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1992 DIGILAW 78 (KER)

L. Venkatesh Naik v. Assistant Collector, Special Customs Preventive Division, Kozhikode

1992-02-24

K.A.NAYAR

body1992
ORDER:- Even though elaborate arguments have been advanced in this case, I feel the question to be decided falls within a narrow compass, for it is admitted that the factual details of the different cases need not be gone into. In all these cases, there had been violations of the Gold (Control) Rules against which prosecutions have been launched under the Gold (Control) Act, 1968 (Act 45 of 1968) and the Rules framed thereunder. For violation of the Act and the Rules, criminal complaints have been filed and the same is pending before the Additional Chief Judicial. Magistrate (Economic Offences), Emakulam. In some cases charges have been framed and in others charges have not been framed. The Gold (Control) Act 1968 (For short 'the Act') was repealed with effect from 6-6-1990. It was only a simple repeal and was not followed by any re-enactment. The only question is whether the criminal cases pending before the Chief Judicial Magistrate (Economic Offences) can be continued. It is argued that after the repeal, the criminal cases cannot be permitted to go on in the criminal Court, for the repeal, being simple repeal, will have to be deemed to have retrospective effect. It is submitted that there is no saving clause in the repealing provision and, therefore, S. 6 of the General Clauses Act will not be applicable. Counsel also referred to the history of the Act wherein it is emphasised that there were saving clauses in all the earlier repeals and, without such saving clause, no prosecution can be continued. Counsel also submitted that section 6 of the General Clauses Act will apply only to enactments and regulations but it will not apply to rules. The contention is that the Gold Control Rules which has been framed under the earlier Act cannot continue and all the rules and notifications issued under the Act will not survive after the repeal. Section 24 of the General Clauses Act also will not be available in the absence of reenactment. Therefore, after the repeal, prosecution against violation of the rules cannot be proceeded with, is the submission. It is also contended that the interpretation to be given by this Court should be consistent with the Constitutional principles and if two interpretations are possible, the one which is constitutionally valid should be considered. In any case, a purpossive interpretation should be given. It is also contended that the interpretation to be given by this Court should be consistent with the Constitutional principles and if two interpretations are possible, the one which is constitutionally valid should be considered. In any case, a purpossive interpretation should be given. For this purpose counsel referred to the objects and reasons for the enactment to show that there was no intention to keep alive any prosecution. He also referred to the budget speech of the Minister in this regard to emphasise that there was no intention to continue the prosecution. It is submitted that if a prosecution is continued, it will result in arbitrariness and violation of Art, 14 of the Constitution and, therefore, the interpretation to be given to the repealing enactment in the light of the statement of objects and reasons should be that the intention of the Parliament is to wipe away the Act from the Statute Book as if it never existed leading to the condusion that the prosecution is not maintainable. 2. The prayer in all these cases is for a writ to quash the direction contained in the circular to the effect that all infractions of law prior to the repeal of the Gold (Control) Act, 1968 should be taken cognisance of and decided as per the law prevailing at the relevant time by virtue of section 6 of the General Clauses Act, 1897. There is also a prayer for a declaration that the objects and reasons preceding the Gold (Control) Repeal Act, 1990 is the contrary intention appearing in the Statute excluding the applicability of Section 6 of the General Clauses Act, 1897 for the continuance of the provisions of the Gold (Control) Act, 1968. The further prayer is for a writ of prohibition restraining the 3rd respondent from proceeding further with the criminal complaints specifically mentioned in each of the original petitions. 3. Section 6 of the General Clauses Act reads as under : "6. The further prayer is for a writ of prohibition restraining the 3rd respondent from proceeding further with the criminal complaints specifically mentioned in each of the original petitions. 3. Section 6 of the General Clauses Act reads as under : "6. Effect of repeal - Where this Act, or any Central Act or Regulation made after the commencement of this Act, repeals any enactment hitherto made or hereafter to be made, then, unless a different intention appears, the repeal shall not - (a) revive anything not in force or existing at the time at which the repeal takes effect, or (b) affect the previous operation of any enactment so repealed or anything duly done or suffered thereunder, or (c) affect any right, privilege, obligation or liability acquired, accrued or incurred under any enactment so repealed; or, (d) affect any penalty, forfeiture or punishment incurred in respect of any offence committed against any enactment so repealed; or (e) affect any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation, liability, penalty, forfeiture or punishment as aforesaid and any such investigation, legal proceeding or remedy may be instituted, continued or enforced, and any such penalty, forfeiture or punishment may be imposed as if the repealing Act or regulation had not been passed." By virtue of the said section, where any Central Act repeals any enactment, unless a different intention appears, the repeal shall not affect any legal proceeding, obligation, liability, penalty, forfeiture or punishment arising out of, or imposed under the repealed enactment. S. 6 of the General Clauses Act is considered to be built in and written in every enactment. The repealing Act will be deemed to contain that section as well. The very purpose of General Clauses Act is to provide a legislative dictionary, to shorten the language of the enactments. As held in Chief Inspector of Mines v. K. C. Thaper, AIR 1961 SC 838, the purpose of General Clauses Act was to place in single statute different provisions as regards interpretations of words or legal principles which would otherwise have to be specified separately in many different Acts, whatever the General Clauses Act says with regard to meaning of the words or as a legal principle has to be read into every statute to which it applies. If that be so, Section 6 of the General Clauses Act will form part of the repealing Act and, therefore, the criminal prosecutions necessarily will have to be continued. 4. Petitioner referred to the history of the decline and fall of the Gold (Control) Act. The Gold (Control) Act was introduced for the first time by amending the Defence of India Act by which the Gold (Control) Rules, 1963 was incorporated as Part XIIA of the Defence of India Rules. Subsequently Gold (Control) Rules, 1963 was repealed and replaced by Gold (Control) Act, 1968. The section repealing the Rules specifically provided that on such repeal, Section 6 of the General Clauses Act, 1897, shall apply as if the same were a Central Act. There was a saving clause to the effect that notwithstanding the repeal, anything done or any action taken (including any application made to or any order made or licence issued by, the Gold Board Administrator or other competent authority) under or in pursuance of the provisions of Part XIIA of the Defence of India Rules, 1962, shall so far as it is not inconsistent with the provisions of this Act, be deemed to have been done or taken under or in pursuance of the corresponding provision of the Gold (Control) Act, 1968. Thereafter, the Gold (Control) Ordinance of 1968 was issued on 22-6-1968 and that Ordinance repealed Part XIIA of the Defence of India Rules. Section 17 of the Ordinance also mentioned the repeal and savings. There was a saving clause as referred to earlier in this Ordinance as well. The Gold (Control) Act, 1968, which replaced the ordinance, also contained similar saving clause. Hence, it is submitted that whenever the Parliament is interested in continuing any action taken under a repealed Act, specific provision is made to that effect in the repealing Act. It is on that basis counsel submitted that in so far as there is no saving clause under the Gold (Control) Repeal Act, 1990, the prosecution or proceedings commenced under the repealed Act cannot be continued. 5. The Gold (Control) Repeal Act, 1990 is a simple repeal stating that "the Gold (Control) Act, 1968 is hereby repealed". It is brought into force with effect from 6-6-1990. The Act received the assent of the President on 6-6-1990 and was published on 7-6-1990. 5. The Gold (Control) Repeal Act, 1990 is a simple repeal stating that "the Gold (Control) Act, 1968 is hereby repealed". It is brought into force with effect from 6-6-1990. The Act received the assent of the President on 6-6-1990 and was published on 7-6-1990. Counsel for the petitioner referred to the statement of objects and reasons, which runs as follows : "Gold Control which regulated the domestic trade and movement of gold within the country was introduced on 9th January, 1963 as part of the Defence of India Rules. Later on, the Gold (Control) Act, 1968 was enacted with the broad objectives of controlling the production, manufacture, supply, distribution, use and possession of, and business in, gold, ornaments and articles of gold. The said enactment was meant to supplement other preventive measures to make circulation of smuggled gold difficult and its detection easier by extending the control over gold beyond the stage of import. 2. Over the past 22 years, the results achieved under the Act have not been encouraging and the desired objectives for which the Act was introduced have not been achieved due to various socio-economic and cultural factors in the vast multitude of the country's population and the lack of adequate administrative machinery. On the other hand, this regressive and purely regulatory Act has given rise to considerable dissatisfaction in the minds of the public as it has caused hardship and harassment to the artisans and small self-employed goldsmiths who have not been able to develop their skills and earn proper living on account of the rigours which this Act imposed upon them. 3. Taking these factors into consideration and the advice of experts who have examined issues related to this Act, it is proposed to repeal the Gold (Control) Act, 1968. 4. The Bill seeks to achieve the said object." Counsel for the petitioner submitted that the intention of the Parliament is very clear from the above statement of objects and reasons. It is submitted that over the past 22 years, the results achieved under the Act have not been encouraging and the objects for which the Act was introduced have not been achieved. It is submitted that over the past 22 years, the results achieved under the Act have not been encouraging and the objects for which the Act was introduced have not been achieved. The Parliament characterised the Act as a regressive and purely regulatory Act which gave rise to considerable dissatisfaction in the minds of the public as it has caused hardship and harassment to the artisans and small self-employed goldsmiths who have not been able to develop their skills and earn proper living on account of the rigours which the Act imposed upon them. It is because of this the repeal was made. When such a repeal is made, it is submitted that there is a duty to look into the objects and give purposive interpretation to the section. An interpretation consistent with the Constitution and the purpose of the Act will have to be given. Counsel for the petitioner referred to the decision reported in Delhi Transport Corporation v. D. T. C. Mazdoor Congress, AIR 1991 SC 101 Para 211 and emphasised that an interpretation consistent with the Constitution will have to be given to the Act. The Supreme Court in that case held : ".....A literal interpretation is not always the only interpretation of a provision in a statute and the Court has to look at the setting in which the words are used and the circumstances in which the law came to be passed to decide whether there is something implicit behind the words actually used which would control the literal meaning of the words used. It has been further held following the observations in the Mysore State Electricity Board v. Bangalore Wollen, Cotton and Silk Mills Ltd., 1963 Supp. (2) SCR 127 : AIR 1963 SC 1128 that it is well settled that if certain provisions of law construed in one way will be consistent with the Constitution and if another interpretation would render them unconstitutional the Court would bear in favour of the former construction." No construction inconsistent with the provisions of the Constitution is involved in this case. I am concerned here only with the application of section 6 of the General Clauses Act. I am concerned here only with the application of section 6 of the General Clauses Act. Counsel also referred to the decision reported in B. Prabhakar Rao v. State of A. P., AIR 1986 SC 210 para 22 and submitted that in this case unless an interpretation is given to the effect that the Act is retrospective in character, the Act will be violative of Part III of the Constitution. In that decision the age of superannuation of the employees of the Andhra Pradesh Government was reduced from 58 to 55 years originally. But soon, when it was realised by the State Government that serious wrong and grave injustice has been caused to its employees, an immediate decision was taken to redress the wrong by reversing the decision. In the meantime, a few employees retired having attained the age of 55 years, and they were denied the benefit of the retirement age of 58 years. The Supreme Court only held that all affected employees who are hit by the reduction of the age of superannuation form a class and, therefore, there was no reason to pick up a class of persons who deserved the same treatment and exclude them from the benefit by classifying them as a separate group. Counsel for the petitioner submitted that those who violated the rules up to 6-6-1990 will be liable for punishment and those who violated it later will be let off without any punishment. That will result in violation of the fundamental rights including Articles 14 and 21 of the Constitution of India and, therefore, as far as possible, it is submitted, the interpretation to be given by the Court must be one consistent with the Constitutional principles, and that result can be achieved only if it is held that the repealing Act is retrospective in character and that all proceedings and prosecution commenced also will have to be stopped. 6. I do not find any support for this contention in the above decision, But in the case in question there are many persons who have been found guilty for violation of the rules before 6-6-1990, and they have been punished. The mere fact that the criminal prosecution against the petitioners did not end before 6-6-1990 will not be a ground for treating that in their case the violation of the rules has not become punishable. The mere fact that the criminal prosecution against the petitioners did not end before 6-6-1990 will not be a ground for treating that in their case the violation of the rules has not become punishable. The matter, according to me, is clearly covered by the decision of the Supreme Court in T. S. Baliah v. T. S. Rangachari, AIR 1969 SC 701, T. Barai v. Henry Ah Hoe, AIR 1983 SC 150, Andhra Pradesh State Electricity Board v. Union of India, AIR 1988 SC 1020, State of Punjab v. Mohar Singh, AIR 1955 SC 84, Indira Sohanlal v. Custodian of Evacuee Property, AIR 1956 SC 77 and Neel v. State of West Bengal, AIR 1972 SC 2066. 7. In T. S. Baliah's case (AIR 1969 SC 701) (supra) the Supreme Court interpreted section 6 of the General Clauses Act and held : "Whenever there is a repeal of an enactment the consequences laid down in section 6 of the General Clauses Act will follow unless, as the section itself says, a different intention appears in the repealing statute. In the case of a simple repeal there is scarcely any room for expression of a contrary opinion." The result may be different when the repeal is followed by fresh legislation. Admittedly in this case there is no fresh legislation and as Supreme Court held, there is scarcely any room for expression of a contrary opinion, when there is only a simple repeal. In the decision reported in T. Barai's case (AIR 1969 SC 701) (supra) the Supreme Court has stated in paragraph 18 of the judgment as follows : "Whenever there is a repeal of an enactment, the consequences laid down in section 6 of the General Clauses Act though it has been specifically mentioned in the repealing Act or not, will follow, unless, as the section itself says, a different intention appears. In State of Punjab v. Mohar Singh, (1955) 1 SCR 893 : AIR 1955 SC 84 this Court has elaborately dealt with the effect of repeal. In the case of a simple repeal, there is scarcely any room for expression of a contrary opinion." I need not consider all the other decisions referred to above. In State of Punjab v. Mohar Singh, (1955) 1 SCR 893 : AIR 1955 SC 84 this Court has elaborately dealt with the effect of repeal. In the case of a simple repeal, there is scarcely any room for expression of a contrary opinion." I need not consider all the other decisions referred to above. They all lay down that whether it has been specifically mentioned in the repealing Act or not, section 6 will be deemed to form part of the repealing Act and it will be read along with the repealing Act and so far as there is no re-enactment, the result envisaged in section 6 of the General Clauses Act will apply. That means, a repeal will not affect any investigation, legal proceedings or remedy in respect of any liability, penalty or punishment and it will not affect the previous operation of the enactment so repealed or anything done thereunder. The legal proceedings will continue as if the repealing Act is not passed. 8. Counsel for the petitioner referred to the decisions reported in National Planners Ltd. v. Contributories, AIR 1958 Punjab 230 (FB) and Waheed Hasab Khan v. State of Hyderabad, AIR 1954 Hyd. 204 (FB) to show that unless there is a specific saving clause, the prosecution cannot be continued. But a reading of the said decisions will not support the petitioner's case. In the decision in National Planners' case (supra) the question was whether the repeal of the Indian Companies Act 1913 which conferred jurisdiction on the District Court to deal with certain cases had taken away all rights to proceed under the repealed statute even in action which were pending, but undetermined at the time of repeal. The 1913 Act was repealed by the Companies Act, 1956. The 1956 Act declared that the High Court alone shall have jurisdiction for winding up companies with paid up share capital of Rs. 1,00,000 /- or more. The winding up proceedings were pending in District Court. The question was whether it can continue or whether it should be transferred to the High Court. There was a saving clause in the 1956 Act enabling continuation of the proceedings pending in the District Court. 1,00,000 /- or more. The winding up proceedings were pending in District Court. The question was whether it can continue or whether it should be transferred to the High Court. There was a saving clause in the 1956 Act enabling continuation of the proceedings pending in the District Court. Counsel relied upon the observation that if a statute is unconditionally repealed without a saving clause in favour of pending proceedings, all actions must stop where the repeal finds them and if final relief is not granted before the repeal comes into effect, it cannot be granted afterwards. But that observation has no application when there is a saving clause and such a saving clause can be provided under the Act itself or by way of section 6 of the General Clauses Act. Section 6 of the General Clauses Act is part of every Act passed by the Central legislature in the same way as it were expressly enacted in the body of the Act itself. The language of Section 6 declares that proceedings which were commenced by virtue of a statute which has been repealed shall not be dismissed by the Court for want of jurisdiction after the repeal of that statute, as under the common law, but that the said proceedings shall continue to be dealt with by the Court as before and shall be carried to final judgment and execution by the said Court in exactly the same way as if the statute had not been repealed. Accordingly, the Court held that it was open to the District Judge in whose Court the winding up proceedings were pending before the Act of 1956 came into force to retain the said proceeding in his Court and to pass judgment thereon in accordance with the provisions of the Act of 1913. This decision, read as a whole is against the contentions raised by the petitioner. Counsel for the petitioner also drew my attention to the following passage : "It is a well settled rule of common law that when an action is brought under a statute which is afterwards repealed, the Court loses jurisdiction of the suit pending under the repealed Act and is unable to deliver judgment therein. Counsel for the petitioner also drew my attention to the following passage : "It is a well settled rule of common law that when an action is brought under a statute which is afterwards repealed, the Court loses jurisdiction of the suit pending under the repealed Act and is unable to deliver judgment therein. The effect of repealing a statute is to obliterate it as completely from the records of the Parliament as if it had never been passed; and it must be considered as a law that never existed, except for the purpose of those actions which were commenced, prosecuted and concluded whilst it was an existing law. " As stated above, if the judgment is read as a whole, it will be seen that the above passage only states a rule of common law which has been modified by the saving clause embodied in section 6 of the General Clauses Act. Therefore, this decision will not support the case of the petitioner. The second case referred to need not detain me long, for there the court was concerned only with procedural rights, viz. right of cross-examination which, the Court held, cannot be preserved to a party after the law which conferred the right was amended or another procedural law substantially altering the mode by which the credibility of witnesses should be tested, is substituted in place of the repealed statute. He also referred to the decision in Rayala Corporation (P) Ltd. v. Director of Enforcement, AIR 1970 SC 494 and Harish Chandra y. State of M. P., AIR 1965 SC 932. In Rayala Corporations case it was held that section 6 of the General Clauses Act cannot apply on the omission of Rule 132A of the Defence of India Rules for the two obvious reasons that Section 6 only applies to repeals and not to omissions, and applies when the repeal is of a Central Act or Regulation and not of a Rule. But the Court held that if Section 6 of the General Clauses Act applies, the complaint against the two accused in that case for the offence punishable under Rule 132A of the Defence of India Rules could have been instituted even after the repeal of that Rule. Therefore, this decision also will not advance the case of the petitioner. But the Court held that if Section 6 of the General Clauses Act applies, the complaint against the two accused in that case for the offence punishable under Rule 132A of the Defence of India Rules could have been instituted even after the repeal of that Rule. Therefore, this decision also will not advance the case of the petitioner. In Harish Chandra's case the question was whether section 24 of the General Clauses Act will apply when the Madhya Bharata Scrap Order was replaced by the Indian Scrap Order. The Court held that neither the section nor the principles underlying it will apply. As stated already, section 6 of the General Clauses Act will do the duty of a saving clause in this case and Section 24 in any case, will have no application. 9. Counsel referred to the budget speech of the minister reported in (1990) 182 ITR 185 (Journal) wherein, according to counsel for the petitioner, it is stated that there is no point in continuing the prosecution, and submitted that the respondents are estopped from continuing the prosecution. The relevant portion of the budget speech runs as follows: "Domestic trade in gold is regulated under the Gold (Control) Act which was introduced in 1963 with the broad objective of curbing the demand for gold. The Act has been largely ineffective. It has also caused hardship and harassment to small goldsmiths. There is no much point in continuing with such an ineffective legislation. The Government, therefore, proposes to abolish the Gold (Control) Act. This step would benefit many artisans and small goldsmiths all over the country. At the same time, we will use the Customs Act more vigorously to prevent smuggling of gold." This cannot be pleaded as an estoppel or admission by the Minister not to continue the prosecution. Finance Minister's budget speech cannot be considered as a binding promise and will not spell in the realm of estoppel. Speech of the Finance Minister cannot also be regarded as a piece of legislation, subordinate or delegated. (See (1987) 31 ELT 25) (Delhi). 10. Counsel for the petitioner also submitted that the continuance of the proceedings will be violative of Article 21 of the Constitution. Speech of the Finance Minister cannot also be regarded as a piece of legislation, subordinate or delegated. (See (1987) 31 ELT 25) (Delhi). 10. Counsel for the petitioner also submitted that the continuance of the proceedings will be violative of Article 21 of the Constitution. According to counsel, there is no fairness in continuing the trial when the statement of objects and reasons clearly held that the Gold (Control) Act spells in the realm of hardships to the citizens, and hence there is violation of Article 21 of the Constitution of India, Article 21 mandates that before a person is deprived of his life or personal liberty procedure established by law shall be strictly followed. The procedure established should be reasonable, fair and just and should not be arbitrary whimsical or unfair. The court has to consider each case on its own merit. In these cases I am not satisfied that Article 21 is in any way violated in continuing the proceedings commenced before the repeal of the Gold Control Act. The only case is whether the petitioners are guilty of any offence under the Gold (Control) Act. For an offence committed during the continuance of the Act, the petitioners have been prosecuted and the prosecution should continue. In Ismail Kutty v. Asst. Collector, (1991) 2 Ker LT 769 and Crl. M.C. 484/91 this Court held so. If the petitioners have any grievance against the ultimate result of the prosecution, the remedy for them is provided under the Code of Criminal Procedure. I find no ground to entertain these original petitions. I make it clear that this judgment will, not stand in the way of the petitioners moving and/or obtaining appropriate direction from the Central Government for dropping the prosecutions. The Original Petitions are dismissed. Petitions dismissed.