Case Note & Summary
In 1954, foreign currency and travelers cheques were recovered from premises at No. 311, Bow Bazar Street, Calcutta, where respondent Sukumar Pyne, along with his mother and brother, carried on business as jewellers. The Foreign Exchange Regulation Act, 1947, as originally enacted, provided in Section 23(1) that contraventions were punishable only by criminal proceedings before a court. By Act XXXIX of 1957, Section 23(1) was substituted and Section 23D was added, empowering the Director of Enforcement to hold adjudication proceedings and impose penalty up to three times the value of the foreign exchange or five thousand rupees, whichever is more, instead of or before criminal complaint. On April 23, 1958, the Director of Enforcement issued a show cause notice to the respondent asking why adjudication proceedings should not be held for contravention of Section 23(1) of the Act. The respondent replied on May 10, 1958, denying sale of travelers cheques and praying for dropping of proceedings. The Director, after considering the reply, decided to proceed with adjudication and asked the respondent to appear on May 13, 1958. The respondent then filed a petition under Article 226 of the Constitution before the Calcutta High Court challenging the adjudication proceedings. The High Court allowed the petition, holding that Section 23(1)(a) violated Article 14 and that the amended provisions did not apply retrospectively because the respondent had a vested right to be tried by an ordinary court with rights of appeal. The Union of India appealed to the Supreme Court by certificate under Article 132(1). Before the Supreme Court, the respondent conceded that Sections 23(1) and 23D did not violate Article 14 in light of Shanti Prasad Jain v. Director of Enforcement. The Supreme Court examined whether the amendment had retrospective effect and whether it violated Article 20(1). Relying on Rao Shiv Bahadur Singh v. State of Vindhya Pradesh, the Court held that a person accused of an offence has no vested right to be tried by a particular court or procedure, except where constitutional objections like discrimination arise. No fundamental right to a particular course of procedure exists. Since the amendment was procedural, it applied retrospectively without any express provision. No right of appeal under the Criminal Procedure Code was affected because no proceedings had been started under that Code. On the Article 20(1) challenge, the Court held that the new Section 23(1)(a) prescribed a maximum penalty, not a minimum; the words 'not exceeding' governed both alternative limits. Therefore, no greater penalty than could have been imposed under the old law, and no violation of Article 20(1). Accordingly, the Supreme Court accepted the appeal, set aside the High Court judgment, and upheld the validity of the adjudication proceedings.
Headnote
A) Constitutional Law - Equality before law - Article 14 Constitution of India, 1950 - Sections 23(1) and 23D Foreign Exchange Regulation Act, 1947 - Challenge that adjudication provisions created discrimination between persons proceeded against by way of adjudication and those tried by ordinary criminal courts - Supreme Court followed Shanti Prasad Jain v. Director of Enforcement and held that these provisions did not violate Article 14; counsel for respondent conceded the point (Paras Not mentioned) B) Criminal Procedure - Retrospective Application of Procedural Amendment - Vested Right to Procedure - Foreign Exchange Regulation Act, 1947, Section 23(1) - Act 39 of 1957 - Question whether substituted Section 23(1) applied to contravention committed in 1954 before amendment - Court held a person accused of an offence has no vested right to be tried by a particular court or procedure; no person has a vested right in any course of procedure; procedural amendments are retrospective without express provision; no proceedings under Criminal Procedure Code had started, so no right of appeal affected (Paras Not mentioned) C) Constitutional Law - Ex Post Facto Law and Penalty - Article 20(1) Constitution of India, 1950 - Section 23(1)(a) Foreign Exchange Regulation Act, 1947 - Respondent argued new section prescribed minimum penalty and old section allowed lesser fine, thus violating Article 20(1) - Court held new section prescribes maximum, not minimum; words 'not exceeding' cover both 'three times the value' and 'five thousand rupees'; no greater penalty than old law, hence no breach of Article 20(1) (Paras Not mentioned)
Issue of Consideration
Whether Section 23(1)(a) and Section 23D of the Foreign Exchange Regulation Act, 1947 violated Article 14 of the Constitution; whether the amended provisions introduced by Act 39 of 1957 applied retrospectively to contraventions committed before the amendment; whether Section 23(1)(a) prescribed a greater penalty than the old provision and thereby violated Article 20(1) of the Constitution
Final Decision
Appeal allowed; Supreme Court set aside the Calcutta High Court judgment quashing adjudication proceedings; held that Sections 23(1) and 23D of Foreign Exchange Regulation Act, 1947 did not violate Article 14; the amended adjudication provisions applied retrospectively as procedural law; Section 23(1)(a) prescribed maximum penalty, not minimum, hence no violation of Article 20(1); adjudication proceedings held valid.
Law Points
- A person accused of an offence has no vested right to be tried by a particular court or by a particular procedure
- except where discrimination or violation of a fundamental right is involved
- no person has a vested right in any course of procedure
- procedural amendments apply retrospectively without need for express provision
- Article 20 prohibits conviction or sentence under ex post facto law but not trial under a different procedure
- Section 23(1)(a) of the Foreign Exchange Regulation Act
- 1947 prescribes maximum penalty
- not minimum
- words 'not exceeding' apply to both penalty alternatives
- Sections 23(1) and 23D do not violate Article 14 of the Constitution
