  he   shall,               instead of imposing any penalty himself,  make               a complaint in writing to the Court......" The  effect of these provisions is that after the  amendment of  1957, adjudication proceedings or  criminal  proceedings could be taken up in respect of a contravention mentioned in s.   23(1)   while  before  the  amendment   only   criminal proceedings before a Court could be instituted to punish the offender.   The High Court, as already observed,  held  that the new amendment did not apply -to contravention which took place before the Act came into force. Mr.  Chatterjee,  the learned counsel  for  the  respondent, urges  that  a substantive vested right to be  tried  by  an ordinary  court existed before the amendment, and he  relied

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on  Maxwell 11 th Edition, p. 217, where it is  stated  that "the   general   principle,  however,  seems  to   be   that alterations in procedure are retrospective, unless there  be some  good reason against it." He says that there is a  good reason  if the principles of art. 20 are borne in mind.   In our opinion, there is force in the content-on of the learned Solicitor-General.   As observed by this Court in  Rao  Shiv Bahadur  Singh v. The State of Vindhya Pradesh(1)  a  person accused of the commission of an offence has no vested  right to be tried by a particular court or a particular  procedure except in so far as there is any Constitutional objection by way  of  discrimination  or  the  violation  of  any   other fundamental  right is involved.  It is well recognized  that "no  person has a vested right in any course  of  procedure" (vide  Maxwell 11th Edition, p. 216), and we see  no  reason why  this  ordinary rule should not prevail in  the  present case.   There  is  no principle underlying art.  20  of  the Constitution which makes a right to any course of  procedure a  vested right.  Mr. Chatterjee complains that there is  no indication in the Amending Act that the new procedure  would be  retrospective and he further says that this affects  his right  of appeal under the Criminal Procedure Code.  But  if this is a matter of Procedure, (1)  [1953] S.C.R. 1188.                              39 then  it  is not necessary that there should  be  a  special provision  to  indicate  that  the  new  procedural  law  is retrospective.   No  right  of  appeal  under  the  Criminal Procedure  Code is affected because no proceedings had  ever been started under the Criminal Procedure Code. Mr. Chatterjee’s next point is that the new s. 23(1)(a) con- travenes  art. 20(1) of the Constitution.  He says  that  s. 23(1) (a) prescribes  a minimum penalty while under the  old s. 23(1) the   Magistrate  had  an option of fixing  a  fine less than the minimum    prescribed  under s. 23 ( 1 )  (a). But  we  are unable to agree with him that the  new  section prescribes  any  minimum.   What  it  does  prescribe  is  a maximum.   The  words  "not exceeding" cover  not  only  the expression  "three times the value of the foreign  exchange" but  also  the words "five thousand  rupees"  Therefore,  no greater  penalty than might have-been levied under  the  old section has been prescribed by the new section 23 (1 )  (a), and  consequently  there is no breach of art. 20(1)  of  the Constitution. We may add that the offence is alleged to have been  commit- ted in 1954 and notice of adjudication was sent in 1958  and now  we axe in the year 1965.  It would be expedient if  the adjudication proceedings are disposed of as expeditiously as possible. In the result the appeal is accepted and the petition  under art. 226 dismissed.  The appellant will have his costs  here and in the High Court. Appeal allowed. 40