Criminal Appeal No 627 of 1986
From the Judgment and Order dated 73
1986 of the Bombay High Court in Crl
Appeal No 119 of 1981
Ashok Sen Kapil Sibbal AK Sanghi and RL Sanghi for the Appellants
MS Rao AS Rao and CV Subba Rao for the Respondents
The Judgment of the Court was delivered by SEN J
The short question involved in this appeal by spe cial leave directed against the judgment and order of the High Court of Bombay dated March 7 1986 is whether the word whoever  in sub section
1 of section 23 of the Foreign Ex change Regulation Act 1947 before its amendment by Act XXXIX of 1957 denoted only a natural person and association of persons such as a firm would not fall within the conno tation of the word whoever 
By the judgment a learned Single Judge 140 of the High Court allowed the appeal of the Director of Enforcement under section 54 of the Act and set aside the order of the Foreign Exchange Regulation Appellate Board Bombay dated January 30 1981 and restored the order of the Direc tor of Enforcement dated August 17 1978 holding the appel lants guilty of contravention of section 122 of the Act read with the notification issued by the Government of India in the Ministry of Finance New Delhi dated April 22 1952 and levying a penalty of Rs 1500000
By its order the Foreign Exchange Regulation Appellate Board held that there could be no levy of penalty on the appellants firm for failure to repatriate foreign exchange on shipments of manganese ore made prior to September 20 1957 ie prior to the amendment of section 231 of the Act and the introduction of section 23C by the Amendment Act and accordingly reduced the amount of penalty to Rs3 10000
AS a result of the decision of the High Court the order of the Director of Enforcement levying a penalty of Rs 1500000 on the appellants has been re stored
The facts giving rise to the appeal are as follows
Messrs Rai Bahadur Seth Shreeram Durgaprasad were a partner ship firm engaged in the business of winning extracting and getting manganese ore from their manganese mines at Tumsar on a very large scale
During the period from 1952 to 1958 the partnership firm made 52 shipments of manganese ore to various foreign countries and earned huge amount of foreign exchange
It however failed to repatriate the full value in foreign exchange against the aforesaid 52 shipments and thereby contravened section 122 of the Act
The Director of Enforcement accordingly initiated adjudication proceedings against the appellants under section 231 as amended for contra vention of section 122 as well as section 41 of the Act
The appellants stated before the Director of Enforcement that they did not contest the charge under section 122 of the Act but questioned the liability of the firm on the ground that the amended section 231 as well as section 23C introduced by the Amendment Act came into force on September 20 1957 and were therefore inapplicable to the export shipments from the year 1952 onwards till that date and if at all the firm could only be held liable under the amended section 231 read with section 23C as from that date
It was contended that the word whoe ver  in sub section
1 of section 23 of the Act before its amendment denoted only a natural person and association of persons such as a firm would not fail within the connotation of the word whoever 
The Director of Enforcement by his order dated August 17 1978 repelled the contention and held that the firm and its partners had deliberately underinvoiced shipments at the time of export and also diverted the unde clared proceeds to their accounts with foreign banks with an intention not to repatriate the sale 141 proceeds in the prescribed manner within the prescribed period in respect of each shipment
He dealt with the evi dence in detail with reference to the books of account and came to the conclusion that both Durgaprasad Saraf and Umashanker Aggarwal were incharge of and responsible for the conduct of the business of the partnership firm during the relevant period
Neither of them produced any evidence to show that the contravention in question had taken place without their knowledge or that they had exercised due diligence to prevent such contravention
They were accord ingly made liable for contravention of section 122 of the Act for failure to repatriate the foreign exchange earned on the aforesaid 52 shipments and were imposed a penalty of Rs 1500000 on the partnership firm
The Foreign Exchange Regulation Appellate Board however disagreed with the Direc tor of Enforcement and accepted the contention of the appel lants and accordingly reduced the amount of penalty to Rs3 10000
Shri Asoke Sen learned counsel appearing for the appel lants with his usual fairness frankly concedes that article 201 of the Constitution would not in terms apply but he contends the principles embodied therein would still gov ern
He has confined his submissions to only one point namely that the word whoever  in sub section
1 of section 23 before its amendment by Act XXXIX of 1957 connoted only a natural person ie those who actually contravened the provisions of section 121 of the Act by failure to repatriate full value of foreign exchange earned on exports and would not take in corporate liability and therefore association of persons such as a firm would not fall within the connota tion of the word whoever 
The learned counsel further contends that by the Amendment Act new section 231 was substi tuted and section 23C introducted wef September 20 1957 and the effect of these provisions was that after that date adjudication proceedings or criminal proceedings could be taken in respect of a contravention mentioned in section 231 while before the amendment only criminal proceedings before a Court could be instituted to punish the offender
We are afraid the contention cannot prevail
It is not correct to say that the amended section 231 of the Act does not apply to contraventions which took place before the Amendment Act came into force
Shri Madhusudan Rao learned counsel ap pearing for the respondents rightly contends that on a combined reading of sections 231 and 122 the only possible construction is that the word whoever  includes a person and therefore initiation of adjudication proceedings against the partnership firm was permissible
He draws sustenance from the provision contained in subs
4 of section 23 which clearly contemplates prosecution of a company or other body corporate
As regards the applicability of the amended 142 section 231 read with section 23C with regard to initiation of adjudication proceedings in respect of contraventions which took place before the Amendment Act came into force he rightly contends that the matter is concluded by the deci sion of this Court in Union of India vs Sukumar Pyne  In order to appreciate the contentions raised it is necessary to set out the statutory provisions insofar as relevant
1 Except with the previous general or special permission of the Reserve Bank no person other than an authorised dealer shall  sell or lend to or exchange with any person not being an authorised dealer any foreign exchange
Where any export of goods has been made to which a notification under sub section 1 applies no person entitled to sell or pro cure the sale of the said goods shall except with the permission of the Reserve Bank do or refrain from doing any act with intent to secure that a the sale of goods is delayed to an extent which is unreasonable having regard to the ordinary course of trade or b payment for the goods is made otherwise than in the prescribed manner or does not represent the full amount payable by the foreign buyer in respect of the goods subject to such deductions if any as may be allowed by the Reserve Bank or is delayed to such extent as aforesaid Provided that no proceedings in respect of any contravention of this sub section shall be instituted unless the pre scribed period has expired and payment for the goods representing the full amount as afore said has not been made in the prescribed manner Section 231 prior to its amendment and the original sub section
3 now renumbered as section 234 are as follows 23
1 Whoever contravenes any of the provi sions of this Act or of any rule direction or order made thereunder 143 shall be punishable with imprisonment for 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 confis cated
234
If the person committing an offence punishable under this section is a company or other body corporate every director manager secretary or other officer thereof shall unless he proves that the offence was commit ted without his knowledge or that he exercised all due diligence to prevent its commission be deemed to be guilty of such offence   Sub section
1 of section 23C is as follows 23C Offences by companies 1 If the person committing a contravention is a company every person who at the time the contravention was committed was incharge of and was responsi ble to the company for the conduct of the business of the company as well as the compa ny shall be deemed to be guilty of the con travention and shall be liable to be proceeded against and punished accordingly Provided that nothing contained in this sub section shall render any such person liable to punishment if he proves that the contravention took place without his knowledge or that he exercised all due diligence to prevent such contravention
 It is clear from these provisions that the word whoev er  in sub section
1 of section 23 of the Act before its amendment was comprehensive enough to include an association of per sons such as a firm and did not connote a natural person alone
There is no reason why the word whoever  in the section should not receive its plain and natural meaning
According to the Shorter Oxford English Dictionary vol 2 p 2543 whoever  means  any one who
any who 
The mean ing given in Webster Comprehensive Dictionary International edn vol 2 at p 1437 is any one without exception any person who 
In our judgment
the word whoever  in the unamended section 231 must be read in juxtaposition with section 122 and must mean any person who commits a 144 contravention of that section without exception
That must be the legal connotation of the word whoever  and it neces sarily takes in corporate liability and includes any associ ation of persons such as a partnership firm
That construc tion of ours is borne out by the plain language of sub section
4 of section 23 inserted by Act XXXIV of 1950
It provides that if the person committing an offence punishable under sub section
1 of section 23 is a company or other body corporate every director manager secretary or other officer thereof shall unless he proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent its commission be deemed to be guilty of such offence
The Act therefore clearly contemplated that adjudication pro ceedings under sub section
1 of section 23 prior to its amendment could be initiated not only against the person who actually commits contravention but also casts vicarious liability on an association of persons such as a partnership firm or an artificial or a legal entity like a company
It is therefore idle to contend that the appellants were not liable to pay  penalty for failure to repatriate foreign exchange on 52 shipments of manganese ore effected through the years 1952 to 1958
Upon that view the learned Single Judge was right in setting aside the order of the Foreign Exchange Regula tion Appellate Board and restoring that of the Director of Enforcement levying a penalty of Rs 1500000 on the appel lants for failure to repatriate foreign exchange in contra vention of section 122 of the Act
The contention of the learned counsel that recourse could not be had to the amended section 231 read with section 23C of the Act in respect of the contravention of section 122 for failure on the part of the appellants to repatriate foreign exchange on shipments of manganese ore made prior to Septem ber 20 1957 and there could be no initiation of adjudica tion proceedings under the amended section 231 read with section 23C or levy of penalty on the appellants must also fail for another reason
In Sukumar Pyne s case the Court reversed the decision of the Calcutta High Court in Sukumar Pyne vs Union of India  Ors AIR 1962 Cal
590 striking down section 231a as being violative of article 14 of the Constitution
Regarding the point namely whether section 231a having been substituted by Amendment Act XXXIX of 1957 would have retro spective 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 section 231a was procedural where a vested right was affected prima facie it was not a question of procedure
Therefore the High Court came to the conclusion that the provision as to adjudication by the 145 Director of Enforcement could not have any retrospective operation
It was held that the impairment of a fight by putting a new restriction thereupon is not a matter of procedure only 
It impairs a substantive right and an enactment that does so is not retrospective unless it says so expressly or by necessary intendment
The Court reversed the High Court and held that effect of these provisions was that after the amendment of 1957 adjudication or criminal proceedings could be taken up in respect of a contravention mentioned in section 231 while before the amendment only crimi nal proceedings before a Court could be instituted to punish the offender
In repelling the contention advanced by Shri NC Chatterjee that the new amendments did not apply to contraventions which took place before the Act came into force the Court observed In our opinion there is force in the conten tion of the learned Solicitor General
As observed by this Court in Rao Shiv Bahadur Singh vs The State of Vindhya Pradesh   a person accused of the commission of an offence has no vested right to be tried by a particular court or a particular proce dure except in so far as there is any consti tutional objection by way of discrimination or the violation of any other fundamental right is involved
It is well recognised 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 article 20 of the Constitution which makes a right to any course of procedure a vested right
 These principles are clearly attracted to the facts and circumstances of the present case and therefore the initia tion of adjudication proceedings for failure to repatriate foreign exchange on shipments of manganese ore prior to September 20 1957 the date when the Amendment Act came into force was permissible
The appeal must therefore fail and is dismissed with costs
NPV Appeal dis missed


Summary:
The Director of Enforcement initiated adjudication proceedings against the appellants a partnership firm under Section 231 as amended for failure to repatriate the full value in foreign exchange earned by it against export shipments of manganese ore made during 1952 1958 and thereby contravening Section 122 as well as Section 41 of the Foreign Exchange Regulation Act 1947
The appellants did not contest the charge under Section 122 of the Act but questioned the liability of the firm on the ground that the amended Section 231 as well as Section 23C introduced by the Amendment Act came into force on September 20 1957 and were therefore inapplicable to the export shipments from the year 1952 onwards till that date and if at all the firm could only be held liable under the amended Section 231 read with Section 23C as from that date
It was con tended that the word whoever  in sub section 1 of Section 23 of the Act before its amendment denoted only a natural person and association of persons such as a firm would not fall within the connotation of the word whoever 
The Director of Enforcement held that the firm and its partners had deliberately underinvoiced shipments at the time of export and also diverted the undeclared proceeds to their accounts with foreign banks with an intention not to repa triate the sale proceeds in the prescribed manner within the prescribed period in respect of each shipment
He also held that the two persons incharge of and responsible for the conduct of the business of the partnership firm during the relevant period did not produce any evidence to show that the contravention in question had taken place without their knowledge or that they had exercised due diligence to pre vent such contravention and they were accordingly made liable for contravention of Section 122 of the Act for failure to repatriate the foreign exchange earned on the shipments and a penalty was imposed on the partnership firm
138 The Foreign Exchange Regulation Appellate Board howev er disagreed with the Director of Enforcement accepted the contention of the appellants and accordingly reduced the amount of penalty
The High Court allowed the appeal of the Director of Enforcement and restored the original order of the Director of Enforcement
In appeal to this Court it was submitted on behalf of the appellants that though Article 201 of the Constitution would not in terms apply the principles embodied thereto would still govern and that the word whoever  in sub sec tion 1 of Section 23 before its amendment by Act XXXIX of 1957 connoted only a natural person ie those who actually contravened the provisions of Section 121 of the Act by failure to repatriate full value of foreign exchange earned or exports and would not take in corporate liability and therefore association of persons such as a firm would not fall within the connotation of the word whoever  that by the Amendment Act a new Section 231 was substituted and Section 23C was introducted and the effect of these provi sions was that after September 20 1987 adjudication pro ceedings or criminal proceedings could be taken in respect of a contravention mentioned in Section 231 while before the amendment only criminal proceedings before a court could be instituted to punish the offender
On behalf of the respondents it was contended that on a combined reading of Section 231 and 122 the only possi ble construction was that the word whoever  includes a person and therefore initiation of adjudication proceed ings against the partnership firm was permissible and sub section 4 of Section 23 clearly contemplates prosecution of a company or other body corporate
Dismissing the appeal this Court HELD 1
It is clear from Sections 41 122 231 234 and 23C that the word whoever  in sub section 1 of Section 23 of the Act before its amendment was comprehensive enough to include an association of persons such as a firm and did not connote a natural person alone
The word whoev er  in the unamended Section 231 must be read in juxtapo sition with Section 122 and must mean any person who commits a contravention of that Section without exception
That must be the legal connotation of the word whoever  and it necessarily takes in corporate liability and includes any association of persons such as a partnership firm
Such a construction is borne out by the plain language of sub section 4 of Section 23 inserted by the Act XXXIV of 139 1950 which provides that if the person committing an offence punishable under sub section 1 of Section 23 is a company or other body corporate every director manager secretary or other officer thereof unless he proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent its commission be deemed to be guilty of such offence
The Act therefore clearly contem plated that adjudication proceedings under sub section 1 of Section 23 prior to its amendment could be initiated not only against the person who actually commits contravention but also casts vicarious liability on an association of persons such as a partnership firm or an artificial or a legal entity like a company
143FH 144A C The High Court was right in setting aside the order of the Foreign Exchange Regulation Appellate Board and restor ing that of the Director of Enforcement levying a penalty of Rs 1500000 on the appellants for failure to repatriate foreign exchange in contravention of Section 122 of the Act
The initiation of adjudication proceedings for failure to repatriate foreign exchange on shipments of manganese ore prior to September 20 1957 the date when the Amendment Act came into force was permissible
144D F Union of India vs Sukumar Pyne   referred to