State of MP v. Narayan Singh
There were two separate cases but having identical facts in which a common question of law was invoked. In both cases, the respondents admit that the trucks in question were intercepted at States tax barrier situate at a distance of 8 miles from the border of Maharashtra carrying 200 bags and 170 bags of fertilisers respectively. The documents seized from the drivers contained the invoices and other records but they did not include a permit issued under the Fertilisers (Movement Control) Order, 1973. Consequently the drivers and cleaners of both the vehicles were prosecuted under the FMC Order read with Section 3 and 7 of the Essential Commodities Act, 1955 for exporting fertilizers from Madhya Pradesh to Maharashtra without a valid permit. In both the cases, the accused did not deny the factum of the transport of fertiliser bags in their respective lorries or the interception of the lories and the seizure of the fertiliser bags or about the fertiliser bags not being covered by a permit issued under the FMC Order. The defence however was that they were not aware of the contents of the documents seized from them and that they were not engaged in exporting the fertiliser bags from Madhya Pradesh to Maharashtra in conscious violation of the provisions of the FMC Order
(1) Whether the prosecution must prove mens rea on the part of the accused in exporting the fertiliser bags without a valid permit for securing their conviction?
(2) Whether the evidence on record established only preparation by the accused for effecting export of fertiliser bags from one State to another without a permit therefore and not an attempt to export fertiliser bags?.
Trial Court and High Court's Decision:
Both the courts have taken the view that in the absence of the evidence of the employee of the transport company there was no material in the cases to hold that the fertiliser bags were being exported to Maharashtra from Madhya Pradesh. The trial Magistrate and the High Court refused to attach any s1gnificance or importance to the invoices recovered from the lorry drivers because the drivers had said they had no knowledge of the contents of the documents seized from them. The trial Magistrate and the High Court have further opined that the materials on record would, at best, make out only a case of preparation by the accused to commit the offence and the evidence fell short of establishing that the accused were attempting to export the fertilizer bags from Madhya Pradesh to Maharashtra in contravention of the FMC Order.
Supreme Court's Observations (Justice Natrajan)
The trial Court and the High Court have failed to comprehend and construe Section 7(1) of the Act in its full perspective. The words used in Section 7(1) are if any person contravenes whether any order made under Section 3". The Section is comprehensively worded so that it takes within its fold not only contraventions done knowingly or intentionally but even otherwise i.e. done unintentionally. The element of mens rea in export of fertilizer bags without a valid permit is therefore not a necessary ingredient for Convicting a person for contravention of an order made under Section 3 if the 1actum of export or attempt to export is established by the evidence on record.
Swastik Oil Industries v. State , the Gujarat High Curt observed: "The plain reading of the Section made it clear that the legislature needed to impose strict liability for contravention of any order made under Section of the Act. By the use of the express words the element of mens rea as an essential condition of the offence was excluded so that every contravention whether intentional or otherwise was made an offence under Section 7 of the Act. It is manifest that the crucial words "whether knowingly, intentionally or otherwise" were inserted in Section 7 in order to prevent persons committing offences under the Act escaping punishment on the plea that the offences were not committed deliberately."
As regards the second issue, the Supreme Court observed that in the commission of an offence there are four stages viz. intention, preparation, attempt and execution. The first two stages would not attract culpability but the third and fourth stages would certainly attract culpability. The respondents in each case were actually caught in the act of exporting fertilizer bags without a permit therefore from Madhya Pradesh to Maharashtra. The trucks were coming from Indore and were proceeding towards Maharashtra. The interception had taken place at sales tax barrier which is only 8 miles from the border of Maharashtra State. It the interception had not taken place, the export would have become a completed act and the fertiliser bags would have been successfully taken to Maharashtra State in contravention of the FMC Order. It was not therefore a case of mere preparation vIz. the respondents trying to procure fertiliser bags from someone or trying to engage a lorry for taking those bags to Maharashtra.
These were cases where the bags had been procured and were being taken in the lorries under cover of sales invoices for being delivered to the consignees and the lorries would have entered the Maharashtra border but for their interception at the sales tax barrier. Surely, no one can say that the respondents were taking the lorries with the fertiliser bags in them for innocuous purposes or for more thrill or amusement and that they would have stopped well ahead of the border and taken back the lorries and the fertilizer bags to the initial place of dispatch or to some other place in Madhya Pradesh State itself. They were therefore clearly cases of attempted unlawful export of the fertilizer bags and not cases of mere preparation alone.
The trial Magistrate and the High Court were in error in taking the view that the respondents were not liable for conviction for contravention of the FMC Order read with Sections 3 and 7 of the EC Act since the prosecution had failed to prove mens rea on their part in transporting fertiliser bags. Both the courts have again committed an error in taking the view that the respondents can at best be said to have only made preparations to export fertiliser bags and they cannot be found guilty of having attempted to export the fertiliser bags. The judgements of the trial Magistrate and the High Court under appeal should be declared erroneous and held unsustainable. Accordingly, the respondents were convicted.