P L D 1967 Supreme Court 1 (PLP)

S. A. RABMAN, J.‑This order will dispose of four Civil Appeals Nos. K‑2 to K‑5 of 1964, as they arise out of the same proceedings. The facts giving rise to these appeals are as follows. The respondents, Messrs Hardcastle Wand (Pakistan) Limited and Messrs Jan Muhammad Hossein (Pakistan) Limited had sent two indents for import of cycle lubricating oil, from Japan, .through Messrs S. M. Abdullah & Sons, Indenting Agents, Chittagong, who are also respondents to these appeals. The orders were placed in 1957. The importers had sold the goods, by forward contracts, to the respondents,‑Messrs S. M. Abdullah & Sons or their nominees. The goods were received in Chittagong Harbour, in October 1957. The Clearing Agents, Messrs Pak. Trade Wind Agencies, Chittagong, acting on behalf of Messrs S. M. Abdullah & Sons, filed the usual documents for taking delivery of the goods, in 'conformity with the indents. On a check, however, it transpired that, out of the consignment of 21 cases, indented for Messrs Hardcastle Waud (Pakistan) Limited only 12 cases contained lubricating oil, while the remaining 9 cases had fountain pens packed in them. Out of the second lot of 62 cases, imported by Messrs Jan Muhammad Hossein (Pakistan) Limited, 33 cases were found to have lubricating oil while 9 cases were full of press buttons and 20 cases contained art silk fabrics. The Customs authorities issued notices to the importers, as well as the Indenting Agents, to show cause why they should not be proceeded against for misdeclaration of the imported goods and their value and for importing goods, not covered by an import licence. By an order, which was despatched on the 14th March 1958, to Messrs Hardcastle Waud (Pakistan) Limited, and the Indenting? Agents, in respect of the first consignment, the Collector of Customs held that the mis-declaration of goods involved a short levy of duty to the extent of Rs. 6,437‑6‑0 and sales‑tax to the tune of Rs. 2,034, as a result of the difference between the declared and?????? the ascertained contents of the packages. This, in his opinion, constituted an offence under sections 39 and 89 of the Sea Customs Act (hereinafter referred to as the Act) and was punishable under the penal clauses of sections 167 (9‑B) and 167 (37‑B) of the Act. The value certified by the importers on the form VBF‑6‑A viz. 16‑ Shillings per dozen tins of oil, was clearly inflated, at it was, found that the rate of sail of comparable quality at or about the time of importation in this case, was 8 Shillings per dozen tins. This warranted penal action under section 167 (9‑B) of the Act. ‑ In addition, the provisions of section 19 of the Act, read with section 3 ( 3) of the Imports and Exports (Control) Act were held to have been contravened, in respect of 9 cases of fountain pens. as the importers had no import licence for them, This attracted the provisions of section 167 (8) of the Act. In pursuance of these findings, the Collector ordered confiscation of 12 cases of lubricating oil under sections 167 (9‑B) and 167 (37‑B) of the Act. The owners of. the goods, viz., Messrs Hardcastle Waud (Pakistan) Limited were, however, given an option under section 1.83 of the Act, to pay Rs. 3,450 as fine in lieu of confiscation, within four months of the date of the despatch of the order. Further, a personal penalty of Rs. 3,000 was imposed on the importers, Messrs Hardcastle Waud (Pakistan) Limited under section 167 (9‑B) of the Act. The nine cases of fountain pens were confiscated under section 167 (9‑B) and section 167 (37‑B), subject to redemption, on payment of a fine of Rs. 21,600 under section 183 of the Act. A further personal penalty of Rs. 14,C00 was imposed on the importers, Messrs Hardcastle Waud (Pakistan) Limited, under section 167 (9‑B) of the Act. The same nine cases of fountain pens were also ordered to be confiscated outright, under section 167 (8) of the Act, read with section 3 (3) of the Imports and Exports (Control) Act. In this order no. option of redemption of goods was given. In effect, therefore, it superseded that order of confiscation subject to the condition of redemption. A personal penalty of Rs. 20,000 was also imposed on the importers under section 167 (B) of the Act. In respect of the Indenting Agents, Messrs S. M. Abdullah & Sons, Chittagong, a personal penalty of Rs. 40,000 was imposed under section 167 (9‑B) of the Act and another penalty of Rs. 500 under section 167 (9‑A) thereof. With regard to the second consignment of 62 cases, imported by Messrs Jan Muhammad Hossein (Pakistan) Limited, it was found that because of the mis-declaration of the goods, there was a short levy of duty to the extent of Rs. 15,242‑14‑0 and sales tax to the tune of Rs. 2,401 as a result of the difference in the declared and the ascertained contents of the packages. Sections 39 and 83 of the Act were held to be attracted, along with sections 167 (9‑B) and 167 (37‑B) thereof. Here again, it was observed that the value, certified by the importers on the VBF‑6‑A form, viz. 16 Shillings per dozen tins, in conformity with the invoice, was wrong, the normal price of comparable goods being in the neighbourhood of 8 Shillings per dozen tins. In this case too, it was found that there was contravention of section 19 of the Act, read with section 3(3) of the Imports and Exports (Control) Act, as 9 cases of press buttons and 20 cases of art silk fabrics, had been imported without a licence. This act was held punishable under section 167 (B) of the Act. The penal action taken was as under:‑ (i) Thirty‑three cases of the lubricating oil were confiscated under sections 167 (9‑B) and 167 (37‑B) of the Act. The importers, Messrs Jan Muhammad Hossein (Pakistan) Limited, were given an option under section 183 of the Act to pay, in lieu of confiscation, to redeem the goods on payment of a fine of Rs. 6,000 only, to be exercised within four months from the date of despatch of the order. A personal penalty of Rs. 15,000 was also imposed on them under section 167 (9‑B) of the Act. (ii) The nine cases of press buttons and the 20 cases of art silk fabrics were confiscated under section 167 (37‑B) of the Act, subject to redemption under section 183 thereof, on payment of a fine of Rs. 23,000. A personal penalty of Rs. 15,000 was also imposed on the importers under section 167 (9‑B) of the Act. (iii) The nine cases of press buttons and 20 cases of art silk fabrics were confiscated outright under section 167 (8) of the Act, read with section 3 (3) of the Imports and Exports (Control) Act. No option to redeem the goods was given in this order, which also imposed a personal penalty of Rs. 30,000 on the importers, Messrs Jan Muhammad Hossein (Pakistan) Limited under section 167 (8) of the Act. The, Indenting Agents, Messrs S. M. Abdullah & Sons were subjected to a personal penalty of Rs. 60,000 under section 167 (9‑B) and another penalty of Rs. 500 under section 167 (9‑A) of the Sea Customs Act. Relief was sought from these orders, first by appeals to the Central Board of Revenue and then by revision petitions submitted to the Central Government of Pakistan. The appeals as well as the‑ revision petitions were dismissed and the penalties armed. ? The respondents then invoked the writ jurisdiction of the High Court of West Pakistan, Karachi Bench, to have the impugned orders quashed, by four petitions. The learned Judges of the High Court held that the Customs authorities "have not proved or established that the false declaration, or the fraud practised upon them, was false to the knowledge of the petitioners in these four writ petitions". No liability was, therefore, in their view, incurred by the petitioners before them, under section 39 of the Act. Reliance was placed, in this connection, on a judgment of this Court, reported as Messrs Eastern Rice Syndicate v. The Central Board of Revenue, etc. (P L D 1959 S C (Pak.) 364). The writ petitions were, consequently, allowed with costs and the orders of the Customs authorities quashed. No attempt seems to have been made in the High Court to determine whether, on the facts and the circumstances of this case as found by the Collector, any mens rea could be imputed to the respondents or not even if the principle of the authority cited, was attracted. Nor was the question examined whether the other provisions of law referred to in the Collector's order beside section 39 of the Act, required a guilty intention to be proved or not. We have heard the learned Deputy Attorney‑General for the appellant, Mr. Hassan A. Sheikh, for the importers and Mr. Dingomal N. Ramchandani for the Indenting Agents. Before their respective contentions are examined, it seems necessary to set out the relevant legal provisions. Subsection (1) of section 39 of the Act reads as follows:‑ (1) If any person, in connection with any matter of Customs,‑ (a) makes or sign, or causes to be made or signed, or delivers or causes to be delivered to an officer of Customs any declaration, notice, certificate or other document whatsoever, or (b) makes any statement in answer to any question put to him by an officer of Customs which he is required, by or under this Act to answer, and such document or statement is untrue in any material particular he shall be guilty of an offence under this section." Section 86 of the Act need not be set out in extenso as it merely provides that the owner of any imported goods shall deliver to the Customs Collector a bill of entry in such form or manner and containing such particulars as the Chief Customs authority may direct. The remaining provisions in the Act, which are pertinent to the case, are reproduced? below, as they stood at the relevant time:‑ Section 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:‑ ??????????????????????????????????????????????????????????????????????? Section ??????????????????????????????????????????????????????????????????????? of this Offences?????????????????????????????????????????????? Act to ??????????????????????????????????????????????????????????????????????? which?????????????????????????????????????? Penalties ??????????????????????????????????????????????????????????????????????? offence ??????????????????????????????????????????????????????????????????????? has ??????????????????????????????????????????????????????????????????????? reference ________________________________________________________________________ 8. If any goods, the im‑ ??????????????????????? 18 and 19 ??????????????????? Such goods shall be ??????????? portation or exportation??????????????????????????????????????????????? liable ,to confiscation; ??????????? of which is for the time????????????????????????????????????? and any person con-? ??????????? being prohibited or??????????????????????????????????????????????????????? cerned in any such ??????????? restricted by or under??????????????????????????????????????????????????? offence shall be liable ??????????? Chapter I V of this Act,??????????????????????????????????????????????? to a penalty not ex?- ??????????? be imported into or ex‑???????????????????????????????????? ceeding five times the ??????????? ported from Pakistan??????????????????????????????????????????????????? value of the goods. ??????????? contrary to such prohibi?-?????????????????????????????????????????????? . . . . . . . . . . . . . . . . . . ??????????? tion or restriction; or???????????????????????????????????????????????????? except that in the case ??????????????????????????????????????????????????????????????????????????????????????????????? of the export of special? If any attempt be made so???????????????????????????????????????????????????????? goods, such goods ??????????? to import or export, such?????????????????????????????????????????????? shall be liable to ??????????? any goods; or?????????????????????????????????????????????????????????????? confiscation; and any???????????????? ??????????????????????????????????????????????????????????????????????????????????????????????? person concerned in ??????????????????????????????????????????????????????????????????????????????????????????????? any such offence shall??? ??????????????????????????????????????????????????????????????????????????????????????????????? on conviction before If any such goods be found?????????????????????????????????????????????????????? a Court, be liable to ??????????? in any package produced????????????????????????????????????????????? imprisonment for a ??????????? to any officer of Customs????????????????????????????????????????????? term not exceeding as containing no such??????????????????????????????????????????????????? six years and not less ??????????? goods, or????????????????????????????????????????????????????????????????????? than one month, and ??????????????????????????????????????????????????????????????????????????????????????????????? shall also be liable to fine. If any such goods, or any????????????????????? dutiable goods be found??????????????????????? either before or after???? ??????????? landing or shipment to?? ??????????? have been concealed in???????????? any manner on board??? fine. ??????????? of any vessel within the ??????????? limits of any part in ??????????? Pakistan; or If any goods, the expor?- ??????????? tation of ‑ which is ??????????? prohibited or restricted ??????????? as aforesaid be brought ??????????? to any wharf in order to ??????????? be put on board of any ??????????? vessel for exportation ??????????? contrary to such pro? ??????????? hibition or restriction. 9‑A.‑If any person contra‑ ?????????????????? 30‑A and ??????? Such person shall be ??????????? venes or fails to comply 30‑B??????????????? liable to a penalty not ??????????? with any rule made under????????????????????????????????? exceeding five hundred ??????????? .section 30‑A or if any????????????????????????? rupees. ??????????? person without reason? ??????????? able cause fails to comply ??????????? with any requirement im?- ??????????? posed under section 30‑B. 9‑B.‑If, in relation to any?????????????????????? 39??????????????????? The goods in question ??????????? goods, an offence is com‑???????????????????????????????? shall be liable to con?- ??????????? mitted under section 39.??????????????????????????????????? fiscation, and every ??????????????????????????????????????????????????????????????????????????????????? person concerned in ??????????? any such offence shall ??????????? be liable to a penalty not exceeding?? one ??????????? thousand rupees??????????? or ??????????? three times the value ??????????? of such goods, which? ever is the greater.??????? 37‑B.‑Where goods have ??????????????????? 86 and 137 ????? Both the goods so been declared on a bill of????????????????????????????????????????????? declared and the goods entry or shipping bill, as???????????????????????????????????? not so declared shall the case may be, and it????????????????????????????????????? be liable to confisca?- is found that goods not????????????????????????????????????? tion, and every person so declared have been????????????????????????????????????????????????? concerned in any such concealed in, or mixed????????????????????????????????????? offence shall be liable with, the goods so???????????????????????????????????????????????????????? to a penalty not declared.????????????????????????????????????????????????????????????????????? exceeding one thou? ??????????????????????????????????????????????????????????? ??????????????????????? sand rupees." It may further be noticed that subsection (1) of section 3 of the Imports and Exports (Control) Act, 1950, as modified up to January 1958, provides that the Central Government may, by order, published in the official Gazette and subject to such conditions and exceptions as may be made by or under the order, prohibit, restrict or otherwise control the import or export of goods of any specified description, by a system of licence. Sub?section (2) of this section prohibits the import or export of goods, specified in the order under subsection (1) of this section, except in accordance with the conditions of a licence to be issued by the Chief Controller, or any other officer authorised, in this behalf by the Central Government. Subsection (3) enacts that all goods to which any order under subsection (1) applies, shall be deemed to be goods of which the import or export has been prohibited and restricted under section 19 of the Sea Customs Act, 1878, and all the provisions of that Act shall have effect accordingly, except that section 183 thereof shall have' effect as if for the word "shall" therein the word "may" were sub?stituted. It is not denied that fountain pens, art silk fabrics and press buttons, which had been imported in this case were not covered by a licence and that they were within the mischief of section 3 of the Imports and Exports (Control) Act. The interpretation, placed on section 39 of the Act in the Eastern Rice Syndicate case by this Court was that in order to attract this penal provision, it must be established that the person who is alleged to have made any statement in a document, submitted to the Customs authorities must be false to the knowledge of the person concerned. It is obvious that such knowledge would depend upon the facts and circumstances of each case. It is not disputed that the statements made in the customs documents in the instant case regarding the nature and value of the goods imported were in fact false. The High Court, in the present case seems to have thought that unless the Customs Collector had recorded an express finding that the persons con?cerned had guilty knowledge of the false declarations made in the relevant documents, no penal action could be taken against them. With respect, it may be pointed out, that the Collector need not have stated in so many words that the false statements, were made in the relevant documents, consciously and deliber?ately, by the respondents. It is sufficient if the Collector recorded findings of fact, from which such an inference necessarily followed. In the instant case, before the Customs authorities, as well as in this Court, the importers on one side and the Indenting Agents on the other have tried to pass on the blame for the wrong statements to each other. The importers were responsible. according to the Indenting Agents' position for all the statements, and the Indenting Agents were the real culprits, according to the stand of the importers. The relevant documents were all signed by the importers. The goods were cleared through the clearing agents of the Indenting agents who, also provided the insurance cover, for them. The indents had been sent to the exporters by latter and they obtained the invoices. They were also the purchasers of the goods on forward contracts. After examining the record, we have reached the conclusion that this attempt on the part of the importers and the Indenting Agents, to exculpate themselves and to make out that the other party was the villain of the piece, was incompatible with the facts found by the Collector of Customs. On behalf of the importers, it was contended that the fraud, if any, was solely menoeuvred by Messrs S. M. Abdullah & Sons, Chittagong, who acted as the Indenting Agents for both the transactions and were also the final and ultimate purchasers of the two consignments, by virtue of forward sales to them or their nominees. It is significant, however, that in the forward sale ?note, in each‑ case, the C. and F. price of the lubricating oil indented, is mentioned as 16 Shillings per dozen tins, whereas there was material before the Collector to show that lubricating oil of the same quality had been despatched from Japan by the same ship, on which the consignments in question arrived, valued at 8 Shillings per dozen tins. Not only this, but the importers got 20 % over this alleged C. and F. value in one case and 10 % in the other case. This means that the importers obtained from the Indenting Agents, in one case 140 %. profit and 120 % in the other. It is obvious that this `rate of profit was not the normal commercial profit. It is impossible to believe that the importers were not aware of the real value of the lubricating oil indented for. They entered into a solemn forward transaction with the Indenting Agents at double the commercial price with a percentage of profit over and above this price. The inference is clear that both the importers and the 'Indenting Agents had deliberately misdeclared and inflated the value of the imported goods, in order to give scope to the foreign exporters to send them more valuable goods, instead of mere lubricating oil, which was shown in the papers. This fact provides a revealing commentary on the claim of innocence, put forward by the importers as well as the Indenting Agents. The Indenting Agents had themselves obtained an invoice, showing double the rate of the commercial price for this lubricating oil. All of them were aware that what they were doing was a fraud. In the light of this fact, it is idle to suggest that the foreign exporters committed a mistake in sending cases containing goods of higher value than lubricating oil. In this context, reliance was placed on a telegram which the Indenting Agents were able to obtain from the foreign exporters and which they produced before the Customs authorities, showing that a mistake had been made in despatching the goods, owing to similar markings on the cases. This was a belated attempt to cover up the fraud, as both the foreign exporters and the importers and the Indenting Agents must have been clear in their own minds that the export price had been fixed at twice the normal price, leaving plenty of scope for sending more goods or goods of higher value than those indented for. The long arm of accidental mistake would be strained to breaking point if it is to be imagined that out of the consignment of 21 cases of cycle lubricating oil, the foreign exporters could have sent as many as 9 cases of fountain pens, in one consignment and 62 cases in the second consignment, 9 cases of press buttons and 20 cases of art silk fabrics, should have been included by sheer mistake. All this material was before the Customs authorities and justified their conclusions implied in the penalties imposed, that they regarded both the importers as well as the Indenting Agents to be guilty of deliberate fraud. Section 39 of the Act, consequently was applicable with full force to both of them. Section 167 (9‑A) of the Act was applied in the case of the Indenting Agents who failed to supply the necessary documents or information, to the Customs authorities, on demand made under section 30‑B of the Act. The Indenting Agents failed to produce the original indent before the authorities and also other relevant documents which were called for. This defiance of authority is punishable under section 167 (9‑A) with a penalty not exceeding Rs. 500. This was the penalty imposed on the Indenting Agents. We see no illegality involved in it. The offence, specified in section 167 (9‑B) was brought home to the importers in whose name the false declarations were filed with the Customs authorities and, in view of the observations made above, it is clear that the importers were conscious that they were making false statements in those documents: The goods in question, therefore, were liable to be confiscated and every person concerned was further liable to a penalty not exceeding Rs. 1,000 or three times the value of such goods whichever may be the greater. The penalties imposed under this provision were therefore lawful. The position of item 37‑B of section 167 of the Act may now be examined. In the instant case, this provision is to be read with section 86 of the Act. In the document, submitted under that section, there was a misdeclaration not only as to the nature of the goods imported but also about their value. Moreover, it was found that the goods not declared in the documents in question, had been concealed in or mixed with the goods so declared, within the meaning of item 37‑B. Mr. Hassan A. Sheikh tried to maintain that the offence, in respect of the two consignment, fell within the purview of item 37‑A, rather than 37‑B of section 167. The former item concerns a case where it is found that the goods had apparently been "packed so as to deceive the officer of Custom." This item is, in our opinion, not attracted to the two consignments in the present case, hat item obviously applies to goods so packed as to deceive an officer of Customs. Item 37‑B appears to us to be directly applicable to the facts of the present case, as it has been found that goods not declared were found concealed in cases bearing the legend "Cycle Lubricating Oil" or if the whole consignment is considered, mixed with cases of such oil. Consequently, not only the goods not so declared but also the goods so declared, were liable to confiscation under item 37‑B and this was the order passed by the Customs authorities. It was strenuously contended, on behalf of the respondents, that even item 37‑B required a mens rea to be proved before penal action could be taken against a person concerned. It seems to us that this contention is devoid of substance. The language of section 167 (37‑B) suggests that this is a case of absolute statutory liability. The only condition of the attachment of this liability is that it should have been found as a fact that the goods not declared to the Customs authorities were concealed or mixed with goods so declared. There are no words in this item which could justify placing it on a par with section 39 of the Act which requires that an oral or written statement in a document should be "untrue" and not merely false. It is also significant that apart from the penalty of confiscation, a personal penalty, imposable under item 37‑B, cannot exceed Rs. 1,000. This contrasts with the penalty imposable under item 9‑B which can be three times the value of goods, if that be in excess of P Rs. 1,000. This fact also supports the inference derivable from the language of item 37‑B that the Legislature intended this to be a case of absolute liability, for which no mental ingredients need be proved. The Collector's order, therefore, imposing the impugned penalties on the importers is not open to any legal exception. It was urged that having ordered confiscation of goods under section 167 (9‑B) there was no occasion for another confiscation order to be passed under section 167 (8) of the Act. We do not consider this objection to be weighty. Under item 9‑B read with section 183 of the Act, it is incumbent on the Customs authorities to give an option to the person concerned to pay a fine in lieu of confiscation. Under item (8) of section 167 read with section 19 of the Act (which gives powers to prohibit or restrict import or export of goods to the Central Government) and section 3 of the Imports and Exports (Control) Act (which amends section 183 so as to give discretion to the confiscating authority to give option of paying fine in lieu of confiscation or not), no option of redemption need be given at all. By resort to these provisions, in effect, the Customs authorities did away with the confiscation order subject to redemption, under item 9‑B or 37‑B. It is the higher of the two penalties, namely, one imposed under section 167 (8), that will alone be effective. On behalf of the importers, it was also sought to be made out that on the Collector's own finding, they had fraudulently parted with the licence in favour of the Indenting Agents and washed their hands completely of the affair after that. The Collector, no doubt, used language which is susceptible of the interpretation that the Importers had been apparently guilty of illegal transfer of the licences to the. Indenting Agents. At the same time, on cannot shut one's eyes to the findings that the importers were also party to the forward contracts, containing a higher inflated price of the goods in question. Consequently, as observed above, it cannot be said that the importers did not know what the Indenting Agents were doing. They were obviously privy to whatever fraud the latter committed and lent their names to them at all stages to effectuate that fraud. They had signed the various documents submitted to the Customs authorities, containing false declarations, with full knowledge of the real position. The penalties imposed on the Indenting Agents, under section 167 (9‑A) and (9‑B) also appear to us to have been rightly imposed, on the facts found, and the order in question did not suffer from any infirmity so as to bring it within the corrective scope of Article 98 of the Constitution. The Collector had held that the Indenting Agents were the principal culprits in the case who had manoeuvred everything in collusion with the foreign exporters. They had acquired interest in the consignments by forward contracts in the names of certain persons who were their own nominees. They had inflated the price and, on its basis, the importers made false declarations. We regret we are unable to share the opinion of the learned Judges of the High Court that the Customs authorities in the instant case had not proved or established that the false declarations made in this case were false to the knowledge of the respondents, or that there was no evidence before the Customs authorities that the Indenting Agents were in league with the foreign exporters in Japan who had packed and exported the goods. The learned Judges were of the opinion that, at the most, the circumstances pointed the finger of suspicion against them but that suspicion could not take the place of proof. Enough has been said above to show that this was a wholly erroneous approach to the case. There was material before the Customs authorities which justified their conclusions and the consequent imposition of penalties on the respondents. I, therefore, allow all the four appeals and set aside the orders passed by the High Court with costs throughout. CORNELIUS, C. J.‑I agree with the judgment prepared by my learned brother S. A. Rahman, J., and have nothing to add to it. HAMOODUR RAHMAN, J.‑I agree that these appeals should be allowed but I regret my inability to subscribe to the view that item 37‑B of section 167 of the Sea Customs Act creates an ‑offence of absolute liability and is an exception to the general rule that mens rea is an essential element in the commission of a criminal offence. Even in the case of a statutory offence the presumption is that mens rea is an essential ingredient unless the statute creating the offence by express terms or by necessary implication rules it out. The mere omission of the word "knowingly" or "inten?tionally" is not sufficient to rebut this presumption for all that such words do is 'to say expressly what is normally implied. Thus where the words used in the statute are not clear or unambiguous an examination of the general scheme and object of the statute becomes necessary to determine whether the general rule of liability has been departed from. In some cases even the quantum of the punishment has been taken into account for determining this question, though this by itself cannot, in my view, be conclusive. It is in conformity with this principle that this Court in the case of the Eastern Rice Syndicate v. Central Board of Revenue after examining the provisions of section 39 of the Sea Customs Act and item 9‑B of section 167 thereof, came to the conclusion that "the essence of this penal provision appears to be that the offender has obtained an advantage at the hands of the Customs Authorities or has induced them to take some form of action" which they otherwise would not have taken but for the "untrue" statement. The word "untrue" was also construed as carrying the sense of falsity to the knowledge of the person concerned." Section 39 and items 9‑B and 37‑B of section 167 of the above Act have been reproduced in the judgment of my learned brother S. A. Rahman, J. I will not repeat them here but I would like to point out that under item 37‑A of section 167 the punishment is the same as under item 37‑B, although on the f wording of the former the element of deception clearly appears to be a necessary ingredient of the offence. This item 37‑A reads as follows:‑ ??????????????????????????????????????????????????????????????????????? Section of ??????????????????????????????????????????????????????????????????????? this Act ??????????????????????? Offence.?????????????????????????????????? to which?????????????????????? Penalties. ??????????????????????????????????????????????????????????????????????? offence has ??????????????????????????????????????????????????????????????????????? reference. 37‑A.‑‑If,???????? in relation to????????????????? 68 and????????????????????????? The goods shall be liable ??????????? any goods in respect of 137????????????????????????????? to???????? confiscation, and ??????????? which a declaration is??????????????????????????????????????????????????? every person concerned ??????????? required??????????? on a bill of??????????????????????????????????????????? in????????? any such offence ??????????? entry or a shipping bill,????????????????????????????????????? shall????? be liable to a ??????????? as the case may be, it be?????????????????????????????????????????????? penalty not exceeding ??????????? found that the goods???????????????????????????????????????????????????? one thousand rupees. ??????????? have apparently been ??????????? packed so as to deceive ??????????? the officer of Customs. It would thus appear from this that the quantum of the punish?ment prescribed can not furnish a safe criterion for the determination of this question. Even under item 9‑B, which? prescribes the punishment for a violation of the provisions of section 39 the maximum punishment may be a fine not exceeding one thousand rupees if three times the value of the goods confiscated is less than this amount. The question then arises as to whether there is anything in the language of item 37‑B to? indicate that an offence of absolute liability has been created. This item has to be read with section 86 of the Act which requires that in respect of goods imported a formal bill of entry has to be filed containing a declaration of the particulars of the goods imported and item 37‑B becomes attracted when undeclared goods are found to have been "concealed in or mixed with" the goods so declared. Now the word "conceal", according to its dictionary meaning, involves the act of hiding, secreting, disguising so as not to make known what one wishes to keep secret. These obviously one does not do unless he has a guilty mind and desires to deceive some one else. Does this not then also connote a conscious suppression of such facts as in law ought to be made known? If so, then does this not also involve the doing of. some act with a view to inducing the Customs Authorities to take some action which they otherwise would not have taken or omitting to do something which they otherwise would have done? The element of `knowledge' of the true state of affairs is thus not, in my view, excluded by this word. 'Similarly the mixing up must also, in my opinion, be with the knowledge of the importer in order to make him liable under the provisions of item 37‑B. I am, therefore, unable to agree that this item creates an offence of absolute liability so as to make an importer vicariously liable even for something done by another without his knowledge or consent. In my view the principle enunciated in the case of the Eastern Rice Syndicate fully applies to an offence under item 37‑B as well. In the present case, however, even applying the principle enunciated in the above‑mentioned case I find that there is enough material on the record to justify the conclusion that the element of mens rea was also present. The fact that they entered into forward transactions at double the commercial price and also stipulated for profits at an unusually high rate over and above this price tells heavily against them and clearly leads to the inference that they were all in the conspiracy to defraud the Customs Authorities. I would, therefore, be content to base my decision on this ground alone and subject to this would respectfully agree with the other conclusions of my learned brother S A. Rahman, J. K? B? A.?????????????????????????????????????????????????????????????????????????????????????????????? Appeals accepted.