DARA SINGH versus STATE THROUGH DIRECTOR OF ENFORCEMENT, NEW

Citation: [1981] 1 S.C.R. 987 · Decided: 29-10-1980 · Supreme Court of India · Bench: R.S. SARKARIA · Disposal: Appeal(s) allowed

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Judgment (excerpt)

DARA SINGH 
v. 
STATE THROUGH DIRECTOR OF ENFORCEMENT, NEW 
DELHI 
October 29, 1980 
[R. S. SARKARIA AND E. S. VENKATARAMIAH, JJ.] 
Foreign Exchange Regulation Act 1947-Section 23F-Scope of--order 
imposing penalty not communicated to the accused-11on·payrr1e11t of penalty 
within stipulated period-if amounts to co11trave11tio11 of section 23F-knowledge 
of order 011 the date of appearance before Magistrate-if amo11nts to knowledge 
of penalty. 
An exparte order holding the appellant guilty of certain offences under 
the Foreign Exchange Regulation Act and imposing penalty for such contraven .. 
tion was passed by the Director of Enforcement. On completion of 45 daY! 
of the issue of the order within which period the penalty was required to h~­
paid, a complaint was lodged with the Judicial Magistrate, 1st class allegin1 
that even though a 
copy of the impugned 
order had 
been served on the 
;ippellant, he failed to deposit the penalty and, that, therefore, he was liable 
to be punished under section 23F of the Act. 
Accepting the appellant's plea that no copy of the impugned order having 
been served on him there was no ground to hold him guilty of contravention 
of section 23F the Magistrate acquitted him. 
The Magistrate, at the same 
time, rejected the complainant's contention that even assuming that the im· 
pugned order had not been received by the appellant he had come to know 
of it on the date he appeared before the Magistrate and when the charge had 
been framed against him and 
his failure to pay the penalty 
de~oite this 
knowledge was enough to attract the provisions of section 23F. 
Ht> held that 
these allegations were stated neither in the complaint nor in the charee and, 
therefore, the appellant could not be convicted. 
Although the High Court, on appeal, upheld the finding of the Magistrate 
that the impugned order had not been served on the appellant, it was of the 
view that since the appellant had come to know about the order when he 
appeared before the Magistrate but still had not paid the penalty within a 
'reasonable time thereafter, he was liable to be punished under section 23F 
of tlrn Act. 
Allowing the appeal. 
HELD: The appellant had not committed any offence punishable under 
section 23F of the Act. [993G] 
When the law lays down that non-compliance with an order would expose 
the person against whom it is made to criminal liability, .it is reascn~ble to 
hold that in the absence of proof of knowledge of the order no penal action 
can be taken against him for non-compliance with that order. The information 
or knowledge which he may gather about such order in the cuur~e of criminal 
987 
A 
B 
c 
0 
!E 
F 
G 
H 
~·ss 
SUPREME COURT REPORTS 
[1981] 1 s.c~ 
A 
proceedings instituted for non-compliance with it cannot be a substitute for 
the knowledge of the order, which should ordinarily precede the institution· 
of such proceedings. The High Court was, therefore, in error in the circums· ! 
tances of the case in 
setting aside the order of acquittal passed by the 
Magistrate and in finding the appellant guilty of the offence complained of. 
[992H] 
B 
c 
D 
E . 
The rules framed under the Act set out the procedure to be follo.ved 
by the Director in holding an enquiry under section 23D of the Act. Although, 
there is no rule requiring a person against whom an order is made to appear 
before the Director on 1he date of pronouncement of bis order, rule 5 of the 
Rules requires that a copy of the order passed under rule 3(7) should be 
supplied free of charge to the person against whom the order is made. 
Tn 
the absence of a provision requiring the service of a notice on such a person 
informing him that .the order would be pronounced on a speci~ed future date, 
the only date · on which the order can 
be deemed to have been effectively 
made is the date on which he gets knowledge of the order either by supply 
of a copy of the order or by any other means. The period of limitalion to 
appeal cannot be computed from a date earlier than the date on which the 
aggrieved party has knowledge of the order. 
In the absence of proof of 
knowledge of the order either by supply of its copy or in any other manner 
the person failing to pay the penalty cannot be proceeded against under 
section 23F. [991H, 992FJ 
In the instant case the Magistrate and the High Court refused to accept 
the plea nf the Director that a copy of the impugned order had been served 
on the appellant. Neither on the date o

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