UNION OF INDIA Vs. VIJAY CHAND JAIN

JUDGEMENT

(1.) This appeal on certificate of fitness turns on the meaning of the words "in respect of" occuring in Section 23 (1B) of the Foreign Exchange Regulation Act, 1947. For a proper appreciation of the question it is necessary to refer to two other sections of the Act, Section 4 (1) and Section 23 (1) (a), before we turn to Section 23 (1B).

(2.) Section 4 (1) lays down:

(3.) These are the facts on which the question of construction of Section 23 (1B) arises. On the morning of January 28, 1966 the respondent who resides and carries on business in Delhi arrived at Palam Airport by I. A.C. Flight No. 181. A customs officer recovered from his possession Indian currency amounting to Rs.78,481/- which sum, the respondent admitted, was the sale proceeds of the foreign currency entrusted to him for sale by someone else. On February 14, 1966 the second appellant, Director, Enforcement Directorate, Ministry of Finance, asked the respondent to show cause why the Indian currency recovered from his possession, which admittedly was the sale proceeds of foreign currency should not be confiscated. The second appellant was the authority adjudging under Section 23(1) (a) an alleged contravention of the provisions of Section 4. On October 14, 1966 the second appellant held on the evidence before him that the respondent was guilty of contravening the provisions of Section 4 (1) and imposed a penalty of Rupees 50,000/- under Section 23 (1) (a). He further directed the sum of Rupees 78,481/- seized from the respondent to be confiscated under Section 23 (1-B). the respondent moved the High Court of Delhi under Article 226 of the Constitution seeking an appropriate writ quashing the order of confiscation. The High Court viewed the matter as follows: