LexTHE SEKSARIA COTTON MILLS LTD. versus THE STATE OF BOMBAY
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S.C.R. SUPREME COURT REPORTS THE REKRARIA COTTON MILLS LTD. v. THE STATE OF BOMBAY. [MEHR CHAND MAHAJAN, VrVIAN BosE and JAGANNADHA DAS JJ.] 825 Essential Supplies Act (XXIV of 1946), ss. 7, 9--Notification requiring manufacturers to submit tru,e and accurate information-- "Delivery", meaning of-Possession of del credere (JJJent-Whether possession uf seller-Delivery to such (JJJent, effect of-Penal statutes -Liberal constrnction. A Government Notification issued under the Essential Sup- plies Act, 1946, required every manufacturer to submit "true and accurate information relating to his undertakings'' and a note on the printed form stated that "by 'delivered' or 'delivery' is meant physical deli very of cloth in bales and pieces but not cloth which, though paid for, is still in the physical possession of the seller." The appellant Mills were manufacture"s of cloth and D.K. & Co. were their sole del credere selling agents who guaranteed payment to the appellant of the price of all sales made and, on the other side, guaranteed delivery <<l.J;.b.e purchasers with whom they dealt direct. One D.:11. informed1'!1o \fills as the agent of an up-country quota-holder that be had been authorised by the latter to take deli- very of 13 bales and on this account paid Rs. 14,000 to D.K. & Co. D.K. & Co. wrote to the Mills that they bad received payment. The ;\fills despatched the goods to D.M. but meanwhile the quota- holder had changed his agent and D.M. refused to take delivery. The Mills credited the money which had been received from D.M. to D.K. & Co. and advised D. K. & Co. to keep the goods in a certain godown till the question of delivery was settled. In a return submitted under the Essential Supplies Act, 1946, these 13 bales ivere shown as "delivered" to D. K. & Co. The appellants were prosecuted and convicted on the ground that physical deli· very was not given to D.K. & Co. and ohe return was not there- fore true and accurate : Held, that, as the goods had left the Mill premises, the price had been paid and the property in them bad passed and as they were in a godown under the control of D. K. & Co., D. K. & Co. were in the circumstances, the persons to whom the goods were actually delivered and the conviction was illegal. A del creclere agent is an agent of the seller only np to a -point. Beyond that he is either a principal or an agent of the buyer. In a penal statute it is the duty of the Court to interpret words of ambiguous meaning in a broad an<l liberal sense. 101 1953 March 30 826 i'il~PREME COURT REPORTS [1953] 1953 CRBHNAI, APPELLATE ,JURISDICTION: Criminal Th r /.,'e J.:~a ri'r1 Gofton .11il!s Ltd. Appeal No. 61 of 1952. ' Appeal by special leave granted by the Supreme Court on the 10th September, 1951, from the Judg- ment and Order dated the .5th March, 1951, of the High Court of .Judicature a.t Bombay (Chagla C.J. and Bhagwati J.) in Criminal Appeal No. 394 of 1950 aris- ing out of the Judgment and OrrlPr dated the 29th May, 1950, of the Court of the Presidency Magistrate, Second Court, Mazagaon, Bombay, in Cases Nos. 630/P and li35 /P of 1949. v. The State of Bombay. 111. P. Amin (R . .!. Kolah, with him) for appel- lants Nos. l, 2 and 4 ... A. K. Jluthuswmni for appellant No. 3. C. K. Daphtary, Solicitor-General for India (Porus A. ]V[ ehta, with him) for the respondent. 1953. March 30. The Judgment of the Court was delivered by ,, BosE J.-The appellants have been convicted under sections 7 and 9 of the Essential Supplies Act (No. XXIV of 1946) on two counts. The first appellant is a registered joint stock company, the Seksaria Mills Ltd. It was fined Rs. 10,000 on each of the two counts, that is to say, a total fine of Rs. 20,000, and this was upheld in appeal. The second appellant is the Director of the Mills. He was sentenced to two months' rigorous imprisonment and to a fine of Rs. 2,00,000 on each count. In appeal the sentence of imprisonment was set aside and the fine reduced to Rs. 10,000 on each count. The third appellant is the General Manager of the Mills. He was sentenced to a fine of Rs. 2,000 on each count. This has been upheld. The fourth appellant is the Sales Manager of the Mills. He was sentenced to four months' rigorous imprisonment and a fine of Rs. 1,00,000 on each count. In appeal the sentence of imprisonment was upheld but the fine was reduced to Rs. 10,000 on each count. The substantive se
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