Prevention of Cruelty to Animals Act

November 30, 2014

Section 1. Short title, extent and commencement.

(1) This Act may be called the Prevention of Cruelty to Animals Act, 1960.

(2) It extends to the whole of India except the State of Jammu and Kashmir.

(3) It shall come into force on such date as the Central Government may, by notification in the official Gazette, appoint, and different dates may be appointed for different States and for the different provisions contained in this Act.¹

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1. See Annexure for notifications under Section 1(3).

Section 2. Definitions.

In this Act, unless the context otherwise requires, -

(a) “Animal” means any living creature other than a human being;

¹[(b) “Board” means the Board established under Section 4, and as reconstituted form time to time under Section 5A.]

(c) “Captive animal” means any animal (not being a domestic animal) which is in captivity or confinement, where permanent or temporary, or which is subjected to any appliance or contrivance for the purposes of hindering or preventing its escape form captivity or confinement or which is pinioned or which is or appears to be maimed;

(d) “Domestic animal” means any animal which is tamed or which has been or is being sufficiently tamed to serve some purpose for the use of man or which, although it neither has been nor is intended to be so tamed, is or has become in fact wholly or partly tamed;

(e) “Local authority” means a municipal committee, district board or other authority for the time being invested by law with the control and administration of any matters within a specified local area;

(f) “Owner”, used with reference to an animal, includes not only the owner but also any other person for the time being in possession or custody of the animal, whether with or without the consent of the owner.

(g) “Phooka” or “doom dev” includes any process of introducing air or any substance into the female organ of a milch animal with the object of drawing off from the animal any secretion of milk;

(h) “Prescribed” means prescribed by Rules made under this Act;

(i) “Street” includes any way, road, lane, square, court, alley, passage or open space, whether a thorough fare or not to which the public have access.

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1. Substituted by Act 26 of 1982 which came into force on 30th July 1982.

Section 3. Duties of persons having charge of animals.

It shall be the duty of every person having the care or charge of any animal to take all reasonable measures to ensure the well being of such animal and to prevent the infliction upon such animal of unnecessary pain or suffering.

Section 4. Establishment of Animal Welfare Board of India.

Chapter Ii ¹[Animal Welfare Board Of India]

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1. Subs. by Act 26 of 1982; S. 3, for the words “Animal Welfare Board”.

4. Establishment of Animal Welfare Board of India-

(1) For the promotion of animal welfare generally and for the purpose of protecting animals from being subjected to unnecessary pain or suffering, in particular, there shall be established by the Central Government, as soon as may be after the commencement of this Act, a Board to be called the ¹[Animal Welfare Board of India.]

(2) The Board shall be a body corporate having perpetual succession and a common seal with power, subject to the provisions of this Act, to acquire, hold and dispose of property and may by its name sue and be sued.

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1. Subs. by Act 26 of 1982; S. 4 for the words “Animal Welfare Board”.

Section 5. Constitution of the Board.

(1) The Board shall consist of the following persons, namely: -

(a) The Inspector-General of Forests, Government of India, ex-officio;

(b) The Animal Husbandry Commissioner to the Government of India, ex-officio;

¹(ba) Two persons to represent respectively the Ministries of the Central Government dealing with Home Affairs and Education, to be appointed by the Central Government;

(bb) One person to represent the Indian Board for Wild Life, to be appointed by the Central Government;

(bc) Three persons who, in the opinion of the Central Government, are or have been actively engaged in animal welfare work and are well-known humanitarians, to be nominated by the Central Government;]

(c) One person to represent such association of veterinary practitioners as in the opinion of the Central Government ought to be represented on the Board, to be elected by that association in the prescribed manner;

(d) Two persons to represent practitioners of modern and indigenous systems of medicine, to be nominated by the Central Government;

²[(e) One person to represent each of such two municipal corporations as in the opinion of the Central Government ought to be represented on the Board, to be elected by each of the said corporations in the prescribed manner;]

(f) One person to represent each of such three organisations actively interested in animal welfare as in the opinion of the Central Government ought to be represented on the Board, to be chosen by each of the said organisations in the prescribed manner;

(g) One person to represent each of such three societies dealing with prevention of cruelty to animals as in the opinion of the Central Government ought to be represented on the Board, to be chosen in the prescribed manner;

(h) Three persons to be nominated by the Central Government;

(i) Six Members of Parliament, four to be elected by the House of the People (Lok Sabha) and two by the Council of States (Rajya Sabha).

(2) Any of the persons referred to in clause (a) or ³ [clause (b) or clause (ba) or clause (bb)] of sub-section (1) may depute any other person to attend any of the meetings of the Board.

⁴[(3) The Central Government shall nominate one of the members of the Board to be its Chairman and another member of the Board to be its Vice-Chairman.]

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1. Inserted by Act 26 of 1982; Section 5(a)(i).

2. Subs. by Act 26 of 1982; S.5 (a)(ii), for the original clause.

3. Subs. by Act 26 of 1982; S.5 (b), for the word, brackets and letter “clause (b)”.

4. Subs. by Act 26 of 1982; Section 5(c) for the original clause.

Section 5 A. Reconstitution of the Board.

¹[Reconstitution of the Board. (1) In order that the Chairman and other members of the Board hold office till the same date and that their terms of office come to an end on the same date, the Central Government may, by notification in the Official Gazette, reconstitute, as soon as may be after the Prevention of Cruelty to Animals (Amendment) Act, 1982 comes into force, the Board.

(2) The Board as reconstituted under sub-section (1) shall be reconstituted from time to time on the expiration of every third year from the date of its reconstitution under sub-section (1).

(3) There shall be included amongst the members of the Board reconstituted under sub-section (1), all persons who immediately before the date on which such reconstitution is to take effect, are Members of the Board but such persons shall hold office only for the unexpired portion of the term for which they would have held office if such reconstitution had not been made and the vacancies arising as a result of their ceasing to be Members of the Board shall be filled up as casual vacancies for the remaining period of the term of the Board as so reconstituted :

Provided that nothing in this sub-section shall apply in relation to any person who ceases to be a Member of the Board by virtue of the amendment made in sub-section (1) of section 5 by sub-clause (ii) of clause (a) of section 5 of the Prevention of Cruelty to Animals (Amendment) Act, 1982.]

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1. Ins. by Act 26 of 1982; S. 6,

Section 6. Terms of office and conditions of service of Members of the Board.

¹[Terms of office and conditions of service of Members of the Board. (1) The term for which the Board may be reconstituted under section 5A shall be three years from the date of the reconstitution and the Chairman and other Members of the Board as so reconstituted shall hold office till the expiry of the term for which the Board has been so reconstituted.

(2) Notwithstanding anything contained in sub-section (1)-

(a) The term of office of an ex-officio Member shall continue so long as he holds the office by virtue of which he is such a Member;

(b) The term of office of a Member elected or chosen under clause (c), clause (e), clause (f), clause (g), clause (h) or clause (i) of section 5 to represent any body of persons shall come to an end as soon as he ceases to be a Member of the body which elected him or in respect of which he was chosen;

(c) The term of office of a Member appointed, nominated, elected or chosen to fill a casual vacancy shall continue for the remainder of the term of office of the Member in whose place he is appointed, nominated, elected or chosen;

(d) The Central Government may, at any time, remove for reasons to be recorded in writing a Member from office after giving him a reasonable opportunity of showing cause against the proposed removal and any vacancy caused by such removal shall be treated as casual vacancy for the purpose of clause (c).

(3) The Members of the Board shall receive such allowances, if any, as the Board may, subject to the previous approval of the Central Government, provide by regulations made in this behalf.

(4) No act done or proceeding taken by the Board shall be questioned on the ground merely of the existence of any vacancy in, or defect in the constitution of the Board and in particular, and without prejudice to the generality of the foregoing, during the period intervening between the expiry of the term for which the Board has been reconstituted under section 5A and its further reconstitution under that section, the ex-officio members of the Board shall discharge all the powers and functions of the Board.]

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1. Subs. by Act 26 of 1982, S. i, for the original Section.

Section 7. Secretary and other employees of the Board.

(1) The Central Government shall appoint ¹[x x x] the Secetary of the Board.

(2) Subject to such rules as may be made by the Central Government in this behalf, the Board may appoint such member of other officers and employees as may be necessary for the exercise of its powers and the discharge of its functions and may determine the terms and conditions of service of such officers and other employees by regulations made by it with the previous approval of the Central Government.

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1. The words “one of its officers to be” omitted by Act, 26 of 1982.

Section 8. Funds of the Board.

The funds of the Board shall consist of grants made to it from time to time by the Government and of contributions, donations, subscriptions, bequests, gifts and the like made to it by any local authority or by any other person.

Section 9. Functions of the Board.

The functions of the Board shall be-

(a) To keep the law in force in India for the prevention of cruelty to animals under constant study and advise the Government on the amendments to be undertaken in any such law from time to time;

(b) To advise the Central Government on the making of rules under this Act with a view to preventing unnecessary pain or suffering to animals generally, and more particularly when they are being transported from one place to another or when they are used as performing animals or when they are kept in captivity or confinement;

(c) To advise the Government or any local authority or other person on improvements in the design of vehicles so as to lessen the burden on draught animals;

(d) To take all such steps as the Board may think fit for ¹[amelioration of animals] by encouraging, or providing for, the construction of sheds, water-troughs and the like and by providing for veterinary assistance to animals;

(e) To advise the Government or any local authority or other person in the design of slaughter-houses or the maintenance of slaughter houses or in connection with slaughter of animals so that unnecessary pain or suffering, whether physical or mental, is eliminated in the pre-slaughter stages as far as possible, and animals are killed, wherever necessary, in as humane a manner as possible;

(f) To take all such steps as the Board may think fit to ensure that unwanted animals are destroyed by local authorities, whenever it is necessary to do so, either instantaneously or after being rendered insensible to pain or suffering;

(g) To encourage, by the grant of financial assistance or otherwise, ²[the formation or establishment of pinjrapoles, rescue homes animal shelters, sanctuaries and the like] where animals and birds may find a shelter when they have become old and useless or when they need protection;

(h) To co-operate with, and co-ordinate the work of, associations or bodies established for the purpose of preventing unnecessary pain or suffering to animals or for the protection of animals and birds;

(i) To give financial and other assistance to animal welfare organisations functioning in any local area or to encourage the formation of animal welfare organisations in any local area which shall work under the general supervision and guidance of the Board;

(j) To advise the Government on matters relating to the medical care and attention which may be provided in animal hospitals and to give financial and other assistance to animal hospitals whenever the Board thinks it necessary to do so;

(k) To impart education in relation to the humane treatment of animals and to encourage the formation of public opinion against the infliction of unnecessary pain or suffering to animals and for the promotion of animal welfare by means of lectures, books, posters, cinematographic exhibitions and the like;

(l) To advise the Government on any matter connected with animal welfare or the prevention of infliction of unnecessary pain or suffering on animals.

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1. Subs. by Act 26 of 1982, S. 9(a) for the word “ameliorating the condition of beats of burden”.

2. Subs. by Act 26 of 1982; S. 9(b) for the words “the formation of pinjrapoles, sanctuaries and the like”.

Section 10. Power of Board to make regulations.

The Board may, subject to the previous approval of the Central Government, make such regulations as it may think fit for the administration of its affairs and for carrying out its functions.

Section 11. Section.

(1) If any person-

(a) Beats, kicks, over-rides, over-drives, over-loads, tortures or otherwise treats any animal so as to subject it to unnecessary pain or suffering or cause, or, being the owner permits, any animal to be so treated’, or

(b) ¹[Employs in any work or labour or for any purpose any animal which, by reason of its age or any disease] infirmity, wound, sore or other cause, is unfit to be so employed or, being the owner, permits any such unfit animal to be so employed; or

(c) Wilfully and unreasonably administers any injurious drug or injurious substance to ²[any animal] or wilfully and unreasonably causes or attempts to cause any such drug or substance to be taken by ²[any animal;] or

(d) Conveys or carries, whether in or upon any vehicle or not, any animal in such a manner or position as to subject it to unnecessary pain or suffering; or (e) keeps or confines any animal in any cage or other receptacle which does not measure sufficiently in height, length and breadth to permit the animal a reasonable opportunity for movement; or

(f) Keeps for an unreasonable time any animal chained or tethered upon an unreasonably short or unreasonably heavy chain or cord; or

(g) Being the owner, neglects to exercise or cause to be exercised reasonably and dog habitually chained up or kept in close confinement; or

(h) Being the owner of ³[any animal] fails to provide such animal with sufficient food, drink or shelter; or

(i) Without reasonable cause, abandons any animal in circumstances which render it likely that it will suffer pain by reason of starvation or thirst; or

(j) Wilfully permits any animal, of which he is the owner, to go at large in any street while the animal is affected with contagious or infectious disease or, without reasonable excuse permits any diseased or disabled animal, of which he is the owner, to die in any street; or

(k) Offers for sale or, without reasonable cause, has in his possession any animal which is suffering pain by reason of mutilation, starvation, thirst, overcrowding or other illtreatment; or

⁴[(l) Mutilates any animal or kills any animal (including straydogs) by using the method of strychnine injections in the heart or in any other unnecessarily cruel manner; or]

⁵[(m) Solely with a view to providing entertainment

(i) Confines or causes to be confined any animal (including tying of an animal as a bait in a tiger or other sanctuary) so as to make it an object of prey for any other animal; or

(ii) Incites any animal to fight or bait any other animal; or]

(n) ⁶[x x x] Organizes, keeps, uses or acts in the management of, any place for animal fighting or for the purpose of baiting any animal or permits or offers any place to be so used or receives money for the admission of any other person of any place kept or used for any such purposes; or

(o) Promotes or takes part in any shooting match or competition wherein animals are released from captivity for the purpose of such shooting; he shall be punishable ⁷[in the case of a first offence, with fine which shall not be less than, ten rupees but which may extend to fifty rupees, and in the case of a second or subsequent offence committed within three years of the previous offence, with fine which shall not be less than twenty-five rupees but which may extend to one hundred rupees or with imprisonment for a term which may extend to three months, or with both.]

(2) For the purposes of sub-section (1) an owner shall be deemed to have committed an offence if he has failed to exercise reasonable care and supervision with a view to the prevention of, such offence:

Provided that where on owner is convicted of permitting cruelty by reason only of having failed to exercise such care and supervision, he shall not be liable to imprisonment without the option of a fine.

(3) Nothing in this section shall apply to-

(a) The dehorning of cattle, or the castration or branding or nose-roping of any animal, in the prescribed manner; or

(b) The destruction of stray dogs in lethal chambers or ⁸[by such other methods as may be prescribed.] or

(c) The extermination or destruction of any animal under the authority of any law for the time being in force; or

(d) Any matter dealt with in Chapter IV; or

(e) The commission or omission of any act in the course of the destruction or the preparation for destruction of any animal as food for mankind unless such destruction or preparation was accompanied by the infliction of unnecessary pain or suffering.

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1. Subs. by Act 26 of 1982, S. 10 (a) (i) for the words “employs in any work or labour any animal which, by reason of any disease”.

2. Subs. by Act 26 of 1982; S. I0 (a (ii) for the words “any domestic or captive animal”.

3. Subs. by Act 26 of 1982, S. 10(a)(iii) for the words “any captive animal”.

4. Subs. by Act 26 of 1982; S. 10(a)(iv) for the original clause.

5. Subs. by Act 26 of 1982; S. 10(a)(v) for the original clause.

6. The words “for the purpose of his business” omitted by Act 26 of 1982, S. 10(a)(vi).

7. Subs. by Act 26 of 1982; S. 10(a)(vii) for the portion beginning with the words “in the case of a first offence” and ending with the words “or with both”.

8. Subs. by Act 26 of 1982, S. 10(b), for the words “by other methods with a minimum of suffering.”

Section 12. Penalty for practising phooka or doom dev.

If any person performs upon any cow or other milch animal the operation called phooka or ¹[doom dev or any other operation (including injection of any substance) to improve lactation which is injurious to the health of the animal] or permits such operation being performed upon any such animal in his possession or under his control, he shall be punishable with fine which may extend to one thousand rupees, or with imprisonment for a term which may extend to two years, or with both, and the animal on which the operation was performed shall be forfeited to the Government.

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1. Subs. by Act 26 of 1982; S. 11, for the words “doom dev”.

Section 13. Destruction of suffering animals.

(1) Where the owner of an animal is convicted of an offence under section 11, it shall be lawful for the court, if the court is satisfied that it would be cruel to keep the animal alive, to direct that the animal be destroyed and to assign the animal to any suitable person for that purpose, and the person to whom such animal is so assigned shall, as soon as possible, destroy such animal or cause such animal to be destroyed in his presence without unnecessary suffering; and any reasonable expense incurred in destroying the animal may be ordered by the court to be recovered from the owner as if it were a fine :

Providing that unless the owner assents thereto, no order shall be made under this section except upon the evidence of a veterinary officer in charge of the area.

(2) When any magistrate, commissioner of police or district superintendent of police has reason to believe that an offence under section 11 has been committed in respect of any animal, he may direct the immediate destruction of the animal, if in his opinion, it would be cruel to keep the animal alive.

(3) Any police officer above the rank of a constable or any person authorised by the State Government in this behalf who finds any animal so diseased or so severely injured or in such a physical conditions that in his opinion it cannot be removed without cruelty, may, if the owner is absent or refuses his consent to the destruction of the animal, forthwith summon the veterinary officer in charge of the area in which the animal is found, and if the veterinary officer certifies that the animal is mortally injured or so severely injured or in such a physical condition that it would be cruel to keep it alive, the police officer or the person authorised, as the case may be, may, after obtaining orders from a magistrate, destroy the animal injured or cause it to be destroyed ¹[in such manner as may be prescribed.]

(4) No appeal shall lie, from any order of a magistrate for the destruction of an animal.

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1. Ins. by Act 26 of 1982, S. 12

Section 14. Experiments on animals.

Nothing contained in this Act shall render unlawful the performance of experiments (including experiments involving operations) on animals for the purpose of advancement by new discovery of physiological knowledge or of knowledge which will be useful for saving or for prolonging life or alleviating suffering or for combating any disease, whether of human beings, animals or plants.

Section 15. Committee for control and supervision of experiments on animals.

(1) If at any time, on the advice of the Board, the Central Government is of opinion that it is necessary so to do for the purpose of controlling and supervision experiments on animals, it may, by notification in the official Gazette, constitute a Committee consisting of such number of officials and non-officials, as it may think fit to appoint thereto.

(2) The Central Government shall nominate one of the Members of the Committee to be its Chairman.

(3) The Committee shall have power to regulate its own procedure in relation to the performance of its duties.

(4) The funds of the Committee shall consist of grants made to it from time to time by the Government and of contributions, donations, subscriptions, bequests, gifts and the like made to it by any person.

Section 15 A. Sub-Committees.

¹[Sub-Committees. (1) The Committee may constitute as many subcommittees as it thinks fit for exercising any power or discharging any duty of the Committee or for inquiring into or reporting and advising on any matter which the Committee may refer.

(2) A sub-committee shall consist exclusively of the Members of the Committee.]

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1. Ins. by Act 26 of 1982, S. 13.

Section 16. Staff of the Committee.

Subject to the control of the Central Government, the Committee may appoint such number of officers and other employees as may be necessary to enable it to exercise its powers and perform its duties, and may determine the remuneration and other terms and conditions of service of such officers and other employees.

Section 17. Duties of the Committee and power of the Committee to make rules relating to experiments on animals.

(1) It shall be the duty of the Committee to take all such measures as may be necessary to ensure that animals are not subjected to unnecessary pain or suffering before, during or after the performance of experiments on them, and for that purpose it may, by notification in the Gazette of India and subject to the condition of previous publication, make such rules as it may think fit in relation to the conduct of such experiments.

¹[(1A) In particular, and without prejudice to the generality of the foregoing power, such rules may provide for the following, matters, namely:

(a) The registration of’ persons or institutions carrying on experiments on animals;

(b) The reports and other information which shall be forwarded to the Committee by persons and institutions carrying on experiments on animals.]

(2) In particular, and without prejudice to the generality of the foregoing power, rules made by the Committee shall be designed to secure the following Objects, namely:

(a) That in cases where experiments are performed in any institution, the responsibility therefor is placed on the person in charge of the institution and that, in cases where experiments are performed outside an institution by individuals, the individuals are qualified in that behalf and the experiments are performed on their full responsibility;

(b) That experiments are performed with due care and humanity, and as far as possible experiments involving operations are performed under the influence of some anaesthetic of sufficient power to prevent the animals feeling pain;

(c) That animals which, in the course of experiments under the influence of anaesthetics, are so injured that their recovery would involve serious suffering, are ordinarily destroyed while still insensible;

(d) That experiments on animals are avoided wherever it is possible to do so; as for example, in medical schools, hospitals, colleges and the like, if other teaching devices such as books, models, films and the like may equally suffice;

(e) That experiments on larger animals are avoided when it is possible to achieve the same results by experiments upon small laboratory animal like guineapigs, rabbits, frogs and rats;

(f) That, as far as possible, experiments are not performed merely for the purpose of acquiring manual skill;

(g) That animals intended for the performance of experiments are properly looked after both before and after experiments;

(h) That suitable records are maintained with respect to experiments performed on animals.

(3) In making any rules under this section, the Committee shall be guided by such directions as the Central Government (consistently with the object for which the Committee is set up) may give to it, and the Central Government is hereby authorised to give such directions.

(4) All rules made by the Committee shall be binding on all individuals performing experiments outside institutions and on person’s incharge of institutions in which experiments are performed.

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1. Ins. by Act 26 of 1982, S. 14.

Section 18. Power of entry and inspection.

For the purpose of ensuring that the rules made by it are being complied with, the Committee may authorise any of its officers or any other person in writing to inspect any institution or place where experiments are being carried on and report to it as a result of such inspection, and any officer or person so authorised may-

(a) Enter at any time considered reasonable by him and inspect any institution or place in which experiments on animals are being carried on; and

(b) Require any person to produce any record kept by him with respect to experiments on animals.

Section 19. Power to prohibit experiments on animals.

If the Committee is satisfied, on the report of any officer or other person made to it as a result of any inspection under section 18 or otherwise, that the rules made by it under section 17 are not being complied with by any person or institution carrying on experiments on animals, the Committee may, after giving an opportunity to the person or institution of being heard in the matter, by order, prohibit the person or institution from carrying on any such experiments either for a specified period or indefinitely, or may allow the person or institution to carry on such experiments subject to such special conditions as the Committee may think fit to impose.

Section 20. Penalties.

If any person-

(a) Contravenes any order made by the Committee under section 19; or

(b) Commits a breach of any condition imposed by the Committee under that section; he shall be punishable with fine which may extend to two hundred rupees, and, when the contravention or breach of condition has taken place in any institution the person in charge of the institution shall be deemed to be guilty of the offence and shall be punishable accordingly.

Section 21. Exhibit, and “train” defined.

In this Chapter, “exhibit means exhibit or any entertainment to which the public are admitted through sale of tickets, and “exhibitor” and “train for the purpose of any such exhibition, and the expressions “exhibitor” and “trainer” have respectively the corresponding meanings.

Section 22. Restriction on exhibition and training of performing animals.

No person shall exhibit or train –

(i) Any performing animal unless he is registered in accordance with the provisions of this chapter;

(ii) As a performing animal, any animals, which the Central Government may, by notification in the official Gazette, specify as an animal, which shall not be exhibited or trained as a performing animal,

Section 23. Procedure for registration.

(1) Every person desirous of exhibiting or training any performing animal shall, on making an application in the prescribed form to the prescribed authority and on payment of the prescribed fee, be registered under this Act unless he is a person who, by reason of an order made by the court under this Chapter, is not entitled to be so registered.

(2) An application for registration under this Chapter shall contain such particulars as to the animals and as to the general nature of the performance in which as may which the animals are to be exhibited or for which they are to be trained as may be prescribed, and the particulars so given shall be entered in the register maintained by the prescribed authority.

(3) The prescribed authority shall give to every person whose name appears on the register kept by them, a certificate of registration in the prescribed form containing the particulars entered in the register.

(4) Every register kept under this Chapter shall at all reasonable times be open for inspection on payment of the prescribed fee, and any person shall, on payment of the prescribed fee, be entitled to obtain copies thereof or make extracts therefrom.

(5) Any person whose name is entered provisions of any order made under this Act by any court, be entitled, on making an application for the purpose, to have the particulars entered in the register with respect to him varied, and where any such particulars are so varied, the existing certificate shall be cancelled and a new certificate issued.

Section 24. Power of court to prohibit or restrict exhibition and training of performing animals.

(1) Where it is proved to the satisfaction of any magistrate on a complaint made by a police officer or any off the prescribed authority referred to in section 23, that the training or exhibition of any performing animal has been accompanied by unnecessary pain or suffering and should be prohibited or allowed only subject to conditions, the court may make an order against the person in respect of whom the complaint is made, prohibiting the training or exhibition or imposing such conditions in relation thereto, as may be specified by the order.

(2) Any court by which an order is made under this section, shall cause a copy of the order to be sent, as soon as may be after the order is made, to the prescribed authority by which the person against whom the order is made is registered, and shall cause the particulars of the order to be endorsed upon the certificate held by that person, and that person shall produce his certificate on being so required by the court for the purposes of endorsement, and the prescribed authority to which a copy of an order is sent under this section shall enter the particulars of the order in that register.

Section 25. Power to enter premises.

(1) Any person authorised in writing by the prescribed authority referred to in section 23 and any police officer not below the rank of a sub-inspector may-

(a) Enter at all reasonable times and inspect any premises in which any performing animals are being trained or exhibited or kept for training or exhibition, and any such animals found therein; and

(b) Require any person who, he has reason to believe is a trainer or exhibitor of performing animals to produce his certificate of registration.

(2) No person or police officer referred to in sub-section (1) shall be entitled under this section to go on or behind the stage during a public performance of performing animals.

Section 26. Offences.

If any person–

(a) Not being registered under this Chapter, exhibits or trains any performing animal; or

(b) Being registered under this Act, exhibits or trains any performing animal with respect to which or in a manner with respect to which, he is not registered; or

(c) Exhibits or trains as a performing animal, any animal which is not to be used for the purpose by reason of a notification issued under clause (ii) of section 22; or

(d) Obstructs or wilfully delays any person or police officer referred to in section 25 in the exercise of powers under this Act as to entry and inspection; or

(e) Conceal any animal with a view to avoiding such inspection; or

(f) Being a person registered under this Act, on being duly required in pursuance of this Act to produce his certificate under this Act, fails without reasonable excuse so to do; or

(g) Applies to be registered under this Act when not entitled to be so registered. He shall be punishable on conviction with fine, which may extend to five hundred rupees, or with imprisonment, which may extend to three months, or with both.

Section 27. Exemptions.

Nothing contained in this Chapter shall apply to-

(a) The training of animals for bona fide military or police purpose or the exhibition of any animal so trained; or

(b) Any animals kept in any zoological garden or by any society or association, which has for its principal object the exhibition of animals for educational or scientific purposes.

Section 28. Saving as respects manner of killing prescribed by religion.

Nothing contained in this Act shall render it an offence to kill any animal in a manner required by the religion of any community.

Section 29. Power of court to deprive person convicted of ownership of animal.

(1) If the owner of any animal is found guilty of any offence under this Act the court upon his conviction thereof, may, if it thinks fit, in addition to any other punishment make an order that the animal with respect to which the offence was committed shall be forfeited to Government and may, further, make such order as to the disposal of the animal as it thinks fit under the circumstances.

(2) No order under sub-section (1) shall be made unless it is shown by evidences to a previous conviction under this Act or as to the character of the owner or otherwise as to the treatment of the animal that the animal, if left with the owner, is likely to be exposed to further cruelty.

(3) Without prejudice to the provisions contained in sub-section (1), the court may also order that a person convicted of an offence under this Act shall, either permanently or during such period as is fixed by the order, be prohibited from having the custody of any animal of any kind whatsoever, or as the court thinks fit of any animal of any kind or species specified in the order.

(4) No order under sub-section (3) shall be made unless-

(a) It is shown by evidence as to a previous conviction or as to the character of the said person or otherwise as to the treatment of the animal in relation to which he has been convicted that an animal in the custody of the said person is likely to be exposed to cruelty;

(b) It is stated in the complaint upon which the conviction was made that it is the intention of the complainant upon the conviction of the accused to request that an order be made as aforesaid; and

(c) The offence for which the conviction was made was committed in an area in which under the law for the time being in force a licence is necessary for the keeping of any such animal as that in respect of which the conviction was made.

(5) Notwithstanding anything to the contrary contained in any law for the time being in force, any person in respect of whom an order is made under subsection (3) shall have no right to the custody of any animal contrary to the provisions of the order, and if he contravenes the provisions of any order, he shall be punishable with fine which may extend to one hundred rupees, or with imprisonment for a term which may extend to three months, or with both.

(6) Any court, which has made an order under sub-section (3), may at any time, either on its own motion or on application made to it in this behalf, rescind or modify, such order.

Section 30. Presumption as to guilt in certain cases.

If any person is charged with the offences of killing a goat, cow or its progeny contrary to the provisions of clause (i) of sub-section (1) of section 11, and it is proved that such person had in his possession, at the time the offence is alleged to have been committed, the skin of any such animal as is referred to in this section with any part of the skin of the head attached thereto, it shall be presumed until the contrary is proved that such animal was killed in a cruel manner.

Section 31. Cognoscibility of offences.

Notwithstanding anything contained in the Code or Criminal Procedure, 1898, (5 of 1898) an offence punishable under clause (1)or clause (n) or clause (o) of sub-section (1) of section 11 or under section 12 shall be a cognizable offence within the meaning of that Code.

Section 32. Powers of search and seizure.

(1) If a police officer not below the rank of sub inspector or any person authorised by the State Government in this behalf has reason to believe that an offence under clause (1) of sub-section 11 in respect of any such animal as is referred to in section 30 is being, or is about to be, or has been, committed in any place, or that any person has in his possession the skin of any such animal with any part of the skin of the head attached thereto, he may enter and search such place or any place in which he has reason to believe any such skin to be, and may seize such skin or any article or thing used for intended to be used in the commission of such offence.

(2) If a police officer not below the rank of sub-inspector, or any person authorised by the State Government in this behalf, has reason be believe that phooka or ¹[doom dev or any other operation of the nature referred to in section 12] has just been, or is being, performed on any animal within the limits of his jurisdiction, he may enter any place in which he has reason to believe such animal to be, and may seize the animal and produce it for examination by the veterinary officer in charge of the area in which the animal is seized.

——————–

1. Subs, by Act 26 of 1982 S. 15 for the words “doom dev”.

Section 33. Search Warrants.

(1) If a magistrate of the first or second class or a presidency magistrate or a sub-divisional magistrate or a commissioner of police or district superintendent of police, upon information in writing, and after such inquiry as he thinks necessary, has reason to believe that an offence under this Act is being, or is about to be, or has been committed in any place, he may either himself enter and search or by his warrant authorise any police officer not below the rank of sub-inspector to enter and search the place.

(2) The provisions of the Code or Criminal Procedure, 1898, (5 of 1898) relating to searches shall so far as those provisions can be made applicable, apply to searches under this Act.

Section 34. General power of seizure for examination.

Any police officer above the rank of a constable or any person authorised by the State Government in this behalf, who has reason to believe that an offence against his Act has been or is being, committed in respect of any animal, may, if in his opinion the circumstances so require, seize the animal and produce the same for examination by the nearest magistrate or by such veterinary officer as may be prescribed, and such police officer or authorised person may, when seizing the animal, require the person in charge thereof to accompany it to the place of examination.

Section 35. Treatment and care of animals.

(1) The State Government, may be general or special order appoint infirmaries for the treatment and care of animals in respect of which offences against this Act have been committed, and may authorise the detention therein of any animal pending its production before a magistrate.

(2) The magistrate before whom a prosecution for an offence against this Ac has been instituted may direct that the animals concerned shall be treated and care for in an infirmary, until it is fit to perform its usual work or is otherwise fit for discharge, or that it shall be sent to a pinjrapole, or if the veterinary officer in charge of the area in which the animal is found or such other veterinary officer as may be authorised in this behalf by rules made under this Act certifies that it is incurable or cannot be removed without cruelty, that it shall be destroyed.

(3) An animal sent for care and treatment to an infirmary shall not, unless the magistrate directs that it shall be sent to a pinjrapole or that it shall be destoryed, be released from such place except upon a certificate of its fitness for discharge issued by the veterinary officer in charge of the area in which the infirmary is situated or such other veterinary officer as may be authorised in this behalf by rules made under this Act.

(4) The cost of transporting the animal to an infirmary or pinjrapole and of its maintenance and treatment in an infirmary, shall be payable by the owner of the animal in accordance with a scale of rates to be prescribed by the district magistrate, or, in presidency-towns, by the commissioner of police;

Provided that when the magistrate so orders on account of the poverty of the owner of the animal, no charge shall be payable for the treatment of the animal.

(5) Any amount payable by an owner of an animal under sub-section (4) may be recovered in the same manner as an arrear of land revenue.

(6) If the owner refuses or neglects to remove the animal within such time as a magistrate may specify, the magistrate may direct that the animal be sold and that the proceeds of the sale be applied to the payment of such cost.

(7) The surplus, if any, of the proceeds of such sale shall, on application made by the owner within two months from the date of the sale, be paid to him.

Section 36. Limitation of prosecutions.

A prosecution for an offence against this Act shall not be instituted after the expiration of three months from the date of the commission of the offence.

Section 37. Delegation of powers.

The Central Government may, by notification in the Official Gazette, direct that all or any of the powers exercisable by it under this Act, may, subject to such conditions as it may think fit to impose, be also exercisable by any State Government.

Section 38. Power to make rules.

(1) The Central Government may, by notification in the Official Gazette, and subject to the condition of previous publication, make rules to carry out the purposes of this Act.

(2) In particular, and without prejudice to the generality of the foregoing power, the Central Government may wake rules providing for all or any of the following matters, namely:

(a) The ¹[x x x] conditions of service of members of the Board, the allowances payable to them and the manner in which they may exercise their powers and discharge their functions;

²[(aa) The manner in which the persons to represent municipal corporations are to be elected under clause (e) of sub-section (1) of section 5;],

(b) The maximum load (including any load occasioned by the weight of passengers) to be carried or drawn by any animal;

(e) The conditions to be observed for preventing the overcrowding of animals;

(d) The period during which, and the hours between which, any class of animals shall not be used for draught purposes;

(e) Prohibiting the use of any bit or harness involving cruelty to animals;

³[(ea) The other methods of destruction of stray dogs referred to in clause (b) of sub-section (3) of section 11;

(eb) The methods by which any animal which cannot be removed without cruelty may be destroyed under sub-section (3) of section 13;]

(f) Requiring persons carrying on the business of a farrier to be licensed and registered by such authority as may be prescribed and levying a fee for the purpose;

(g) The precautions to be taken in the capture of animals for purposes of sale, export or for any other purpose, and the different appliances or devices that may alone be used for the purpose; and the licensing of such capture and the levying of fees for such licences;

(h) The precautions to be taken in the transport of animals whether by rail, road, inland, waterway, sea or air and the manner in which and the cages or other receptacles in which they may be so transported;

(i) Requiring persons owning or in charge of premises in which animals are kept or milked to register such premises, to comply with such conditions as may be laid down in relation to the boundary walls or surroundings of such premises, to permit their inspection for the purpose of ascertaining whether any offence under this Act is being or has been committed therein, and to expose in such premises copies of section 12 in a language or languages commonly understood in the locality;

(j) The form in which applications for registration under Chapter V may be made, the particulars to be contained therein, the fees payable for such registration and the authorities to whom such applications may be made;

⁴[ja) The fees which may be charged by the Committee constituted under section 15 for the registration of persons or institutions carrying on experiments on animals or for any other purpose;]

(k) The purpose to which fines realised under this Act may be applied, including such purposes as the maintenance of infirmaries, pinjrapole and veterinary hospitals;

(l) Any other matter which was to be, or may be prescribed.

(3) If any person contravenes, or abets the contravention of, any rules made under this section, he shall be punishable with fine which may extend to one hundred rupees, or with imprisonment for a term which may extend to three months, or with both.

⁵[x x x ]

——————–

1. The words “terms and” omitted by Act 26 of 1982, S, 16 (a) (i).

2. Ins. by Act 26 of 1982; S. 16 (a) (ii)

3. Ins. by Act 26 of 1982; S. 16 (a) (iii).

4. Ins. by Act 26 of 1982. S. 16(a) (iv).

5. “Sub-section (4) of the Principal Act” omitted by Act 26 of 1982, S. 16(b)

Section 38 A. Rules and Regulations to be laid before Parliament.

¹[Rules and Regulations to be laid before Parliament. Every rule made by the Central Government or by the Committee constituted under section 15 and every regulation made by the Board shall be laid, as soon as may be after it is made, before each House of Parliament, while it is in session, for a total period of thirty days which may be comprised in one session or in two or more successive sessions, and if, before the expiry of the session immediately following the session or the successive sessions aforesaid, both Houses agree in making any modification in the rule or regulation, as the case may be, should not be made, the rule or regulation shall there after have effect only in such modified form or be of no effect, as the case may be; so, however, that any such modification or annulment shall be without prejudice to the validity of anything previously done under that rule or regulation.]

——————–

1. Ins by Act 26 of 1982, S. 17.

Section 39. Persons authorised under Section 34 to be public servants.

Every person authorised by the Sate Government under section 34 shall be deemed to be a public servant within the meaning of section 21 of the Indian Panel Code.

Section 40. Indemnity.

No suit, prosecution or other legal proceeding shall lie against any person who is, or who is deemed to be, a public servant within the meaning of section 21 of the Indian Panel Code in respect of anything in good faith done or intended to be done under this Act.

Section 41. Repeal of Act 11 of 1890.

Where in pursuance of a notification under sub-section (3) of section 1 any provision of this Act comes into force in any State, any provision of the Prevention of Cruelty to Animals Act, 1890 (11 of 1890), which corresponds to the provision so coming into force, shall thereupon stand repealed.

Contempt of Courts Act

November 30, 2014

Introduction

The origin of the law of Contempt in India can be traced from the English law. In England Superior Courts of record have form early times, exercised the power to commit for contempt persons who scandalized the Court or the Judges. The right of the Indian High Courts to punish for contempt, was in the first instance recognized by the Judicial Committee of the Privy Council which observed that the offence of the contempt of court and the powers of the High Courts to punish it are the same in such courts as in the Supreme Court in England. It also observed that the three chartered contempt. Almost all the High Courts in India, apart form the chartered High Courts have exercised the jurisdiction inherent in a court of record from the very nature of the court itself. It has been judicially accepted throughout India that the jurisdiction was a special one inherent in the very nature of the court.

The fist Indian stature on the law of contempt i.e., the Contempt of Courts Act was passed in 1926. It was enacted to define and limit the powers of certain courts in punishing contempt of courts. When the Contempt of Courts Act, 1926 (XII of 1926) was in existence in British India, various Indian States also had their corresponding enactment. These States were Hyderabad, Madhya Bharat, Mysore, Pepsu, Rajastha, Travancore-Cochin and Saurasjtra. State enactments of the Indian States and the Contempt of Courts Act, 1926 were replaced by the Contempt of Courts Act, 1952 (32 of 1952).

An attempt was made in April, 1960 to introduce in the Lok Sabha a Bill to consolidate and amend the law relating to Contempt of Courts. On an examination of the Bill, government appears to have felt that the law relating to Contempt of Courts in uncertain, undefined and unsatisfactory and that in the light of the constitutional changes which have taken place in the country, it would be advisable to have the entire law on the subject scrutinized by a Special Committee set up for the purpose. In pursuance to that decision a Committee was set up on 29th July, 1961 and it submitted its report on 28th February,1963 to define and limit the powers of certain courts in punishing contempt of courts and to regulate their procedure in relation thereto.

Joint Select Committee of Parliament on Contempt of Courts went in detail and a new Bill, The Contempt of Courts Bill, 1968 was prepared by the Joint Select Committee.

Statement of objects and reasons

It is generally felt that the existing law relating to contempt of Courts is somewhat uncertain undefined and unsatisfactory. The jurisdiction to punish for contempt touches upon two important fundamental rights of the citizens namely, the right to personal liberty and the right to freedom of expression. It was, therefore, considered advisable to have the entire law on the subject scrutinized by a special committee. In pursuance of this, a Committee was set up in 1961 under the Chairmanship of the late Shri H.N. Sanayal the then Additional Solicitor General. The Committee made a comprehensive examination of the law and problems relating to contempt of Court in the light of the position obtaining in our own country and various foreign countries. The recommendations which the Committee made took note of the importance given to freedom of speech in the Constitution and of the need for safeguarding the status and dignity of Courts and interests of administration of justice.

The recommendations of the Committee have been generally accepted by Government after considering the view expressed on those recommendations by the State Governments, Union Territory Administrations, the Supreme Court, the High Courts and the Judicial Commissioners. The Bill seeks to give effect to the accepted recommendations of the Sanyal Committee.

Act 70 of 1971

The Contempt of Courts Act, 1971 (70 of 1971) was passed by the Parliament in December 1971 and it came into force w.e.f. 24th December, 1971.

List of amending act

The Contempt of Courts (Amendment) Act, 1976 ( 45 of 1976)

Preamble

(24th December, 1971)

An Act to define and limit the powers of certain courts in punishing contempt of courts and to regulate their procedure in relation thereto.

Section 1. Short title and extent.

Act no. 70 of 1971

AN ACT TO DEFINE AND LIMIT THE POWERS OF CERTAIN COURTS IN P UNISHINGCONTEMPTS O [24th December, 1971]

BE it enacted by Parliament in the Twenty-second Year of the Republic of India as follows :-

(1) This Act may be called the Contempt of Courts Act, 1971.

(2) It extends to the whole of India

Provided that it shall not apply to the State of Jammu and Kashmir except to the extent to which the provisions of this Act relate to contempt of the Supreme Court.

Section 2. Definitions.

In this Act, unless the context otherwise requires -

(a) “Contempt of court” means civil contempt or criminal contempt”

(b) “Civil contempt” means willful disobedience to any judgement, decree, direction, order, writ or other process of a court or willful breach of an undertaking given to a court.

(c) “Criminal contempt” means the publication (whether by words, spoken or written, or by signs, or by visible representation, or otherwise) of any matter or the doing of any other act whatsoever which-

(d) Scandalizes or tends to scandalize, or lowers or tends to lower the authority of, any court, or

(ii) Prejudices, or interferes or tends to interfere with the due course of any judicial proceeding , or

(iii) Interferes or tends to interfere with, or obstructs or tends to obstruct, the administration of justice in any other manner.

(a) “High Court” means the High Court for a State or a Union territory and includes the court of the Judicial Commissioner in any Union territory.

Section 3. Innocent publication and distribution of matter not contempt.

(1) A person shall not be guilty of contempt of court on the ground that he has published (whether by words, spoken or written, or by signs, or by visible representations, or otherwise) any matter which interferes or tends to interfere with, or obstructs or tends to obstruct, the course of justice in connection with any civil or criminal proceeding pending at that time of publication, if at that time he had no reasonable grounds for believing that the proceeding was pending.

(2) Notwithstanding anything to the contrary contained in this Act or any other law for the time being in force, the publication of any such matter as is mentioned in sub-section (1) in connection with any civil or criminal proceeding which is not pending at the time of publication shall not be deemed to constitute contempt of court.

(3) A person shall not be guilty of contempt of court on the ground that he has distributed a publication containing any such matter as is mentioned in sub-section (1), if at the time of distribution he had no reasonable grounds for believing that it contained or was likely to contain any such matter as aforesaid:

Provided that this sub-section shall not apply in respect of the distribution of—

(i) any publication which is a book or paper printed or published otherwise than in conformity with the rules contained in section 3 of the Press and Registration of Books Act, 1867 (25 of 1867);

(ii) any publication which is a newspaper published otherwise than in conformity with the rules contained in section 5 of the said Act.

1. —For the purposes of this section, a judicial proceeding—

(a) is said to be pending—

(A) in the case of a civil proceeding, when it is instituted by the filing of a plaint or otherwise,

(B) in the case of a criminal proceeding under the Code of Criminal Procedure, 1898 (5 of 1898)¹, or any other law—

(i) where it relates to the commission of an offence, when the charge-sheet or challan is filed, or when the court issues summons or warrant, as the case may be, against the accused, and

(ii) in any other case, when the court takes cognizance of the matter to which the proceeding relates, and

in the case of a civil or criminal proceeding, shall be deemed to continue to be pending until it is heard and finally decided, that is to say, in a case where an appeal or revision is competent, until the appeal or revision is heard and finally decided or, where no appeal or revision is preferred, until the period of limitation prescribed for such appeal or revision has expired;

(b) which has been heard and finally decided shall not be deemed to be pending merely by reason of the fact that proceedings for the execution of the decree, order or sentence passed therein are pending.

———————————-

1. Now see Code of Criminal Procedure, 1973 (2 of 1974).

Section 4. Fair and accurate report of judicial proceeding not contempt.

Subject to the provisions contained In section 7, a person shall not be guilty of contempt of court for publishing a fair and accurate report of a judicial proceeding or any state thereof.

Section 5. Fair criticism of judicial act not contempt.

A person shall not be guilty of contempt of court for publishing any fair comment on the merits of any case which has been heard and finally decided.

Section 6. Complaint against presiding officers of subordinate courts when not contempt.

A person shall not be guilty of contempt of court in respect of any statement made by him in good faith concerning the presiding officer or any subordinate court to -

(a) Any other subordinate court, or

(b) The High court to which it is subordinate.

Explanation – In this section, ” subordinate court” means any court subordinate to a High court.

Section 7. Publication of information relating to proceeding in chambers or in camera not contempt except in certain cases.

(1) Notwithstanding anything contained in this Act, a person shall not be guilty of contempt of court for publishing a fair and accurate report of a judicial proceedings before any court sitting in chambers or in camera except in the following cases, that is to say-

(a) Where the publication is contrary to the provisions of any enactment for the time being in force.

(b) Where the court, on grounds of public policy or in exercise of any power vested in it, expressly prohibits the publication of all information relating to the proceeding or of information of the description which is published.

(c) Where the court sits in chambers or in camera for reason connected with public order or the security of the State, the publication of information relating to those proceedings,

(d) Where the information relates to secret process, discovery or invention which is an issue in the proceedings.

(2) Without prejudice to the provisions contained in sub section (1) a person shall not be guilty of contempt of court for publishing the text or a fair and accurate summary of the whole, or any part, of an order made by a court sitting in chambers or in camera, unless the court has expressly prohibited the publication thereof on grounds of public policy, or for reasons connected with public order or the security of the State, or on the ground that it contains information relating to secret process, discovery or invention, or in exercise of any power vested on it.

Section 8. Other defences not affected.

Nothing contained in this Act shall be construed as Implying that any other defence which would have been a valid defence in any proceedings for contempt of court has ceased to be available merely by reason of the provisions of this Act.

Section 9. Act not to imply enlargement of scope of contempt.

Nothing contained in this Act shall be construed as implying that any disobedience, breach, publication or other act is punishable as contempt of court which not be so punishable apart from this Act.

Section 10. Power of High Court to punish contempt’s of subordinate courts.

Every High Court shall have and exercise the same jurisdiction, powers and authority, in accordance with the same procedure and practice, in respect of contempt’s of courts subordinate to it and it has and exercise in respect of contempt’s of itself.

Provided that no High Court shall take cognizance of a contempt alleged to have been committed in respect of a court subordinate to it where such contempt is an offence punishable under the Indian Penal Code (45 of 1860).

Section 11. Power of High Court to try offences committed or offenders found Outside jurisdiction.

A High Court shall have jurisdiction to inquire into or try a contempt of itself or of any court subordinate to it, whether the contempt is alleged to have been committed within or outside the local limits of its jurisdiction , and whether the person alleged to be guilty of contempt is within or outside such limits.

Section 12. Punishment for contempt of court.

(1) Save as otherwise expressly provided in this Act or in any other law, a contempt of court may be punished with simple imprisonment for a term which may extend to six months, or with fine which may extend to two thousand rupees, or with both.

Provided that the accused may be discharged or the punishment awarded may be remitted on apology being made to the satisfaction of the court.

Explanation – An apology shall not be rejected merely on the ground that it is qualified or conditional if the accused makes it bona fide.

(2) Notwithstanding anything contained in any law for the time being in force, no court shall impose a sentence in excess of that specified in sub section for any contempt either in respect of itself or of a court subordinate to it.

(3) Notwithstanding anything contained in this section, where a person is found guilty of a civil contempt, the court, if it considers that a fine will not meet the ends of justice and that a sentence of imprisonment is necessary shall, instead of sentencing him to simple imprisonment, direct that the he be detained in a civil prison for such period not exceeding six months as it may think fit.

(4) Where the person found guilty of contempt of court in respect of any undertaking given to a court is a company, every person who, at the time the contempt was committed, was in charge of, and was responsible to, the company for the conduct of business of the company, as well as the company, shall be deemed to be guilty of the contempt and the punishment may be enforced, with the leave of the court, by the detention in civil prison of each such person.

Provided that nothing contained in this sub section shall render any such person liable to such punishment if he proves that the contempt was committed without his knowledge or that he exercised all due diligence to prevent its commission.

(5) Notwithstanding anything contained in sub section (4) where the contempt of court referred to therein has been committed by a company and it is provided that the contempt has been committed with the consent or connivance of, or is attributable to any neglect on the part of, any director, manger, secretary or other officer of the company, such director, manager , secretary or other officer shall also be deemed to be guilty of the be contempt and the punishment may be enforced, with the leave of the court, by the detention in civil prison of such director, manager, secretary or other officer.

Explanation – For the purpose of sub sections (4) and (5)-

(a) “Company ” means any body corporate and includes a firm or other association of individuals, and

(b) “Director” in relation to a firm, means a partner in the firm.

Section 13. Contempt’s not punishable in certain cases.

¹[13. Contempts not punishable in certain cases.—Notwithstanding anything contained in any law for the time being in force,—

(a) no court shall impose a sentence under this Act for a contempt of court unless it is satisfied that the contempt is of such a nature that it substantially interferes, or tends substantially to interfere with the due course of justice;

(b) the court may permit, in any proceeding for contempt of court, justification by truth as a valid defence if it is satisfied that it is in public interest and the request for invoking the said defence is bona fide.]

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1. Subs. by Act 6 of 2006, sec. 2, for section 13 (w.e.f. 17-3-2006). Section 13, before substitution, stood as under:

“13. Contempts not punishable in certain cases.—Notwithstanding anything contained in any law for the time being in force, no court shall impose a sentence under this Act for a contempt of court unless it is satisfied that the contempt is of such a nature that it substantially interferes, or tends substantially to interfere with the due course of justice:”.

Section 14. Procedure where contempt is in the face of the Supreme Court or a High Court.

(1) When it is alleged, or appears to the Supreme Court or the High Court upon its own view, that a person has been guilty of contempt committed in its presence or hearing, the court may cause such person to he detained in custody, and, at any time before the rising of the court, on the same day, or as early as possible thereafter, shall -

(a) Cause him to be informed in writing of the contempt with which he is charged.

(b) Afford him an opportunity to make his defence to the charge,

(c) After taking such evidence as may be necessary or as may be offered by such person and after hearing him, proceed, either forthwith or after adjournment , to determine the matter of the charge, and

(d) Make such order for the punishment or discharge of such person as may be just.

(2) Notwithstanding anything contained in sub section (1) where a person Charged with contempt under the sub section applies, whether orally or in writing, to have the charge against him tried by some Judge other than the Judge or Judges in whose presence or hearing the offence is alleged to have been committed, and the court is of opinion that it is practicable to do so and that in that interest of proper administration of justice the application should be allowed, it shall cause the matter to be placed, together with a statement of the facts of the case, before the Chief Justice for such directions as he may think fit to issue as respects the trial thereof.

(3) Notwithstanding anything contained in any other law, in any trial of a person charged with contempt under sub section (1) which is held, in pursuance of a direction given under sub section (2), by a Judge other than the Judge or Judges in whose presence or hearing the offence is alleged to have been committed, it shall not be necessary for the Judge or Judges in whose presence or hearing the offence is alleged to have been committed to appear as a witness and the statement placed before the Chief Justice under sub section (2) shall be treated as evidence in the case.

(4) Pending the determination of the charge, the court may direct that a person charged with contempt under this section shall be detained in such custody as it may specify.

Provided that the shall be released on bail, of a bond for such sum of money As the court thinks sufficient is executed with or without sureties conditioned that the person charged shall attend at the time and place mentioned in the bond and shall continue t so attend until otherwise directed by the court.

Provided further that the court may, if it thinks fit, instead of taking bail from such person, discharge him on his executing a bond without sureties for his attendance as aforesaid.

Section 15. Cognizance of criminal contempt in other cases.

(1) In the case of a criminal contempt, other than a contempt referred to in section 14, the Supreme Court or the High Court may take action on its own motion or on a motion made by—

(a) the Advocate-General, or

(b) any other person, with the consent in writing to the Advocate-General,¹[or]

¹[(c) in relation to the High Court for the Union territory of Delhi, such Law Officer as the Central Government may, by notification in the Official Gazette, specify in this behalf, or any other person, with the consent in writing of such Law Officer.]

(2) In the case of any criminal contempt of a subordinate court, the High Court may take action on a reference made to it by the subordinate court or on a motion made by the Advocate-General or, in relation to a Union territory, by such Law Officer as the Central Government may, by notification in the Official Gazette, specify in this behalf.

(3) Every motion or reference made under this section shall specify the contempt of which the person charged is alleged to be guilty.

1. —In this section, the expression “Advocate-General” means—

(a) in relation to the Supreme Court, the Attorney-General or the Solicitor-General;

(b) in relation to the High Court, the Advocate-General of the State or any of the States for which the High Court has been established;

(c) in relation to the Court of a Judicial Commissioner, such Law Officer as the Central Government may, by notification in the Official Gazette, specify in this behalf.

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1. Ins. by Act 45 of 1976, sec. 2 (w.e.f. 30-3-1976).

Section 16. Contempt by judge, magistrate or other person acting judicially.

(1) Subject to the provisions of any law for the time being in force, a judge, magistrate or other persons act in judicially shall also be liable for contempt of his own court or of any other court in the same manner as any other individual is liable and the provisions of this Act, so far as may be, apply accordingly.

(2) Notwithstanding in this section shall apply to any observations or remarks made by a judge, magistrate or other person act in judicially, regarding a subordinate court in an appeal or revision pending before such judge, magistrate or other person against the order or judgement of the subordinate court.

Section 17. Procedure after cognizance.

(1) Notice of every proceeding under Section 15 shall be served personally on the person charged, unless the court for reasons to be recorded directs otherwise.

(2) The notice shall be accompanied-

(a) In the case of proceedings commenced on a motion, by a copy of the motion as also copies of the affidavits, if any, on which such motion is founded and,

(b) In case of proceedings commenced on a reference by a subordinate court, by a copy of the reference.

(3) The court may, if it is satisfied that a person charged under Section 15 is likely to abscond or keep out of the way to avoid service of the notice, order the attachment of his property of such value or amount as it may deem reasonable.

(4) Every attachment under sub section (3) shall be effected in the manner provided in the code of Civil procedure., 1908 (5 of 1908)¹, for the attachment of property in execution of a decree for payment of money, and if , after such attachment, the person charged appears and shows to the satisfaction of the court that he did not abscond or keep out of the way to avoid service of the notice, the court shall order the release of his property from attachment upon such terms as to costs or otherwise as it may think fit.

(5) Any person charged with contempt under Section 15 may file an affidavit in support of this defence, and the court may determine the matter of the charge either on the affidavits filed or after taking such further evidence as may be necessary, and pass such order as the justice of the case requires.

——————————

1. Now see Code of Criminal Procedure, 1973 (2 of 1974).

Section 18. Hearing of cases of criminal contempt to be by Benches.

(1) Every case of criminal contempt under section 15 shall be heard and determined by a Bench of not less than two Judges.

(2) Sub section (1) shall not apply to the court of a judicial commissioner.

Section 19. Appeals.

(1) An appeals shall lie as of right from any order to decision of High Court in the exercise of its jurisdiction to punish for contempt-

(a) Where the order or decision is that of a single judge, to a Bench of not less than two Judges of the Court.

(b) Where the order or decision is that of a Bench, to the Supreme Court.

Provided that where the order or decision is that of the Court of the Judicial Commissioner in any Union territory, such appeal shall lie to the Supreme Court.

(2) Pending any appeal. The appellate court may order that-

(a) The execution of the punishment or order appealed against be suspended

(b) If the appellant is in confinement, he be released on bail, and

(c) The appeal be heard notwithstanding that the appellant has not purged his contempt.

(3) Where any person aggrieved by any order against which an appeal may be filed satisfied the High Court that he intends to prefer an appeal, the High Court may also exercise all or any of the powers conferred by sub section (2).

(4) An appeal under sub section (1) shall be filed-

(a) In the case of an appeal to a Bench of the High Court, within thirty days.

(b) In the case of an appeal to the Supreme Court, within sixty days, from the date of the order appealed against.

Section 20. Limitation for actions for contempt.

No court shall initiate any proceedings if contempt, either on its own motion or otherwise, after the expiry of a period of one year from the date on which the contempt is alleged to have been committed.

Section 21. Act not to apply to Nyaya Panchayatas or other village courts.

Nothing contained in this Act shall apply in relation to contempt of Nyaya Panchayats or other village courts, by whatever name known, for the administration of justice, established under any law.

Section 22. Act to be in addition to, and not in derogation of, other laws relating to contempt.

The provisions of this Act shall be in addition to, and not in derogation of the provision of any other law relating to contempt of courts.

Section 23. Power of Supreme Court and High Court to make rules.

The Supreme Court or, a the case may be, any High Court, may make rules, not inconsistent with the provisions of this Act, providing for any matter relating to its procedure.

Section 24. Repeal.

The Contempt of Courts Act, 1952 (32 of 1952) is hereby repealed.

Rules

Rules to regulate proceedings for contempt to the supreme court, 1975 g.s.r. 142 -

In exercise of the powers under section 23 of the Contempt of Courts Act, 1971 read with article 145 of the Constitution of India and all other powers enabling it in this behalf, the Supreme Court hereby makes, with the approval of the President, the following rules-

1. (1) These Rules may be called the Rules to Regulate Proceedings for contempt of the Supreme Court, 1975.

(2) They shall come into force on the date of their publication in the official Gazette (Note:- Published in the Gazette of India, dated 1st February,1975 and came into force from that date.

2. (1) Where contempt is committed in view or presence or hearing of the Court, the contemnor may be punished by the Court before which it is committed either forthwith or on such date as may be appointed by the Court in that behalf.

(2) Pending the determination of the charge, the Court may direct that the contemnor shall be detained in such custody as it may specify.

Provided that the contemnor may be released on bail on such terms as the Court may direct.

3. In case of contempt other than the contempt referred to in rule 2, the Court may take action.

(a) Suo matu, or

(b) On a petition made by Attorney General, or Solicitor General, or

(c) On a petition made by any person, and in the case of a criminal contempt with the consent in writing of the Attorney General or the Solicitor General.

4. (a) Every petition under Rule 3 (b) or (c) shall contain :-

(i) The name, description and place of residence of the petitioner or petitioners and of the persons charged.

(ii) Nature of the contempt alleged, and such material facts, including the date or dates of commission of the alleged contempt, as may be necessary for the proper determination of the case.

(iii) If a petition has previously been made by him on the same facts, the petitioners shall give the details of the petition previously made and shall also indicate the result thereof.

(b) The Petition shall be supported by an affidavit.

(c) Whether the petitioner relies upon a document or documents in his possession or power, he shall file such document or documents or true copies thereof with the petition.

(d) No court-fee shall be payable on the petition, and on any documents filed in the proceedings.

5. Every petition under rule 3 (b) and (c) shall be posted before the Court for preliminary hearing and for orders as to issue of notice. Upon such hearing, the Court, if satisfied that no prima facie case has been made out for issue of notice, may dismiss the petition, and, if not so satisfied direct that notice of the petition be issued to the contemnor.

6. (1) Notice to the person charged shall be in Form 1. The person charged shall, unless otherwise ordered, appear in person before the Court a directed on the date fixed for hearing of the proceeding, and shall continue to remain present during hearing till the proceeding is finally disposed of by order of the Court

(2) When action is instituted on petition, a copy of the petition along with the annexure and affidavits shall be served upon the person charged.

7. The person charged may file his reply duly supported by an affidavit or affidavits.

8. No further affidavit or document shall be filed except with the leave of the Court.

9. Unless otherwise ordered by the Court, seven copies of the Paper Book shall be prepared in the Registry, one for the petitioner, one for the opposite party and the remaining for the use of the Court. The Paper Book in case shall be prepared at the expense of the Central Government and shall consist of the following documents :-

(i) Petition and affidavits filed by the petitioner,

(ii) A copy of, or a statement relating to, the objectionable matter constituting the alleged contempt.

(iii) Replay and affidavits of the parties.

(iv) Documents filed by the parties.

(v) Any other document which the Registrar may deem fit to include.

10. The Court may direct the Attorney- General or Solicitor- General to appear and assist the Court.

11. (1) The Court may, if it has reason to believe, that the person charged is absconding or is otherwise evading service of notice, or if he fails to appear in person or to continue to remain present in person in pursuance of the notice, direct a warrant bailable or non-bailable for his arrest, addressed to one or more police officers or may order attachment of property. The warrant shall be issued under the signature of the Registrar. The warrant shall be in Form II and shall be executed, as far as may be in the manner provided for execution of warrants under the Code of Criminal Procedure.

(2) The warrant shall be execute by the officer to officers to whom it is directed, and may also be executed by any other police officer whose name is endorsed upon the warrant by the officer to whom it is directed or endorsed.

(3) Where a warrant is to be executed outside the Union Territory of Delhi, the Court may instead of directing such warrant to police officer, forward it to the Magistrate of the District or the Superintendent of Police or Commissioner of Police of the district within which the person charged is believed to be residing. The Magistrate or the police officer to whom the warrant is forwarded shall endorse his name thereon, and cause it to be executed.

(4) Every person who is arrested and detained shall be produced before the nearest Magistrate within a period of twenty-four hours of such arrest excluding the time necessary for the from the place of arrest to the Court of the Magistrate, and no such person shall be detained in custody beyond the said period without the authority of a Magistrate.

12. The court may, either suo motu, or on motion made for that purpose, order the attendance for cross-examination, for a person whose affidavit has been filed in the matter.

13. The court may make orders for the purpose of securing the attendance of any person to be examined as a witness and for discovery of production of any document.

14. The court may pass such orders as it thinks fit including orders as to costs which may recovered as if the order were a decree of the court.

15. Save as otherwise provided by the rules contained herein, the provisions of the Supreme Court Rules, 1966 shall, so far as may be, apply to proceedings in relation to proceedings in contempt under this part.

16. Where a person charged with contempt is adjusted guilty and is sentenced to suffer imprisonment, a warrant of commitment a d detention shall be made out in Form IV under the signature of the Registrar. Every such warrant shall remain in force until it is cancelled by order of the Court on until it is executed. The Superintendent of the Jail shall in pursuance of the order receive the person so adjusted and detain him in custody for the period specified therein, or until further orders.

Anand Marriage Act

November 30, 2014

Section 2. Validity of anand marriage.

All marriages, which may be or may have been duly solemnized according to the Sikh Marriage ceremony called Anand shall be and shall be deemed to have been with effect from the date of the solemnization of each respectively, good and valid in law.

Section 3. Exemption of certain marriages from Act.

Nothing in this Act shall apply to-

(a) Any marriage between persons not professing the Sikh religion, or

(b) Any marriage, which has been judicially declared to be null and void.

Section 4. Saving of marriages solemnized according to other ceremonies.

Nothing in this Act shall affect the validity of any marriage duly solemnized according to any other marriage ceremony customary among the Sikhs.

Section 5. Non-validation of marriages within prohibited degrees.

Nothing in this Act shall be deemed to validate any marriage between persons who are related to each other in any degree of consanguinity or affinity, which would, according to the customary law of the Sikhs, render a marriage between them illegal.

Advocates Act

November 30, 2014

Section 1. Short title, extent and commencement

²(1) This Act may be called the Advocates Act, 1961.

²[(2) It extends to the whole of India]

(3) It ³[shall, in relation to the territories other than those referred to in sub-section (4) come into force] on such date ⁴ as the Central Government may, by notification in the Official Gazette, appoint, and different dates3 may be appointed for different provisions of this Act.

⁵[(4) This Act shall, in relation to the State of Jammu and Kashmir6 and the Union territory of Goa, Daman and Diu, come into force on such date7 as the Central Government may, by notification in the Official Gazette, appoint in this behalf, and different dates may be appointed for different provisions of this Act.

1. Subs, by Act 60 of 1973, sec. 2, for sub-section (2) (w.e.f. 31-1-1974).
2. The Act has been extended to The Union territory of Dadra & Nagar Haveli by Regulation 8 of 1963. The Union territory of Pondicherry by Act 26 of 1968, sec. 3 and Sch.

3. Subs, by Act 60 of 1973, sec. 2 (w.e.f. 31-1-1974).
4. The following are the Notifications by which different dates have been appointed for different provisions of this Act:-

5. Sub-section (4) ins. By Act 60 of 1973, sec, 2.
6. 1-8-1986 vide G.S.R. 1946(E), dated 15-7-1986 (except section 30) the Act is enforced in the State of Jammu and Kashmir.
7. 1-6-1979, vide G.S.R. 84(E)/1979, (except section 30) the Act is enforced in Goa, Daman and Diu.

Section 2. Definitions.

¹[(1)] In this Act, unless the context otherwise requires,

(a) “advocate” means an advocate entered in any roll under the provisions of this Act;

(b) “appointed day”, in relation to any provision of this Act, means the day on which that provision comes into force;

(c) ²[***]

(d) “Bar Council” means a Bar Council constituted under this Act;

(e) “Bar Council of India” means the Bar Council constituted under section 4 for the territories to which this Act extends;

(f) ³[***]

(g) “High Court”, except in sub-section (1) ⁴[and sub-section (1A)] of section 34 and in sections 42 and 43, does not include a court of the Judicial Commissioner, and, in relation to a State Bar Council, means,

(i) in the case of a Bar Council constituted for a State or for a State and one or more Union Territories, the High Court for the State;

(ii) in the case of the Bar Council constituted for Delhi, ⁵[the High Court of Delhi];

(h) “law graduate” means a person who has obtained a bachelor’s degree in law from any university established by law in India;

(i) “legal practitioner” means an advocate ⁶[or vakil] of any High Court, a pleader mukhtar or revenue agent;

(j) “prescribed” means prescribed by rules made under this Act;

(k) “roll” means a roll of advocates prepared and maintained under this Act;

(l) “State” does not include a Union Territory;

(m) “State Bar Council” means a Bar Council constituted under section 3;

(n) “State roll” means a roll of advocates prepared and maintained by a State Bar Council under section 17.

⁷[(2) Any reference in this Act to a law which is not in force in the State of Jammu and Kashmir or in the Union Territory of Goa, Daman and Diu, shall, in relation to that State or that territory, be construed as a reference to the corresponding law, if any, in force in that State or that Territory, as the case may be.]

1. Section 2 renumbered as sub-section (1) thereof by Act 60 of 1973, sec. 2 (w.e.f. 31-1-1974).

2. Clause (c) omitted by Act 107 of 1976, sec. 2 (w.e.f. 15-10-1976).

3. Clause (f) omitted by Act 60 of 1973 sec 3 (w.e.f. 31-01-1974.)

4. Ins. by Act 60 of 1973 sec. 3 (w.e.f. 31-1-1974.)

5. Subs. by Act 60 of 1973 sec. 3 for the High Court of Punjab (w.e.f. 31-1-1974.)

6. Subs. by Act 107 of 1976 sec. 2 for vakil or attorney (w.e.f. 15-10-1976).

7. Ins. by Act 60 of 1973 sec. 3 for vakil or attorney (w.e.f.15-10-1976.)

* Goa is now a state, see Goa, Daman and Diu Reorganisation Act, 1987 (18 of 1987),
sec. 3 (w.e.f. 30-5-1987).

Section 3. States Bar Councils.

(1) There shall be a Bar Council—

(a) for each of States of Andhra Pradesh, Bihar, Gujarat, ¹[Jammu and Kashmir], ²[Jharkhand] ³[Madhya Pradesh, Chhattisgarh], ⁴[***], ⁵[***], ⁶[Karnataka], Orissa, Rajasthan ⁷[Uttar Pradesh and Uttaranchal], to be known as the Bar Council of that State;

⁸[(b) for the States of Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland and Tripura to be known as the Bar Council of Assam, Nagaland, Meghalaya, Manipur, Tripura, Mizoram and Arunachal Pradesh;]

(c) for the State of Kerala and 9[the Union territory of Lakshadweep], to be known as the Bar Council of Kerala;

¹⁰[(cc) for the ¹¹[State of Tamil Nadu] and the Union territory of Pondicherry to be known as the Bar Council of Madras*;]

¹²[(ccc) for the States of Maharashtra and Goa, and the Union territories of Dadra and Nagar Haveli and Daman and Diu, to be known as the Bar Council of Maharashtra and Goa;]

¹³[(d) for the States of Punjab and Haryana, and the Union territory of Chandigarh, to be known as the Bar Council of Punjab and Haryana;

(dd) for the State of Himachal Pradesh, to be known as the Bar Council of Himachal Pradesh;]

(e) for the State of West Bengal and the ¹⁴[Union territory of Andaman and Nicobar Islands], to be known as the Bar Council of West Bengal; and

(f) for the Union territory of Delhi, to be known as the Bar Council of Delhi.

(2) A State Bar Council shall consist of the following members, namely:—

(a) in the case of the State Bar Council of Delhi, the Additional Solicitor General of India ex officio ¹⁵[in the case of the State Bar Council of Assam, Nagaland, Meghalaya, Manipur and Tripura, the Advocate General of each of the State of Assam, Manipur, Meghalaya, Nagaland and Tripura, ex officio; in the case of the State Bar Council of Punjab and Haryana, the Advocate-General of each of the State of Punjab and Haryana, ex officio;] and in the case of any other State Bar Council, the Advocate-General of the State, ex officio;

¹⁶[(b) in the case of a State Bar Council with an electorate not exceeding five thousand, fifteen members, in the case of a State Bar Council with an electorate exceeding five thousand but not exceeding ten thousand, twenty members, and in the case of the State Bar Council with an electorate exceeding ten thousand, twenty-five members, elected in accordance with the system of proportional representation by means of the single transferable vote from amongst advocates on the electoral roll of the State Bar Council:]

¹⁷[Provided that as nearly as possible one-half of such elected members shall subject to any rules that may be made in this behalf by the Bar Council of India, be persons who have for at least ten years been advocates on a State roll, and in computing the said period of ten years in relation to any such person, there shall be included any period during which the person has been an advocate enrolled under the Indian Bar Councils Act, 1926 (38 of 1926).]

¹⁸[(3) There shall be a Chairman and a Vice-Chairman of each State Bar Council elected by the Council in such manner as may be prescribed.

(3A) Every person holding office as Chairman or as Vice-Chairman of any State Bar Council immediately before the commencement of the Advocates (Amendment) Act, 1977 (38 of 1977) shall, on such commencement, cease to hold office as Chairman or Vice-Chairman, as the case may be:

Provided that every such person shall continue to carry on the duties of his office until the Chairman or the Vice-Chairman, as the case may be, of each State Bar Council, elected after the commencement of the Advocates (Amendment) Act, 1977 (38 of 1977), assumes charge of the office.]

¹⁹[(4) An Advocate shall be disqualified from voting at an election under sub-section (2) or for being chosen as, and for being, a member of State Bar Council, unless he possesses such qualifications or satisfies such conditions as may be prescribed in this behalf by the Bar Council of India, and subject to any such rules that may be made, an electoral roll shall be prepared and revised from time to time by each State Bar Council.

(5) Nothing in the proviso to sub-section (2) shall affect the term of office of any member elected before the commencement of the Advocates (Amendment) Act, 1964 (21 of 1964), but every election after such commencement shall be held in accordance with the provisions of the rules made by the Bar Council of India to give effect to the said proviso.]

²⁰[(6) Nothing in clause (b) of sub-section (2) shall affect the representation of elected members in any State Bar Council as constituted immediately before the commencement of the Advocates (Amendment) Act, 1973 (60 of 1973), until that State Bar Council is reconstituted in accordance with the provision of this Act.]

—————

1. Ins. by Act 60 of 1973, sec. 4 (w.e.f. 31-1-1974).

2. Ins. by Act 30 of 2000, sec. 28 (w.e.f. 15-11-2000).

3. Subs. by Act 28 of 2000, sec. 24, for “and Madhya Pradesh” (w.e.f. 1-11-2000).

4. The word “Madras” omitted by Act 26 of 1968, sec. 3 and Sch.—Part I (w.e.f. 24-5-1968).

5. The word “Maharashtra” omitted by the Dadra and Nagar Haveli (Civil Courts and Miscellaneous Provisions) Regulations, 1963 (8 of 1963), sec. 12 (w.e.f. 1-7-1965).

6. Subs. by the Mysore State (Alteration of Name) (Adaptation of Laws on Union Subjects) Order, 1974, for “Mysore” (w.e.f. 1-11-1973).

7. Subs. by Act 29 of 2000, sec. 29, for “and Uttar Pradesh” (w.e.f. 9-11-2000).

8. Subs. by Act 69 of 1986, sec. 19, for clause (b) (w.e.f. 24-12-1986). Earlier clause (b) was substituted by Act 81 of 1971, sec. 34(3) and by Act 34 of 1986, sec. 16.

9. Subs. by Act 34 of 1973, sec. 5, for “the Union territory of the Laccadive, Minicoy and Amindivi Islands” (w.e.f. 1-11-1973).

10. Ins. by Act 26 of 1968, sec. 3 and Sch.—Part I (w.e.f. 26-5-1968).

11. Subs. by the Madras State (Alteration of Name) (Adaptation of Laws on Union Subjects) Order, 1970, for “State of Madras” (w.e.f. 14-1-1969). * Now Tamil Nadu.

12. Subs. by Act 18 of 1987, sec. 21, for clause (ccc) (w.e.f. 30-5-1987). Earlier clause (cc) was inserted by the Dadra and Nagar Haveli (Civil Courts and Miscellaneous Provisions) Regulations, 1963 (8 of 1963), regulation 12 and was re-lettered as clause (ccc) by Act 26 of 1968, sec. 3 and Sch.—Part I (w.e.f. 26-5-1968) and it was amended by Act 60 of 1973, sec. 4 (w.e.f. 31-1-1974).

13. Subs. by Act 53 of 1970, sec. 24, for clause (d) (w.e.f. 25-1-1971).

14. Subs. by Act 81 of 1971, sec. 34, for “Union Territories of Tripura and the Andaman and Nicobar Islands” (w.e.f. 21-1-1972).

15. Ins. by Act 60 of 1973, sec. 4 (w.e.f. 31-1-1974).

16. Subs. by Act 60 of 1973, sec. 4, for clause (b) (w.e.f. 31-1-1974).

17. Ins. by Act 21 of 1964, sec. 2 (w.e.f. 16-5-1964).

18. Subs. by Act 38 of 1977, sec. 2, for sub-section (3). Earlier sub-section (3) was substituted by Act 107 of 1976, sec. 3 (w.e.f. 13-9-1976).

19. Ins. by Act 21 of 1964, sec. 2 (w.e.f. 16-5-1964).

20. Ins. by Act 60 of 1973, sec. 4 (w.e.f. 31-1-1974).

Section 4. Bar Council of India.

(1) There shall be a Bar Council for the territories to which this Act extends to be known as the Bar Council of India which shall consist of the following members, namely:

(a) the Attorney-General of India, ex officio;

(b) the Solicitor-General of India, ex officio;

¹[***]

(c) one member elected by each State Bar Council from amongst its members.

²[(1 A) No person shall be eligible for being elected as a member of the Bar Council of India unless he possesses the qualifications specified in the proviso to sub-section (2) of section 3.]

³[(2) There shall be a Chairman and a Vice-Chairman of the Bar Council of India elected by the Council in such manner as may be prescribed.

(2A) A person holding office as Chairman or as Vice-Chairman of the Bar Council of India immediately before the commencement of the Advocates (Amendment) Act, 1977 (38 of 1977), shall, on such commencement, cease to hold office as Chairman or Vice-Chairman, as the case may be :

PROVIDED that such person shall continue to carry on the duties of his office until the Chairman or the Vice-Chairman, as the case may be, of the Council, elected after the commencement of the Advocates (Amendment) Act, 1977 (38 of 1977), assumes charge of the office.]

⁴[(3) The term of office of a member of the Bar Council of India elected by the State Bar Council shall

(i) in the case of a member of a State Bar Council who holds office ex officio, be two years from the date of his election[or till he ceases to be a member of the State Bar Council, whichever is earlier;] and

(ii) in any other case, be for the period for which he holds office as a member of the State Bar Council:

PROVIDED that every such member shall continue to hold as a member of the Bar Council of India until his successor is elected.]

1. Clause (bb) omitted by Act 38 of 1977 sec. 3 (w.e.f. 31-10-1977).

2. Inserted by Act 60 of 1973 sec 5 (w.e.f. 31-1-1974)..

3. Substituted by Act 38 of 1977 sec 3 for sub-section (2) (w.e.f. 31-10-1979).

4. Inserted by Act 21 of 1964 sec.3

Section 5. Bar Council to be body corporate.

Every Bar Council shall be a body corporate having perpetual succession and a common seal, with power to acquire and hold property, both movable and immovable, and to contract, and may by the name by which it is known sue and be sued.

Section 6. Functions of State Bar Councils.

(1) The functions of a State Bar Council shall be

(a) to admit persons as advocates on its roll;

(b) to prepare and maintain such roll;

(c) to entertain and determine cases of misconduct against advocates on its roll;

(d) to safeguard the rights, privileges and interests of advocates on its roll;

¹[(dd) to promote the growth of Bar Associations for the purposes of effective implementation of the welfare schemes referred to in clause (a) of sub-section (2) of this section and clause (a) of sub-section (2) of section 7;]

(e) to promote and support law reform;

²[(ee) to conduct seminars and organise talks on legal topics by eminent jurists and publish journals and papers of legal interest;

(eee) to organise legal aid to the poor in the prescribed manner;]

(f) to manage and invest the funds of the Bar Council;

(g) to provide for the election of its members;

³[(gg) to visit and inspect universities in accordance with the directions given under clause (i) of sub-section (1) of section 7;]

(h) to perform all other functions conferred on it by or under this Act; (i) to do all other things necessary for discharging the aforesaid functions.

⁴[(2) A State Bar Council may constitute one or more funds in the prescribed manner for the purpose of

(a) giving financial assistance to organise welfare schemes for the indigent, disabled or other advocates;

(b) giving legal aid or advice in accordance with the rules made in this behalf;

⁵[(c) establishing law libraries.]

⁶(3) A State Bar Council may receive any grants, donations, gifts or benefactions for all or any of the purposes specified in sub-section (2) which shall be credited to the appropriate fund or funds constituted under that sub-section.]

1 Inserted by Act 70 of 1993, sec. 2(i)(a).

2. Inserted by Act 60 of 1973 sec. 6 (w.e.f. 31-1-1974).

3. Substituted by Act 70 of 1993 sec. 2(i) (b).

4. Sub-section (2) and (3) subs. by Act 60 of 1973 sec.6 for sub -section (2).

5. Ins by Act 70 of 1993 sec. 2(ii)
6. Sub-sections (2) and (3) subs. by Act 60 of 1973, sec. 6, for sub-section (2) (w.e.f. 31-1-1974).

Section 7. Functions of Bar Council of India.

¹[(1)] The functions of the Bar Council of India shall be

²[***]

(b) to lay down standards of professional conduct and etiquette for advocates;

(c) to lay down the procedure to be followed by its disciplinary committee and the disciplinary committee of each State Bar Council;

(d) to safeguard the rights, privileges and interests of advocates;

(e) to promote and support law reform;

(f) to deal with and dispose of any matter arising under this Act, which may be referred to it by a State Bar Council;

(g) to exercise general supervision and control over State Bar Councils;

(h) to promote legal education and to lay down standards of such education in consultation with the universities in India imparting such education and the State Bar Councils;

(i) to recognise universities whose degree in law shall be a qualification for enrolment as an advocate and for that purpose to visit and inspect universities; ³[or cause the State Bar Councils to visit and inspect universities in accordance with such directions as it may give in this behalf;]

⁴[(ia) to conduct seminars and organise talks on legal topics by eminent jurists and publish journals and papers of legal interest;

(ib) To organise legal aid to the poor in the prescribed manner;

(ic) To recognise on a reciprocal basis foreign qualifications in law obtained outside Indian for the purpose of admission as advocate under this Act;]

(j) To manage and invest the funds of the Bar Council;

(k) To provide for the election of its members;

(l) To perform all other functions conferred on it by or under this Act;

(m) To do all other things necessary for discharging the aforesaid functions;

⁵[(2) The Bar Council of India may constitute one or more funds in the prescribed manner for the purpose of

(a) Giving financial assistance to organise welfare schemes for indigent, disabled or other advocates;

(b) Giving legal aid or advice in accordance with the rules made in this behalf;]

⁶[( c) Establishing law libraries.]

⁵(3) The Bar Council of India may receive any grants, donations, gifts or benefactions for all or any of the purposes specified in sub-section (2) which shall be credited to the appropriate fund or funds constituted under that sub-section].

1. Renumbered as sub-s. (1) by Act 60 of 1973

2. Inserted by Act 70 of 1993.

3. Inserted by Act 60 of 1973.

Section 7A. Membership in international bodies.

¹[7A.- Membership in international bodies

The Bar Council of India may become a member of international legal bodies such as the International Bar Association or the International Legal Aid Association, contribute such sums as it thinks fit to such bodies by way of subscription or otherwise and authorise expenditure on the participation of its representatives in any international legal conference or seminar.]

1. Ins. by Act 60 of 1973 sec. 8 (w.e.f. 31-1-1974).

Section 8. The term of office of an elected member of a State Bar Council.

¹[8. The term of office of an elected member of a State Bar Council.

The than an elected member thereof referred to in Section 54) shall be five years from the date of publication of the result of his election:

Provided that where a State Bar Council fails to provide for the election of its members before the expiry of the said term, the Bar Council of India may, by order for reasons to be recorded in writing, extend the said term, the Bar Council of India may, by order, for reasons to be recorded in writing, extend the said term for a period not exceeding six months.

—————

1. Section 8 subs. by Act 70 of 1993, sec. 4, for section 8 (w.e.f. 26-12-1993).

Section 8A. Constitution of Special Committee in the absence of election.

¹ Constitution of Special Committee in the absence of election.

(1) Where a State Bar Council fails to provide for the election of its members before the expiry of the term of five years or the extended term, as the case may be, referred to in section 8, the Bar Council of India shall, on and from the date immediately following the day of such expiry, constitute a Special Committee consisting of

(i) the ex officio member of the State Bar Council referred to in clause (a) of sub-section (2) of section 3 to be the Chairman :

PROVIDED that where there are more than one ex officio members, the senior most amongst them shall be the Chairman; and

(ii) two members to be nominated by the Bar Council of India from amongst advocates on the electoral roll of the State Bar Council, to discharge the functions of the State Bar Council until the Bar Council is constituted under this Act.

(2) On the constitution of the Special Committee and until the State Bar Council is constituted

(a) all properties and assets vesting in the State Bar Council shall vest in the Special Committee;

(b) all rights, liabilities and obligations of the State Bar Council, whether arising out of any contract or otherwise, shall be the rights, liabilities and obligations of the Special Committee;

(c) all proceedings pending before the State Bar Council in respect of any disciplinary matter or otherwise shall stand transferred to the Special Committee.

(3) The Special Committee constituted under sub-section (1) shall, in accordance with such directions as the Bar Council of India may give to it in this behalf, hold elections to the State Bar Council within a period of six months from the date of its constitution under sub-section (1), and where, for any reason the Special Committee is not in a position to conduct election within the said period of six months, the Bar Council of India may, for reasons to be recorded by it in writing, extend the said period.

—————

1. Section 8A subs. by Act 70 of 1993, sec. 4, for section 8 (w.e.f. 26-12-1993).

Section 9. Disciplinary Committees.

(1) A Bar Council shall constitute one or more disciplinary committees, each of which shall consist of three persons of whom two shall be persons elected by the Council from amongst its members and the other shall be a person co-opted by the Council from amongst advocates who possess the qualifications specified in the proviso to sub-section (2) of section 3 and who are not members of the Council, and the senior-most advocate amongst the members of a disciplinary committee shall be the Chairman thereof.

(2) Notwithstanding anything contained in sub-section (1), any disciplinary committee constituted prior to the commencement of the Advocates (Amendment) Act, 1964, (21 of 1964) may dispose of the proceedings pending before it as if this section had not been amended by the said Act.

Section 9A. Constitution of legal aid committees

¹[9A. Constitution of legal aid committees

(1) A Bar Council may constitute one or more legal aid committees each of which shall consist of such number of members, not exceeding nine but not less than five, as may be prescribed.

(2) The qualifications, the method of selection and the term of office of the member of a legal aid committee shall be such as may be prescribed.]

1. Ins by Act 60 of 1973 sec. 9 (w.e.f. 31-1-1974.)

Section 10. Constitution of committee other than disciplinary committees.

(1) A State Bar Council shall constitute the following standing committees, namely,

(a) an executive committee consisting of five members elected by the Council from amongst its members;

(b) an enrolment committee consisting of three members elected by the Council from amongst its members.

(2) The Bar Council of India shall constitute the following standing committees, namely,

(a) an executive committee consisting of nine members elected by the Council from amongst its members;

(b) a legal education committee consisting of ten members, of whom five shall be persons elected by the Council from amongst its members and five shall be persons co-opted by the Council who are not members thereof.

(3) A State Bar Council and the Bar Council of India may constitute from amongst its members such other committees as it may deem necessary for the purposes of carrying out the provisions of this Act.

Section 10A. Transaction of business by Bar Councils and committees thereof.

¹[10A. Transaction of business by Bar Councils and committees thereof

²[(1) The Bar Council of India shall meet at New Delhi or at such other place as it may, for reasons to be recorded in writing, determine.

(2) A State Bar Council shall meet at its headquarters or at such other place as it may, for reasons to be recorded in writing, determine.]

(3) The committees other than disciplinary committees constituted by the Bar Councils shall meet at the headquarters of the respective Bar Councils.

(4) Every Bar Council and every committee thereof except the disciplinary committees shall observe such rules of procedure in regard to the transaction of business at their meetings as may be prescribed.

(5) The disciplinary committees constituted under section 9 shall meet at such times and places and shall observe such rules of procedure in regard to the transaction of business at their meetings as may be prescribed.]

1 Inserted by Act 60 of 1973 Sec. 10 (w.e.f. 31-1-1974).

2 Substituted by Act 70 of 1993. sec. 5,

Section 10B. Disqualification of members of Bar Council.

¹[10B.] Disqualification of members of Bar Council

An elected member of a Bar Council shall be deemed to have vacated his office if he is declared by the Bar Council of which he is a member to have been absent without sufficient excuse from three consecutive meetings of such Council, or if his name is, for any cause, removed from the roll of advocates or if he is otherwise disqualified under any rule made by the Bar Council of India.

—————

1. Section 10A renumbered as section 10B by Act 60 of 1973, sec. 10 (w.e.f. 31-1-1974).

Section 11. Staff of Bar Council.

(1) Every Bar Council shall appoint a secretary and may appoint an accountant and such number of other persons on its staff as it may deem necessary.

(2) The secretary and the accountant, if any, shall possess such qualifications as may be prescribed.

Section 12. Accounts and audit.

(1) Every Bar Council shall cause to be maintained such books of accounts and other books in such form and in such manner as may be prescribed.

(2) The accounts of a Bar Council shall be audited by auditors duly qualified to act as auditors of companies under the Companies Act, 1956 (1 of 1956), at such times and in such manner as may be prescribed.

¹[(3) As soon as may be practicable at the end of each financial year, but not later than the 31st day of December of the year next following, a State Bar Council shall send a copy of its accounts together with a copy of the report of the auditors thereon to the Bar Council of India and shall cause the same to be published in the Official Gazette.

(4) As soon as may be practicable at the end of each financial year, but not later than the 31st day of December of the year next following the Bar Council of India shall send a copy of its accounts together with a copy of the report of the auditors thereon to the Central Government and shall cause the same to be published in the Gazette of India.]

———

1. Sub-sections (3) and (4) subs. by Act 63 of 1973, sec. 11, for sub-section (3) (w.e.f.31-1-1974).

Section 13. Vacancies in Bar Councils and Committees thereof not to invalidate action taken.

No act done by a Bar Council or any committee thereof shall be called in question on the ground merely of the existence of any vacancy in, or any defect in the constitution of the Council or committee, as the case may be.

Section 14. Election to Bar Councils not to be questioned on certain grounds.

No election of a member to a Bar Council shall be called in question on the ground merely that due notice thereof has not been given to any person entitled to vote thereat, if notice of the date has, not less than thirty days before that date, been published in the Official Gazette.

Section 15. Power to make rules.

(1) A Bar Council may make rules to carry out the purposes of this Chapter.

(2) In particular, and without prejudice to the generality of the foregoing power, such rules may provide for

¹(a) the election of members of the Bar Council by secret ballot including the conditions subject to which persons can exercise the right to vote by postal ballot, the preparation and revision of electoral rolls and the manner in which the results of election shall be published;

²[***]

³[(c) the manner of election of the Chairman and the Vice-Chairman of the Bar Council];

(d) the manner in which and the authority by which doubts and disputes as to the validity of an election to the Bar Council ⁴[or to the office of the Chairman or Vice-Chairman] shall be finally decided.

⁵[***]

(f) the filling of casual vacancies in the Bar Council;

(g) the powers and duties of the Chairman and the Vice-Chairman of the Bar Council;

⁶[(ga) the constitution of one or more funds by a Bar Council for the purpose of giving financial assistance or giving legal aid or advice referred to in sub-section (2) of section 6 and sub-section (2) of section 7;

⁶[***](gb) organisation of legal aid and advice to the poor, constitution and functions of committees and sub-committees for that purpose and description of proceedings in connection with which legal aid or advice may be given];

(h) the summoning and holding of meetings of the Bar Council, ⁷[* * *]the conduct of business thereat, and the number of members necessary to constitute a quorum;

(i) the constitution and functions of any committee of the Bar Council and the term of office of members of any such committee;

(j) the summoning and holding of meetings, the conduct of business of any such committee, and the number of members necessary to constitute a quorum;

(k) the qualifications and the conditions of service of the secretary, the accountant and other employees of the Bar Council;

(l) the maintenance of books of accounts and other books by the Bar Council;

(m) the appointment of auditors and the audit of the accounts of the Bar Council;

(n) the management and investment of the funds of the Bar Council.

(3) No rules made under this section by a State Bar Council shall have effect unless they have been approved by the Bar Council of India.

—————

1. Subs. by Act 60 of 1973, sec. 12, for clause (a) (w.e.f. 31-1-1974).

2. Clause (b) omitted by Act 60 of 1973, sec. 12 (w.e.f. 31-1-1974).

3. Clause (c) ins. by Act 38 of 1977, sec. 5 (w.r.e.f. 31-10-1977).

4. Ins. by Act 38 of 1977, sec. 5 (w.r.e.f. 31-10-1977).

5. Clause (e) omitted by Act 23 of 1966, sec. 3 (w.r.e.f. 16-8-1961).

6. Ins. by Act 60 of 1973, sec. 12 (w.e.f. 31-1-1974).

7. The words “the times and places where such meetings are to be held” omitted by Act 60 of 1973, sec. 12 (w.e.f. 31-1-1974).

Section 16. Senior and other advocates.

(1) There shall be two classes of advocates, namely, senior advocates and other advocates.

(2) An advocate may, with his consent, be designated as senior advocate if the Supreme Court or a High Court is of opinion that by virtue of his ability, ¹[standing at the Bar or special knowledge of experience in law] he is deserving of such distinction.

(3) Senior advocates shall, in the matter of their practice, be subject to such restrictions as the Bar Council of India may, in the interest of the legal profession, prescribe.

(4) An advocate of the Supreme Court who was a senior advocate of that court immediately before the appointed day shall, for the purposes of this section, be deemed to be a senior advocate :

²[PROVIDED that where any such senior advocate makes an application before the 31st December, 1965 to the Bar Council maintaining the roll in which his name has been entered that he does not desire to continue as a senior advocate, the Bar Council may grant the application and the roll shall be altered accordingly].

1 Substituted by Act 60 of 1993 for words “experience and standing at the Bar”.

2 Added by Act 21 of 1964.

Section 17. State Bar Councils to maintain roll of advocates.

(1) Every State Bar Council, shall prepare and maintain a roll of advocates in which shall be entered the names and addresses of

(a) all persons who were entered as advocates on the roll of any High Court under the Indian Bar Councils Act, 1926 (38 of 1926), immediately before the appointed day ¹[including persons, being citizens of India, who before the 15th day of August, 1947, were enrolled as advocates under the said Act in any area which before the said date was comprised within India as defined in the Government of India Act, 1935, and who at any time] express an intention in the prescribed manner to practise within the jurisdiction of the Bar Council;

(b) all other persons who are admitted to be advocates on the roll of the State Bar Council under this Act on or after the appointed day.

(2) Each such roll of advocates shall consist of two parts, the first part containing the names of senior advocates and the second part, the names of other advocates.

(3) Entries in each part of the roll of advocates prepared and maintained by a State Bar Council under this section shall be in the order of seniority, ²[and, subject to any rule that may be made by the Bar Council of India in this behalf, such seniority shall be determined] as follows:

(a) the seniority of an advocate referred to in clause (a) of sub-section (1) shall be determined in accordance with his date of enrolment under the Indian Bar Council Act, 1926 (38 of 1926);

(b) the seniority of any person who was a senior advocate of the Supreme Court immediately before the appointed day shall, for the purposes of the first part of the State roll, be determined in accordance with such principles as the Bar Council of India may specify;

³[***]

(d) the seniority of any other person who, on or after the appointed day, is enrolled as a senior advocate or is admitted as an advocate shall be determined by the date of such enrolment or admission, as the case may be;

⁴[(e) notwithstanding anything contained in clause (a), the seniority of an attorney enrolled whether before or after the commencement of the Advocates (Amendment) Act, 1980 as an advocate shall be determined in accordance with the date of his enrolment as an attorney.]

(4) No person shall be enrolled as an advocate on the roll of more than one State Bar Council.

1. Substituted by Act 60 of 1973 for words “and who within the prescribed time”.

2. Substituted by Act 21 of 1964 for words “and, such seniority shall be determined”.
3. Clause (c) omitted by Act 60 of 1973, sec. 14 (w.e.f. 31-1-1974).
4. Inserted by Act 47 of 1980.

Section 18. Transfer of name from one State roll to another.

(1) Notwithstanding anything contained in section 17, any person whose name is entered as an advocate on the roll of any State Bar Council may make an application in the prescribed form to the Bar Council of India for the transfer of his name from the roll of that State Bar Council to the roll of any other State Bar Council and, on receipt of any such application the Bar Council of India shall direct that the name of such person shall, without the payment of any fee, be removed from the roll of the first mentioned State Bar Council and entered in the roll of the other State Bar Council and the State Bar Councils concerned shall comply with such direction

¹[PROVIDEO that where any such application for transfer is made by a person against whom any disciplinary proceeding is pending or where for any other reason it appears to the Bar Council of India that the application for transfer has not been made bona fide and that the transfer should not be made, the Bar Council of India may, after giving the person making the application an opportunity of making a representation in this behalf, reject the application].

(2) For the removal of doubts it is hereby declared that where on an application made by an advocate under sub-section (1), his name is transferred from the roll of one State Bar Council to that of another, he shall retain the same seniority in the latter roll to which he was entitled in the former roll.

1. Added by Act 21 of 1964.

Section 19. State Bar Councils to send copies of rolls of advocates to the Bar Council of India.

Every State Bar Council shall send to the Bar Council of India an authenticated copy of the roll of advocates prepared by it for the first time under this Act and shall thereafter communicate to the Bar Council of India all alterations in, the addition to, any such roll, as soon as the same have been made.

Section 20. Special provision for enrolment of certain Supreme Court advocates

¹[20. Special provision for enrolment of certain Supreme Court advocates

(1) Notwithstanding anything contained in this chapter, every advocate who is entitled as of right to practise in the Supreme Court immediately before the appointed day and whose name is not entered in any State roll may, within the prescribed time, express his intention in the prescribed form to the Bar Council of India for the entry of his name in the roll of a State Bar Council and on receipt thereof the Bar Council of India shall direct that the name of such advocate shall, without payment of any fee, be entered in the roll of that State Bar Council, and the State Bar Council concerned shall comply with such direction.

(2) Any entry in the State roll made in compliance with the direction of the Bar Council of India under sub-section (1) shall be made in the order of seniority determined in accordance with the provisions of sub-section (3) of section 17.

(3) Where an advocate referred to in sub-section (1) omits or fails to express his intention within the prescribed time, his name shall be entered in the roll of the State Bar Council of Delhi].

1. Subs. by Act 60 of 1973 sec. 15 for section 20 (w.e.f. 31-1-1974).

Section 21. Disputes regarding seniority.

(1) Where the date of seniority of two or more persons is the same, the one senior in age shall be reckoned as senior to the other.

¹[(2) Subject as aforesaid, if any dispute arises with respect to the seniority of any person, it shall be referred to the State Bar Council concerned for decision.]

—————

1. Subs. by Act 60 of 1973, sec. 16, for sub-section (2) (w.e.f. 31-1-1974).

Section 22. Certificate of enrolment

¹[22. Certificate of enrolment,

(1) There shall be issued a certificate of enrolment in the prescribed form by the State Bar Council of every person whose name is entered in the roll of advocates maintained by it under this Act.

(2) Every person whose name is so entered in the State roll shall notify any change in the place of his permanent residence to the State Bar Council concerned within ninety days of such change.]

1. Section 17 subs. By Act No. 60 of 1973 sec. 22 (w.e.f. 31-1-1974).

Section 23. Right of pre-audience.

(1) The Attorney General of India shall have pre-audience over all other advocates.

(2) Subject to the provisions of sub-section (1), the Solicitor-General of India shall have pre-audience over all other advocates.

(3) Subject to the provisions of sub-sections (1) and (2), the Additional Solicitor-General of India shall have pre-audience over all other advocates.

¹[(3A) Subject to the provisions of sub-sections (1), (2) and (3), the second Additional Solicitor-General of India shall have pre-audience over all other advocates.]

(4) Subject to the provisions of sub-section (1), ²[(2), (3) and (3A)] the Advocate General of any State shall have pre-audience over all other advocates, and, the right of pre-audience among Advocates-General inter se shall be determined by their respective seniority.

(5) Subject as aforesaid

(i) Senior advocates shall have pre-audience over other advocates; and

(ii) The right of pre-audience over senior advocates inter se and other advocates inter se shall be determined by their respective seniority.

1. Ins. By Act No. 47 of 1980 sec. 3 (w.e.f. 29-11-1980).

2. Subs. by Act 47 of 1980 for the brackets, figures and words “(2) and (3)”.

Section 24. Persons who may be adopted as advocates on a State roll.

(1) Subject to the provisions of this Act, and the rules made there under, a person shall be qualified to be admitted as an advocate on a State roll, if he fulfills the following conditions, namely:

(a) He is a citizen of India:

Provided that subject to the other provisions contained in this Act, a national of any other country may be admitted as an advocate on a State roll, if citizens of India, duly qualified, are permitted to practise law in that other country;

(b) He has completed the age of twenty-one years;

(c) He has obtained a degree in law

(i) Before the ¹[12th day of March, 19671 from any University, in the territory of India; or

(ii) Before the 15th of August, 1947, from any University in any area which was comprised before that date within India as defined by the Government of India Act, 1935; or

²[(iii) After the 12th day of March, 1967, save as provided in sub-clause (iii) After undergoing a three years course of study in law from any University in India which is recognised for the purposes of this Act by the Bar Council of India; or

(iiia) After undergoing a course of study in law, the duration of which is not less than two academic years commencing from the academic year 1967-68 or any earlier academic year from any University in India which is recognised for the purposes of this Act by the Bar Council of India; or]

³(iv) In any other case, from any University outside the territory of India, if the degree is recognised ‘for the purpose of this Act by the Bar Council of India] or;

⁴[He is a barrister and is called to the Bar on or before the 31st day of December, 1976 ⁵[or has passed the articled clerks’ examination or any other examination specified by the High Court at Bombay or Calcutta for enrolment as an attorney of that High Court;] or has obtained such other foreign qualification in law as is recognised by the Bar Council of India for the purpose of admission as an advocate under this Act]:

⁶[(d) * * *]

(e) He fulfills such other conditions as may be specified in the rules made the State bar Council under this Chapter;

⁷[(f) He has paid, in respect of the enrolment, stamp duty, if any, chargeable under the Indian Stamp Act 1899, and an enrolment fee payable to the State Bar Council of ⁸[six hundred rupees and to the Bar Council of India, one hundred and fifty rupees by way of a bank draft drawn in favour of that Council]:

Provided that where such person is a member of the Scheduled Castes or the Scheduled Tribes and produces a certificate to the effect from such authority as may be -scribed, the enrolment fee payable by him to the State Bar Council shall be⁹[one hundred rupees and to the Bar Council of India, twenty-five rupees].

¹⁰[Explanation -For the purposes of this sub-section, a person shall be deemed to have obtained a degree in law from a University in India on the date on which the results of the examination for that degree are published by the University on its notice-board or otherwise declaring him to have passed that examination].

(2) Notwithstanding anything contained in subsection (1) ¹¹[a vakil or a pleader who is a law graduate] may be admitted as an advocate on a State roll, if he

(a) Makes an application for such enrolment in accordance with the revisions of this Act, not later than two years from the appointed, day, and

(b) Fulfills the conditions specified in clauses (a), (b) and (f) of subsection (1)

¹²[(3) Notwithstanding anything contained in subsection (1) a person who

(a) ¹³[* * *] has, for at least three years, been a vakil or a pleader or a mukhtar or was entitled at any time to be enrolled under any law ¹³[* * *] as an advocate of a High Court (including a High Court of a former Part B State) or of a Court of Judicial Commissioner in any Union territory; or

¹⁴[(aa) Before the 1st day of December, 1961, was entitled otherwise than as an advocate to practise the profession of law (whether by way of pleading or acting or both) by virtue of the provisions of any law, or who would have been so entitled had he not been in public service on the said date; or]

¹⁵[(b) * * *]

(c) Before the 1st day of April, 1937, has been an advocate of any High Court in any area which was comprised within Burma as defined in the Government of India Act, 1935-, or

(d) Is entitled to be enrolled as an advocate under any rule made by the Bar Council of India in this behalf, may be admitted as an advocate on a State roll if he

(i) Makes an application for such enrolment in accordance with the provisions of this Act; and

(ii) Fulfills the conditions specified in clauses (a), (b), (e) and (f) of sub-section

¹⁶[(4) * * *]

1. Subs. by Act 60 of 1973 sec. 18 for 28th day of February 1963 (w.e.f. 31-1-1974).

2. Subs. By Act No. 60 of 1973 sec 18 for clause (iii) (w.e.f. 31-1-1974).

3. Ins by act 21 of 1964 sec. 13.

4. Subs. by Act 60 of 1973 sec. 18 for he is a barrister (w.e.f. 31-1-1974).

5. Ins. By Act No. 107 of 1976 sec. 6 (w.e.f. 15-10-1976).

6. Clause (d) omitted by Act 60 of 1973 sec. 18 (w.e.f. 31-1-1974).

7. Clause (f) subs. by Act 60 of 1973 sec. 18 (w.e.f. 31-1-1974).

8. Subs. By Act No. 70 of 1993 sec 6.

9. Subs. By Act No. 70 of 1993 sec 6.

10. Ins. By Act No. 14 of 1962 sec. 2

11. Subs by Act 21 of 1964 sec. 13 for certain words.

12. Sub-section (3) and (4) ins. by Act 21 of 1964 sec. 13.

13. The words before the 31st day of March 1964 and then in force omitted by act 33 of 1968 sec. 2 (w.e.f. 5-6-1968).

14. Sub-clause (aa) ins by act 60 of 1973 sec. 18 (w.e.f. 31-1-1974).

15. Sub clause (b) omitted by Act 60 of 1973 sec. 18 (w.e.f. 31-1-1974).

16. Sub-section (4) omitted by Act 107 of 1976 sec. 6.

Section 24A. Disqualification for enrolment

¹24A. Disqualification for enrolment

(1) No person shall be admitted as an advocate on a State roll

(a) If he is convicted of an offence involving moral turpitude.

(b) If he is convicted of an offence under the provision s of the Untouchables (Offences) Act, 1955.

²(c) (Note:- Ins. by Act 70 of 1993, sec.7) If he is dismissed or removed from employment or office under the State or any charge involving moral turpitude.

Explanation- In this clause, the expression “State” shall have the meaning assigned to it under article 12 of the Constitution.

Provided that the disqualification for enrolment as aforesaid shall cease to have effect after a period of two years has elapsed since his ³release or dismissal or, as the case may be, removal.

(2) Nothing contained in sub-section (1) shall apply to a person who having been found guilty is dealt with under the provision of the Probation of Offenders Act, 1958 (20 of 1958).

—————

1. Ins. by Act 60 of 1973, sec. 19 (w.e.f. 31-1-1974).

2. Ins. by Act 70 of 1993, sec. 7(i) (w.e.f. 26-12-1993).

3. Subs. by Act 70 of 1993, sec. 7(ii), for “release” (w.e.f. 26-12-1993).

Section 25. Authority to whom applications for enrolment may be made.

An application for admission as an advocate shall be made in the prescribed form to the State Bar Council within whose jurisdiction the applicant proposes to practise.

Section 26. Disposal of an application for admission as an Advocate.

(1) State Bar Council shall refer every application for admission as an advocate to its enrolment committee, and subject to the provisions of sub-section (2) and (3),¹[and to any direction that may be given in writing by the State Bar Council in this behalf] such committee shall dispose of the application in the prescribed manner:

²[Provided that the Bar Council of India may, if satisfied, either on a reference made to it in this behalf or otherwise, that any person has got his name entered on the roll of advocates by misrepresentation as to an essential fact or by fraud or undue influence, remove the name of such person from the roll of advocates after giving him an opportunity of being heard.]

(2) Where the enrolment committee of State Bar Council proposes to refuse any such application, it shall refer the application for opinion to the Bar Council of India and every such reference shall be accompanied by a statement of the grounds in support of the refusal of the application.

(3) The enrolment committee of State Bar Council shall dispose of any application referred to the Bar Council of India under sub-section (2) in conformity with the opinion of the Bar Council of India.

¹[(4) Where the enrolment committee of a State Bar Council has refused any application for admission as an advocate on its roll, the State Bar Council shall as soon as may be, send intimation to all other State Bar Councils about such refusal stating the name, address and qualifications of the person whose application was refused and the grounds for the refusal.]

1. Ins. By Act 21 No. of 1964 sec. 14

2. Added by Act No.21 of l964. sec. 14

Section 26A. Power to remove names from roll.

¹[26A. Power to remove names from roll.

-A State Bar Council may remove from the State roll the name of any advocate who is dead or from whom a request has been received to that effect.]

1. Subs. by Act No. 60 of 1973 sec 20 for section 26A (w.e.f. 31-1-1974

Section 27. Application once refused not to be entertained by another Bar Council except in certain circumstances.

Where a State Bar Council has refused the application of any person for admission as an advocate on its roll, no other State Bar Council shall entertain an application for admission of such person as an advocate on its roll, except with the previous consent in writing of the State Bar Council which refused the application and of the Bar Council of India.

Section 28. Power to make rules.

(1) A State Bar Council may make rules to carry out the purposes of this Chapter.

(2) In particular, and without prejudice to the generality of the foregoing power, such rules may provide for

¹[(a) The time within which and form in which an advocate shall express his intention for the entry of his name in the roll of a State bar Council under Section 20;]

²[(b) * * *]

(c) The form in which an application shall be made to the Bar Council for admission as an advocate on its roll and the manner in which such application shall be disposed of by the enrolment committee of the Bar Council;

(d) The conditions subject to which a person may be admitted as an advocate on any such roll:

(e) The instilments in which the enrolment fee may be paid.

(3) No rules made under this Chapter shall have effect unless the Bar Council of India has approved them.

1. Clause (a) subs. by Act No. 60 of 1973 sec 21.

2. Clause (b) Omitted by Act No. 60 of 1973 sec. 21 (w.e.f. 31-1-1974)

Section 29. Advocates to be the only recognised class of persons entitled to practice law.

Subject to the provisions of this Act and any rules made thereunder, there shall, as from the appointed day, be only one class of persons entitled to practise the profession of law, namely, advocates.

Section 30. Right of advocates to practise.

Subject to provisions of this Act, every advocate whose name is entered in the ¹[State roll] shall be entitled as of right to practise throughout the territories to which this Act extends,

(i) In all Courts including the Supreme Court;

(ii) Before any tribunal or person legally authorised to take evidence; and

(iii) Before any other authority or person before whom such advocate is by or under any law for the time being in force entitled to practice.

—————

1. Subs. by Act 60 of 1973, sec. 22, for “common roll” (w.e.f. 31-1-1974).

Section 31. Special provision for attorneys

Omitted by the advocates (amendment) act 1976 (107 of 1976) sec. 7.

Section 32. Power of Court to permit appearances in particular cases.

Notwithstanding anything contained in this chapter, any court, authority or perse may permit any person, not enrolled as an advocate under this Act, to appear before or him in any particular case

Section 33. Advocates alone entitle to practise.

Except as otherwise provided in this Act or in any other law for the time being in force, no person shall, on or after the appointed day, be entitled to practise in any court or before any authority or person unless he is enrolled as an advocate under this Act

Section 34. Power of High Courts to make rules.

(1) The High Court may make rules laying down the conditions subject to which an advocate shall be permitted to practise in the High Court and the courts subordinate thereto.

¹[(1A) The High Court shall make rules for fixing and regulating by taxation or otherwise the fees payable as costs by any party in respect of the fees of his adversary’s advocate upon all proceedings in the High Court or in any Court subordinate thereto.

²[(2) Without prejudice to the provisions contained in sub-section (1), the High Court at Calcutta may make rules providing for the holding of the Intermediate and the Final examinations for articled clerks to be passed by the persons referred to in Section 58 AG for the purpose of being admitted as advocates on the State roll and any other matter connected therewith.]

³[(3) * * *]

1. Ins. By Act No. 60 of 1973 sec 23 (w.e.f. 31-1-1974).

2. Omitted by act 107 of 1976 sec. 8 (w.e.f. 1-1-1977 and again ins. by Act No. 38 of 1977 sec 6 (w.e.f. 31-10-1977.

3. Omitted by Act No. 107 of 1976 sec 8 (w.e.f. 1-1-1977.

Section 35. Punishment of advocates for misconduct.

(1) Where on receipt of a complaint or otherwise a State Bar Council has reason to believe that any advocate its roll has been guilty of professional or other misconduct, it shall refer the case for disposal to its disciplinary committee.

¹[(1A) The State Bar Council may, either of its own motion or on application made to it by any person interested, withdraw a proceeding pending before its disciplinary committee mid direct the inquiry to be made by any other disciplinary committee of that State Bar Council;]

(2) The disciplinary committee of a State Council ²[***] shall fix a date for the hearing of the case and shall cause a notice thereof to be given to the advocate concerned and to the Advocate General of the State.

(3) The disciplinary committee of a State Bar Council after giving the advocate concerned and the Advocate-General an opportunity of being heard, may make any of the following orders, namely: –

(a) Dismiss the complaint or, where the proceedings were initiated at the instance of the State Bar Council, direct that the proceedings be filed;

(b) Reprimand the advocate;

(c). Suspend the advocate from practice for such period as it may deemed fit;

(d) Remove the name of the advocate from the State roll of advocates.

(4) Where an advocate is suspended from practice under clause(c) of subsection (3) he shall, during the period of suspension, be debarred from practicing in any court or before any authority or person in India.

(5) Where any notice is issued to the Advocate-General under subsection (2), the Advocate-General may appear before the disciplinary committee of the State Bar Council either in person or through any advocate appearing on his behalf.

³[Explanation. -In this section ⁴[Section 37 and Section 38] the expression Advocate General’ and ‘Advocate-General of the State’ shall, in relation to the Union territory of Delhi, mean the Additional Solicitor General of India].

1. Ins. by Act 60 of 1973, sec. 24 (w.e.f. 31-1-1974).

2. The words “, if it does not summarily reject the complaint,” omitted by Act 60 of 1973, sec. 24 (w.e.f. 31-1-1974)

3. Ins. by Act 21 of 1964, sec. 17 (w.e.f. 16-5-1964).

4. Ins. by Act 60 of 1973, sec. 24 (w.e.f. 31-1-1974).

Section 36. Disciplinary powers of Bar Council of India.

(1) Where on receipt of a complaint or otherwise the Bar Council of India has reason to believe that any advocate¹[***] whose name is not entered on any State roll has been guilty of professional or other misconduct, it shall refer the case for disposal to its disciplinary committee.

(2) Notwithstanding anything contained in this Chapter the disciplinary committee of the Bar Council of India may,

²[either of its own motion or on a report by any State Bar Council or an application made to it by any person interested], withdraw for inquiry before itself any proceedings for disciplinary action against any advocate pending before the disciplinary committee of any State Bar Council and dispose of the same.

(3) The disciplinary committee of the Bar Council of India disposing of any case under this section, shall observe, so far as may be, the procedure laid down in Section 35, the references to the Advocate-General in that section being construed as references to the Attorney-General of India.

(4) In disposing of any proceedings under this section the disciplinary committee of’ the Bar Council of India may make any order which the disciplinary committee of a State Bar Council can make under sub-section (3) of Section 35, and where any proceedings have been withdrawn for inquiry ³before the disciplinary committee of the Bar Council of India the State Bar Council concerned shall give effect to any such order.

1. The words “on the common roll” omitted by Act 60 of 1973, sec. 25 (w.e.f. 31-1-1974).

2. Subs. by Act 60 of 1973, sec. 25, for “of its own motion” (w.e.f. 31-1-1974).

3. Subs. by Act 60 of 1973, sec. 25, for “before the Bar Council of India” (w.e.f. 31-1-1974).

Section 36A. Changes in constitution of disciplinary committees.

¹[36A. Changes in constitution of disciplinary committees.

Whenever in respect of any proceedings under Section 35 or Section 36, a disciplinary committee of the State Bar Council or a disciplinary committee of the Bar Council of India cease to exercise jurisdiction and is succeeded by another committee which has and exercises jurisdiction, the disciplinary committee of the State Bar Council or the disciplinary committee of the Bar Council of India, as the case may be, so succeeding may continue the proceedings from the stage at which the proceedings were so left by its predecessor committee.

1. Ins. By Act 60 No. of 1973 sec. 26 (w.e.f. 31-1-1974.

Section 36B. Disposal of disciplinary proceedings

¹ Disposal of disciplinary proceedings

(1) The disciplinary committee of a State Bar Council shall dispose of the complaint received by it under Section 35 expeditiously and in each case the proceedings shall be concluded within a period of one year from the date of the receipt of the complaint or the date of initiation of the proceedings at the instance of the State Bar Council, as the case may be, failing which such proceedings shall stand transferred to the Bar Council of India which may dispose of the same as if it were a proceeding withdrawn for inquiry under sub-section (2) of Section 36.

(2) Notwithstanding anything contained in sub-section (1), where on the commencement of the Advocates (Amendment) Act” 1973, any proceedings in respect of any disciplinary matter against an advocate is pending before the disciplinary committee of a State Bar Council, that disciplinary committee of the State bar Council shall dispose of the same within a period of six months from the date of such commencement or within a period of one year from the date of the receipt of the complaint or, as the case may be, the date of initiation of the proceedings at the instance of the State Bar Council, whichever is later, failing which such other proceedings shall stand transferred to the Bar Council of India for disposal under sub-section (1).]

—————

1. Ins. by Act 60 of 1973, sec. 26 (w.e.f. 31-1-1974).

Section 37. Appeal to the Bar Council of India.

(1) Any person aggrieved by in order of the disciplinary committee of a State Bar Council made ¹[under Section 35] ²[or the Advocate-General of the State] may, within sixty days of the date of the communication of the order to him, prefer an appeal to the Bar Council of India.

(2) Every such appeal shall be heard by the disciplinary committee of the Bar Council of India which may pass such order ²[including an order varying the punishment awarded by the disciplinary committee of the State Bar Council] thereon as it deems fit.

²[Provided that no order of the disciplinary committee of the State Bar Council shall be varied by the disciplinary committee of the Bar Council of India so as to prejudicially affect the person aggrieved without giving him reasonable opportunity of being heard.]

1. Subs. By Act No. 21 Of 1964, for the words ‘under subsection (3) of Section 35.

2. Ins. by Act No. 60 of 1973.

Section 38. Appeal to the Supreme Court.

Any person aggrieved by an order made by’ the disciplinary committee of the Bar Council of India under Section 36 or Section 37 ¹[or the Attorney-General of India or the Advocate-General of the State concerned as the case may be], within sixty days of the date on which the order is communicated to him, prefer an appeal to the Supreme Court and the Supreme Court may pass such order ¹[including an order varying the punishment awarded by the disciplinary committee of the Bar Council of India] thereon as it deems fit:

¹[Provided that no order of the disciplinary committee of the Bar Council of India shall be varied by the Supreme Court so as to prejudicially affect the person aggrieved without giving him a reasonable opportunity of being heard.]

1. Ins. by Act No. 60 of 1973.

Section 39. Application of Sections 5 and 12 of Limitation Act, 1963.

¹[39. Application of Sections 5 and 12 of Limitation Act, 1963.

The provisions of Sections 5 and 12 of the Limitation Act, 1963, shall, so far as may be, apply to appeals under Section 37 and Section 38.]

1. Subs. by Act 60 of 1973 sec. 29 (w.e.f. 31-1-1974.)

Section 40. Stay of order

¹ [(1)] An appeal, made under Section 37 or Section 38, shall not operate as a stay of the order appealed against, but the disciplinary committee of tire Bar Council of India or the Supreme Court, as the case may be, (c) may for sufficient cause direct the stay of such order on such terms and conditions as it may deem fit.

¹[(2) Where an application is made for the stay of the order before the expiration of the time allowed for appealing there from under Section 37 or Section 38, the disciplinary committee of the State Bar Council, or the disciplinary committee of the Bar Council of India, as the case may be, may, for sufficient cause, direct the stay of such order on such terms and conditions as it may deem fit.]

1. Sec. 40 renumbered as sub-s. (1) thereof and sub-s. (2) inserted by Act 60 of 1973 sec. 30.

Section 41. Alteration in roll of Advocates.

(1) Where an order is made under this Chapter reprimanding or suspending an advocate, a record of the punishment shall be entered against his name

(a) In the case of an advocate whose name is entered in a State roll, in that roll

¹[(b) * * * ]

Anywhere any order is made removing an advocate from practice his name shall be struck off the State roll ²[***].

¹[(2) * * *]

(3) Where any advocate is suspended or removed from practice, the certificate granted to him under Section 22, in respect of his enrolment shall be recalled.

1. Omitted by Act No. 60 of 1973.

2. Words “or the common roll, as the cases may be” omitted by Act 60 of 1973.

Section 42. Powers of disciplinary committee.

(1) The disciplinary committee of the Bar Council shall have the same powers as are vested in a civil court under the Code of Civil Procedure, 1908 (5 of 1908), in respect of the following matters, namely:

(a) Summoning and enforcing the attendance of any person and examining him on oath;

(b) Requiring discovery and production of any documents;

(c) Receiving evidence on affidavit;

(d) Requisitioning any public record or copies thereof from any court or office;

(e) Issuing commissions for the examination of witness or documents;

(f) Any other matter, which may be prescribed:

Provided that no such disciplinary committee shall have the right to require the attendance of

(a) Any presiding officer of a court except with the previous sanction of the High Court to which court is subordinate;

(b) Any officer of a revenue court except with the previous sanction of the State Government.

(2) All proceedings before a disciplinary committee of a Bar Council shall be deemed to be judicial proceedings within the meaning (.if Sections 193 and 228 of the Indian Penal Code, 1860 (45 of 1960), and every such disciplinary committee shall be deemed to be a civil court for the purpose of Sections 480, 482and 485 of Code of Criminal Procedure, 1898 (5 of 1898).

(3) For the purpose of exercising any of the powers conferred by subsection (1), a disciplinary committee may send to any civil court in the territories to which this Act extends, any summons or other process, for the attendance of a witness or the production of a document required by the committee or any commission which it desires to issue, and civil court shall cause such process to be served or such commission to be issued as the case may be, and may enforce any such process as if it were a process for attendance or production before itself.

¹[(4) Notwithstanding the absence of the Chairman or any member’ of a disciplinary committee on a date fixed for the hearing of a case before it, the disciplinary committee may, if it so thinks fit, hold or continue the proceedings on the date so fixed and no such proceedings and no order made by the disciplinary committee in any such proceedings shall be invalid merely by reason of the absence of the Chairman or member thereof on any such date:

Provided that no final orders of the nature referred to in sub-section (3) of Section 35 can be made in any proceedings unless the Chairman and other members of the disciplinary committee are present.

²(5) Where no final order of the nature referred to in subsection (3) of Section 35 can be made in any proceedings in accordance with the opinion of the Chairman and the members of a disciplinary committee either for want of majority opinion amongst themselves or otherwise, the case, with their opinion thereon, shall be laid before the Chairman of the Bar Council concerned or if the Chairman of’ the Bar Council is acting as the Chairman or a member of the disciplinary committee, before the Vice-Chairman of the Bar Council, and the said Chairman or the Vice-Chairman of the Bar Council, as the case may be, after such hearing as he thinks fit, shall deliver his opinion and the final order of the disciplinary committee shall follow such opinion.]

1. See now the Code of Criminal Procedure, 1973 (Act 2 of 1974), sections 345 (1), 346 and 349.

2. Ins. by Act 60 of 1973, sec. 32 (w.e.f. 31-1-1974).

Section 42A. Power of Bar Council of India and other committees.

¹[42A. Power of Bar Council of India and other committees.

The provisions of Section 42, shall so far as may be, apply in relation to tie Bar Council of India, the enrolment committee, the election committee., the legal aid committee, or any other committee of a Bar Council as they apply in relation to the disciplinary committee of a Bar Council.]

1. Ins. By Act No. 60 of 1973 sec. 33 (w.e.f. 31-1-1974).

Section 43. Cost of proceedings before a disciplinary committee.

The disciplinary committee to a Bar Council may, make such order as to the cost of any proceedings before it as it may deem fit and any such order shall be executable as if it were an order

(a) in the case of an order of the disciplinary committee of the Bar Council of India, of the Supreme Court;

(b) in the case of an order of the disciplinary committee of a State Bar Council, of the High Court.

Section 44. Review of orders by disciplinary committee.

The disciplinary committee of a Bar Council may of its own motion or otherwise review any order ¹[(within sixty days of the date of that order] passed by it under this Chapter:

PROVIDED that no such order of review of the disciplinary committee of a State Bar Council shall have effect unless it has been approved by the Bar Council of India.

—————

1. Ins. by Act 60 of 1973, sec. 34 (w.e.f. 31-1-1974).

Section 45. Penalty for persons illegally practicing in courts and before other authorities.

Any person who practises in any court or before any authority or person, in or before whom he is not entitled to practise under the provisions of this Act, shall be punishable with imprisonment for a term which may extend to six months.

Section 46. Payment of part of enrolment fees to the Bar Council of India

¹46. Payment of part of enrolment fees to the Bar Council of India

[Omitted by Act 70 of 1993]

——–

1. Earlier section 46 was substituted by Act 107 of 1976, sec. 9 (w.e.f. 15-10-1976).

46A. Financial assistance to State Bar Council.

¹[46A. Financial assistance to State Bar Council.

The Bar Council of India may, if it is satisfied that any State Bar Council is in need of funds for the purpose of performing its functions under this Act, give such financial assistance as it deems fit to that Bar Council by way of grant or otherwise.]

1. Ins. By Act No. 60 of 1973 sec. 35 (w.e.f. 31-1-1974).

Section 47. Reciprocity.

(1) Where any country, specified by the Central Government in this behalf by noti fication in the Official Gazette, prevents citizens of India from practising the profession of law or subjects them to unfair discrimination in that country, no subject of any such country shall be entitled to practise the profession of law in India.

(2) Subject to the provisions of sub-section (1), the Bar Council of India may prescribe the conditions, if any, subject to which foreign qualifications in law obtained by persons other than citizens of India shall be recognised for the purpose of admission as an advocate under this Act.

Section 48. Indemnity against legal proceedings.

No suit or other legal proceeding shall lie against any Bar Council or any committee thereof or a member of a Bar Council ¹[or any Committee thereof for any act in good faith done or intended to he done in pursuance of the provisions of this Act or of any rules made there under.

—————

1. Ins. by Act 60 of 1973, sec. 36 (w.e.f. 31-1-1974).

Section 48A. Power of revision.

¹[48A.Power of revision.

(1) The Bar Council of India may, at any time, call for the record of any proceeding under this Act which has been disposed of by a State Bar Council or a Committee thereof, and from which no appeal lies, for the purpose of satisfying itself as to the legality or propriety of such disposal it may pass such orders in relation thereto as it may think fit.

(2) No order, which prejudicially affects any person, shall be passed under this section without giving him a reasonable opportunity of being heard.]

1. Ins. By Act No. 21 of 1964 sec. 19.

Section 48AA. Review.

¹[48AA. Review.

The Bar Council of India or any of its committees. Other than its disciplinary committee, may of its own motion or otherwise review any order, within sixty days of the date of that order, passed by it under this Act.]

1. Ins. By Act No. 60 of 1973 sec. 37 (w.e.f. 31-1-1974).

Section 48B. Power to give directions.

¹[48B.Power to give directions.

(1) For the proper and efficient discharge of the functions of a State Bar Council or any Committee thereof, the Bar Council of India may, in the exercise of its powers of general supervision and control, give such directions to the State Bar Council or any committee thereof as may appear to it to be necessary, and the State Bar Council or the committee shall comply with, such directions.

(2) Where a State Bar Council is unable to perform its functions for any reason whatsoever, the Bar Council of India may, without prejudice to the generality of the foregoing power, give such directions to the ex officio member thereof as may appear to it to be necessary, and such directions shall have effect notwithstanding anything contained in the rules made by the State Bar Council.]

1. Ins. By Act No. 21 of 1968 sec 19.

Section 49. General power of the Bar Council of India to make rules.

¹[(1)] The Bar Council of India may make rules for discharging its functions under this Act and particular, such rules may prescribe.]

²[(a) the conditions subject to which an advocate may he entitled to vote at an election to the State Bar Council, including the qualifications or disqualifications of voters, and the matter in which an electoral roll of voters may be prepared and revised by a State Bar Council;

(ab) Qualifications for membership of a Bar Council and the disqualifications for such membership;

(ac) the time within which and the manner in which effect may be given to the proviso to sub-section (2) of Section 3;

(ad) The manner in which the name of any advocate may be prevented from being entered in more than one State roll; (ae) The manner in which the seniority among advocates may be determined;

³(af) The minimum qualifications required for admission to a course of degree in law in any recognised University;]

(ag) The class or category of persons entitled to be enrolled as advocates;

(ah) The conditions subject to which an advocate shall have the right to practise and the circumstances under which a person shall be deemed to practise as an advocate in a court;]

(b) The form in which an application shall be made for the transfer of the names of advocates from one State roll to another;

(c) The standards of professional conduct and etiquette to be observed by advocates;

(d) The standards of legal education to be observed by university in India and the inspection of Universities for that purpose;

(e) The foreign qualifications in law obtained by person other than citizens of India, which shall be recognised for the purpose of admission as an advocate under this Act;

(f) The procedure to be followed by the disciplinary committee of State Bar Council and by its own disciplinary committee;

(g) The restrictions in the matter of practice to which senior advocates shall be subject;

⁴[(gg) The form of dresses or robes to be worn by advocates, having regard to the climatic conditions, appearing before any court or tribunal];

(h) The fees, which may be levied in respect of any matter under this Act;

²[(i) general principles for guidance of State Bar Councils and the manner in which directions issued or orders made by the Bar Councils of India may be enforced;]

(j) Any other matter, which may be prescribed:

³[Provided that no rules made with reference to clause (c) or clause (gg) shall have effect unless they have approved by the Chief Justice of India]:

¹ [Provided further that] no rules made with reference to clause (e) shall have effect unless they have been approved by the Central Government.

³[(2) Notwithstanding anything contained in the first proviso to sub-section (1), any Rule made with reference to clause (c ) or clause (gg) of the said sub-section and in force immediately before commencement of the Advocates (Amendment) Act, 1973, shall continue in force until altered or amended in accordance with the provisions if this Act ]

1. Section 49 renumbered as sub-section (1) by Act No. 60 of 1973, and sub-section (2) added.

2. Sub. by Act No. 21 of 1964.

3. Subs. by Act No. 60 of 1973.

4. Subs. by Act No. 60 of 1973, for words “Provided that”.

49A. Power of central government to make rules.

¹[49A. Power of central government to make rules.

(1) The Central Government may, by notification in the official Gazette, make for carrying out the purposes of this Act including rules with respect to any matter for which the Bar Council of India or State Bar Council has power to make rules.

(2) In particular and without prejudice to the generality of the foregoing power, such rules may provide for.

(a) Qualification of membership of Bar Council and disqualifications for such membership;

(b) The manner in which the Bar Council of India may exercise supervision and control over state Bar Council and the manner in which the directions issued or orders made by the Bar Council of India may be enforced;

(c) The class or category of persons entitled to be enrolled as advocates under this Act;

(d) The category of persons who may be exempted from undergoing a course of training and passing an examination prescribed under clause (d) of sub-section (1) of Section24;

(e) The manner in which seniority among advocates may be determined;

(f) The procedure to be followed by a disciplinary committee of a Bar Council in hearing cases and the procedure to be followed by a disciplinary committee of the Bar Council of India in hearing appeals;

(g) Any other matter, which may be prescribed.

(3) Rules under this section may be made either for the whole of India or for all or any of the Bar Councils.

(4) If any provision of a rule made by a bar Council is repugnant to nay provision of a rule made by the Central Government under this section, then, the rule under this section, whether made before or after the rule made by the Bar Council shall prevail and the rule made by the Bar Council shall, to the extent of the repugnancy, be void.

²[(5) Every rule made under this section shall be laid, as soon as may be after it is made, before each House of Parliament, while it is session for a total period of thirty days Which may be comprised in one session or in two or more successive sessions and if, before the expiry of the sessions immediately following the session or the successive sessions aforesaid, both Houses agree in making any modification in the rule or both Houses agree that the rule should not be made, the rule shall thereafter have effect only in such modified form or be of no effect, as the case may be; so, however, that any such modification or annulment shall be without prejudice to the validity of anything previously done under that rule].

Section 50 Ins. by Act No. 21 of 1964.

2. Subs. by Act No. 60 of 1973 sec. 39 (w.e.f. 31-1-1974. 50. Repeal of certain enactments.

(1) On the date on which a State Bar Council is constituted under this Act, the provisions of Sections 3 to 7 (inclusive), sub-sections (1), (2) and (3) of Section 15 and Section 20 of the Indian Bar Council Act, 1926 (38 of 1926), shall stand repealed in the territory for which the State Bar Council is constituted.

(2) On the date on which Chapter III comes into force, the following shall stand repealed namely.

(a) Sections 6, 7, 18, and 37 of the Legal Practitioners Act, 1879 (18 of 1879) and so much of Sections 8, 9, 16, 17, 19 and 41 of that Act as relate to the admission and enrolment of legal practitioners;

(b) Sections 3, 4 and 6 of the Bombay Pleaders Act, 1920 (Bombay Act 17 of 1920);

(c) So much of Section 8-of the Indian Bar Councils Act, 1926 (38 of 1926), as relate to the admission and enrolment of legal practitioners;

(d) the provisions of the Letters Patent of any High Court and of any other law in so far as they relate to the admission and enrolment of legal practitioners.

(3) On the date on which Chapter IV comes into force, the following shall stand repealed, namely:

(a) Sections-4, 5, 10, and 20 of the Legal Practitioners Act, 1879 (18 of 1879), and so much of Sections 8, 9, 19 and 41 of that Act as confer on legal practitioners the right to practise in any court or before any authority or person;

(b) Sections 5, 7, 8 and 9 of the Bombay Pleaders Act, 1920 (Bombay Act 17 of 1920);

(c) Section 14 of the Indian Bar Councils Act, 1926 (39 of 1926), and so much of Sections 8 and 15 of that Act as confer on legal practitioners the right to practise in any court or before any authority or person;

(d) The Supreme Court Advocates (Practice in High Courts) Act, 1951 (18 of 195 1);

(e) The provisions of the Letters Patent of any High Court and of any other law conferring on legal practitioners the right to practise in any, court or before any authority or person.

(4) On the date on which Chapter V comes into force, the following shall stand repealed, namely:

(a) Sections 12 to 15 (inclusive), Sections 21 to 24 (inclusive) and Sections 39 and 40 of the Legal Practitioners Act, 1879 (19 of 1979), and so much of Sections 16, 17 and 41 of that Act as relate to the suspension, removal or dismissal of legal practitioners;

(b) Sections 24 to 27 (inclusive) of the Bombay Pleaders Act, 1920 (17 of 1920);

(c) Sections 10 to 13 (inclusive) of the Indian Bar Council Act, 1926 (38 of 1926);

(d) The provisions of the Letters Patent of any High Court and of any other law in so far as they relate to the suspension, removal or dismissal of legal practitioners,

(5). When the whole of this Act has come into force

(a) The remaining provisions of the Acts referred to in this section which do not stand repealed by virtue of any of the foregoing provisions of this section (except Sections 1, 3 and 36 of the Legal Practitioners Act, 1879 (19 of 1879) shall stand repealed;

(b) The enactments specified in the Schedule shall stand repealed to the extent mentioned therein.

Section 51. Rule of construction.

On and from the appointed day, references in any enactment to an advocate enrolled by a High Court in any form of words shall be construed as references to an advocate enrolled under this Act.

(2) On the date on which Chapter III comes into force, the following shall stand repealed namely.

Section 52. Saving.

Nothing in this Act shall be deemed to affect the power of the Supreme Court to make rules under Article 145 of the Constitution

(a) for laying down the conditions subject to which a senior advocate shall be entitled to practise in that court;

(b) for determining the persons who shall be entitled to ¹[act or plead] in that court

—————

1. Subs. by Act 70 of 1993, sec. 9, for “act” (w.e.f. 26-12-1993).

Section 53. Elections to first State Bar Council.

Notwithstanding anything contained in this Act, the elected members of a State Bar Council constituted for the first time under this Act, shall be elected by and from amongst advocates, vakils, pleaders and attorneys who on the date of the election, are entitled as of right to practise in the High Court and are ordinarily practising within the territory for which the Bar Council is to be constituted.

1. -Where the territory for which the Bar Council is to be constituted includes a Union territory, the expression ‘High Court’ shall include the Court of the Judicial Commissioner of that Union territory.

Section 54. Term of office of members of first State Bar Council.

Term of office of members of first ¹[ * * *] State Bar Council

Notwithstanding anything contained in this Act, the term of office of the ²[* * *] elected members of ¹[* * *] a State Bar Council constituted for the first time, shall be two years from the date of the first meeting of the Council:

³[Provided that such members shall continue to hold office until the State Bar Council is reconstituted in accordance with the provisions of this Act.

1. Words “the Bar Council of India and” omitted by Act 21 of 1964.

2. Words “nominated and” omitted by Act 14 of 1962.

3. Ins. By Act 21 of 1964 sec.22(ii) and shall be deemed to have always been inserted.

Section 55. Right of certain existing legal practitioners not affected. Notwithstanding anything contained in this Act,

(a) Every pleader or vakil practising as such immediately before the date on which Chapter IV comes into force (hereinafter in this section referred to as the said date) by virtue of the provisions of-the Legal Practitioners Act, 1879 (18 of 1879), the Bombay Pleaders Act, 1920 (17 of 1920), or any other law who does not elect to be or is not qualified to be enrolled as an advocate under this Act:

¹[(b) [* * *]

²[(c) every mukhtar practising as such immediately before the said date by virtue the provisions of the Legal Practitioners Act, 1879, or any other law, who does not elect to be, or is not qualified to be, enrolled as an advocate under this Act; (d) Every revenue agent practising as such immediately before the said date by virtue of the provisions of the Legal Practitioners Act, 1879 or any other law];

shall, notwithstanding the repeal by this Act of the relevant provisions of the Legal Practitioners Act, 1879 (18 of 1879), the Bombay Pleaders Act, 1920 (Bombay Act 17 of 1920) or other law, continue to enjoy the same rights as respects practice in any court or revenue office or before any authority or person and be subject to the disciplinary jurisdiction of the same authority which he enjoyed or, as the case may be, to which he was subject immediately before the said date and accordingly the relevant provisions of the Acts or law aforesaid shall have effect in relation to such persons as if they had not been repealed.

—————

1. Clause (b) omitted by Act 107 of 1976, sec. 10 (w.e.f. 1-1-1977).

2. Subs. by Act 21 of 1964, sec. 23, for clause (c) (w.e.f. 16-5-1964).

Section 56. Dissolution of existing Bar Council.

(1) On the constitution under this Act of a State Bar Council other than the Bar Council of Delhi hereinafter referred to as the new Bar Council:

(a) All properties and assets vesting in the corresponding Bar Council shall vest in the new Bar Council;

(b) All rights, liabilities, and obligations of the corresponding Bar Council whether arising out of any contract or otherwise, shall be the rights, liabilities and obligations respectively of this new Bar Council;

(c) All proceedings pending before the corresponding Bar Council in respect of any disciplinary matter or otherwise shall stand transferred to the new Bar Council.

(2) In this section, ‘corresponding Bar Council’ in relation to a State Bar Council, other than the Bar Council of Delhi, means the Bar Council for the High Court in the territory for which the State Bar Council is constituted under this Act.

Section 57. Power to make rules pending the constitution of a Bar Council.

Until a Bar Council is constituted under this Act the power of that Bar Council to make rules under this Act shall be exercised

(a) In the case of the Bar Council of India, by the Supreme Court;

(b) In the case of a State Bar Council, by the High Court.

Section 58. Special provisions during the transitional period.

1[58.Special provisions during the transitional period

(1) Where a State Bar Council has not been constituted under this Act or where a State Bar Council so constituted is unable to perform its functions by reason of any order of a court or otherwise, the functions of the Bar Council or any committee thereof, insofar as they relate to the admission and enrolment of advocates, shall be performed by the High Court in accordance with the provisions of this Act.

(2) Until Chapter IV comes into force, a State Bar Council or a High Court performing the functions of a State Bar Council may enroll any person to be an advocate on a State roll, if he is qualified to be so enrolled under this Act, notwithstanding that no rules have been made under section 28 or that the rules so made have not been approved by the Bar Council of India, and every person so enrolled shall, until that chapter comes into force, be entitled to all the rights of practice conferred on an advocate under section 14 of the Indian Bar Councils Act, 1926 (38 of 1926).

(3) Notwithstanding anything contained in this Act, every person who, immediately before the 1st day of December, 1961, was an advocate on the roll of any High Court under the Indian Bar Councils Act, 1926 (38 of 1926) or who has been enrolled as an advocate under this Act shall, until Chapter IV comes into force, be entitled as of right to practise in the Supreme Court, subject to the rule made by the Supreme Court in this behalf.

(4) Notwithstanding the repeal by sub-section (2) of section 50 of the provisions of the Legal Practitioners Act, 1879 (18 of 1879) or of the Bombay Pleaders Act, 1920 (17 of 1920) 2[or of any other law relating to the admission and enrolment of legal practitioners, the provisions of the Acts and law aforesaid] and any rules made thereunder insofar as they relate to3[the renewal or the issue byway of renewal] of a certificate to a legal practitioner authorising him to practise shall have effect until Chapter IV comes into force and, accordingly, every certificate issued or renewed to legal practitioner (who is not enrolled as an advocate under this Act) which is or purports to be issued or renewed under the provisions of either of the aforesaid Acts4[or of the other law] during the period beginning with the 1st day of December, 1961 and ending with the date on which Chapter IV comes into force, shall be deemed to have been validly issued or renewed.]

1 Inserted by Act 14 of 1962.

2 Words “relating to the admission and enrollment of legal practitioners, the provisions of those Act” substituted by Act 32 of 1962.

3 Words “the issue and renewal” substituted by Act 21 of 1964.

4 Inserted by Act 32 of 1932.

Section 58A. Special provisions With respect to certain Advocates.

¹[58A Special provisions with respect to certain advocates

(1) Notwithstanding anything contained in this Act, all advocates who, immediately before the 26th day of July, 1948, were entitled to practise in the High Court in Allahabad or the Chief Court in Oudh and who under the provisions of the United Provinces High Courts (Amalgamation) Order, 1948 were recognised as advocates entitled to practise in the new High Court of Judicature at Allahabad but whose names were not formally entered on the roll of advocates of that High Court merely by reason of the non-payment of the fee payable to the Bar Council of the said High Court, and all advocates who were enrolled as such between the said date and the 26th day of May, 1952, shall, for the purposes of clause (a) of sub-section (1) of section 17 be deemed to be persons who were entered as advocates on the roll of the said High Court under the Indian Bar Councils Act, 1926 (38 of 1926) and every such person may, on an application being made in this behalf, be admitted as an advocate on the State roll of Uttar Pradesh.

(2) Notwithstanding anything contained in this Act, all advocates who, immediately before the 10th day of October, 1952 were entitled to practise in the High Court of Hyderabad but whose names were not formally entered on the roll of advocates of that High Court merely by reason of the non-payment of the fee payable to the Bar Council of the said High Court shall, for the purposes of clause (a) of sub-section (1) of section 17 be deemed to be persons who were entered as advocates on the roll of the said High Court under the Indian Bar Councils Act, 1926 (38 of 1926) and every such person may, on an application being made in this behalf, be admitted as an advocates on the State roll of Andhra Pradesh or of Maharashtra.

(3) Notwithstanding anything contained in this Act, all advocates who, immediately before the 1st day of May, 1960, were entitled to practise in the High Court of Bombay and who applied to get their names entered on the roll of advocates of the High Court of Gujarat under the provisions of section 8 of the Indian Bar Councils Act, 1926 (38 of 1926), but whose names were not so entered by reason of the repeal of the said provision shall, for the purposes of clause (a) of sub-section (1) of section 17, be deemed to be persons who were entered as advocates on the roll of the High Court of Gujarat under the said Act and every such person may, on an application being made in this behalf, be admitted as an advocate on the State roll of Gujarat.

(4) Notwithstanding anything contained in this Act, all persons who, immediately before the 1st day of December, 1961, were advocates on the roll of the Court of Judicial Commissioner in any Union Territory under any law in force in that territory shall, for the purposes of clause (a) of sub-section (1) of section 17, be deemed to be persons who were entered as advocates on the roll of a High Court under the Indian Bar Councils Act, 1926 (38 of 1926) and every such person may, on an application made in this behalf, be admitted as an advocate on the State roll maintained in respect of that Union Territory.

—————

1. Ins. by Act 21 of 1964, sec. 25 (w.e.f. 16-5-1964).

Section 58AA. Special Provisions in relation to the Union territory of Pondicherry

¹(1) Notwithstanding anything contained in this Act, all persons who, immediately before the date on which the provisions of Chapter II are brought into force in the Union territory of Pondicherry, were entitled to practice the profession of law (whether by way of pleading or acting or both) under any law in force in the said Union territory or who would have been so entitled had they not been in public service on the said date, shall for the purpose of clause( a) of sub section (1) of section 17, be deemed to be persons who were entered as advocates on the roll of a High Court under the Indian Bar Council Act, 1926, and every such person may, on an application made in this behalf within such time as may be specified by the Bar Council of Madras, be admitted as an advocate on the State roll maintained in respect of the said Union territory.

(2) Notwithstanding anything contained in this Act, every person, who immediately before the date on which the provisions of Chapter IV are brought into force in the Union territory of Pondicherry, was practicing the profession of law (whether by way of pleading or action or both or in any other way) by virtue of the provisions of any law in force in the said Union territory of Pondicherry, was practicing the profession of law (whether by way of pleading or acting or both or any other way) by virtue of the provisions of any law in force in the said Union territory, who does not elect to be or is not qualified to be, enrolled as an advocate under sub section (1), shall notwithstanding the repeal of the relevant provisions of such law by the Pondicherry (Extension of Laws) Act, 1968, continue to enjoy the same rights as respects in any court or revenue office or before any authority or person and be subject to the disciplinary jurisdiction of the same authority which he enjoyed, or as the case may be, to which he was subject, immediately before the said date and accordingly the relevant provisions of the law aforesaid shall have effect in relation to such persons as if they had not been repealed.

—————

1. Ins. by Act 26 of 1968, sec. 3 and Sch.—Part I (w.e.f. 10-6-1968).

Section 58AB. Special provisions with respect to certain persons enrolled by Mysore State Bar Council.

¹[58AB. Special provisions with respect to certain persons enrolled by Mysore State Bar Council

Notwithstanding anything contained in this Act or any judgment, decree or order of any court or any resolution passed or direction given by the Bar Council of India, every person who was admitted as an advocate on the State roll by the State Bar Council of Mysore during the period beginning with the 28th day of February, 1963, and ending on the 31st day of March, 1964 on the basis of his having obtained a certificate of pleadership from the High Court of Karnataka, shall, save as otherwise provided, be deemed to have been validly admitted as an advocate on that State roll and accordingly entitled to practise the profession of law (whether by way of pleading or acting or both):

PROVIDED that where any such person has been elected to be enrolled as an advocate on the roll of any other State Bar Council, his name shall be deemed to have been struck off the roll of the State Bar Council, of Karnataka from the date he was enrolled by the other State Bar Council:

PROVIDED FURTHER that the seniority of such person, whether his name is borne on the State roll of the State Bar Council of Karnataka, or on the State roll of any other Bar Council, shall, for the purposes of clause (d) of sub-section (3) of section 17, be determined by reckoning the 16th day of May, 1964, as the date of admission.]

1. Ins by Act 33 of 1968 sec 3 (w.e.f. 5-6-1968 ).

Section 58AC. Special provision with respect to certain persons enrolled by Uttar Pradesh State Bar Council.

¹58AC. Special provisions with respect to certain persons enrolled by Uttar Pradesh State Bar Council

Notwithstanding anything contained in this Act or any judgment, decree or order of any court, every person who was enrolled as an advocate by the High Court during the period beginning with the 2nd day of January, 1962 and ending on the 25th day of May, 1962 and was subsequently admitted as an advocate on the State roll by the State Bar Council of Uttar Pradesh shall be deemed to have been validly admitted as an advocate on that State roll from the date of his enrolment by the High Court and accordingly entitled to practise the profession of law (whether by way of pleading or acting or both).]

1. Secs. 58AC, 58AD, 58AE and 58AF inserted by Act 60 of 1973.

Section 58AD. Special provisions with respect to certain persons migrating India.

¹58AD. Special provisions with respect to certain persons migrating to India

Notwithstanding the repeal by this Act of the provisions of the Legal Practitioners Act, 1879 (18 of 1879), or of any other law relating to the admission and enrolment of legal practitioners (hereafter in this section referred to as such Act or law), every person who migrates to the territory of India from any area which, before the 15th day of August, 1947, was comprised within India as defined in the Government of India Act, 1935, and who has, before such migration, been a pleader, mukhtar or revenue agent in any such area under any law in force therein, may be admitted and enrolled under the relevant provisions of such Act or law as a pleader, mukhtar or, as the case may be, revenue agent, if he

(a) makes an application for the purpose to the appropriate authority under such Act or law; and

(b) is a citizen of India and fulfils other conditions, if any, specified in this behalf by the appropriate authority aforesaid,

and notwithstanding the repeal by this Act of the relevant provisions of such Act or law, every pleader, mukhtar or revenue agent so enrolled shall have the same right as respects practise in any court or revenue office or before any other authority or person and be subject to the disciplinary jurisdiction of the same authority to which he would be subject under the relevant provisions of such Act or law as if they had not been repealed and accordingly, those provisions shall have effect in relation to such persons.

—————

1. Ins. by Act 60 of 1973, sec. 40 (w.e.f. 31-1-1974).

Section 58AE. Special provisions in relation to the Union territory of Goa, Daman and Diu.

¹(1) Notwithstanding anything contained in this Act, all persons who, immediately before the date on which the provisions of Chapter III are brought into force in the Union Territory of Goa, Daman and Diu were entitled to practise the profession of law (whether by way of pleading or acting or both) under any law in force in the said Union Territory or who would have been so entitled had they not been in public service on the said date, shall, for the purpose of clause (a) of sub-section (1) of section 17, be deemed to be persons who were entered as advocates on the roll of a High Court under the Indian Bar Councils Act, 1926 (38 of 1926), and every such person may, on an application made in this behalf within such time as may be specified by the Bar Council of Maharashtra, be admitted as an advocate on the State roll maintained in respect of the said Union Territory:

PROVIDED that the provisions of this sub-section shall not apply to any person who, on the date of the application aforesaid, was not a citizen of India.

(2) Notwithstanding anything contained in this Act, every person who, immediately before the date on which the provisions of Chapter IV are brought into force in the Union Territory of Goa, Daman and Diu, was practising the profession of law (whether by way of pleading or acting or both or in any other way) by virtue of the provisions of any law in force in the said Union Territory, or who does not elect to be or is not qualified to be enrolled as an advocate under sub-section (1), shall notwithstanding the repeal by this Act of the relevant provisions of such law, continues to enjoy the same rights as respects practise in any court or revenue office or before any other authority or person and be subject to the disciplinary jurisdiction of the same authority which he enjoyed, or, as the case may be, to which he was subject, immediately before the said date and accordingly the relevant provisions of the law aforesaid shall have effect in relation to such persons as if they had not been repealed.

(3) On the date on which this Act or any part thereof comes into force in the Union Territory of Goa, Daman and Diu, the law in force in that Union Territory which corresponds to this Act or such part and which does not stand repealed by virtue of the provisions of section 50 of this Act, shall also stand repealed.

—————

1. Ins. by Act 60 of 1973, sec. 40 (w.e.f. 31-1-1974).

Section 58AF. Special provisions in relation to Jammu and Kashmir.

¹58AF. Special provisions in relation to Jammu and Kashmir

(1) Notwithstanding anything contained in this Act, all advocates who, immediately before the date on which the provisions of Chapter III are brought into force in the State of Jammu and Kashmir, were entitled to practise in the High Court of that .State, or who would have been so entitled had they not been in public service on the said date, shall for the purpose of clause (a) of sub-section (1) of section 17, be deemed to be persons who were entered as advocates on the roll of a High Court under the Indian Bar Councils Act, 1926 (38 of 1926), and every such person may, on an application made in this behalf within such time as may be specified by the Bar Council of India, be admitted as an advocate on the State roll maintained in respect of the said State.

(2) Notwithstanding anything contained in this Act, every person who, immediately before the date on which the provisions of Chapter III are brought into force in the State of Jammu and Kashmir, was entitled otherwise than an advocate to practise the profession of law (whether by way of pleading or acting or both) by virtue of the provisions of any law in force in the said State, or who would have been so entitled had he not been in public service on the said date, may be admitted as an advocate on the State roll maintained in respect of the said State, if he

(i) makes an application for such enrolment in accordance with the provisions of this Act; and

(ii) fulfils the conditions specified in clauses (a), (b), (e) and (f) of sub-section (1) of section 24.

(3) Notwithstanding anything contained in this Act, every person who, immediately before the date on which the provisions of Chapter IV are brought into force in the State of Jammu and Kashmir, was practising the profession of law (whether by way of pleading or acting or both or in any other way) by virtue of the provisions of any law in force therein, or who does not elect to be or is not qualified to be enrolled as an advocate under sub-section (1) or sub-section (2), shall, notwithstanding the repeal by this Act of the relevant provisions of such law, continue to enjoy the same rights as respects practise in any court or revenue office or before any other authority or person and be subject to the disciplinary jurisdiction of the same authority which he enjoyed, or as the case may be, to which he was subject, immediately before the said date and accordingly the relevant provisions of the law aforesaid shall have effect in relation to curli nprcnns as if fhpv had not been repealed.

(4) On the date on which this Act or any part thereof comes into force in the State of Jammu and Kashmir, the law in force in that State which corresponds to this Act or such part thereof which does not stand repealed by virtue of the provisions of section 50 of this Act, shall also stand repealed.]

—————

1. Ins. by Act 60 of 1973, sec. 40 (w.e.f. 31-1-1974).

Section 58AG. Special provisions in relation to articled clerks

¹[58AG. Special provisions in relation to articled clerks

Notwithstanding anything contained in this Act, every person who, immediately before the 31st day of December, 1976, has commenced his articleship and passed the Preliminary examination, for the purpose of enrolment as an attorney of the High Court at Calcutta in accordance with the rules made under sub-section (2) of section 34, before the omission of that sub-section by the Advocates (Amendment) Act, 1976 (107 of 1976), may be admitted as an advocate on the State roll if he

(i) passes, on or before the 31st day of December, 1980,

(a) the Final examination in a case where such person has, before the 31st day of December, 1976, passed the Intermediate examination,

(b) the Intermediate and the Final examinations in any other case. Explanation : For the purpose of this clause, the High Court at Calcutta may prescribe such rules as may be necessary under sub-section (2) of section 34, specifying the nature of the examination and any other matter relating thereto;

(ii) makes an application for such enrolment in accordance with the provisions of this Act; and (iii) fulfils the conditions specified in clauses (a), (b), (e) and (f) of sub-section (1) of section 24.]

Section 58B. Special provisions relating to certain disciplinary proceedings.

¹58B. Special provisions relating to certain disciplinary proceedings

(1) As from the 1st day of September, 1963, every proceeding in respect of any disciplinary matter in relation to an existing advocate of a High Court shall, save as provided in the first proviso to sub-section (2), be disposed of by the State Bar Council in relation to that High Court, as if the existing advocate had been enrolled as an advocate on its roll.

(2) If immediately before the said date, there is any proceeding in respect of any disciplinary matter in relation to an existing advocate pending before any High Court under the Indian Bar Councils Act, 1926 (38 of 1926), such proceeding shall stand transferred to the State Bar Council in relation to that High Court, as if it were a proceeding pending before the corresponding Bar Council under clause (c) of sub-section (1) of section 56 :

PROVIDED that where in respect of any such proceeding the High Court has received the finding of a Tribunal constituted under section 11 of the Indian Bar Councils Act, 1926 (38 of 1926), the High Court shall dispose of the case and it shall be lawful for the High Court to exercise for the purpose all powers conferred on it under section 12 of the said Act as if that section had not been repealed:

PROVIDED FURTHER that where the High Court has referred back any case for further inquiry under sub-section (4) of section 12 of the said Act, the proceeding shall stand transferred to the State Bar Council in relation to the High Court as if it were proceeding before a corresponding Bar Council under clause (c) of sub-section (1) of section 56.

(3) If immediately before the said date there is any proceeding in respect of any disciplinary matter pending in relation to any pleader, vakil, mukhtar or attorney, who has been enrolled as an advocate on any State roll under the Act, such proceeding shall stand transferred to the State Bar Council on the roll of which he has been enrolled and be dealt with under this Act as if it were a proceeding arising against him thereunder.

(4) In this section “existing advocate” means a person who was enrolled as an advocate on the roll of any High Court under the Indian Bar Councils Act, 1926 (38 of 1926), and who, at the time when any proceeding in respect of any disciplinary matter initiated against him, is not enrolled as an advocate on a State roll under this Act.

(5) The provisions of this section shall have effect, notwithstanding anything contained in this Act]

1. Inserted by Act 21 of 1964 sec. 25.

Section 59. Removal of difficulties.

¹[59. Removal of difficulties

(1) If any difficulty arises in giving effect to the provisions of this Act, particularly in relation to the transition from the enactments repealed by this Act to the provisions of this Act, the Central Government may, by order published in the Official Gazette, make such provision not inconsistent with the purposes of this Act, as appear to it to be necessary or expedient for removing the difficulty.

(2) An order under sub-section (1) may be made so as to have retrospective effect from the date not earlier than the 1st day of December, 1961.]

1 Inserted by Act 21 of 1964.

Section 60. Powers of Central Government to make rules.

¹[60. Powers of Central Government to make rules

(1) Until rules in respect of any matter under this Act are made by a State Bar Council and approved by the Bar Council of India, the power to make rules in respect of that matter shall be exercisable by the Central Government.

(2) The Central Government after consultation with the Bar Council of India may by notification in the Official Gazette, make rules under sub-section (1) either for any State Bar Council or generally for all State Bar Councils and the rules so made shall have effect, notwithstanding anything contained in this Act.

(3) Where in respect of any matter any rules are made by the Central Government under this section for any State Bar Council, and in respect of the same matter, rules are made by the State Bar Council and approved by the Bar Council of India, the Central Government may, by notification in the Official Gazette, direct that the rules made by it in respect of such matter shall cease to be in force in relation to that Bar Council with effect from such date as may be specified in the notification and on the issue of such notification, the rules made by the Central Government shall, accordingly, cease to be in force except as respects things done or omitted to be done before the said date.]

1. Inserted by Act 32 of 1962 sec. 4.

SCH1. The Schedule

[Section 50(5)]

Repeal Of Certain Enactments

Negotiable Instruments Act

November 30, 2014

Chapter I – Preliminary

Section 1. Short title.

(26 of 1881)

(9th December, 1881)

An Act to define and Law relating to Promissory Notes, Bills of Exchange and cheques.

WHEREAS it is expedient to define and amend the law relating to promissory notes, bills of exchange and cheques.It is hereby enacted as follows:

This Act may be called the Negotiable Instruments Act, 1881.

Local extent, Saving of usage relating to hundis, etc., Commencement.-It extends to [the whole of India ] but nothing herein contained affects the Indian Paper Currency Act, 1871 (3 of 1871), section 2, or affects any local usage relating to any instrument in an oriental language : Provided that such usages may be excluded by any words in the body of the instrument, which indicate and intention that the legal relations of the parties thereto shall be governed by this Act; and it shall come into force on the first day of March, 1882.

1. The Act has been extended to Goa, Daman, and Diu by Regulation 12 of 1962, sec. 3 and Sch. (w.e.f. 1-12-1965) and to Dadra and Nagar Haveli by Regulation 6 of 1963, sec. and Sch. I (w.e.f. 1-11-1956).

2. Substituted by the A.O. 1950, for “all the Provinces of India”.

3. The Words “except the State of Jammu and Kashmir” omitted by Act 62 of 1956, sec. 2 and Sch. (w.e.f. 1-11-1956).

Section 2. Repeal of enactments.

[Rep. By the Amending Act, 1891 (12 of 1891), sec. 2 and Sch. I, Pt. I.

Section 3. Interpretation clause

In this Act

¹[* * *]

“Banker”: ²[“banker” includes any person acting as a banker and any post office savings bank].

³[* * *]

1. Definition of “India” omitted by Act 62 of 1956, sec. 2 and Sch. (w.e.f. 1-11-1956) .

2. Substituted by Act 37 of 1955, sec. 2 for the definition of word “banker” (w.e.f. 1-4-1956).

3. Definition of “notary public” omitted by Act 53 of 1952, sec.16 (w.e.f. 14-2-1956).

INTRODUCTION

In India, there is reason to believe that instrument to exchange were in use from early times and we find that papers representing money were introducing into the country by one of the Mohammedan sovereigns of Delhi in the early part of the fourtheenth century. The word ‘hundi’, a generic term used to denote instruments of exchange in vernacular is derived from the Sanskrit root ‘hund’ meaning ‘to collect’ and well expresses the purpose to which instruments were utilised in their origin. With the advent of British rule in India commercial activities increased to a great extent. The growing demands for money could not be met be mere supply of coins; and the instrument of credit took the function of money which they represented.

Before the enactment of the Negotiable Instrument Act, 1881, the law of negotiable instruments as prevalent in England was applied by the Courts in India when any question relating to such instruments arose between Europeans. When then parties were Hindu or Mohammedans, their personal law was held to apply. Though neither the law books of Hindu nor those of Mohammedans contain any reference to negotiable instruments as such, the customs prevailing among the merchants of the respective community were recognised by the courts and applied to the transactions among them. During the course of time there had developed in the country a strong body of usage relating to hundis, which even the Legislature could not without hardship to Indian bankers and merchants ignore. In fact, the Legislature felt the strength of such local usages and though fit to exempt them from the operation of the Act with a proviso that such usage may be excluded altogether by appropriate words. In the absence of any such customary law, the principles derived from English law were applied to the Indians as rules of equity justice and good conscience.

The history of the present Act is a long one. The Act was originally drafted in 1866 by the India Law Commission and introduced in December, 1867 in the Council and it was referred to a Select Committee. Objections were raised by the mercantile community to the numerous deviations from the English Law which it contained. The Bill had to be redrafted in 1877. After the lapse of a sufficient period for criticism by the Local Governments, the High Courts and the chambers of commerce, the Bill was revised by a Select Committee. In spite of this Bill could not reach the final stage. In 1880 by the Order of the Secretary of State, the Bill had to be referred to a new Law Commission. On the recommendation of the new Law Commission the Bill was re-drafted and again it was sent to a Select Committee which adopted most of the additions recommended by the new Law Commission. The draft thus prepared for the fourth time was introduced in the Council and was passed into law in 1881 being the Negotiable Instruments Act, 1881 (26 of 1881)

Chapter II – Of Notes, Bills And Cheques

Section 4. “Promissory note”.

A “promissory note” is an instrument in writing (not being a bank-note or a currency-note) containing an unconditional undertaking signed by the maker, to pay a certain sum of money only to, or to the order of, a certain person, or to the bearer of the instrument

Section 5. “Bill of exchange”.

A “bill of exchange” is an instrument in writing containing an unconditional order, signed by the maker, directing a certain person to pay a certain sum of money only to, or to the order of, a certain person or to the bearer of the instrument.

A promise or order to pay is not “conditional”, within the meaning of this section and section 4, by reason of the time for payment of the amount or any installment thereof being expressed to be on the lapse of certain period after the occurrence of a specified event which, according to the ordinary expectation of mankind, is certain to happen, although the time of its happening may be uncertain.

The sum payable may be “certain”, within the meaning of this section and section and section4, although it includes future indicated rater of change, or is according to the course of exchange, or is according to the course of exchange, and although the instrument provides that, on default of ayment of an installment, the balance unpaid shall become due. The person to whom it is clear that the direction is given or that payment is to be made may be a “certain person,” within the meaning of this section and section 4, although he is misnamed or designated by description only

Section 6. Cheque

¹[6. “Cheque”

A ”cheque” is a bill of exchange drawn on a specified banker and not expressedto be payable otherwise than on demand and it includes the electronic image of a truncated cheque and a cheque in the electronic form.

Explanation I.-For the purposes of this section, the expressions

(a) “A cheque in the electronic form” means a cheque which contains the exact mirror image of a paper cheque, and is generated, written and signed in a secure system ensuring the minimum safety standards with the use of digital signature (with or without biometrics signature) and asymmetric crypto system;

(b) “A truncated cheque” means a cheque which is truncated during the course of a clearing cycle, either by the clearing house or by the bank whether paying or receiving payment, immediately on generation of an electronic image for transmission, substituting the further physical movement of the cheque in writing.

Explanation II.-For the purposes of this section, the expression “clearing house” means the clearing house managed by the Reserve Bank of India or a clearing house recognised as such by the Reserve Bank of India.]

1. Substituted for section 6 Act No. 55 of 2002, sec. 2 for “A “cheque” is a bill of exchange drawn on a specified banker and not expressed to be payable otherwise than on damand” (w.e.f. 6-2-2003).

Section 7. Drawer, drawee

The maker of a bill of exchange or Cheque is called the “drawer”; the person thereby directed to pay is called the “Drawee”.

“Drawee in case of need “: When the bill or in any endorsement thereon the name of any person is given in addition to the drawee to be resorted to in case of need such person is called a “drawee in case of need”.

“Acceptor”: After the drawee of a bill has signed his assent upon the bill, or, if there are more parts thereof than one, upon one of such part, and delivered the same, or given notice of such signing to the holder or to some person on his behalf, he is called the “acceptor”.

“Acceptor for honour”: ¹[When a bill of exchange has been noted or protested for non-acceptance or for better security], and any person accepts it supra protest for honour of the drawer or of any one of the endorser, such person is called an “acceptor for honour”.

“Payee”: The person named in the instrument, to whom or to whose order the money is by the instrument directed to be paid, is called the “payee”.

1. Substituted by Act 2 of 1885, sec. 2 for “When acceptance is refused and the bill is protested form on-acceptance”.

Section 8. “Holder”.

The “holder” of a promissory note, bill of exchange or cheque means any person entitled in his own name to the possession thereof and to receive or recover the amount due thereon from the parties thereto.

Where the note, bill or cheque is lost or destroyed, its holder is the person so entitled at the time of such loss or destruction.

Section 9. “Holder in due course”.

“Holder in due course” means any person who for consideration became the possessor of a promissory note, bill of exchange or cheque if payable to bearer, or the payee or indorse thereof, if [payable to order] before the amount mentioned in it became payable, and without having sufficient cause to believe that any defect existed in the title of the person from whom he derived his title.

1. Subs. by Act 8 of 1919, sec. 2, for “payable to, or to the order of, a payee.

Section 10. “Payment in due course”.

“Payment in due course” means payment in accordance with the apparent tenor of the instrument in good faith and without negligence to any person in possession thereof under circumstances which do not afford a reasonable ground for believing that he is not entitled to receive payment of the amount therein mentioned.

Section 11. “Inland instrument”.

A promissory note, bill of exchange or cheque drawn or made in [India] and made payable in, or drawn upon any person resident in, [Indian] shall be deemed to be an inland instrument.

1. Substituted by Act 36 of l957, sec. 3 and Sch. II, for wards” a State”.

Section 12. “Foreign instrument”.

Any such instrument not so drawn, made or made payable shall be deemed to be a foreign instrument.

Section 13. “Negotiable instrument”.

[(1) A “negotiable instrument” means a promissory note, bill of exchange or cheque payable either to order or to bearer.

Explanation (i).- A promissory note, bill of exchange or cheque is payable to order which is expressed to be so payable to a particular person, and does not contain words prohibiting transfer or indicating an intention that it shall not be transferable.

Explanation (ii).- A promissory note, bill of exchange or cheque is payable to bearer which is expressed to be so payable or on which the only or last endorsements is an endorsement is an endorsement in blank.

Explanation (iii) Where a promissory note, bill of exchange or cheque, either originally or by endorsement, is expressed to be payable to the order of a specified person, and not to him or his order, it is nevertheless payable to him or his order at his option.]

(2) A negotiable instrument may be made payable to two or more payees jointly, or it may be made payable in the alternative to one or two, or one or some of several payees.]

1. Substituted by Act 8 of 1919, sec. 3, for sub-section (1).

2. Ins. by Act 5 of 1914, sec. 2.

Section 14. Negotiation.

When a promise note, bill of exchange or cheque is transferred to any person, so as to continue the person the holder thereof, the instrument is said to be negotiated.

Section 15. Endorsement.

When the marker or holder of an negotiable instrument signs the same, otherwise than as such maker, for the purpose of negotiation, one the back or face thereof or on a slip of paper annexed thereto, or so signs for the same purpose a stamped paperintended to be completed as a negotiable instrument, he is said to indorse the same, and is called the endorser.

Section 16. Endorsement in blank and in full-endorsee

¹[(1)] If the endorser signs his name only, the endorsement is said to be “in blank”, and if he adds a direction to pay the amount mentioned in the instrument to, or to the order of, a specified person, the endorsement is said to be “in full”, and the person so specified is called the “endorsee” of the instrument.

²[(2) The provisions of this Act relating to a payee shall apply with the necessary modifications to an endorsee.]

1. Section 16 renumbered as sub-section. (1) by Act 5 of 1914, sec. 3.

2. Added by Act 5 of 1914, sec. 3.

Section 17. Ambiguous instruments.

Where an instrument may be construed either as a promissory note or bill of exchange, the holder may at his election treat it as either and the instrument shall be thenceforward treated accordingly.

Section 18. Where amount is stated differently in figures and words.

If the amount undertaken or ordered to be paid is stated differently in figures and in words, the amount stated in words shall be the amount undertaken or ordered to be paid.

Section 19. Instruments payable on demand.

A promissory note or bill of exchange, in which no time for payment is specified, and, a cheque, are payable on demand.

Section 20.Inchoate stamped instruments.

Where one person signs and delivers to another a paper stamped in accordance with the law relating to negotiable instruments then in force in [India], and either wholly blank or having written thereon an incomplete negotiable instrument, he thereby gives prima facie authority to the holder thereof to make or complete, as then case may be, upon it a negotiable instrument, instrument, for any amount specified therein and not exceeding the amount covered by the stamp. The person so signing shall be liable upon such instrument, in the capacity in which he signed the same, to any holder in due course for such amount, provided that no person other than a holder in due course shall recover from the person delivering the instrument anything in excess of the amount intended by him to be paid thereunder.

1. Substituted by Act 3 of 1951, sec. 3 and Sch., for “the States”.

Section 21. “At sight”, “On presentment”, “After sight”.

In a promissory note or bill of exchange the expressions “at sight” and “on presentment” means on demand. The expression “after sight” means, in a promissory note, after presentment for sight, and, in a bill of exchange after acceptance, or noting for non-acceptance, or nothing for non-acceptance, or protest for non-acceptance.

Section 22. “Maturity”.

The maturity of a promissory note or bill of exchange is the date at which it falls due.

Days of grace.-Every promissory note or bill of exchange which is not expressed to be payable on demand, at sight or on presentment is at maturity on the third day after the day on which it is expressed to be payable.

Section 23. Calculating maturity of bill or note payable so many months after date or sight

In calculating the date at which a promissory note or bill of exchange, made payable at stated number of months after date or after sight, or after a certain event, is at maturity, the period stated shall be held to terminate on the day of months, which corresponds with the day on which the instrument is dated, or presented for acceptance or sight, or noted for non-acceptance, or protested for non-acceptance, or the event happens or, where the instrument is a bill of exchange made payable a stated number of months after sight and has been accepted for honour, with the day on which it was so accepted. If the month in which the period would terminate has no corresponding day, the period shall be held to terminate on the last day of such month.

Illustrations

(a) A negotiable instrument dated 29th January, 1878, is made payable at one month after date. The instrument is at maturity on the third day after the 28th February, 1878.

(b) A negotiable instrument, dated 30th August, 1878, is made payable three months after date. The instrument is at maturity on the 3rd December, 1878.

(c) A promissory note or bill of exchange, dated 31st August, 1878, is made payable three months after date. The instrument is at maturity on the 3rd December, 1878.

Section 24. Calculating maturity of bill or note payable so many days after date so sight.

In calculating the date at which a promissory note or bill of exchange made payable a certain number of days after date of after sight or after a certain event is at maturity, the day of the date, or of presentment for acceptance or sight, or of protest for non-acceptance, or on which the event happens, shall be excluded.

Section 25. When day of maturity is a holiday

When the day on which a promissory note or bill of exchange is at maturity is a public holiday, the instrument shall be deemed to be due on the next preceding business day.

Explanation: The Expression “Public Holiday” includes Sunday” ¹[***] and any other day declared by the ²[Central Government], by notification in the Official Gazette, to be a public holiday.

1. Words “New-Year’s day, Christmas day: if either of such days falls on a Sunday, the next following Monday; Good Friday;” omitted by Act 37 of 1955, sec. 3 (w.e.f. 1-4-1956).

2. Substituted by the AO 1937, for “Local Government”.

Chapter III – Parties To Notes, Bills And Cheques

Section 26. Capacity to make, etc., promissory notes, etc.

Every person capable of contracting, according to the law to which he is subject, may bind himself and be bound by the making, drawing, acceptance, endorsement, delivery and negotiation of a promissory note, bill of exchange or cheque.

Minor.- A minor may draw, indorse, deliver and negotiate such instruments to as to bind all parties except himself.

Nothing herein contained shall be deemed to empower a corporation to make, indorse or accept such instruments except in cases in which, under the law for the time being in force, they are so empowered.

Section 27. Agency.

Every person capable of binding himself or of being bound, as mentioned in section 26, may so bind himself or be bound by a duly authorised agent acting in his name.

A general authority to transact business and to receive and discharge debts does not confer upon an agent the power of accepting or indorsing bills of exchange so as to bind his principal.

An authority to draw bills of exchange does not of itself impart an authority to endorse.

Section 28. Liability of agent signing.

An agent who sign his name to a promissory note, bill of exchange or cheque without indicating thereon that he signs as agent, or that he does not intend thereby to incur personal responsibility, is liable personally on the instrument, except to those who induced him to sign upon the belief that the principal only would be held liable.

Section 29. Liability of legal representative signing.

A legal representative of a deceased person who sign his name to a promissory note, bill of exchange or cheque is liable personally thereon unless he expressly limits his liability to the extent of the assets received by him as such.

Section 30. Liability of drawer

The drawer of a bill of exchange or cheque is bound in case of dishonour by the drawee or acceptor thereof, to compensate the holder, provided due notice of dishonour has been give to, or received by, the drawer as hereinafter provided.

Section 31. Liability of drawee of cheque.

The drawee of a cheque having sufficient funds of the drawer in his hands properly applicable to the payment of such cheque must pay the cheque when duly required so to do, and, in default of such payment, must compensate the drawer for any loss or damage caused by such default.

Section 32. Liability of maker of note and acceptor of bill.

In the absence of contract to the contrary, the maker of a promissory note and the acceptor before maturity of a bill of exchange are bound to pay the amount thereof at maturity according to the apparent tenor of the note or acceptance respectively, and the acceptor of a bill of exchange at or after maturity is bound to pay the amount thereof to the holder on demand.

In default of such payment as aforesaid, such maker or acceptor is bound to compensate any party to the note or bill for any loss or damage sustained by him and caused by such default.

Section 33. Only drawee can be acceptor except in need for honour.

No person except the drawee of a bill of exchange, or all or some of several drawees, or a person named therein as a drawee in case of need, or an acceptor for honour, can bind himself by an acceptance.

Section 34. Acceptance by several drawee not partners.

Where there are several drawees of a bill of exchange who are not partners, each of them can accept if for himself, but non of the them can accept it for another without his authority.

Section 35. Liability of endorser.

In the absence of a contract to the contrary, whoever indorses and delivers a negotiable instrument before maturity, without in such endorsement, expressly excluding or making conditional his own liability, is bound thereby to every subsequent holder, in case of dishonour by the drawee, acceptor or maker, to compensate such holder for any loss or damage caused to him by such dishonor, provided due notice of dishonour has been given to, or received by, such endorser as hereinafter provided.

Every endorser after dishonour is liable as upon an instrument payable on demand.

Section 36. Liability of prior parties to holder in due course.

Every prior party to a negotiable instrument is liable thereon to a holder in due course until the instrument is duly satisfied.

Section 37. Maker, drawer and acceptor principals.

The maker of a promissory note or cheque, the drawer of bill of exchange until acceptance, and the acceptor are, in the absence of a contract to the contrary, respectively liable thereon as principal debtors, and the other parties thereto are liable thereon as sureties for the maker, drawer or acceptor, as the case may be.

Section 38. Prior party a principal in respect of each subsequent party.

As between the parties so liable as sureties, each prior party is, in the absence of a contract to the contrary. Also liable thereon as a principal debtor in respect of each subsequent party.

ILLUSTRATION

A draws a bill payable to his own order on B, who accepts, A afterwards endorses the bill to C, C to D to E. As between E and B, B is the principal debtor, and A, C and D are his sureties. As between E and A., A is the principal debtor, and C and D are his sureties. As between E and C, C is the principal debtor and D is his surety.

Section 39. Surety ship.

When the holder of an accepted bill of exchange enters into any contract with the acceptor which, under section 134 or 135 of the Indian Contract Act,1872 ( 9 of 1872), would discharge the other parties, the holder may expressly reserve his right to charge the other parties, and in such case they are not discharged.

Section 40. Discharge of endorser’s liability.

Where the holder of a negotiable instrument, without the consent of the endorser, destroys or impairs the endorser’s remedy against a prior party, the endorser is discharged from liability to the holder to the same extent as if the instrument had been paid at maturity.

Illustration

A is the holder of a bill of exchange made payable to the order of B, which contains the following endorsements in blank

First endorsement, “B”.

Second endorsement, “Peter Williams”.

Third endorsement, “Wright & Co.”.

Fourth endorsement “John Rozario”.

This bill A puts in suit against John Rozario and strikes out, without John Rosario’s consent, the endorsements by Peter Williams and Wright & Co. A is not entitled to recover any thing from John Rozario.

Section 41. Acceptor bound, although endorsement forged.

An acceptor of a bill of exchange already indorsed is not relieved from liability by reason that such endorsement is forged, if he knew or had reason to believe the endorsement to be forged when he accepted the bill.

Section 42. Acceptance of bill drawn in fictitious name.

An acceptor of a bill of exchange drawn in a fictitious name and payable to the drawer’s order is not, by reason that such name is fictitious, relieved from liability to any holder in due course claiming under an endorsement by the same hand as the drawer’s signature, and purporting to be made by the drawer.

Section 43. Negotiable instrument made, etc., without consideration.

A negotiable instrument made, drawn, accepted, indorsed, or transferred without consideration, or for a consideration which fails, creates no obligation of payment between the parties to the transaction. But if any such party has transferred the instrument with or without endorsement to a holder for consideration, such holder, and every subsequent holder deriving title from him, may recover the amount due on such instrument from the transferor for consideration or any prior party thereto.

Exception I.- No party for whose accommodation a negotiable instrument has been made, drawn, accepted or indorsed can, if he has paid the amount thereof, recover thereon such amount from any person who became a party to such instrument for his accommodation.

Exception II.-No party to the instrument who has induced any other party to make, draw, accept, indorse or transfer the same to him for a consideration which he has failed to pay or perform in full shall recover there in an amount exceeding the value of the consideration (if any) which he has actually paid or performed.

Section 44. Partial absence or failure of money-consideration.

When the consideration for which a person signed a promissory note, bill of exchange or cheque consisted of money, and was originally absence in part relation with such signer id entitled to receive from him is proportionally reduced.

Explanation.-The drawer of a bill of exchange stands in immediate relating with the acceptor. The maker of a promissory note, bill of exchange or cheque stands in immediate relation with the payee, and the endorser with his endorsee. Other signers may by agreement stand in immediate relation with a holder.

Illustration

A draws a bill on B for Rs. 500 payable to the order of A. B accepts the bill, but subsequently dishonours it by non-payment. A sues B on the bill. B proves that it was accepted for value as to Rs. 400, and as an accommodation to the plaintiff as to the residue. A can only recover Rs. 400.

Section 45. Partial failure of consideration not consisting of money.

Where a part of the consideration for which a person signed a promissory note, bill of exchange or cheque, though not consisting of money, is ascertainable in money without collateral enquiry, and there has been a failure of that party, the sum which a holder standing in immediate relation with such signer is entitled to receive from him is proportionally reduced.

Section 45A. Holder’s right to duplicate of lost bill

¹[45A. Holder’s right to duplicate of lost bill

Where a bill of exchange has been lost before it is overdue, the person who was the holder of it may apply to the drawer to give him another bill of the same tenor, giving security to the drawer, if required, to indemnify him against all persons whatever in case the bill alleged to have been lost shall be found again.

If the drawer on request as aforesaid refuses to give such duplicate bill, he may be compelled to do so].

1. Inserted by Act 2 of 1885, sec. 3.

Chapter IV – Of Negotiation

Section 46. Delivery.

The making, acceptance or endorsement of a promissory note, bill of exchange or cheque is completed by delivery, actual or constructive.

As between parties standing in immediate relation; delivery to be effectual must be made by the party making accepting or indorsing the instrument, or by a person authorised by him in that behalf.

As between such parties and any holder of the instrument other than a holder in due course, it may be shown that the instrument was delivered conditionally or for a special purposes only, and not for the purpose of transferring absolutely the property therein.

A promissory note, bill of exchange or cheque payable to bearer is negotiable by the deliver thereof.

A promissory note, bill of exchange or cheque payable to bearer is negotiable by the deliver thereof.

Section 47. Negotiation by delivery.

Subject to the provisions of section 58, a promissory note, bill of exchange or cheque payable to bearer is negotiable by deliver thereof.

Exception.-a promissory note, bill of exchange or cheque delivered on condition that it is not to take effect except in a certain event is not negotiable (except in the hands of a holder for value without notice of the condition) unless such event happens.

Section 48. Negotiation by endorsements.

Subject to the provisions of section 58, a promissory note, bill of exchange or cheque [payable to order], is negotiable by the holder by endorsement and delivery thereof

1. Substituted by Act 8 of 1919, sec. 4, for “payable to the order of a specified person, or to a specified person or order”.

Section 49. Conversion of endorsement in blank into endorsement in full.

The holder of a negotiable instrument indorsed in blanks may, without signing his own name, by writing above the endorser’s signature a direction to pay to any other person as endorsee, convert the endorsement in full; and the holder does not thereby incur the responsibility of an endorser.

Section 50. Effect of indorsement.

The of a negotiable instrument followed by delivery transfers to the indorsee the property therein with the right of further negotiation; but the indorsement may be express words, restrict or exclude such right, or may merely constitute the indorsee an agent to indorse the instrument, or to receive its contents for the indorser, or for some other specified person.

Section 51. Who may negotiate.

Every sole maker, drawer, payee or indorsee, or all of several joint makers, drawers, payee or indorsees, of a negotiable instrument may, if the negotiability of such instrument has not been restricted or excluded as mentioned in section 50, indorse and negotiate the same.

Explanation.-Nothing in this section enables a maker or drawer to indorse or is holder thereof, or enables a payee or indorse to indorse or negotiate an instrument, unless he is holder thereof.

Section 52. Indorser who excludes his own liability or maker it conditional.

The indorser of a negotiable instrument may, by express words in the indorsement, exclude his own liability thereon, or make such liability or the right of the indorsee to receive the amount due thereon depend upon the happening of a specified event, although such event may never happen.

Where an indorser so excludes his liability and afterwards becomes the holder of the instrument all intermediate indorsers are liable to him.

Section 53. Holder deriving title from holder in due course.

a holder of a negotiable instrument who derives title from a holder in due course has the rights thereon of that holder in due course.

Section 54. Instrument indorsed in blank.

Subject to the provisions hereinafter contained crossed cheques, a negotiable instrument indorsed in blank is payable to the bearer thereof even although originally payable to order.

Section 55. Conversion of indorsement in blank into indorsement in full.

If a negotiable instrument, after having been indorsed in blank, is indorsed in full, the amount of it cannot be claimed from the indorser in full, except by the person to whom it has been indorsed in full, or by one who derives title through such person.

56. Indorsement for part of sum due.

No writing on a negotiable instrument is valid for the purpose of negotiation of such writing purports to transfer only a part of the amount appearing to be due on the instrument; but where such amount has been partly paid a note to that effect may be indorsed on the instrument, which may then be negotiated for the balance.

Section 57. Legal representative cannot by delivery only negotiate instrument indorsed by deceased.

The legal representative of a deceased person cannot negotiate by delivery only a promissory note, bill of exchange or cheque payable to order and indorsed by the deceased but not delivered.

Section 58. Instrument obtained by unlawful means or for unlawful consideration.

When a negotiable instrument has been lost, or has been obtained form any maker, acceptor or holder thereof by means of offence or fraud, or for an unlawful consideration, no possessor or indorsee who claims through the person who found or so obtained the instrument is entitled to receive the amount due thereon from such maker, acceptor or holder, or from any party prior to such holder, unless such possessor or indorsee is, or some person through whom he claims was, a holder thereof in due course.

Section 59. Instrument acquired after dishonour or when overdue.

The holder of a negotiable instrument, who has acquired it after dishonour, whether by non-acceptance or non-payment, with notice thereof, or after maturity, has only, as against the other parties, the rights thereon of his transferor;

Accommodation note or bill.- Provided that any person who, in good faith and for consideration, becomes the holder, after maturity, of a promissory note or bill of exchange made, drawn or accepted without consideration, for the purpose of enabling some party thereto to raise money thereon, may recover the amount of the note or bill from any prior party.

Illustration

The acceptor of a bill of exchange, when he accepted it, deposited with the drawer certain goods as a collateral security for the payment of the bill, with power to the drawer to sell the goods and apply the proceeds in discharge of the bill if it were not paid at maturity. The bill not having been paid in maturity, the drawer sold the goods and retained the proceeds, but endorsed the bill to A.. A’s title is subject to the same objection as the drawer’s title.

Section 60. Instrument negotiable till payment or satisfaction.

A negotiable instrument may be negotiated (except by the maker, drawee or acceptor after maturity) until payment or satisfaction thereof by the maker, drawee or acceptor at or after maturity, but not after sect payment or satisfaction.

Chapter V – Of Presentment

Section 61. Presentment for acceptance.

A bill of exchange payable after sight must, if no time or place is specified therein for presentment, be presented to the draweee thereof for acceptance, if he can, after reasonable search, be found, by a person entitled to demand acceptance, within a reasonable time after it is drawn, and in business hours on a business day, in default of such presentment, on party thereto is liable thereon to the person making such default. If the drawee cannot, after reasonable search, be found, the bill is dishonoured.

If the bill is directed to the drawee at a particular place, it must be presented at that place, and if art the due date for presentment he cannot, after reasonable search, be found thereon, the bill is dishonoured.

[Where authorized by agreement or usage, a presentment through the post office by means of a registered letter is sufficient.]

1. Added by Act 2 of 1885, sec. 4.

Section 62. Presentment of promissory note for sight.

A promissory note, payable at a certain period after sight must be presented to the maker thereof for sight ( if he can after reasonable search be found ) by a person entitled to demand payment, within a reasonable time after it is made and in business hours on a business day. In default of such presentment, no party thereto is liable thereon to the person making such default.

Section 63. Drawee’s time for deliberation.

The holder must, if so required by the drawee of a bill of exchange presented to him for acceptance, allow the drawee [forty –eight ] hours (exclusive of public holidays ) to consider whether he will accept it.

1. Substituted by Act l2 of 1921, sec. 2 for “twenty-four”.

Section 63. Drawee’s time for deliberation.

The holder must, if so required by the drawee of a bill of exchange presented to him for acceptance, allow the drawee [forty –eight ] hours (exclusive of public holidays ) to consider whether he will accept it.

1. Substituted by Act l2 of 1921, sec. 2 for “twenty-four”.

Section 64. Presentment for payment

¹[(1)] Promissory notes, bill of exchange and cheques must be presented for payment to the maker, acceptor or drawee thereof respectively, by or on behalf or the holder as hereinafter provided. In default of such presentment, the other parties thereto are not liable thereon to such holder.

²[Where authorized by agreement or usage, a presentment through the post office by means of a registered letter is sufficient.]

Exception:-Where a promissory note is payable on demand and is not payable at a specified place, no presentment is necessary in order to charge the maker thereof.

³[“(2) Notwithstanding anything contained in section 6, where an electronic image of a truncated cheque is presented for payment, the drawee bank is entitled to demand any further information regarding the truncated cheque from the bank holding the truncated cheque in case of any reasonable suspicion about the genuineness of the apparent tenor of instrument, and if the suspicion is that of any fraud, forgery, tampering or destruction of the instrument, it is entitled to further demand the presentment of the truncated cheque itself for verification:

Provided that the truncated cheque so demanded by the drawee bank shall be retained by it, if the payment is made accordingly.]

1. Section 64 renumbered as sub-section (1) thereof by Act 55 of 2002, sec. 3 (w.e.f. 6-2-2003).

2. Inserted by Act 2 of 1885, sec. 4.

3. Inserted by Act No. 55 of 2002. sec. 3 (w.e.f. 6-2-2003)

Section 65. Honours for presentment.

Presentment for payment must be made during the usual hours of business and, if at a banker’s, within banking hours.

Section 66. Presentment for payment of instrument payable after date or sight.

a promissory note or bill of exchange, made payable at a specified period after date or sight thereof, must be presented for payment at maturity.

Section 67. Presentment for payment of promissory note payable by instalments.

A promissory note payable by instalments must be presented for payment on the third day after the date fixed for payment of each instalment; and non-payment on such presentment has the same effect as non-payment of a note at maturity.

Section 68. Presentment for payment of instrument payable at specified place and not elsewhere.

A promissory note, bill of exchange or cheque made, drawn or accepted payable at a specified place and not elsewhere must, in order to charge any party thereto, be presented for payment at that place.

Section 69. Instrument payable at specified place.

A promissory note or bill of exchange made, drawn or accepted payable at a specified place must, in order to charge the maker or drawer thereof, be presented at the place.

Section 70.- Presentment where no exclusive place specified.

A promissory note or bill of exchange, not made payable as mentioned in section 68 and 69, must be presented for payment at the place of business (if any), or at the usual residence, of the maker, drawee or acceptor thereof, as the case may be.

Section 71. Presentment when maker, etc., has no known place of business or residence.

If the maker, drawee or acceptor of a negotiable instrument has no known place of business or fixed residence, and no place is specified in the instrument for presentment for acceptance or payment such presentment may be made to him in person wherever he can be found.

Section 72. Presentment of cheque to charge drawer.

[Subject to the provisions of section 84] a cheque must, in order to charge the drawer, be presented at the bank upon which it is drawn before the relation between the drawer and his banker has been altered to the prejudice of the drawer.

1. Inserted by Act 6 of 1897, sec. 2

Section 73. Presentment of cheque to charge any other person.

A cheque must, in order to charge any person except the drawer, be presented within a reasonable time after delivery thereof by such person.

Section 74. Presentment of instrument payable on demand.

Subject to the provisions of section 31, a negotiable instrument payable on demand must be presented for payment within a reasonable time after it is received by the holder receives it.

Section 75. Presentment by or to agent, representative of deceased, or assignee of insolvent.

Presentment for acceptance or payment may be made to the duly authorized agent of the drawee, maker or acceptor, as the case may be, or, where the drawee, maker or acceptor has died, to his legal representative, or, where he has been declared an insolvent, to his assignee.

Section 75A. Excuse for delay in presentment for acceptance or payment

¹[75A. Excuse for delay in presentment for acceptance or payment

Delay in presentment ²[for acceptance of payment] is excused if the delay is caused by circumstances beyond the control of the holder, and not imputable to his default, misconduct or negligence. When the cause of the delay ceases to operate, presentment must be made within a reasonable time.]

1. Inserted by Act 25 of 1920, sec. 2.

2. Subs. by Act 12 of 1921, sec. 3, for “for payment”

Section 76. When presentment unnecessary.

No presentment for payment is necessary, and the instrument is dishonoured at the due date for presentment, in any of the following cases:

(a) if the maker, drawee or acceptor intentionally prevents the presentment of the instrument, or if the instrument being payable at his place of business, he closes such place on a business day during the usual business hours, or if the instrument being payable at some other specified place, neither he nor any person authorized to pay it attends at such place during the usual business hours, or if the instrument not being payable at any specified place, he cannot after due search be found;

(b) as against any party sought to be charged therewith, if he has engaged to pay notwithstanding non-presentment ;

(c) as against any party if, after maturity, with knowledge that the instrument has not been presented.- he makes a part payment on account of the amount due on the instrument, or promises to pay the amount due therein whole or in part, or otherwise waives his right to take advantage of any default in presentment for payment;

(d) as against the drawer, if the drawer could not suffer damage from the want of such presentment.

Section 77. Liability of banker for negligently dealing with bill presented for payment.

When a bill of exchange, accepted payable at a specified bank, has been duly presented there for payment and dishonoured, if the banker so negligently or improperly keeps, deals with or delivers back such bill as to cause loss to the holder, he must compensate the holder for such loss.

Chapter VI – Of Payment And Interest

Section 78. To whom payment should be made.

Subject to the provisions of section82, clause (c), payment of the amount due on a promissory note, bill of exchange or cheque must, in order to discharge the maker or acceptor, be made to the holder of the instrument.

Section 79. Interest when rate specified.

When interest at a specified rate is expressly made payable on a promissory note or bill of exchange , interest shall be calculated at the rate specified, on the amount of the principal money due thereon, from the date of the instrument, until tender or realization of such amount, or until such date after the institution of a suit to recover such amount as the Court directs.

Section 80. Interest when no rate specified.

When no rate of interest is specified in the instrument, interest on the amount due thereon shall, [notwithstanding any agreement relating to interest between any parties to the instrument], be calculated at the rate of [eighteen per centum] per annum, from the date at which the same ought to have been paid by the party charged, until tender or realization of the amount due thereon, or until such date after the institution of a suit to recover such amount as the Court directs.

Explanation.- When the party charged is the endorser of an instrument dishonoured by non-payment, he his liable to pay interest only form the time that he receives notice of the dishonour.

1. Substituted by Act 30, of 1926, sec. 2 for “except in case provided for by the Code of Civil Procedure, section 532″.

2. Substituted by Act 66 of 1988, sec. 2 for ‘six per centum’ (w.e.f. 30-12-1988).

Section 81. Delivery of instrument on payment or indemnity in case of loss

¹[(1)] Any person liable to pay, and called upon by the holder thereof to pay, the amount due on a promissory note, but of exchange or cheque is before payment entitled to have it shown, is on payment entitled to have it delivered up to him, or, if the instrument is lost or cannot be produced, to be indemnified against any further claim thereon against him.

²[(2) Where the cheque is an electronic image of a truncated cheque, even after the payment the banker who received the payment shall be entitled to retain the truncated cheque.

(3) A certificate issued on the foot of the printout of the electronic image of a truncated cheque by the banker who paid the instrument, shall be prima facie proof of such payment.]

1. Section 81 renumbered as sub-section (1) thereof by Act 55of 2002, sec. 4 (w.e.f. 6-2-2003).

2. Inserted by Act 55 of 2002, sec. 4 (w.e.f. 6-2-2003).

Chapter VII – Of Discharge From Liability On Notes, Bills And Cheques

Section 82. Discharge from liability.

The maker, acceptor or indorser respectively of a negotiable instrument is discharged from liability thereon

(a) BY cancellation.-to a holder thereof who cancels such acceptor’s or indorser’s name with intent to discharge him, and to all parties claiming under such holder;

(b) By release- to a holder thereof who otherwise discharges such maker, acceptor or indorser, and to all parties deriving title under such holder after notice of such discharge;

(c) By payment- to all parties thereto, if the instrument is payable to bearer, or has been indorsed in blank, and such maker, acceptor or indorser makes payment in due course of the amount due thereon.

Section 83. Discharge by allowing drawee more than forty-eight hours to accept.

If the holder of a bill of exchange allows the drawee more than [forty eight] hours, exclusive of public holidays, to consider whether he will accept the same, all previous parties not consenting to such allowance are thereby discharged from liability to such holder.

1. Substituted by Act 12 of 1921, sec. 2 for “twenty-four”.

Section 84. When cheque not duly presented any drawer damaged thereby.

(1) Where a cheque is not presented for payment within a reasonable time of its issue, and the drawer or person on whose account it is drawn had the right, at the time when presentment ought to have been made, as between himself and the banker, to have the cheque paid and suffers actual damage through the delay, he is discharged to the extent of such damage, that is to say, to the extent to which such drawer or person is a creditor of the banker to a large amount than he would have been if such cheque had been paid.

(2) In determining what is a reasonable time, regard shall be had to the nature of the instrument, the usage of trade and of bankers, and the facts of the particular case.

(3) The holder of the cheque as to which such drawer or person is so discharged shall be a creditor, in lieu of such drawer or person, of such banker to the extent of such discharge and entitled to recover the amount from him.

Illustrations

(a) A draws a cheque for Rs. 1,000, and, when the cheque ought to be presented, has funds at the bank to meet it. The bank fails before the cheque is presented. The drawer is discharged, but the holder can prove against the bank for the amount of the cheque.

(b) A draws a cheque at Umballa on a bank in Calcutta. The bank fails before the cheque could be presented in ordinary course. A is not discharged, for he has not suffered actual damage through any delay in presenting the cheque.

1. Substituted by Act 6 of 1897, sec. 3 for section 84.

Section 85. Cheque payable to order

¹[(1)] Where a cheque payable to order purports to be endorsed by or on behalf of he payee, the drawee is discharged by payment in sue course.

²[(2) Where a cheque is originally expressed to be payable to be payable to bearer, the drawee is discharged by payment in due course to the bearer thereof, notwithstanding any endorsement whether in full or in blank appearing thereon, and notwithstanding that any such endorsement purports to restrict of exclude further negotiation.]

1. Section 85 re-numbered as sub-section. (1) thereof by Act 17 of 1934, sec. 2.

2. Inserted by Act 17 of 1934, sec. 2.

Section 85A. Drafts drawn by one branch of a bank on another payable to order

¹[85A. Drafts drawn by one branch of a bank on another payable to order

Where any draft, that is an order to pay money, drawn by one office of a bank upon another office of the same bank for a sum of money payable to order on demand, purports to be endorsed by or behalf of the payee, the bank is discharged by payment in due course.]

1. Inserted by Act 25 of 1930, sec. 2.

Section 86. Parties not consenting discharged by qualified or limited acceptance.

If the holder of a bill of exchange acquiesces in qualified acceptance, or one limited to part of the sum mentioned in the bill, or which substituted a different place or time for payment or which, where the drawees are not partners, is not signed by all the drawees, all previous parties whose consent is not obtained to such acceptance are discharged as against the holder and those claiming under him, unless on notice given by the holder they assent to such acceptance.

Explanation.-An acceptance is qualified

(a) where it is conditional, declaring the payment to be dependent or the happening of an event therein stated;

(b) where it undertakes the payment of part only of the sum ordered to be paid;

(c) where, no place of payment being specified on the order, it undertakes the payment at a specified place, and not otherwise or elsewhere, or where a place of payment being specified in the order, it undertakes the payment at some other place and not otherwise or elsewhere;

(d) where it undertakes the payment at a time other than that at which under the order or would be legally due.

Section 87. Affect of material alteration.

Any material alteration of a negotiable instrument renders the same void as against anyone who is a party thereto at the time of making such alteration and does not consent thereto, unless it was made in order to carry out the common intention of the original parties;

Alteration by endorsee:- And any such alteration, if made by an endorsee, discharges his endorser from all liability to him in respect of the consideration thereof.

The provisions of this section are subject to those of sections 20, 49, 86 and 125.

Section 88. Acceptor or endorser bound notwithstanding previous alteration.

An acceptor or endorser of a negotiable instrument is bound by the acceptance or endorsement notwithstanding any previous alteration of the instrument.

Section 89. Payment of instrument on which alteration is not apparent

¹[(1)] Where a promissory note, bill of exchange or cheque has been materially altered but does not appear to have been so altered, or where a cheque is presented for payment which does not at the time of presentation appear to be crossed or to have had a crossing which has been obliterated, payment thereof by a person or banker liable to pay an paying the same according to the apparent tenor thereof at the time of payment and otherwise in due course, shall discharge such person or banker liable to pay and paying the same according to the apparent tenor thereof at the time of payment and otherwise in due course, shall discharge such a person or banker from all liability thereon, and such payment shall not be questioned by reasons of the instrument having been altered, or the cheque crossed.

²[(2) Where the cheque is an electronic image of a truncated cheque, any difference in apparent tenor of such electronic image and the truncated cheque shall be a material alteration and it shall be the duty of the bank or the clearing house, as the case may be, to ensure the exactness of the apparent tenor of electronic image of the truncated cheque while truncating and transmitting the image.

(3) Any bank or a clearing house which receives a transmitted electronic image of a truncated cheque, shall verify from the party who transmitted the image to it, that the image so transmitted to it and received by it, is exactly the same.]

1. Section 89 re-numbered as sub-section (1) thereof by Act 55 of 2002, sec. 5 (w.e.f. 6-2-2003).

2. Ins. by Act 55 of 2002, sec. 5 (w.e.f. 6-2-2003).

Section 90. Extinguishments of rights of action on bill in acceptor’s hands.

If a bill of exchange which has been negotiated is, at or after maturity, held by the acceptor in his own right, all rights of action thereon are extinguished.

Chapter VIII – Of Notice Of Dishonor

Section 91. Dishonor by non- acceptance.

A bill of exchange is said to be dishonored by non-acceptance when the drawee, or one of several drawee not being partners, makes default in acceptance upon being duly required to accept the bill, or where presentment is excused and the bill is not accepted. Where the drawee is incompetent to contract, or the acceptance is qualified the bill may be treated as dishonored

Section 92. Dishonors by non-payment.

A promissory note, bill of exchange or cheque is said to be dishonored by non-payment when the maker of the note, acceptor of the bill or drawee of the cheque makes default in payment upon being duly required to pay the same.

Section 93. By and to whom notice should be given.

When a promissory note, bill of exchange or cheque is dishonored by non-payment, the holder thereof, or some party thereto who remains liable thereon, must given notice that the instrument has been so dishonored to all other parties whom the holder seeks to make severally liable thereon, and to some one of several partied whom he seeks to make jointly liable thereon.

Nothing in this section renders it necessary to give notice to the maker of the dishonored promissory note, or acceptor of the dishonored bill of exchange or cheque.

Section 94. Mode in which notice may be given.

Notice of dishonor may be given to a duly authorized agent of the person to whom it is required to be given, or , where he has died, to his legal representative, or, where he has been declared an insolvent, to his assignee, maybe oral or written, may, if written, be sent by post, and may be in any form, but it must inform the party to whom it is given, either in express terms or by reasonable intendment that the instrument has been dishonored, and in what way, and that he will be held liable thereon, and it must be given within a reasonable time after dishonor, at the place of business or (in case such party has no place of business) at the residence of the party for whom it is intended.

IF the notice is duly directed and sent by post and miscarries, such miscarriage does not render the notice invalid.

Section 95. Party receiving must transmit notice of dishonor.

Any party receiving notice of dishonor must in order to render any prior party liable to himself, give notice of dishonor to such party within a reasonable time , unless such party otherwise receives due notice as provided by section 93.

Section 96. Agent for presentment.

When the instrument is deposited with an agent for presentment, the agent is entitled to the same time to give notice to his principal as if he were the holder giving notice of dishonor, and the principal is entitled to a further like period to give notice of dishonor.

Section 97. When party to whom notice given is dead.

When the party to whom notice of dishonor is dispatched is dead, but the party dispatching the notice is ignorant of his death, the notice is sufficient.

Section 98. When notice of dishonor is unnecessary.

Notice of dishonor is necessary

(a) when it is dispensed with by the party entitled thereto

(b) in order to charge the drawer, when he has countermanded payment

(c) when the party charged could not suffer damage for want of notice

(d) when the party entitled to notice cannot after due search be found, or the party bound to give notice is, for any other reason, unable without any fault of his own to give it.

(e) to charge the drawers, when the acceptors is also a drawer.

(f) in the case of a promissory note which is not negotiable.

(g) when the party entitled to notice, knowing the facts, promise unconditionally to pay the amount due on the instrument.

Chapter IX – No Noting And Protest

Section 99. Noting.

When a promissory note or bill of exchange has been dishonored non-acceptance or non-payment, the holder may cause such dishonor to be noted by a notary public upon the instrument, or upon a paper attached thereto, or partly upon each.

Such note must be made within a reasonable time after dishonor, and must specify the date of dishonor, the reason, if any, assigned for such dishonor, or, if the instrument has not been expressly dishonored, the reason why the holder treats it as dishonored, and the notary’s charges.

Section 100. Protest.

When a promissory note or bill of exchange has been dishonored by non-acceptance or non-payment, the holder may, within a reasonable time, cause such dishonor to be noted and certified by a notary public. Such dishonor to be noted and certified by a notary public. Such certificate is called a protest.

Protest for bitter security.- When the acceptor of a bill of exchange has become insolvent, or his credit has been publicly impeached, before the maturity of the bill, the holder may, within a reasonable time, cause a notary public to demand better security of the acceptor, and on its being refused may, with a reasonable time, cause such facts to be noted and certified as aforesaid. Such certificate is called a protest for better security.

Section 101. Contents of protest.

A protest under section 100mmust contain

(a) either the instrument itself, or a literal transcript of the instrument and of everything written or printed thereupon;

(b) the name of the person for whom and against whom the instrument has been protested;

(c) a statement that payment or acceptance, or better security, as the case may be, has been demanded of such person by the notary public; the terms of his answer, if any, or a statement that he could not be found;

(d) when the note or bill has been dishonored, the place and time of dishonor, and, when better security has been refused, the place and time of refusal;

(e) the subscription of the notary public making the protest;

(f) in the event of an acceptance for honor or of a payment for honor, the name of the person by whom, of the person whom, and the manner in which, such acceptance or payment was offered and effected.

¹[A notary public may make the demand mentioned in clause (c) of this section either person or by his clerk or, were authorised by agreement or usage, by registered letter.]

1. Added by Act 2 of 1885, sec. 5.

Section 102. Notice of protest.

When a promissory note or bill of exchange is required by law to be protested; notice of such protest must be given instead of notice of dishonor, in the same manner and subject to the same conditions; but the notice may be given by the notary public who makes the protest.

Section 103. Protest of non-payment after dishonor by non-acceptance.

All bills of exchange drawn payable at some other place than the place mentioned as the residence of the drawee, and which are dishonored by non-acceptance, may, without further presentment to the drawee, be protested for non-payment, in the place specified for payment, unless paid before or at maturity.

Section 104. Protest of foreign bills.

Foreign bills of exchange must be protested for dishonor when such protest is required by the law of the place where they are drawn.

Section 104A. When noting equivalent to protest

¹[104A.When noting equivalent to protest

For the purpose of this Act, where a bill of notes is required to be protested within a specified time or before some further proceeding is taken is it sufficient that the bill has been noted for protest before the expiration of the specified time or the taking of the proceeding; and the formal protest may be extended at any time thereafter as of the date of the noting.]

1. Inserted by Act 2 of 1885, sec. 6.

Chapter X – Of Reasonable Time

Section 105. Reasonable time.

In determining what is a reasonable time for presentment for acceptance or payment, for giving notice of dishonor and for noting, regard shall be had to the nature of the instrument and the usual course of dealing with respect to similar instruments; and., in calculating such time, public holidays shall be excluded.

Section 106. Reasonable time of giving notice of dishonor.

If the holder and the party to whom notice of dishonor is give carry on business or live (as the case may be) in different places, such notice is given within a reasonable time if it is dispatched by the next post or on the day next after the day of dishonor.

If the said parties carry on business or live in the same place, such notice is given within a reasonable time if it is dispatched in time to reach its destination on the day next after the day of dishonor.

Section 107. Reasonable time for transmitting such notice.

A party receiving notice of dishonor, who seeks to enforce his right against a prior party, transmits the notice within a reasonable time if he transmits it within the same time after its receipt as he would have had to give notice if he had been the holder.

Chapter XI – Of Acceptance And Payment For Honor And Reference In Case Of Need

Section 108. Acceptance for honour

When a bill of exchange has been noted or protested for non-acceptance or for better security, any person not being a party already liable thereon may, with the consent of the holder, by writing on the bill accept the same for the honour of any party thereto.

¹[* * *].

1. Second sentence omitted by Act 2 of 1985, sec. 7.

Section 109. How acceptance for honour must be made

A person desiring to accept for honour must, ¹[by writing on the bill under his hand], declare that he accepts under protest the protested bill for the honour of the drawer or of a particular endorser whom he names, or generally for honour ²[* * *].

1. Substituted by Act 2 of 1885, section. 8, for “in the presence of a notary public, subscribe the bill with his own hand, and”.

2. The Words “and such declaration must be recorded by the notary in his register” omitted by Act 2 of 1885, section 8.

Section 110. Acceptance not specifying for whose honor it is made.

Where the acceptance does not express for whose honor it is made for the honor of the drawer.

Section 111. Liability of acceptor for honor.

An acceptor for honor binds himself to all parties subsequent to the party for whose honor he accepts to pay the amount of the bill if the drawee do not; and such party and all prior parties are liable in their respective capacities to compensate the acceptor for honor for all loss or damage sustained by him in consequence of such acceptance.

But an acceptor for honor is not liable to the holder of the bill unless it is presented, or (in case the address given by such acceptor on the bill is a place other than the place where the bill is made payable) forwarded for presentment, not later than the day next after the day of its maturity.

Section 112. When acceptor for honor may be charged.

An acceptor for honor cannot be charged unless the bill has at its maturity been presented to the drawee for payment, and has been dishonored by him, and noted or protested for such dishonor.

Section 113. Payment for honour

When a bill of exchange has been noted or protested for non-payment, any person may pay the same for the honour of any part liable to pay the same; provided that the person so paying ¹[or his agent in that behalf] has previously declared before a notary public the party for whose honour he pays, and that such declaration has been recorded by such notary public.

1. Inserted by Act 2 of 1885, Section 9.

Section 114. Right of payer for honor.

Any person so paying is entitled to all the rights in respect of the bill, of the holder at the time of such payment, and may recover from the party for whose honor he pays all sums so paid, with interest thereon and with all expenses properly incurred in making such payment.

Section 115. Drawee in case of need

Where a drawee in case of need is named in a bill of exchange, or in any endorsement thereon, the bill is not dishonored until it has been dishonored by such drawee.

Section 116. Acceptance and payment without protest

A drawee in case of need may accept and pay the bill of exchange without previous protest.

Chapter XII – Of Compensation

Section 117. Rules as to compensation

The compensation payable in case of dishonour of promissory note, bill of exchange or cheque, by any party liable to the holder or any indorsee, shall ¹[***] be determined by the following rules:

(a) The holder is entitled to the amount due upon the instrument together with the expense property incurred in presenting, noting and protesting it;

(b) When the person charged resides at a place different from that at which the instrument was payable, the holder is entitled to receive such sum at the current rate of exchange between the two places;

(c) An endorser who, being liable, has paid the amount due on the same is entitled to the amount so paid with interest at ²[eighteen per centum] per annum from the date of payment until tender or realisation thereof, together with all expenses caused by the dishonour and payment.

(d) When the person charged and such endorser resides at different places, the endorser is entitled to receive such sum at the current rate of exchange between the two places;

(e) The party entitled to compensation may draw a bill upon the party, liable to compensate him, payable at sight or on demand, for the amount due to him, together with all expenses properly incurred by him. Such bill must be accompanied by the instrument dishonoured and the protest thereof (if any). If such bill is dishonoured , the party dishonoring the same is liable to make compensation thereof in the same manner as in the case of the original bill.

1. The words figure and brackets “(except in cases provided for by the Code of Civil Procedure’ sections 532)” omitted by Act 30 of 1926, section 3.

2. Substituted by Act 66 of 1988, section 3 for ‘six per centum’ (w.e.f. 30-12-1988).

Chapter XIII – Special Rules  Of Evidence

Section 118. Presumptions as to negotiable instruments of consideration

Until the contrary is proved, the following presumptions shall be made:

(a) of consideration-that every negotiable instrument was made or drawn for consideration, and that every such instrument, when it has been accepted, indorsed, negotiated or transferred, was accepted, indorsed, negotiated or transferred for consideration;

(b) as to date- that every negotiable instrument bearing a date was made or drawn on such date;

(c) as to time of acceptance- that every accepted bill of exchange was accepted within a reasonable time after its date its date and before its maturity;

(d) as to time of transfer.- that every transfer of a negotiable instrument was made before its maturity;

(e) as to order of endorsements – that the endorsements appearing upon a negotiable instrument were made in the order in which they appear thereon;

(f) as to stamps-that a lost promissory note, bill of exchange or cheque was duly stamped;

(g) that holder is a holder in due course – that the holder of a negotiable instrument is a holder in due course; provided that, where the instrument has been contained from its lawful owner, or form any person in lawful custody thereof, by means of an offence or fraud, or for unlawful consideration, the burden of proving that the holder is a holder in due course lies upon him.

Section 119. Presumption on proof of protest

In a suit upon an instrument which has been dishonored, the Court shall, on proof of the protest, presume the fact of dishonor, unless and until such fact is disproved.

Section 120. Estoppels against denying original validity of instrument

No maker of a promissory note, and no drawer of a bill of exchange or cheque, and no acceptor of a bill of exchange for the honor of the drawer shall, on proof of the protest, presume the fact of dishonor, unless and until validity of the instrument as originally made or drawn.

Section 121. Estoppel against denying capacity of payee to endorse

No maker of a promissory note and no acceptor of a bill of exchange or cheque, and no acceptor of a bill of exchange ¹[payable to order] shall, in suit thereon by a holder in due course, be permitted to deny the payee’s capacity, at the rate or the note or bill, to endorse the same.

1. Substituted by Act 8 of 1919, sec. 5 for “payable to, or to the order of, a specified person”.

Section 122. Estoppels against denying signature or capacity of prior party

No. endorser of a negotiable instrument shall, in a suit thereon by a subsequent holder, be permitted to deny the signature or capacity to contract to contract of any prior party to the instrument.

Chapter XIV – Of Crossed Cheques

Section 123. Cheque crossed generally

Where a cheque bears across its face an addition of the words “and company” or any abbreviation thereof, between two parallel transverse lines, or of two parallel transverse lines simply, either with or without the words “not negotiable”. That addition shall be deemed a crossing, and the cheque shall be deemed to be crossed generally.

Section 124. Cheque crossed specially

Where a cheque bears across its face an addition of the name of a banker, either with or without the words “not negotiable”, that addition shall be deemed a crossing, and the cheque shall be deemed to be crossed specially, and to be crossed to that banker.

Section 125. Crossing after issue

Where a cheque is uncrossed, the holder may cross it generally or specially.

Where a cheque is crossed generally, the holder may cross it specially.

Where a cheque is crossed generally or specially, the holder may add the words “not negotiable”.

Where a cheque is crossed specially, the banker to whom it is crossed may again cross it specially to another banker, his agent, for collection.

Section 126. Payment of cheque crossed generally

Where a cheque is crossed generally, the banker on whom it is drawn shall not pay it otherwise than to a banker.

Payment of cheque crossed specially.- Where a cheque is crossed specially, the banker on whom it is drawn shall not pay it otherwise than to the banker to whom it is crossed, or his agent for collection.

Section 127. Payment of cheque crossed specially more than once

Where a cheque is crossed specially to more than one banker, except when crossed to an agent for the purpose of collection, the banker on whom it is drawn shall refuse payment thereof.

Section 128. Payment in due course of crossed cheque

Where the banker on whom a crossed cheque is drawn has paid the same in due course, the banker paying the cheque, and (in case such cheque has come to the hands of the payee) the drawer thereof, shall respectively be entitled to the same rights, and be placed in the same position in all respects, as they would respectively be entitled to and placed in if the amount of the cheque had been paid to and received by the true owner thereof.

Section 129. Payment of cheque crossed specially more than once

Any banker paying a cheque crossed generally otherwise than to a banker or a cheque crossed specially otherwise than to the banker to whom the same is crossed, or his agent for collection, being a banker, shall be liable to the true owner of the cheque for any loss he may sustain owing to the cheque having been so paid.

Section 130. Cheque bearing “not negotiable”

A person taking a cheque crossed generally or specially, bearing in either case the words “not negotiable”, shall not have and shall not be capable of giving, a better title to the cheque than that which the person from whom he took it had.

Section 131. Non-liability of banker receiving payment of cheque

A banker who has in good faith and without negligence received payment for a customer of a cheque crossed generally or specially to himself shall not, in case the title to the cheque proves defective, incur any liability to the true owner of the cheque by reason only of having received such payment.

¹[²[Explanation I]:- A banker receives payment of a crossed cheque for a crossed cheque for a customer within the meaning of his section notwithstanding that he credits his customer’s accounts with the amount of the cheque before receiving payment thereof].

³[“Explanation II:- It shall be the duty of the banker who receives payment based on an electronic image of a truncated cheque held with him, to verify the prima facie genuineness of the cheque to be truncated and any fraud, forgery or tampering apparent on the face of the instrument that can be verified with due diligence and ordinary care.

1. Added by Act 18 of 1922, sec. 2.

2. Explanation re-numbered as Explanation I thereof by Act 55 of 2002, sec. 6 (w.e.f. 6-2-2003).

3. Inserted by Act 55 of 2002, sec. 6 (w.e.f. 6-2-2003).

Section 131A. Application of chapter to drafts

¹[131A.Application of chapter to drafts

The provisions of this chapter shall apply to any draft, as defined in section 85A, as if the draft were a cheque.

1. Added by Act 33 of 1947, section 2.

Chapter XV – Of Bills In Sets

Section 132. Set of bills

Bills of exchange may be drawn in parts, each part being numbered and containing a provision that it shall continue payable only so long as the others remain unpaid. All the parts together make a set; but the whole set constitutes only one bill, and is extinguished when one of the parts if a separate bill, would be extinguished.

Exception:- When a person accepts or indorses different parts of the bill in favour of different persons, he hand the subsequent endorsers of each are liable on such part as if it were a separate bill.

Section 133. Holder of first acquired part entitled to all

As between holders in due course of different parts of the same set, he who first acquired title to his part is entitled to the other parts and the money represented by the bill.

Chapter XVI – Of International Law

Section 134. Law governing liability of maker, acceptor or endorser of foreign instrument

In the absence of a contract to the contrary, the liability of the maker of drawer of a foreign promissory note, bill of exchange or cheque is regulated in all essential matters by the law of the place where he made the instrument, and the respective liabilities of the acceptor and endorser by the law of the place where the instrument is made payable.

Illustration

A bill of exchange was drawn by A California where the rate of interest is 25 percent, and accepted by B, payable in Washington where the rate of interest is 6 per cent. The bill is endorsed in ¹[India], and is dishonoured. An action on the bill is brought against B in ¹[India]. He is liable to pay interest at the rate of 6 per cent, only; but if A is charged as drawer, A is liable to pay interest at the rate of 25 percent.

1. Subs. by Act 3 of 1951, sec. 3 and Sch., for “the State”

Section 135. Law of place of payment governs dishonours

Where a promissory note, bill of exchange or cheque is made -payable in a different place from that in which it is made or endorsed, the law of the place, where it is made payable determines what constitutes dishonour and what notice of dishonour is sufficient.

Illustration

A bill of exchange drawn and endorsed in ¹[India], but accepted payable in France, is dishonoured. The endorsee cause it to be protested for such dishonour, and gives notice thereof in accordance with the law of France through not in accordance with the rules herein contained in respect of bills which are no! foreign. The notice is sufficient.

1. Subs. by Act 3 of 1951, sec. 3 and Sch., for “the State”.

Section 136. Instrument made, etc. out of India, but in accordance with the law of India

If a negotiable instrument is made, drawn accepted or endorsed 1[outside India], but in accordance with the ¹[law of India] the circumstance that any agreement evidenced by such instrument is invalid according to the law of the country wherein it was entered into does not invalidate any subsequent acceptance or endorsement made thereon ¹[within India]

1. The words “out of British India” were successively amended by the A.O. 1948, the A.O. 1950 and Act 3 of 1951, sec. 3 and Sch to read abobe.

Section 137. Presumption as to foreign law

The law of any foreign country ¹[* * *] regarding promissory note, bills of exchange and cheques shall be presumed to be the same as that of ²[India], unless and until the contrary is proved.

1. The words “or the State Jammu and Kashmir” omitted by Act 62 of 1956, sec. 2 and Sch.

2. Subs. by Act 3 of 1951, sec. 3 and Sch., for “the State”.

Chapter XVII – Of Penalties In  Case Of Dishonor Of Certain Cheque For Insufficiency Of Funds In The Accounts

Section 138. Dishonour of cheque for insufficiency, etc., of funds in the accounts

¹[CHAPTER XVII]

OF PENALTIES IN CASE OF DISHONOUR OF CERTAIN CHEQUES FOR INSUFFICIENCY OF FUNDS IN THE ACCOUNTS

Where any cheque drawn by a person on an account maintained by him with a banker for payment of any amount of money to another person from out of that account for the discharge, in whole or in part, of any debt or other liability, is returned by the bank unpaid, either because of the amount of money standing to the credit of that account is insufficient to honour the cheque or that it exceeds the amount arranged to be paid from that account by an agreement made with that bank, such person shall be deemed to have committed an offence and shall without prejudice to any other provisions of this Act, be punished with imprisonment for ²[“a term which may extend to two year”], or with fine which may extend to twice the amount of the cheque, or with both:

Provided that nothing contained in this section shall apply unless

(a) The cheque has been presented to the bank within a period of six months from the date on which it is drawn or within the period of its validity, whichever is earlier.

(b) The payee or the holder induce course of the cheque, as the case may be, makes a demand for the payment of the said amount of money by giving a notice, in writing, to the drawer, of the cheque, ³[“within thirty days”] of the receipt of information by him from the bank regarding the return of the cheques as unpaid, and

(c) The drawer of such cheque fails to make the payment of the said amount of money to the payee or, as the case may be, to the holder in due course of the cheque, within fifteen days of the receipt of the said notice.

Explanation: For the purpose of this section, “debt or other liability” means a legally enforceable debt or other liability].

OBJECTS AND REASONS OF AMENDING ACT OF 2002

The Negotiable Instruments Act, 1881 was amended by the Banking, Public Financial Institutions and Negotiable Instruments Laws (Amendment) Act, 1988 wherein a new Chapter XVII was incorporated for penalties in case of dishonour of cheques due fo insufficiency of funds in the account of the drawer of the cheque. These provisions were incorporated with a view to encourage the culture of use of cheques and enhancing the credibility of the instrument. The existing provisions in the Negotiable Instruments Act, 1881, namely, sections 138 to 142 in Chapter XVII have been found deficient in dealing with dishonour of cheques, Not only the punishment provided in the Act has proved to be inadequate, the procedure prescribed for the Courts to deal with such matters has been found to be cumbersome. The Courts are unable to dispose of such cases expeditiously in a time bound manner in view of the procedure contained in the Act- (Para 1)

Keeping in view the recommendations of the Standing Committee on Finance and other representations, it has been decided to bring out, inter alia, the following amendments in the Negotiable Instruments, Act, 1881, namely:

(i) to increase the punishment as prescribed under the Act from one year to two years;

(ii) to increase the period for issue of notice by the payee to the drawer from 15 days to 30 days; (Para 4)

1. Inserted by Act 66 of 1988, , sec. 4 (w.e.f. 1-4-1989). Earlier Chapter XVII relating to ” Notaries Public” Inserted by Act 2 of 1985, sec. 10, was replaced by the Notaries Act, 1952 (53 of 1952), sec. 16 (w.e.f. 14-2-1956).

2. Substituted by Act 55 0f 2002, sec. 7 for “a term which may extended to one year” (w.e.f. 6-2-2003).

3. Substituted by Act 55 of 2002, sec. 7, for “within Fifteen days” (w.e.f. 6-2-2003).

Section 139. Presumption in favour of holder

¹[Presumption in favour of holder

It shall be presumed, unless the Contrary is proved, that the holder of a cheque received the cheque of the nature referred to in section 138 for the discharge, in whole or in part, or any debt or other liability].

1. Ins. by Act 66 of 1988, sec. 4 (w.e.f. 1-4-1989).

Section 140. Defence which may not be allowed in any prosecution under section 138

¹[Defence which may not be allowed in any prosecution under section 138 It shall not be a defence in a prosecution of an offence under section 138 that the drawer had no reason to believe when he issued the cheque that the cheque may be dishonoured on presentment for the reasons stated in that section].

1. Ins. by Act 66 of 1988, sec. 4 (w.e.f. 1-4-1989)

Section 141- Offences by companies.

¹[Offences by companies.

(1) If the person committing an offence under section 138 is a company, every person who, at the time the offence was committed, was in charge of, and was responsible to the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and proceeded against and punished accordingly];

Provided that nothing contained in this sub-section shall render any person liable to punishment if he proves that the offence was committed without his knowledge, or that he had exercised all due diligence to prevent the commission of such offence.

²[“Provided further that where a person is nominated as a Director of a company by virtue of his holding any office or employment in the Central Government or State Government or a financial corporation owned or controlled by the Central Government or the State Government, as the case may be, he shall not be liable for prosecution under this Chapter.]

(2) Notwithstanding anything contained in sub-section (1), where any offence under this Act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attribute to, any neglect on the part of, any director, Manager, secretary, or other office of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly. Explanation: For the purpose of this section.

(a) “Company” means any body corporate and includes a firm or other association of individuals; and

(b) “Director”, in relating to a firm, means a partner in the firm.

OBJECTS AND REASONS OF AMENDING ACT OF 2002

The existing provisions in the Negotiable Instruments Act, 1881, namely, sections 138 to 142 in Chapter XVII have been found deficient in dealing with dishonour of cheques. Not only the punishment provided in the Act has proved to be inadequate, the procedure prescribed for the Courts to deal with such matters has been found to be cumbersome. The Courts are unable to dispose of such cases expeditiously in a time bound manner in view of the procedure contained in the Act

Keeping in view the recommendations of the Standing Committee on Finance and other representations, it has been decided to bring out, inter alia, the following amendments in the Negotiable Instruments, Act, 1881, namely:

(viii) to exempt those directors from prosecution under section 141 of the Act who are nominated as directors of a company by virtue of their holding any office or employment in the Central Government or State Government or a financial corporation owned or controlled by the Central Government, or the State Government, as the case may be;

1. Ins by Act 66 of 1988, sec. 4 (w.e.f. 1-4-1989).

2. Ins. by Act 55 of 2002, sec. 8 (w.e.f. 6-2-2003).

Section 142. Cognizance of offences

¹[Cognizance of offences

Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974).

(a) No court shall take cognizance of any offence punishable under section 138 except upon a complaint, in writing, made by the payee or, as the case may be, the holder in due course of the cheque; (b) Such complaint is made within one month of the date on which the cause of action arises under clause (C) of the proviso to section 138:

²[“Provided that the cognizance of a complaint may be taken by the Court after the prescribed period, if the complainant satisfies the Court that he had sufficient cause for not making a complaint within such period.]

(c) No court inferior to that of a Magistrate or a Judicial Magistrate of the first class shall try any offence punishable under section 138].

OBJECTS AND REASONS OF AMENDING ACT OF 2002

Keeping in view the recommendations of the Standing Committee on Finance and other representations, it has been decided to bring out, inter alia, the following amendments in the Negotiable Instruments, Act, 1881, namely:

(iii) to provided discretion to the Court to waive the period of one month, which has been prescribed for taking cognizance of case under the Act;

1. Ins. by Act 66 of 1988, sec. 4 (w.e.f. 1-4-1989).

2. Ins. by Act 55 of 2002, sec. 9 (w.e.f. 6-2-2003).

Section 143. Power of Court to try cases summarily.

¹[143. Power of Court to try cases summarily.

(1) Notwithstanding anything contained in the Code of Criminal Procedure, 1973 (2 of 1974) all offences under this Chapter shall be tried by a Judicial Magistrate of the first class or by a Metropolitan Magistrate and the provisions of sections 262 to 265 (both inclusive) of the said Code shall, as far as may be, apply to such trials:

Provided that in the case of any conviction in a summary trial under this section, it shall be lawful for the Magistrate to pass a sentence of imprisonment for a term not exceeding one year and an amount of fine exceeding five thousand rupees:

Provided further that when at the commencement of, or in the course of, a summary trial under this section, it appears to the Magistrate that the nature of the case is such that a sentence of imprisonment for a term exceeding one year may have to be passed or that it is, for any other reason, undesirable to try the case summarily, the Magistrate shall after hearing the parties, record an order to that effect and thereafter recall any witness who may have been examined and proceed to hear or rehear the case in the manner provided by the said Code.

(2) The trial of a case under this section shall, so far as practicable, consistently with the interests of justice, be continued from day to day until its conclusion, unless the Court finds the adjournment of the trial beyond the following day to be necessary for reasons to be recorded in writing.

(3) Every trial under this section shall be conducted as expeditiously as possible and an endeavour shall be made to conclude the trial within six months from the date of filing of the complaint.]

1. Section 143 to 147 ins. by Act 55 of 2002, sec. 10 (w.e.f. 6-2-2003).

Section 144. Mode of service of summons.

¹[Mode of service of summons.

(1) Notwithstanding anything contained in the Code of Criminal Procedure, 1973, (2 of 1974) and for the purposes of this Chapter, a Magistrate issuing a summons to an accused or a witness may direct a copy of summons to be served at the place where such accused or witness ordinarily resides or carries on business or personally works for gain, by speed post or by such courier services as are approved by a Court of Session.

(2) Where an acknowledgment purporting to be signed by the accused or the witness or an endorsement purported to be made by any person authorised by the postal department or the courier services that the accused or the witness refused to take delivery of summons has been received, the Court issuing the summons may declare that the summons has been duly served.

1. Section 143 to 147 ins. by Act 55 of 2002, sec. 10 (w.e.f. 6-2-2003).

Section 145. Evidence on affidavit.

¹[Evidence on affidavit.

(1) Notwithstanding anything contained in the Code of Criminal Procedure, 1973, (2 of 1974.) the evidence of the complainant may be given by him on affidavit and may, subject to all just exceptions be read in evidence in any enquiry, trial or other proceeding under the said Code.

(2) The Court may, if it thinks fit, and shall, on the application of the prosecution or the accused, summon and examine any person giving evidence on affidavit as to the facts contained therein.]

1. Section 143 to 147 ins. by Act 55 of 2002, sec. 10 (w.e.f. 6-2-2003).

Section 146. Bank’s slip prima facie evidence of certain facts.

¹[146. Bank’s slip prima facie evidence of certain facts.

The Court shall, in respect of every proceeding under this Chapter, on production of bank’s slip or memo having thereon the official mark denoting that the cheque has been dishonoured, presume the fact of dishonour of such cheque, unless and until such fact is disproved.]

1. Section 143 to 147 ins. by Act 55 of 2002, sec. 10 (w.e.f. 6-2-2003).

Section 147. Offences to be compoundable.

¹[147. Offences to be compoundable.

Notwithstanding anything contained in the Code of Criminal Procedure, 1973, (2 of 1974.) every offence punishable under this Act shall be compoundable.]

OBJECTS AND REASONS OF AMENDING ACT OF 2002

Keeping in view the recommendations of the Standing Committee on Finance and other representations, it has been decided to bring out, inter alia, the following amendments in the Negotiable Instruments, Act, 1881, namely:

(iv) to prescribe procedure for dispensing with preliminary evidence of the complainant

(v) to prescribe procedure for servicing of summons to the accused or withness by the Court through speed post or empanelled private couriers;

(vi) to provide summary trial of the cases under the Act with a view to speeding up disposal of cases;

(vii) to make the offences under the Act compoundable;

1. Section 143 to 147 ins. by Act 55 of 2002, sec. 10 (w.e.f. 6-2-2003).

SCH1. Schedule

Enactment repealed

[Rep. by Amending Act, 1891 (12 of 1891), sec. 2 and Sch. I.]

INTRODUCTION

In India, there is reason to believe that instrument to exchange were in use from early times and we find that papers representing money were introducing into the country by one of the Mohammedan sovereigns of Delhi in the early part of the fourtheenth century. The word ‘hundi’, a generic term used to denote instruments of exchange in vernacular is derived from the Sanskrit root ‘hund’ meaning ‘to collect’ and well expresses the purpose to which instruments were utilised in their origin. With the advent of British rule in India commercial activities increased to a great extent. The growing demands for money could not be met be mere supply of coins; and the instrument of credit took the function of money which they represented.

Before the enactment of the Negotiable Instrument Act, 1881, the law of negotiable instruments as prevalent in England was applied by the Courts in India when any question relating to such instruments arose between Europeans. When then parties were Hindu or Mohammedans, their personal law was held to apply. Though neither the law books of Hindu nor those of Mohammedans contain any reference to negotiable instruments as such, the customs prevailing among the merchants of the respective community were recognised by the courts and applied to the transactions among them. During the course of time there had developed in the country a strong body of usage relating to hundis, which even the Legislature could not without hardship to Indian bankers and merchants ignore. In fact, the Legislature felt the strength of such local usages and though fit to exempt them from the operation of the Act with a proviso that such usage may be excluded altogether by appropriate words. In the absence of any such customary law, the principles derived from English law were applied to the Indians as rules of equity justice and good conscience.

The history of the present Act is a long one. The Act was originally drafted in 1866 by the India Law Commission and introduced in December, 1867 in the Council and it was referred to a Select Committee. Objections were raised by the mercantile community to the numerous deviations from the English Law which it contained. The Bill had to be redrafted in 1877. After the lapse of a sufficient period for criticism by the Local Governments, the High Courts and the chambers of commerce, the Bill was revised by a Select Committee. In spite of this Bill could not reach the final stage. In 1880 by the Order of the Secretary of State, the Bill had to be referred to a new Law Commission. On the recommendation of the new Law Commission the Bill was re-drafted and again it was sent to a Select Committee which adopted most of the additions recommended by the new Law Commission. The draft thus prepared for the fourth time was introduced in the Council and was passed into law in 1881 being the Negotiable Instruments Act, 1881 (26 of 1881)

Plantation Labour Act

November 30, 2014

Preamble

[Act No. 69 of 1951]

AN ACT TO PROVIDE FOR THE WELFARE OF THE LABOUR, AND TO REGULATE THE CONDITIONS OF WORK, IN PLANTATIONS Be it enacted by Parliament in the fifth year of Republic of India as follows :

Section 1. Short title, extent, commencement and application.

(1) This Act may be called the Plantation Labour Act, 1951.

(2) It extends to the whole of India except the State of Jammu and Kashmir.

(3) It shall come into force on such date as the Central Government may, by notification in the official Gazette, appoint.

(4) It applies to the following plantations, that is to say, – (a) to any land used or intended to be used for growing tea, coffee, rubber cinchona or cardamom which admeasures 5 hectares or more and in which fifteen or more persons are employed or were employed on any day of the proceeding twelve months;

(b) to any land used or intended to be used for growing any other plant, which admeasures 5 hectares or more and in which fifteen or more persons are employed or were employed on any day of the preceding twelve months, if, after obtaining the approval of the Central Government, the State Government, by notification in the official Gazette, so directs.

Explanation : Where any piece of land used for growing any plant, referred to in Cl. (a) or Cl. (b) of this sub-section admeasures less than 5 hectares and is contiguous to any other piece of land not being so used but capable of being so used, and both such piece of land are under the management of the same employer, then, for the purposes of this sub-section, the piece of land first mentioned shall be deemed to be a plantation, if the total area of the both such pieces of the land admeasures 5 hectares or more.

(5) The State Government may, by notification in the official Gazette, declare that all or any of the provision of this Act shall apply also to any land used or intended to be used for growing any plant referred to Cl. (a) or Cl. (b) of sub-section (4), notwithstanding that -

(a) it admeasures less than 5 hectares, or

(b) the number of persons employed therein is less than fifteen :

Provided that no such declaration shall be made in respect of such land which admeasured less than 5 hectares or in which less than fifteen persons were employed, immediately before the commencement of this Act.

Section 2. Definitions.

In this Act, unless the context otherwise requires, -

(a) “adolescent” means a person who has completed his fourteenth year but has not completed his eighteenth year :

(b) “adult” means a person who has completed his eighteenth year;

(c) “child” means a person who has not completed his fourteenth year;

(d) “day” means a period of twenty – four hours beginning at midnight;

(e) “employer”, when used in relation to a plantation, means the person who has the ultimate control over the affairs of the plantation, and where the affairs of any plantation are entrusted to any other person (whether called a managing agent, manager, superintendent or by other name) such other person shall be deemed to be the employer in relation to that plantation;

(ee) “family”, when used in relation to a worker, means – (i) his or her spouse, and

(ii) the legitimate and adopted children of the worker dependent upon him or her, who have not completed their eighteenth year. and includes, where the worker is a male, his parents dependent upon him.

(eee) “Inspector” means an inspector of plantations appointed under sub-section (1) of Sec. 4 and includes an additional inspector of plantations appointed under sub-section (1-A) of that section;

(f) “plantation” means any plantation to which this Act, whether wholly or in part, applies and includes offices, hospitals, dispensaries schools, and any other premises used for any purpose connected with such plantation, but does not include any factory on the premises to which the provisions of the Factories Act, 1948 (64 of 1948), apply.

(g) “prescribed” means prescribed by rules under this Act;

(h) “qualified medical practitioner” means a person holding a qualification granted by an authority specified or notified under Sec. 3 of the Indian Medical Degrees act, 1916 (7 of 1916), or specified in the Schedules to the Indian Medical Council Act, 1956 (102 of 1956), and includes any person having a certificate granted any Provincial or State Medical Council Act;

(i) “wages” has the meaning assigned to it in Cl. (h) of Sec. 2 of the Minimum Wages Act, 1948 (11 of 1948).

(j) “week” means a period of seven days beginning at midnight on Saturday night or such other night as may be fixed by the State Government in relation to plantations in any area after such consultation as may be prescribed with reference to the plantations concerned in that area;

(k) “worker” means a person employed in a plantation for hire or reward, whether directly or through any agency, to do any work, skilled, unskilled, manual or clerical, but does not include – (i) a medical officer employed in the plantation;

(ii) any person employed in the plantation (including any member of the medical staff whose monthly wages exceed rupees seven hundred and fifty,

(iii) any person employed in the plantation primarily in a managerial capacity, notwithstanding that his monthly wages do not exceed rupees seven hundred and fifty; or

(iv) any person temporarily employed in the plantation in any work relating to the construction, development or maintenance of buildings, roads, bridges, drains or canals;

(l) “young person” means a person who is either a child for an adolescent.

Section 3. Reference to time of day.

In this Act, references to time of day are references to Indian Standard Time being five and a half hours ahead of Greenwhich Means Time : Provided that for any area in which the Indian Standard Time is not ordinarily observed, the State Government may make rules – (a) specifying the area;

(b) defining the local mean time ordinarily observed therein; and

(c) permitting such time to be observed in all or any of the plantations situated in that area.

Section 3A. Appointment of registering officers.

The State Government may by notification in the official gazette, – (a) appoint such persons, being gazetted officers of Government, as it thinks fit, to be registering officers for the purpose of this chapter, and

(b) define the limits within which a registering officer shall exercise the powers and discharge the functions conferred or imposed on him by or under this chapter.

Section 3B. Registration of plantations.

(1) Every employer of the plantation, existing at the commencement of the Plantations Labour (Amendment) Act, 1981, shall within a period of sixty days of such commencement, and every employer of any other plantation coming into existence after such commencement shall, within a period of sixty days of the coming into existence of such plantation, make an application to the registering officer for the registration of such plantation : Provided that the registering officer may entertain any such application after the expiry of the period aforesaid if he is satisfied that the applicant was prevented by sufficient cause from making the application within such period.

(2) Every applicant made under sub-section (1) shall be in such form and shall contain such particulars and shall be accompanied by such fees as may be prescribed.

(3) After the receipt of an application under sub-section (1) the registering officer shall register the plantation.

(4) Where a plantation is registered under this section, the registering officer shall issue a certificate of registration to the employer thereof in such form as many be prescribed.

(5) Where, after the registration of a plantation under this section, any change occurs in the on ownership or management or in the extent of the area or other prescribed particulars in respect of such plantation, the particulars regarding such change shall be intimated by the employer to the registering officer within thirty days of such change in such form as may be prescribed.

(6) Where as a result of any intimation received under sub-section (5), the registering officer is satisfied that the plantation is no longer required to be registered under this section, he shall, by order in writing, cancel the registration thereof and shall, as soon as practicable, cause such order to be published in any one newspaper in the language of, and having circulation in, the area where the plantation is situated.

Section 3C Appeals against order of registering officer.

(1) Any person aggrieved by the order of a registering officer under sub-section (6) of Sec. 3-B may, within thirty days of the publication of such order in the newspaper under that sub-section, prefer an appeal to such authority as may be prescribed. Provided that the appellate authority may entertain an appeal under this sub-section after the expiry of the aforesaid period if it is satisfied that the appellant was prevented by sufficient cause from referring the appeal within such period.

(2) After the receipt of an appeal under sub-section (1), the appellate authority may, after giving the appellant, the employer refereed to in sub-section (5) of Sec. 3-B and the registering officer an opportunity of being heard in the matter, dispose of the appeal as expeditiously as possible.

Section 3D. Power to make rules.

(1) State Government may, by notification in the official Gazette, make rules to carry out the purposes of this Chapter.

(2) In particular, and without prejudice to the generality of the fore-going power, such rules may provide for all or any of the following matters, namely :

(a) the form of application for the registration of a plantation, the particulars to be contained in such application and the fees to be accompanied along with such application;

(b) the form of the certificate of registration;

(c) the particulars regarding any change in respect of which intimation shall be given by the employer to the registering officer under sub-section

(5) of sec. 3-B and the form in which such change shall be intimated;

(d) the authority to which an appeal may be preferred under Sec. 3-C and the fees payable in respect of such appeal;

(e) the registers to be kept and maintained by the registering officer.

Section 4. Chief inspector and inspectors.

(1) The State Government may, by notification in the official Gazette, appoint for the State a duly qualified person to be the chief inspector of plantation and so many duly qualified person to be inspectors of plantation subordinate to the chief inspector as it thinks fit.

(1-A) The State Government may also, by notification in the official Gazette, appoint such officers of the State Government or of any local authority under its control, as it thinks fit, to be additional inspectors of plantation for all or any of the purpose of this Act.

(2) Subject to such rules as may be made in this behalf by the State Government, the chief inspector may declare the local area or areas within which, or the plantation with respect to which, inspectors shall exercise their powers under this Act, and may himself exercise the powers of an inspector within such limits as may be assigned to him by the State Government.

(3) The chief inspector and all inspectors shall be deemed to be public servants within the meaning of the Indian Penal Code, 1860 (45 of 1860).

Section 5. Power and functions of inspectors.

Subject to any rules made by the State Government in this behalf, an inspector may, within the local limits for which he is appointed – (a) make such examination and inquiry as he thinks fit in order to ascertain whether the provisions of the Act and of the rules made thereunder are being observed in the case of any plantation;

(b) with such assistants, if any, as he thinks fit, enter, inspect and examine any plantation or part thereof at any reasonable time for the purpose of carrying out the objects of this Act;

(c) examine the crops grown in any plantation or any worker employed therein or require the production of any register or other document maintained in pursuance of this Act, and take on the spot or otherwise statements of any person which he may consider necessary for carrying out the purpose of this Act;

(d) exercise such other powers as may be prescribed :

Provided that no person shall be compelled under this section to answer any question or make any statement tending to incriminate himself.

Section 6. Facilities to be afforded to inspectors.

Every employer shall afford the inspector all reasonable facilities for making any entry, inspection, examination or inquiry under this Act.

Section 7. Certifying surgeons.

(1) The State Government may appoint qualified medical practitioners to be certifying surgeons for the purposes of this Act within such local limits or for such plantation or class of plantations or it may assign to them respectively.

(2) The certifying surgeon shall carry out duties as may be prescribed in connection with – (a) the examination and certification of workers;

(b) the exercise of such medical supervision as may be prescribed where adolescents and children are, or are to be; employed in any work in any plantation which is likely to cause injury to their health.

Section 8. Drinking water.

In every plantation effective arrangements shall be made by the employer to provide and maintain at convenient places in the plantation a sufficient supply of wholesome drinking water for all workers.

Section 9. Conservancy.

(1) There shall be provided separately for males and females in every plantation a sufficient number of latrines and urinals of prescribed types so situated as to be convenient and accessible to workers employed therein.

(2) All latrines and urinals provided under sub-section (1) shall be maintained in a clean and sanitary condition.

Section 10. Medical facilities.

(1) In every plantation there shall be provided and maintained so as to be readily available such medical facilities for the workers and their families as may be prescribed by the State Government.

(2) If in any plantation medical facilities are not provided and maintained as required by sub-section (1) the chief inspector may cause to be provided therein such medical facilities and recover the cost thereof from the defaulting employer.

(3) For the purposes of such recovery the chief inspector may certify the costs to be recovered to the Collector, who may recover the amount as an arrear of land-revenue.

Section 11. Canteens.

(1) The State Government may make rules requiring that in every plantation wherein one hundred and fifty workers are ordinarily employed, one or more canteens shall be provided and maintained by the employer for the use of the workers.

(2) Without prejudice to the generality of the foregoing power, such rules may provide for – (a) at date by which the canteen shall be provided :

(b) the number of canteens that shall be provided and the standards in respect of construction, accommodation, furniture and other equipments of the canteens;

(c) the foodstuffs which may be served therein and the charges which may be made therefor;

(d) the constitution of a managing committee for the canteen and the representation of the workers in the management of the canteen;

(e) the delegation to the chief inspector, subject to such conditions as may be prescribed, of the power to make rules under Cl. (c).

Section 12. Creches.

(1) In every plantation wherein fifty or more women workers (including women workers employed by any contractor) are employed or employed on any day of the preceding twelve months, or where the number of children of women workers (including women workers employed by any contractor) is twenty or more, there shall be provided and maintained by the employer suitable rooms for the use of children of such women workers.

Explanation : For the purposes of this sub-section (1-A) “children” means persons who are below the age of six years. (1-A) Notwithstanding anything contained in sub-section (1), if in respect of any plantation wherein less than fifty women workers (including women workers employed by any contractor) are employed or were employed on any day of the preceding twelve months, or where the number of children of such women workers is less than twenty, the State Government, having regard to the number of children of such women workers deems it necessary that suitable rooms for the use of such children should be provided and maintained by the employer, it may by order, direct the employer to provide and maintain such rooms and thereupon the employer shall be bound to comply with such direction.

(2) The rooms referred to in sub-section (1) or sub-section (1-A) shall : (a) provide adequate accommodation;

(b) be adequately lighted and ventilated;

(c) be maintained in a clean and sanitary conditions; and

(d) be under the charge of a woman trained in the care of children and infants.

(3) The State Government may make rules prescribing the location and the standards of the rooms referred to in sub-section (1) or sub-section (1-

A) in respect of their construction and the equipment and amenities to be provided therein.

Section 13. Recreational facilities.

The State Government may make rules requiring every employer to make provision in his plantation for such recreational facilities for the workers and children employed therein as may be prescribed.

Section 14. Educational facilities.

Where the children between the ages of six and twelve of workers employed in any plantation exceed twenty-five in number the State Government may make rules requiring every employer to provide educational facilities, for the children in suck manner and of such standard as may be prescribed.

Section 15. Housing facilities.

It shall be the duty of every employer to provide and maintain necessary housing accommodation, -

(a) for every worker (including his family) residing in the plantation;

(b) for every worker (including his family) residing outside the plantation, who has put in six months continuous service in such plantation and who has expressed a desire in writing to reside in the plantation :

Provided that the requirement of continuous service of six months under this clause shall not apply to a worker who is a member of the family of a deceased worker, who, immediately before his death, was residing in the plantation.

Section 16. Power to make rules relating to housing.

The State Government may make rules for the purpose of giving effect to the provisions of Sec. 15 and, in particular providing for – (a) the standard and specification of the accommodation to be provided;

(b) the selection and preparation of sites for the construction of houses and the size of such plot;

(c) the constitution of advisory boards consisting of representatives of the State Government, the employer and the workers for consultation in regard to matters connected with housing and the exercise by them of such powers, functions and duties in relation thereto as may be specified;

(d) the fixing of rent, if any, for the housing accommodation provided for workers;

(e) the allotment to workers and their families of housing accommodation and of suitable strips of vacant land adjoining such accommodation for the purpose of maintaining kitchen gardens, and for the eviction of workers and their families from such accommodation;

(f) access to the public to those parts of the plantation wherein the workers are housed.

Section 16A. Liability or employer in respect or accidents resulting from collapse of houses provided by him.

(1) If death or injury is caused to any worker or a member of his family as a result of the collapse of a house provided under Sec. 15, and the collapse is not solely and directly attributable to a fault on the part of any occupant of the house or to a natural calamity, the employer shall be liable to pay compensation.

(2) The provisions of Sec. 4 of, and Sch. IV to the Workmen’s Compensation Act, 1923 (8 of 1923), as in force for the time being, regarding the amount of compensation payable to a workman under that Act shall, so far as may be, apply for the determination of the amount of compensation payable under sub-section (1).

Section 16B. Appointment or commissioners.

The State Government may, by notification in the official Gazette, appoint as many persons, possessing the prescribed qualifications, as it thinks fit, to be commissioners to determine the amount of compensation payable under Sec. 16-A and may define the limits within which each such Commissioner shall exercise the powers and discharge the functions conferred or imposed on him by or under this Act.

Section 16C. Application for compensation.

An application for payment or compensation under Sec. 16-A may be made to the Commissioner, -

(a) by the person who has sustained the injury; or

(b) by any agent duly authorized by the person who has sustained the injury; or

(c) where the person who has sustained the injury is a minor, by his guardian; or

(d) where death has resulted out of the collapse of the house, by any dependent of the deceased or by any agent duly authorized by such dependent, or, if such dependant is a minor, by his guardian.

(2) Every application under sub-section (1) shall be in such form and shall contain such particulars as may be prescribed.

(3) No application for compensation under this section shall be entertained unless it is made within six months of the collapse of the house :

Provided that the Commissioner may, if he is satisfied that the applicant was prevented by sufficient cause from making the application within the aforesaid period of six months entertain such application within a further period of six months.

Explanation : In this section, the expression “dependant” has the meaning assigned to it in Cl. (d) of Sec. 2 of the Workmen’s Compensation Act, 1923 (8 of 1923).

Section 16D. Procedure and powers.

(1) On receipt of an application under Sec. 16-C, the Commissioner may make an inquiry into the matter covered by the application.

(2) In determining the amount of compensation payable under Sec. 16-A, the Commissioner may, subject to any rules that may be made in this behalf, follow such summary procedure as he thinks fit.

(3) The Commissioner shall have all the powers of a civil court while trying a suit under the Code of Civil Procedure, 1908 (5 of 1908) in respect of the following matters, namely :

(a) summoning and enforcing the attendance of any person and examining him on oath;

(b) requiring the discovery and production of any document;

(c) receiving evidence on affidavits;

(d) requisitioning any public record or copy thereof from any court or office;

(e) issuing commissions for the examination of witnesses or documents;

(f) any other matter which may be prescribed.

(4) Subject to any rules that may be made in this behalf, the Commissioner may, for the purpose of determining any claim or compensation, choose one or more persons possessing special knowledge of any matter relevant to the inquiry to assist him in holding the inquiry.

Section 16E. Liability to pay compensation, etc. To be decided by commissioner.

(1) Any question as to the liability of an employer to pay compensation under Sec. 16-A, or as to the amount thereof, or as to the person to whom such compensation is payable, shall be decided by the Commissioner.

(2) Any person aggrieved by a decision of the Commissioner refusing to grant compensation, or as to the amount of compensation granted to him, or to the apportionment thereof, may prefer an appeal to the High Court having jurisdiction over the place where the collapse of the house has occurred, within ninety days of the communication of the order of the Commissioner to such person : Provided that the High Court may entertain any such appeal after the expiry of the period aforesaid if it is satisfied that the appellant was prevented by sufficient cause from preferring the appeal within such period; Provided further that nothing in this sub-section shall be deemed to authorize the High Court to grant compensation in excess of the amount of compensation payable under Sec. 16-A.

(3) Subject to the decision of the High Court in cases in which an appeal is preferred under sub-section (2), the decision of the Commissioner under sub-section (1) shall be final and shall not be called in question in any Court.

Section 16F. Saving as to certain rights.

The right of any person to claim compensation under Sec. 16-A shall be without prejudice to the right of such person to recover compensation payable under any other law for the time being in force, but no person shall be entitled to claim compensation more than once in respect of the same collapse of the house.

Section 16G. Power to make rules.

The State Government may, by notification in the official Gazette, make rules for giving effect to the provisions of Secs. 16-A to 16-F (both inclusive).

(2) In particular, and without prejudice to the generality of the foregoing power, such rules may provide for -

(i) the qualifications and conditions of service of Commissioners;

(ii) the manner in which claims for compensation may be inquired into and determined by the Commissioner;

(iii) generally for the effective exercise of any powers conferred on the Commissioner.

Section 17. Other facilities.

The State Government may make Rules requiring that in every plantation the employer shall provide the workers with such number and type of umbrellas, blankets, rain coats or other like amenities for the protection of workers from rain or cold as may be prescribed.

Section 18. Welfare officers.

(1) In every plantation wherein three hundred or more workers are ordinarily employed the employer shall employ such number of welfare officers as may be prescribed.

(2) The State Government may prescribe the duties, qualifications and conditions of service of officers employed under sub-section (1).

State Amendments

Section 18-A. Chief inspector to provide facilities on default by employer.

If in any plantation, facilities are not provided or maintained by the employer as required by Sec. 8. Sec. 9 or Sec. 12 or Sec. 15 or the rules made under Sec. 11 or Sec. 14 or Sec, 17, the Chief Inspector may cause to be provided or maintained therein such facilities and recover the cost thereof from the defaulting employer :

Provided that before providing or maintaining such facilities the employer shall be given an opportunity of being heard.

(2) For the purpose of recovery of the cost under sub-section (1) the Chief Inspector may certify the amount to be recovered to the Collector, who may thereupon recover such amount as an arrear of land revenue. – Vide Kerala Act 25 of 1969, Secs. 2 and 3 (w.e.f. 1st December, 1969).]

Section 19. Weekly hours.

(1) Save as otherwise expressly provided in this Act, no adult worker shall be required or allowed to work on any plantation in excess of forty-eight hours a week and no adolescent of child for more than twenty seven hours a week.

(2) Where an adult worker works in any plantation on any day in excess of the number of hours constituting a normal working day or for more than forty eight hours in any week, he shall, in respect of such overtime work, be entitled to twice the rates of ordinary wages :

Provided that no such worker shall be allowed to work for more than nine hours on any day and more than fifty-four hours in any week.

(3) For any work done on any closed holiday in the plantation or on any day of rest, a worker shall be entitled to twice the rates of ordinary wages as in the case of overtime work.

Section 20. Weekly holidays.

(1) The State Government may, by rules made in this behalf – (a) provide for a day of rest in every period of seven days which shall be allowed to all workers;

(b) provide for the conditions subject to which, and the circumstances in which, an adult worker may be required or allowed to work overtime.

(2) Notwithstanding anything contained in Cl. (a) of sub-section (1) where a worker is willing to work on any day of rest which is not a closed holiday in the plantation, nothing contained in this section shall prevent him from doing so :

Provided that in so doing a worker does not work for more than ten days consecutively without a holiday for a whole day intervening.

Explanation I : Where on any day a worker has been prevented from working in any plantation by reason of tempest, fire, rain or other nature causes, that day, may, if, he so desires be treated as his day of rest for the relevant period of seven days within the meaning of sub-section (1).

Explanation II : Nothing contained in this section shall apply to any worker whose total period of employment including any day spent on leave is less than six days.

Section 21. Daily intervals for rest.

The period of work on each day shall be so fixed that no period shall exceed five hours and that no worker shall work for more than five hours before he has had an interval for rest for at least half an hour.

Section 22. Spread-over.

The period of work of an adult worker in a plantation shall be so arranged that inclusive of his interval for rest under Sec.21 it shall not spread over more than twelve hours including the time spent in waiting for work on any day.

Section 23. Notice of period of work.

(1) There shall be displayed and correctly maintained in every plantation a notice of periods of work in such form and manner as may be prescribed showing clearly for every day the periods during which the workers may be required to work.

(2) Subject to the other provisions contained in this Act, no worker shall be required or allowed to work in any plantation otherwise than in accordance with the notice of periods of work displayed in the plantation.

(3) An employer may refuse to employ a worker for any day if on that day he turns up for work more than half an hour after the time fixed for the commencement of the day’s work.

24. OMITTED BY ACT 61 OF SEC. 24(b), (W.E.F., 23RD DECEMBER, 1986).

Section 24. Omitted by act 61 of sec. 24(b), (w.e.f., 23rd december, 1986).

24. OMITTED BY ACT 61 OF SEC. 24(b), (W.E.F., 23RD DECEMBER, 1986).

Section 25. Night work for women and children.

Except with the permission of the State Government, no woman or child worker shall be employed in any plantation otherwise than between the hours of 6 A.M. and 7 P.M.

Provided that nothing in this section shall be deemed to apply to midwives and nurses employed as such in any plantation.

Section 26. Nonadult workers to carry to tokens.

No child and no adolescent shall be required or allowed to work in any plantation unless – (a) a certificate of fitness granted with reference to him under Sec. 27 is in the custody of the employer; and

(b) such child of adolescent carries with him while he is at work a token giving a reference to such certificate.

Section 27. Certificate of fitness.

(1) A certifying surgeon shall, on the application of any young person or his parent or guardian accompanied by a document signed by the employer or any other person on his behalf that such person will be employed in the plantation if certified to be fit for work, or on the application of the employer or any other person on his behalf with reference to any young person intending to work, examine such person and ascertain his fitness for work either as a child or as an adolescent.

(2) A certificate of fitness granted under this section shall be valid for a period of twelve months from the date thereof, but may be renewed.

(3) Any fee payable for a certificate under this section shall be paid by the employer and shall not be recoverable from the young person, his parents or guardian.

Section 28. Power to require medical examination.

An inspector may, if he thinks necessary so to do, cause any young person employed in a plantation to be examined by a certifying surgeon.

Section 29. Application of chapter.

(1) The provisions of this chapter shall not operate to the prejudice of any rights to which a worker may be entitled under any other law or under other terms of any award, agreement, or contract of service :

Provided that where such award, agreement or contract of service provides for a longer leave with wages than provided in this chapter the worker shall be entitled only to such longer leave.

Explanation : For the purpose of this chapter leave shall not, except as provided in Sec. 30, include weekly holidays or holidays for festivals or other similar occasions.

Section 30. Annual leave with wages.

(1) Every worker shall be allowed leave with wages for a number of days calculated at the rate of -

(a) if an adult, one day for every twenty days of work performed by him, and

(b) if a young person, one day for every fifteen days of work performed by him :

Explanation: For the purpose of calculating leave under this sub-section -

(a) any day on which no work or less than half a day’s work is performed shall not be counted, and

(b) any day on which half or more than half a day’s work is performed shall be counted as one day.

Explanation II : The leave admissible under this sub-section shall be exclusive of all holidays, whether occurring during, or at either end of, the period of leave.

(2) If a worker does not in any one period of twelve months take the whole of the leave allowed to him under sub-section (1) any leave not taken by him shall be added to the leave to be allowed to him under that sub-section in the succeeding period of twelve months.

(3) A worker shall cease to earn any leave under this section when the earned leave due to him amounts to thirty days.

(4) If the employment of a worker who is entitled to leave under this section is terminated by the employer before he has taken the entire leave to which he is entitled, the employer shall pay him the amount payable under Sec. 3 in respect of the leave not taken, and such payment shall be made before the expiry of the second working day after such termination.

Section 31. Wages during leave period.

(1) For the leave allowed to a worker under Sec. 30, he shall be paid, – (a) if employed wholly on a time-rate basis, at a rate equal to the daily wages payable to him immediately before the commencement of such leave under any law or under the terms of any award, agreement or contract of service, and (b) in other cases, including cases where he is, during the preceding twelve calendar months, paid partly on a time-rate basis and partly on a piece-rate basis, at the rate of the average daily wage calculated over the preceding twelve calendar months. Explanation : For the purposes of Cl.(b) of sub-section (1), the average daily wage shall be computed on the basis of his total full time earnings during the preceding twelve calendar months, exclusive of any overtime earnings of bonus, if any, but inclusive of dearness allowance.

(1-A) In addition to the wages for the leave period at the rates specified in sub-section (1), a worker shall also be paid the cash value of food and other concessions, if any, allowed to him by the employer in addition to his daily wages unless these concessions are continued during the leave period.

(2) A worker who has been allowed leave for lpa-35 any period not less than four days in the case of an adult and five days in the case of a young person under Sec. 30 shall, before his leave begins, be paid his wages for the period of the leave allowed.

Section 32. Sickness and maternity benefits.

(1) Subject to any rules that may be made in this behalf, every worker shall be entitled to obtain from his employer – in the case of sickness certified by a qualified medical practitioner, sickness allowance, at such rate, for such period and at such intervals as may be prescribed.

(2) The State Government may make rules regulating the payment of sickness allowance and any such rules may specify the circumstances in which such allowance shall not be payable or shall cease to be payable, and in framing any rules under this section the State Government shall have due regard to the medical facilities that may be provided by the employer in any plantation.

Section 32A. Notice of accident.

Where in any plantation, an accident occurs which causes death or which causes bodily injury to a worker by reason of which the worker injured is prevented from working for a period of forty-eight hours or more immediately following the accident, or which is of such a nature as may be prescribed in this behalf, the employer thereof shall send notice thereof to such authorities, in such form, and within such time, as may be prescribed.

Section 32B. Register of accidents.

The employer shall maintain a register of all accidents which occur in the plantation in such form and in such manner as may be prescribed.

Section 33. Obstruction.

(1) Whoever obstructs an inspector in the discharge of his duties under this Act or refuses or wilfully neglects to afford the inspector any reasonable facility for making any inspection, examination or inquiry authorised by ar under this Act in relation to any plantation, shall be punishable with imprisonment for a term which may extend to three months, or with fine which may extend to five hundred rupees, or with both.

(2) Whoever wilfully refuses to produce on the demand of an inspector any register or other document kept in pursuance of this Act, or prevents or attempts to prevent or does anything which he has reason to believe is likely to prevent any person from appearing before or being examined by an inspector acting in pursuance of his duties under this Act, shall be punishable with imprisonment for a term which may extend to three months, or with fine which may extend to five hundred rupees, or with both.

Section 34. Use of false certificate of fitness.

Whoever knowingly uses or attempts to use as a certificate of fitness granted to himself under Sec. 27 a certificate granted to another person under that section, or having been granted a certificate of fitness to himself, knowingly allows it to be used, or allows an attempt to use it to be made by another person, shall be punishable with imprisonment which may extend to one month, or with fine which may extend to fifty rupees, or with both.

Section 35 Contravention of provisions regarding employment of labour.

Whoever, except as otherwise permitted by or under this Act, contravenes any provision of this Act or of any rules made thereunder prohibiting, restricting or regulating the employment of persons in a plantation, shall be punishable with imprisonment for a term, which may extend to three months, or fine, which may extend to five hundred rupees, or with both.

Section 36. Other offences.

Whoever contravenes any of the provisions of this Act or of any rules made thereunder for which no other penalty is elsewhere provided by or under this Act shall be punishable with imprisonment for a term which may extend to three months, or with fine which may extend to five hundred rupees, or with both.

Section 37. Enhanced penalty after previous conviction.

If any person who has been convicted of any offence punishable under this Act is again guilty of an offence involving a contravention of the same provision, he shall be, punishable on a subsequent conviction with imprisonment which may extend to six months, or with fine which may extend to one thousand rupees, or with both :

Provided that for the purposes of this section no cognizance shall be taken of any conviction made more than two years before the commission of the offence which is being punished.

Section 37A. Power of court to make orders.

(1) Where an employer is convicted of an offence punishable under Sec. 36, the Court may, in addition to, awarding any punishment, by order in writing, require him within such period as may be specified in the order (which the Court may if it thinks fit and on an application made in this behalf by the employer, from time to time, extend) to take such measures as may be so specified for remedying the matters in respect of which the offence was committed.

(2) Where an order is made under sub-section (1), the employer shall not be liable under this Act in respect of the continuation of the offence during the period or extended period, as the case may be, specified by the Court, but if, on the expiry of such period or extended period, the order of the Court has not been fully complied with, the employer shall be deemed to have committed a further offence and he shall, on conviction, be punishable with imprisonment for a term which may extend to six months and with fine which may extend to three hundred rupees for every day after such expiry.

Section 38. Exemption of employer from liability in certain cases.

Where an employer charged with an offence under this Act, alleges that another person is the actual offender, he shall be entitled upon complaint made by him in this behalf to have, on giving to the prosecutor in this behalf three cleat days’ notice in writing of his intention so to do, that other person brought before the Court on the day appointed for the hearing of the case and if, after the commission of the offence has been proved, the employer proves to the satisfaction of the Court that -

(a) he has used due diligence to enforce the execution of the relevant provisions of this Act; and

(b) that the other person committed the offence in question without his knowledge, consent or connivance; the said other person shall be convicted of the offence and shall be liable to the like punishment as if he were the employer and the employer shall be acquitted :

Provided that – (a) the employer may be examined on oath and his evidence and that of any witness whom he calls in his support shall be subject to cross-examination on behalf of the person he charges to be the actual offender and by the prosecutor, and (b) if, inspite of due diligence, the person alleged as the actual offender cannot be brought before the Court on the day appointed for the hearing of the case, the Court shall adjourn the hearing thereof from time to time so, however, that the total period of such adjournment does not exceed three months, and if, by the end of the said period, the person alleged as the actual offender cannot still be brought before the Court, the court shall proceed to hear the case against the employer.

Section 39. Cognizance of offences.

No Court shall take cognizance of any offence under this Act except on complaint made by, or with the previous sanction in writing of, the chief inspector and no Court inferior to that of a presidency magistrate or a magistrate of the second class shall try any offence punishable under this Act.

Section 40. Limitation of prosecutions.

No court shall take cognizance of an offence punishable under this Act unless the complaint thereof has been made or is made within three months from the date on which the alleged commission of the offence came to the knowledge of an inspector :

Provided that where the offence consists of disobeying a written order made by an inspector, complaint thereof may be made within six months of the date on which the offence is alleged to have been committed.

Section 41. Power to give directions.

The Central Government may give directions to the Government of any State as to the carrying into execution in the State of the provisions contained in this Act.

Section 42. Power to exempt.

The State Government may, by order in writing exempt, subject to such conditions and restrictions as it may thinks fit to impose, any employer or class of employers from all or any of the provisions of this Act :

Provided that no such exemption other than exemption from Sec. 19 shall be granted except with the previous approval of the Central Government.

Section 43. General power to make rules.

(1) The State Government may, subject to the condition of previous publication, make rules to carry out the purposes of this Act : Provided that the date to be specified under Cl. (3) of Sec. 23 of the General Clauses Act, 1978 (10 of 1978), shall not be less than six weeks from the date on which the draft of the proposed rules was published.

(2) In particular, and without prejudice to the generality of the foregoing power, any such rules may provide for -

(a) the qualifications required in respect of the chief inspector and inspector;

(b) the powers which may be exercised by inspectors and the areas in which and the manner in which such powers may be exercised;

(c) the medical supervision which may be exercised by certifying surgeons;

(d) the examination by inspectors or other persons of the supply and distribution of drinking water in plantations;

(e) appeals from any order of the chief inspector or inspector and the form in which, the time within which and the authorities to which, such appeal may be preferred;

(f) the time within which housing recreational, educational or other facilities required by this Act to be provided and maintained may be so provided;

(g) the types of latrines and urinals that should be maintained in plantations;

(h) the medical, recreational and educational facilities that should be provided in plantations;

(i) the form and manner in which notices of periods of work shall be displayed and maintained;

(j) the registers which should be maintained by the employers and the returns, whether occasional or periodical, as in the opinion of the State Government may be required for the purposes of this Act;

(k) the hours of work for a normal working day for the purpose of wages and overtime;

(l) any other matter which is required to be, or may be prescribed.

(3) All rules made under this Act shall, if made by any Government, other than the Central Government, by subject to the previous approval of the Central Government.

Appendix

In relation to the areas or establishments to which the Maternity Benefit Act, 1961 (53 of 1961) applies, Sec. 32 of the Plantations Labour Act, 1951, has been amended by Sec. 29 of the former Act as follows :

“29. Amendment of Act 69 of 1951. – In Sec. 32 of the Plantations Labour Act, 1951, – (a) in sub-section (1), the letter and brackets “(a)” before the words “in the case of sickness” the word “and” after the words “sickness allowance” and Cl. (b) shall be omitted;

(b) in sub-section (2), the word “or maternity” shall be omitted.

Guardians and Wards Act

November 30, 2014

Chapter I – Preliminary

Section 1. Title, extent and commencement.

(1)This Act may be called the Guardians and Wards Act, 1890.

(2) It extends to the whole of India ¹[except the State of Jammu and Kashmir] ²[***]; ³[***].

(3) It shall come into force on the first day of July, 1890.

—————

1. Subs. by Act 3 of 1951, sec. 3 and Schedule, for “except Part B States’’.

2. Repealed by the A.O., 1948, for the words “inclusive of Brit­ish Baluchistan”.

3. The word “and” omitted by Act 40 of 1949, sec. 3 and Sch. II.

Section 2. (Repealed by the Repealing Act, 1938 (1 of 1938), sec. 2 and Schedule).

(Repealed by the Repealing Act, 1938 (1 of 1938), sec. 2 and Schedule)

Section 3. Saving of jurisdiction of Courts of Wards and Chartered High Courts.

This Act shall be read subject to every enactment here­tofore or hereafter passed relating to any Court of Wards by ¹[any competent Legislature, authority or person in ²[any State to which this Act extends]]; and nothing in this Act shall be construed to effect or in any way derogate from, the jurisdiction or authority of any Court of Wards, or to take away any power possessed by ³[any High Court ⁴[***]].

—————

1. Subs. by the A.O., 1937 for “the Governor-General in Council or by a Governor or Lieutenant-Governor in Council”.

2. Subs. by Act 3 of 1951, sec. 3 and Sch., for “Part A States and Part C States”.

3. Subs. by the A.O., 1937, for “any High Court established under the Statutes 24 and 25 Victoria, Chapter 104 (an Act for estab­lishing High Courts of Judicature in India)”.

4. The words “established in Part A States and Part C States’’, omitted by Act 3 of 1951, sec. 3 and Sch.

Section 4. Definitions.

In this Act, unless there is something repugnant in the subject or context-

(1) “Minor” means a person who, under the provisions of the Indian Majority Act, 1875 (9 of 1875) is to be deemed not to have attained his majority.

2. “Guardian” means minor for whose person or property or both there is a guardian.

3. “Ward” means a minor for whose person or property or both there is a guardian.

4. “District Court” has the meaning assigned to that expression in the code of Civil Procedure, 1882 (14 of 1882)¹, and includes a High Court in the exercise of its ordinary original civil jurisdiction,

²5. “The Court” means-

(a) The District Court having jurisdiction to entertain an application under

this Act for an order appointing or declaring a person to be a guardian, or

(b) Where a guardian has been appointed or declared in pursuance of any such application-

(i) The Court which, or the Court of the officer who, appointed or declared the guardian or is under this Act deemed to have appointed or declared the guardian, or

(ii) In any matter relating to the person of the ward the District Court having jurisdiction in the place where the ward for the time being ordinarily resides, or

(a) In respect of any proceeding transferred under Section 4-A, the Court of the officer to whom such proceeding has been transferred.

(1) “Collector” means the chief officer in charge of the revenue-administration of a district and includes any officer whom the State Government, by notification in the official Gazette may, by name or in virtue of his office, appoint to be a Collector in any local area or with respected to any class of persons, for all or any of the purposes of this Act.

³[***]; and

(2) “Prescribed” means prescribed by rules made by the High Court under this Act.

—————

1. See now the Code of Civil Procedure, 1908 (5 of 1908).

2. Subs. by Act 4 of 1926, sec. 2, for the original clause (5).

3. Clause (7) omitted by Act 3 of 1951, sec. 3 and Schedule.

Section 4A. Power to confer jurisdiction on subordinate judicial officers and to transfer proceedings to such officers.

¹[4A. Power to confer jurisdiction on subordinate judicial officers and to transfer proceedings to such officers.—(1) The High Court may, by general or special order, empower any officer exercising original civil jurisdiction subordinate to a district court, or authorise the Judge of any District Court to empower any such officer subordinate to him, to dispose of any proceedings under this Act transferred to such officer under the provisions of this section.

2. The Judge of a district court may, by order in writing, transfer at any stage any proceeding under this Act pending in his Court for disposal to any officer subordinate to him empowered under sub-section (1).

3. The Judge of a district court may at any stage transfer to his own Court or to any officer subordinate to him empowered under sub-section (1) any proceeding under this Act pending in the Court of any other such officer.

4. When any proceedings are transferred under this section in any case in which a guardian has been appointed or declared, the Judge of the District Court may, by order in writing, declare that the Court of the Judge or officer to whom they are transferred shall, for all or any of the purpose of this Act, be deemed to the Court which appointed or declare the guardian.

—————

1. Ins. by Act 4 of 1936, sec. 3.

Chapter II – Appointment and Declaration of Guardians

Section 5. Power of parents to appoint in case of European British subjects.

(Rep. By the Part B States (Laws) Act, 1951 (3 of 1951), sec. 3 and Schedule.

Section 6. Saving of power of appoint in other cases.

In the case of a minor ¹[***], nothing in this Act shall be construed to take away or derogate from any power to appoint a guardian of his person or property or both, which is valid by the law to which the minor is subject.

—————

1.  The words “who is  not  an  European  British subject”, omitted by Act 3 of 1951, sec. 3 and Sch.

Section 7. Power of the Court to make orders as to guardianship.

(1) Where the Court is satisfied that it is for the welfare of a minor that an order should be made- Appointing a guardian of his person or property or both, or declaring a person to be such a guardian the Court may make an order accordingly.

An order under this section shall imply the removal of any guardian who has not been appointed by will or other instrument or appointed or declared by the Court.

Where a guardian has been appointed by will or other instrument or appointed or declare by the Court, an order under this section appointing or declaring another person to be guardian in his stand shall not be made until the powers of the guardian appointed or declare as aforesaid have ceased under the provision of this Act.

Section 8. Persons entitled to apply for order.

An order shall not be made under the last foregoing section except on the application of the person desirous of being, or claiming to be, the guardian of the minor, or any relative of friend of the minor, or the Collector of the district or other local area within which the minor ordinarily resides or in which he has property, or the Collector having authority with respect to the class to which the minor belongs.

Section 9. Court having jurisdiction to entertain application.

(1) If the application is with respect to the guardianship of the person of the minor, it shall be made to the District Court having jurisdiction in the place where the minor ordinarily resides.

If the application is with respect of the guardianship of the property of the minor, it may be made either to the District Court having jurisdiction in the place where the minor ordinarily resides or to a District Court having jurisdiction in the place where he has property.

If an application with respect to the guardianship of the property of a minor is made to a District Court other than that having jurisdiction in the place where the minor ordinarily resides, the Court may return the application if in its opinion the application would be disposed of more justly on conveniently by any other District Court having jurisdiction.

Section 10. Form of application.

(1) If the application is not made by he Collector, it shall be by petition signed and verified in manner prescribed by the Code of Civil Procedure, 1882 (14 of 1882),¹ for the signing and verification of a plaint, and stating, so far as can be ascertained-

the name, sex, religion, date of birth and ordinary residence of the minor,

where the minor is a female, whether she is married and if so, the name and age of her husband,

the nature, situation and approximate value of the property,if any, of the minor,

the name and residence of the person having the custody or possession of the person or property of the minor,

what near relations the minor has and where they reside,

whether a guardian of the person or property or both, of the minor has been appointed by any person entitled to claiming to be entitled by the law to which the minor is subject to make such an appointment

whether an application has at any time been made to the Court or to any there Court with respect to the guardianship of the person or property or both, of the minor and if so, when, to what Court and with what result,

whether the application is for the appointment or declaration of a guardian of the person of the minor, or of his property, or of both.

Where the application is to appoint a guardian, the qualifications of the proposed guardian.

Where the application is to declare a person to be a guardian, the grounds on which that person claims,

The cause which have led to the making of the application, and

Such other particulars, if any, as may be prescribed or as the nature of the application renders it necessary to state.

If the application is made by the Collector, it shall be by letter addressed to the Court forwarded by post or in such other manners as may be found convenient, and shall state as far as possible the particulars mentioned in sub-section (1).

The application must be accompanied by a declaration of the willingness of the proposed guardian to act, and the declaration must be signed by him and attested by at least two witnesses.

—————

1. See now the Code of Civil Procedure, 1908 (5 of 1908).

Section 11. Procedure on admission of application.

(1) If the court is satisfied that there is ground for proceeding on the application, it shall fix a day for the hearing thereof and cause notice of the application and of the date fixed for the hearing.

To be served in the manner directed in the Code of Civil Procedure, 1882 (14 of 1882) ¹on

the parents of the minor if they are residing in ²(any State to which this Act extends)

the person, if any, named in the petition or letter as having the custody or possession of

the person or property of the minor the person proposed in the application or letter to be appointed or declared guardian, unless that person is himself the applicant, and

any other person to whim, in the opinion of the Court special notice of the applicant should be given, and to be posted on some conspicuous part of the court-house and of the residence of the minor, and otherwise published in such manner as the Court, subject to any rules made by the High Court under this Act, thinks fit.

The state Government may, by general or special order, require that when any part of the property described in a petition under sec. 10, sec-section (1) is land of which a Court of Wards could assume the superintendence, the Court shall also cause a notice as aforesaid to be served on the Collector in whose district the minor ordinarily resides and on every Collector in whose district any portion of the land is situate, and the Collector may cause the notice to be published in any manner he deems fit.

No charge shall be made by the Court or the Collector for the service or publication of any notice served or published under sub-section (2).

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1. See now the Code of Civil Procedure, 1908 (5 of 1908).

2. Subs. by Act 3 of 1951, sec. 3 and Sch., for “a Part A State or a Part C State”.

Section 12. Power to make interlocutory order for production of minor and interim protection of person and property.

(1) The Court may direct that the person if any, having the custody of the minor, shall produce him or cause him to be produced at such place and time and before such person as it appoints, and may make such order for the temporary custody and protection of the person or property of the minor as it thinks proper.

If the minor is a female who ought not to be compelled to appear in public, the claiming to be her guardian on the ground of his being her husband, unless she is already in his custody with the consent of her parents, if any, or

Any person to whom the temporary custody and protection of the property if a minor is entrusted to dispossess otherwise than by due course of law any person in possession of any of the property

Section 13. Hearing of evidence before making of order.

On the day fixed for the hearing of the application or as soon afterwards as may be, the Court shall hear such evidence as may be adduced in support of or in opposition to the application.

Section 14. Simultaneous proceedings in different Courts.

(1) If proceedings for the appointment or declaration of a guardian of a minor are taken in more Courts than one, each of those courts shall, on being apprised of the proceedings in the order Court or Courts, stay the proceedings before itself.

¹In any other case in which proceedings are stayed under sub-section (1), the Courts shall report the case to and to guided by such orders as they may receive from their respective State Governments.

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1.  Subs. by the A.O. 1937, for the original sub-section (3).

Section 15. Appointment or declaration of several guardians.

(1) If the law to which the minor is subject admits of his having two or more joint guardians of his person or property or both, the Court may, if it thinks fit, appoint or declare them.

¹[***]

Separate guardians may be appointed or declared of the person and of the property of a minor.

If a minor has several properties, the Court may, if it thinks fit, appoint or declare a separate guardian for any one or more of the properties.

————

1.  Sub-sections (2) and (3) omitted by Act 3 of 1951, sec. 3 and Sch.

Section 16. Appointment or declaration of guardian for property beyond jurisdiction of the Court.

If the Court appoints or declares a guardian for any property situate beyond the local limits of its jurisdiction, the court having jurisdiction in the place where the property is situate shall, on production of a certified copy of the order appointing or declaring the guardian accept him as duly appointed or declared and give effect to the order.

Section 17. Matter to be considered by the Court in appointing guardian.

(1) In appointing or declaring the guardian of a minor, the Court shall, subject to the provisions of this section, be guided by what, consistently with the law to which the minor is subject, appears in the circumstances to be for the welfare of the minor.

In considering what will be for the welfare of the minor, the Courts shall have regard to the age, sex and religion of the minor, the character and capacity of the proposed guardian and his nearness of kin to the minor, the wishes, if any, of a deceased parent, and any existing or previous relations of the proposed guardian with the minor or his property.

If the minor is old enough to form an intelligent preference, the Court may consider that preference.

The Court shall not appoint or declare any person to be a guardian against his will.

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1. Sub-section (4) omitted by Act 3 of 1951, sec. 3 and Sch.

Section 18. Appointment or declaration of Collector in virtue of office.

Where a Collector is appointed or declared by the Court in virtue of his office to be guardian of the person or property or both, of a minor, the order appointing or declaring him shall be deemed to authorize and require the person for the time being holding the office to act as guardian of the minor with respect to his person or property or both, as the case may be.

Section 19. Guardian not to be appointed by the Court in certain cases.

Nothing in this Chapter shall authorise the Court to appoint or declare a guardian of the property of a minor whose property is under the superintendence of a Court of Wards or to appoint or declare a guardian of the person of a minor who is married female and whose husband is not, in the opinion of Court, unfit to be guardian of her person,

¹[***] of a minor whose father is living and is not in the opinion of the Court, unfit to be guardian of the person of the minor; or

(c) of a minor whose property is under the superintendence of a Court of Wards competent to appoint a guardian of the person of the minor.

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1. The words “subject to the provisions of this Act with respect to European British subjects” omitted by Act 3 of 1951, sec. 3 and Sch.

Chapter III – Duties, Rights and Liabilities of Guardians

Section 20. Fiduciary relation of guardian to ward.

(1) A guardian stands in a fiduciary relation to his ward, and, save as provided by the will or other instrument, if any, by which he was appointed, or by his act, he must not make any profit out of his office.

The fiduciary relation of a guardian to his ward extends to and affects purchases by the guardian of the property of the ward, and by the ward of the property of the guardian, immediately or soon after the ward has ceased to be a minor and generally all transactions between them while the influence of the guardian still lasts or is recent.

Section 21. Capacity of minor to act as guardians.

A minor is incompetent to act as guardian of any minor except his own wife or child or where he is the managing member of an undivided Hindu family, the wife or child of another minor member of that family.

Section 22. Remuneration of guardian.

(1) A guardian appointed or declared by the Court shall be entitled to such allowances, if any, as the Court thinks fit for his care and pains in the execution of his duties.

(2) When an officer of the Government, as such officer, is so appointed or declared to be guardian, such fees shall be paid to the Government out of the property of the ward as the State Government, by general or special order, directs.

Section 23. Control of Collector as guardian.

A Collector appointed or declared by the Court to be guardian of the person or property or both, of a minor shall, in all matters connected with the guardianship of his ward, be subject to the control of the State Government or of such authority as that Government, by notification in the official Gazette, appoints in this behalf.

Section 24. Duties of guardian of the person.

A guardian of the person of a ward is charged with the custody of the ward and must look to his support, health and education, and such other matters as the law to which the ward is subject requires.

Section 25. Title and guardian to custody of ward.

(1) if a ward leaves or is removed from the custody of a guardian of his person, the Court, if it is of opinion that it will be for the welfare of the ward to return to the custody of his guardian, may make an order for his return and for the purpose of enforcing the order may cause the ward to be arrested and to be delivered into the custody of the guardian.

For the purpose of arresting the ward, the Court may exercise the power conferred on a Magistrate of the first class by section 100 of the Code of Criminal Procedure, 1882 (10 of 1882).

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1. See now section 97 of the Code of Criminal Procedure, 1973 (2 of 1974).

Section 26. Removal of ward from jurisdiction.

(1) A guardian of the person appointed or declared by the Court, unless he is the Collector or is a guardian appointed by will or other instrument, shall not, without the leave of the Court by which he was appointed or declared, remove the ward from the limits of its jurisdiction except for such purposes as may be prescribed.

The leave granted by the Court under sub-section (1) may be special or general and may be defined by the order granting it.

Section 27. Duties of guardian of property.

A guardian of the property of a ward is bound to deal with as carefully as a man of ordinary prudence would deal with it, if it were his own and subject to the provisions of this Chapter, he may do all acts which are reasonable and proper for the realization, protection or benefit of the property

Section 28. Power of testamentary guardian.

Where a guardian has been appointed by will or the other instrument, his power to mortgage or charge, or transfer by sale, gift, exchange or otherwise, immovable property belonging to his ward is subject to any restriction which may be imposed by the instrument, unless he has under this Act been declared guardian and the Court which made the declaration permits him by an order in writing, notwithstanding the restriction, to dispose of any immovable p

Section 29. Limitation of powers of guardian of property appointed or declared by the Court.

Where a person other than a Collector, or than a guardian appointed by will or other instruments, has been appointed or declared by the Court to be guardian of the property of award, he shall not, without the previous permission of the Court,- Mortgage or charge or transfer by sale, gift, exchange or otherwise, any part of the immovable property of his ward, or lease any part of that property for a term exceeding five years or for any term extending more than one year beyond the date on which the ward will cease to be a minor.

Section 30. Violability of transfers made in contravention of section 28 or section 29.

A disposal of immovable property by a guardian in contravention of either of the two last foregoing sections is violable at the instance of any other person affected thereby.

Section 31. Practice with respect to permitting transfer under section 29.

(1) Permission to the guardian to do any of the acts mentioned in section 29 shall not be granted by the Court except in case of necessity or for an evident advantage to the ward.

The order granting the permission shall recite the necessity or advantage, as the case may be, describe the property with respect to which the act permitted is to be done, and specify such conditions, if any, as the Court may see fit to attach to the permission, and it shall be recorded, dated and signed by the Judge of the Court with his own hand, or when from any cause he is prevented from recording the order with his own hand, shall be taken down in writing from his dictation and be dated and signed by him.

The Court may in its discretion attach to the permission the following among other conditions, namely:- That a sale shall not be completed without the sanction of the Court.

That a sale shall be made to the highest bidder by public auction before Court or some person specially appointed by the Court for that purpose, at a time and place to be specified by the Court, after such proclamation of the intended sale as the Court subject to any rules made under this Act by the High Court, directs,

That a lease shall not be made in consideration of a premium or shall be made for such term of years and subject to such rents and convenience as the Court directs.

That the whole or any part of the proceeds of the act permitted shall be paid into the Court by the guardian, to be disbursed therefrom or to be invested by the Court on prescribed securities or to be otherwise disposed of as the Court directs.

Before granting permission to a guardian to do an act mentioned in section 29, the court may cause notice of the application for the permission to be given to any relative or friend of the ward who should, in its opinion, receive notice thereof, and shall hear and record the statement of any person who appears in opposition to the application

Section 32. Variation of powers of guardian of property appointed or declared by the Court.

Where a guardian of the property of a ward has been appointed or declared by the Court and such guardian is not the Collector, the Court may, form time to time, by order, define, restrict or extend his powers with respect to the property of the ward in such manner and to such extend as it may consider to be for the advantage of the ward and consistent with the law to which the ward is subject..

Section 33. Right of guardian so appointed or declared to apply to the Court for opinion in management of property of ward.

(1) A guardian appointed or declared by the Court may apply by petition to the Court which appointed or declared him for its opinion, advice or direction on any present question respecting the management or administration of the property of his ward.

If the Court considers the question to be proper for summary disposal, it shall cause a copy of the petition to be served on, and the hearing thereof may be attended by, such of the person interested in the application as the Court thinks fit.

The guardian sitting in good faith the facts in the petition and acting upon the opinion, advice or direction given by the Court shall be deemed, so far as regards his own responsibility, to have performed his duty as guardian in the subject-matter of the application.

Section 34. Obligations on guardian of property appointed or declared by the Court.

Where a guardian of he property of a ward has been appointed or declared by the Court and such guardian is not the Collector, he shall,- If so required by the Court, give a bond, as nearly as may be in the prescribed form, to the Judge of the Court to ensure for the benefit of the Judge for the time being, with or without sureties, as may be prescribed engaging duly to account for what he may receive in respect of the property of the ward.

If so required by the Court, deliver to the Court, within six months from the date of his appointment or declaration by the Court, or within such other time as the Court directs, a statement of the immovable property belonging to the ward, of the money and other movable property which he has received on behalf of he ward up to the date of delivering the statement, and of the debts due on that date to on from the ward.

If so required by the Court, exhibit his accounts in the Court at such times and in such form as the Court form time to time directs.

If so required by the Court, pay into the Court at such time as the Court directs the balance due from him on those accounts, or so much thereof as the Court directs, and

Apply for the maintenance, education and advancement of the ward and of such person as are dependent on him, and for the celebration of ceremonies to which the ward or any of those persons may be party, such portion of the income of the property of the ward as the Court from time to time directs, and , if the Court so directs, the whole or any part of that property

Section 34A. Power to award remuneration for auditing accounts.

¹[34A. Power to award remuneration for auditing accounts.—When accounts are exhibited by a guardian of the property of a ward in pursuance of a requisition made under clause (c) of section 34 or otherwise, the Court may appoint a person to audit the accounts, and may direct that remuneration for the work be paid out of the income of the property.

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1.  Ins. by Act 17 of 1929, sec. 2.

Section 35. Suit against guardian where administration-bond- was taken.

Where a guardian appointed or declared by the Court has given a bond duly to a account for what he may receive in respect of the property of his ward, the Court may, on application made by petition and on being satisfied that the engagement of the bond has not been kept, and upon such term as to security, or providing that any money received by paid into the Court, or otherwise as the Court thinks fit, assign the bond to some proper person, who shall thereupon the entitled to sue on the bond in his own name as if the bond had been originally given to him instead of to the Judge of the Court, and shall be entitled to recover thereon, as trustee for the ward, in respect of any breach thereof.

Section 36. Suit against guardian where administration-bon- was not taken.

(1) Where a guardian appointed or declared by the Court has not given a bond as aforesaid, any person, with the leave of the Court, may, as next friend, at any time during the continuance of the minority of the ward, and upon such terms as aforesaid, institute a suit against the guardian, or, in case of his death, against his representative, for an account of what the guardian has received in respect of the property of the ward, and may recover in the suit, as trustee for the ward, such amount as may be found to be payable by the guardian or his representative, as the case may be.

The provisions of such-section (1) shall, so far as they relate to a suit against a guardian, be subject to the provisions of section 4400 of the Code of Civil Procedure as amended by this Act, 1882 (14 of 1882).

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1.  See now Order XXXII, rules 1 and 4(2), in the First Schedule to the Code of Civil Procedure, 1908 (5 of 1908).

Section 37. General liability of guardian as trustee.

Nothing in either of the two last foregoing sections shall be construed to deprive a ward or his representative of any remedy against his guardian, or the representative of the guardian, which, not being expressly provided in either of those sections, any other beneficiary or his representative would have against his trustee or the representative of the trustee.

Section 38. Right of survivorship among joint guardians.

On the death of one of two or more joint guardians, the guardianship continues to the survivor or survivor until a further appointment is made by the Court.

Section 39. Removal of guardian.

The court may, on the application of any person interested, or of its own motion, remove a guardian appointed or declared by the Court, or a guardian appointed by will or other instrument, for any of the following causes, namely :- For abuse of his trust for continued failure to perform the duties of his trust, for incapacity to perform the duties of his trust, for ill-treatment, or neglect to take proper care, of his ward, for contumacious disregard of any provision of this Act or of any order of the Court, for conviction of an offence implying, in the opinion of the Court, a defect of character which unfits him to be the guardian of his ward.

For having an interest adverse to the faithful performance of his duties.

For ceasing to reside within the local limits of the jurisdiction of the Court.

In the case of a guardian of the property, for bankruptcy or insolvency, By reason of the guardianship of the guardian ceasing, or being liable to cease, under the law to which the minor is subject.

Provided that a guardian appoint by will or other instrument, whether he has been declared under this Act, or not, shall not be removed- For the cause mentioned in clause (g) unless the adverse interest accrued after the death of the person who appointed him, or it is shown that person made and maintained the appointment In ignorance of the existence of the adverse interest, or for the cause mentioned in clause (h) unless such guardian has taken up such a residence as, in the opinion of the Court, renders it impracticable for him to discharge the functions of guardian

Section 40. Discharge of guardian.

(1) If a guardian appointed or declared by the Court desires to resign his office, he may apply to the Court to be discharged.

If the court finds that there is sufficient reason for the application, it shall discharge him, and if the guardian making the application is the Collector and the State Government approves of his applying to be discharged, the Court shall in any case discharge him

Section 41. Cessation of authority of guardian.

(1) The powers of a guardian of the person cease.- By his death, removal or discharge by the Court of wards assuming superintendence of the person of the ward, by the ward ceasing to be a minor in the case of a female ward, by her marriage to a husband who is not unfit to be guardian of her person or, if the guardian was appointed or declared by the Court, by her marriage to a husband who is not, in the opinion of the Court, so unfit, or in the case of a ward whose father was unfit to be guardian of the person of the ward, by the father ceasing to be so or, if the father was deemed by the Court to be so unfit, by his ceasing to be so in the opinion of the Court.

The powers of a guardian of the property cease- by his death, removal or discharge, by the Court of Wards assuming superintendence of the property of the ward, or by the ward ceasing to be a minor.

When for any cause the powers of a guardian cease, the Court may require him of, if he is dead, his representative to delivers as it directs any property in his possession or control belonging to the ward or any accounts in his possession or control relating to any past of present of the ward.

When he has delivered the property or accounts as required by the Court, the Court may declare him to be discharged from his liabilities save as regards any fraud which may subsequently be discovered

Section 42. Appointment of successor to guardian dead, discharged or removed.

When a guardian appointed or declared by the Court is discharged, or, under the law to which the ward is subject, ceases to be entitled to act, or when any such guardian or a guardian appointed by will or other instrument is removed or dies, the Court, of its own motion or on application under Chapter II, may, if the ward is still a minor, appoint or declare another guardian of his person or property, or both, as the case may be.

Chapter IV – Supplemental Provisions

Section 43. Orders for regulating conduct or proceedings of guardians, and enforcement of those orders.

(1) The Court may, on the application of any person interested or of its own motion, make an order regulating the conduct or proceedings of any guardian appointed or declared by the Court.

(2) Where there are more guardians than one of a ward and they are unable to agree upon a question affecting his welfare, any of them may apply to the Court for its direction, and the Court may make such order respecting the matter in difference as it thinks fit.

(3) Except where it appears that the object of making an order under sub-section (1) or sub-section (2) would be defeated by the day, the Court shall, before making the order, direct notice of the application therefor or of the intention of the Court to make it, as the case may be, to be given, in a case under sub-section (1), to the guardian or, in a case under sub-section (2), to the guardian who has not made the application.

(4) In case of disobedience to an order made under sub-section (1), or sub-section (2), the order may be enforced in the same manner as an injunction granted under section 492 or section 493 of the Code of Civil Procedure, 1882 (14 of 1882)¹, in a case under sub-section (1) as if the ward were the plaintiff and the guardian were the defendant or, in a case under sub-section (2), as if the guardian who made the application were the plaintiff and the other guardian were the defendant.

(5) Except in a case under sub-section (2), nothing in this section shall apply to a Collector who is, as such, a guardian.

————

1. See now Order XXXIX, rules 1 and 2 in the First Schedule to the Code of Civil Procedure, 1908 (5 of 1908).

Section 44. Penalty for removal of ward from jurisdiction.

If, for the purpose or with the effect of preventing the Court from exercising its authority with respect to a ward, a guardian appointed or declared by the Court removes the ward from the limits of the jurisdiction of the Court in contravention of the provisions of section 26, he shall be liable, by order of the Court, to fine not exceeding one thousand rupees, or to imprisonment in the civil jail for a term which may extend to six months.

Section 45. Penalty for contumacy.

(1) In the following cases, namely :- If a person having the custody of a minor fails to produce him or cause him to be produced in compliance with a direction under section 12, sub-section (1), or to do his utmost to compel the minor to return to the custody of his guardian in obedience to an order under section 25, sub-section (1),or

If a guardian appointed or declared by the Court fails to deliver to the Court, within the time allowed by or under clause (b) of section 34, a statement required under that clause, or to exhibit accounts in compliance with a requisition under clause (C) of that section, or to pay into the Court the balance due from him on those accounts in compliance with a requisition under clause (d) of that section.

If a person who has ceased to be guardian, or the representative of such a person, fails to deliver any property or accounts in compliance with a requisition under section 41, sub-section (3).

The person, guardian or representative, as the case may be, shall be liable, by order of the Court, to fine not exceeding one hundred rupees, and in case of recusancy to further fine not exceeding ten rupees for each day after the first during which the default continues, and not exceeding five hundred rupees in the aggregate, and to detention in the civil jail until the undertakes to produce the minor or cause him to be produced, or to compel his return, or to deliver the statement, or to exhibit the accounts, or to pay the balance, or to deliver the property or accounts, as the case may be.

If a person who has been released from detention on giving an undertaking under sub-section (1) fails to carry out the undertaking within the time allowed by the Court, the Court may cause him to be arrested and recommitted to the civil jail.

Section 46. Reports by Collectors and subordinate Courts.

(1) The Court may call upon the Collector, or upon any court subordinate to the court, for a report on any matter arising in any proceeding under this Act and treat the report as evidence.

For the purpose of preparing the report the Collector or the Judge of the subordinate Court, as he case may be, shall make such inquiry as he deems necessary, and may for the purposes of the inquiry exercise any power of compelling the attendance of witnesses to give evidence or produce a document which is conferred on a Court by the Code of Civil Procedure, 1882 (14 of 1882)¹

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1.  See now the Code of Civil Procedure, 1908 (5 of 1908).

Section 47. Orders appeasable.

An appeal shall lie to the High Court from an order made by a ¹[***]Court- under Section 7, appointing or declaring or refusing to a appoint or declare a guardian, or under Section 9 sub-section (3) returning an application, or under section 25, making or refusing to make an order for the return of a ward to the custody of his guardian, or under section 26, refusing leave for the removal of a ward from the limits of the jurisdiction of the Court, or imposing conditions with respect thereto, or under Section 28 or section 29, refusing permission to a guardian to do an act referred to in the section, or under section 32, defining, restricting or extending the powers of a guardian, or under section 39, removing a guardian, or under section 43, regulating the conduct or proceedings of a guardian or settling a matter in difference between joint guardians or enforcing the order, or under section 44 or section 45, imposing a penalty.

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1.The word “district” repealed by Act 4 of 1926, sec. 4.

Section 48. Finality of others orders.

Save as provided by the last foregoing section and by section 622 of the Code of Civil Procedure, 1882 (14 of 1882)¹ an order made under this Act shall be final, and shall not be liable to be contested by suit or otherwise.

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1.  See now section 115 of the Code of Civil Procedure, 1908 (5 of 1908).

Section 49. Costs.

The costs of any proceeding under this Act, including the costs of maintaining a guardian or other person in the civil jail, shall, subject to any rules made by the High Court under this Act, be in the discretion of the court in which the proceeding is had.

Section 50. Power of High Court to make rules.

(1) In addition to any other power to make rules conferred expressly or implied by this Act, the High Court may from time to time make rules consistent with this Act- As to the matters respecting which, and the time at which, reports, should be called for from Collectors and subordinate Courts.

As to the allowances to be granted to, and the security to be required from, guardians, and the cases in which such allowances should be granted.

As to the procedure to be followed with respect to applications of guardians for permission to do acts referred to in section 28 and 29.

As to the circumstances in which such requisitions as are mentioned in clause (a), (b), (c) and (d) of section 34 should be made.

As to the preservation of statements and accounts delivered and exhibited by guardians.

As to the inspection of those statements and accounts by persons interested.

¹As to the audit of accounts under Section 34-A, the class of persons who should be appointed to audit accounts, and the scales of remuneration to be granted to them.

as to the custody of money, and securities for money, belonging to wards,

As to the securities on which money belonging to wards may be invested.

As to the education of wards for whom guardians, not being Collectors, have been appointed or declared by the Court, and

Generally, for the guidance of the Courts in carrying out the purposes of this Act.

Rules under clauses (a) and (I) of sub-section (1) shall not have effect until they have been approved by the ²(State Government) nor shall any rule under this section have effect until it has been published in the official Gazette.

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1.  Ins. by Act 17 of 1929, sec. 3.

2.  Subs. by A.L.O. 1950, for the words “Provincial Government”.

Section 51. Applicability of Act to guardians already appointed by Court.

A guardian appointed by, or holding a certificate of administration from, a Civil Court under any enactment repealed by this Act shall, save as may be prescribed, be subject to the provisions of this Act, and of the rules made under it, as if he had been appointed or declared by the Court under Chapter II.

Section 52. Amendment of Indian Majority Act.

(Rep. By the Repealing Act, 1938 (1 of 1938) section 2 and Schedule).

Section 53. Amendment of Chapter XXXI of the Code of Civil Procedure.

(Rep. By the code of Civil Procedure, 1908 ( 5 of 1908) section 156 and Sch. VI).

The schedule.

Enactment repealed.- (Rep. By the Repealing Act, 1938 (1 of 1938), section 2 and Schedule).

Explosives Act

November 30, 2014

Section 1. Short title.

(1) This Act may be called the Explosives Act, 1884; and Local extent.

(2) It extends to the whole of India.

Section 2. Commencement.

(1) This Act shall come into force on such day as the Central Government, by notification, in the Official Gazette appoints.

Section 3. Repeal of portions of Act 12 of 1875.

[Rep. by Art X of 1889.]

Section 4. Definitions.

In Act, unless the context otherwise requires, -

(a) “Aircraft” means any machine which can derive support in the atmosphere from the reaction of the air, other than the reactions of the air against the earth’s surface, and includes balloons, whether fixed or free, airships, kites, gliders and flying machines; I

(b) “Carriage” includes any carriage, wagon cart, truck, vehicle or other means of conveying goods or passengers by land, in whatever manner the same may be propelled;

(c) “District Magistrate” in relation to any area for which a Commissioner of Police has been appointed, means the Commissioner of Police thereof and includes-

(i) Any such Deputy Commissioner of Police, exercising jurisdiction over the whole or any part of such area, as may he specified by the State Government in this behalf in relation to such area or part; and

(ii) An additional District Magistrate;

(d) “Explosive” means gunpowder, nitroglycerine, ritroglycol, and gun cotton di-nitro-toluene, tri-nitro-toluene picric acid, di-nitro-phenol, tri-nitro-resorcinol (styphnic acid), cyclotrimethylene trinitramine, pentaerythritol-tetranitrate, totryl, nitro gannidine, lead azide, lead styphynate, fulminate of mercury or any other metal diazo-di-nitrophenol, coloured fires or any other substance whether a single chemical compound or a mixture of substances, whether solid or liquid or gaseous used or manufactured with a view to produce a practical effect by explosion or pyrotechnic effect; and includes fog signals, fireworks, fuses, rockets, percussion-caps, detonators, cartridges, ammunition of all description and every adaptation of preparation of an explosive as defined in this clause;

(e) “Export” means taking out of India to a place outside India by land, sea of air;

(f) “Import “ means to bring into India from a place outside India by land, sea of air;

(g) “Master”, -

(i) In relation to any vessel or aircraft means any person, other than a pilot harbour master, assistant harbour master or berthing master, having for the time being the charge or control of such vessel or aircraft, as the case may be; and

(ii) In relation to any boat belonging to a ship, means the master of that ship;

(h) “Manufacture” in relation to an explosive includes the process of-

(1) Dividing the explosive into its component parts or otherwise breaking up or unmaking the explosive, or making fit for use any damaged explosive, and

(2) Remaking, altering or repairing the explosive;

(i) “Prescribed” means prescribed by rules made under the Act;

(j) “Vessel” includes any ship, boat, sailing vessel, or other description of vessel used in navigation whether propelled by cars or otherwise and anything made for the conveyance, mainly by water, of human beings or of goods and a caisson.

Section 5. Power to make rules as to licensing of the manufacture, possession, use, sale, transport, import and export of explosives.

(1) The Central Government may for any part of India make rules consistent with this Act to regulate or prohibit, except under and in accordance with the conditions of a licence granted as provided by those rules, the manufacture, possession, sale, transport, import and export of explosives, or ally specified class of explosives,

(2) Rules under this section may provide for all or any of the following among other matters, that is to say, -

(a) The authority by which licences may be granted;

(b) The fees to be charged for licences, and the other sums (if any) to be paid for expenses by applicants for licences; (c) The manner in which applications for licences must be made, and the matters to be specified in such applications;

(d) The form in which, and the conditions on and subject to which, licences must be granted;

(e) The period for which licences are to remain in force;

(ee) The authority to which appeals may be preferred under Section 6-F, the procedure to be followed by such authority and the period within which appeals shall be preferred, the fees to be paid in respect of such appeals and the circumstances under which such fees may be refunded;

(ee-a) The total quantity of explosives that a licensee can purchase in a given period of time;

(ee-b) The fees to be charged by the Chief Controller of Explosives or any officer authorised by him in this behalf, for services rendered in connection with the manufacture, transport, import or export of explosives;

(f) The exemption absolutely or subject to conditions of any explosives or ally person or class of persons from the operation of the rules.

Section 5-A. Persons, already in business in respect of certain explosives to carry on such business without licence for a certain period.

Notwithstanding anything in Section 5 or in the rules made thereunder where, immediately before the commencement of the Indian Explosives (Amendment) Act, 1978, any person was carrying on the business or manufacture, sale, transport, import or export of any explosive for which no licence was required under this Act before its amendment by the Indian Explosives (Amendment) Act, 1978, then, such person shall be entitled to continue to carry on such business without licence in respect of such explosive-

(a) For a period of three months from the date of such commencement; or

(b) If before the expiry of the said period of three months, such person has made an application for grant of licence under this Act for such licences in such explosive, until the final disposal of his application, whichever is later.

Section 6. Power for Central Government to prohibit the manufacture, possession of importation of specially dangerous explosives.

(1) Notwithstanding anything in the rules under the last foregoing section, the Central Government may from time to time, by notification in the official Gazette,-

Prohibit, either absolutely or subject to conditions, the manufacture, possession or importation of any explosive which is of so dangerous a character that, in the opinion of the Central Government, it is expedient for the public safety to issue the notification.

(2) The officers of sea customs at every port shall have the same power in respect of any explosive with regard to the importation of which a notification has been issued under this section and the vessel containing the explosive, as they have for the time being in respect of any article, the importation of which is prohibited or regulated by the law relating to sea customs and the vessel containing the same, and the enactments for the time being in force relating to sea customs or any such article or vessel shall apply accordingly.

(3) Any person manufacturing, possessing or importing an explosive in contravention of a notification issued under this section shall be punishable with imprisonment for a term which may extend to three years or with fine which may extend to five thousand rupees or with both and in the case of importation by water, the owner and master of the vessel in which the explosive is imported shall, in the absence of reasonable excuse, each be punishable with fine which may extend to five thousand rupees.

Section 6A. Prohibition of manufacture, possession, sale, or transport of explosive by young persons and certain other persons.

Notwithstanding anything in the foregoing provisions of this Act,-

(a) No person, -

(i) Who has not completed the age of eighteen years, or

(ii) Who has been sentenced on conviction of any offence involving violence or moral turpitude for a term of not less than six months, at any time during a period of five years after the expiration of the sentence, or

(iii) Who has been ordered to execute under Chapter VIII of the Code of Criminal Procedure, 1973 (2 of 1974), a bond for keeping the peace or for good behaviour, at any time during the term of the bond, or

(iv) Whose licence under this Act has been cancelled, whether before or after the commencement of the Indian Explosives (Amendment) Act, 1978, for contravention of the provisions of this Act or of the rules made thereunder, at any time during a period of five years from the date of cancellation of such licence, Shall-

(1) Manufacture, sell, transport, import or export any explosive, or

(2) Possess any such explosive as the Central Government may, having regard to the nature thereof, by notification in the Official Gazette, specify;

(b) No person shall sell, deliver or despatch any explosive to a person whom he knows or has reason to believe fit the time of such sale, delivery or dispatch,-

(i) To be prohibited under clause (a) to manufacture, sell, transport, import, export or possess such explosive, or

(ii) To be of unsound mind.

Section 6-B. Grant of licences.

(1) Where a person makes an application for licence under Section 5, the authority prescribed in the rules made under that section for grant of ,licences (hereinafter referred to in this Act as the licensing authority), after making such inquiry, if any, as it may consider necessary, shall, subject to the other provisions of this Act, by order in writing either grant the licence or refuse to grant the same,

(2) The licensing authority shall grant a licence-

(a) Where it is required for the purpose of manufacture of explosive if the licensing authority is satisfied that the person by whom licence is required-

(i) Possesses technical know-how and experience in the manufacture of explosives; or

(ii) Has in his employment or undertaken to employ a person or pencils, possessing such technical know, how and experience; or

(b) Where it is required for any other purpose, if the licensing authority is satisfied that the person by whom licence is required has a good reason for obtaining the same.

Section 6-C. Refusal of licences.

(1) Notwithstanding anything contained in Section 6-B the licensing authority shall refuse to grant a licence-

(a) Where such licence is required in respect of any prohibited explosive; or

(b) Where such licence is required by a person whom the licensing authority has reason to believe-

(i) To be prohibited by this Act or by any other law for the time being in force to manufacture, possess, sell, transport, import or export any explosive, or

(ii) To be of unsound mind, or

(iii) To be for any reason unfit for a licence under this Act; or

(c) Where the licensing authority deems it necessary for the security of the public peace or for public safety to refuse to grant such licence. (2) Where the licensing authority refuses to grant a licence to any person, it shall record in writing the reasons for such refusal and furnish to that person on demand a brief statement of the same unless in any case the licensing authority is of opinion that it will not be in the public interest to furnish such statement.

Section 6-D . Licensing authority competent to impose conditions in addition to prescribed conditions.

A licence granted under Section 6-B may contain in addition to prescribed conditions such other conditions as may be considered necessary by the licensing authority in any particular case.

Section 6-E. Variation , suspension and revocation of licences.

(1) The licensing authority may vary the conditions subject to which a licence has been granted except such of them as have been prescribed and may for that purpose require the holder of licence by notice in writing to deliver-up the licence to it within such time as may be specified in the notice.

(2) The licensing authority may, on the application of the holder of a licence, also vary the conditions of the licence except such of them as have been prescribed.

(3) The licensing authority may, by order in writing, suspend a licence for such period as it thinks fit or revoke a licence,-

(a) If the licensing authority is satisfied that the holder of the licence is prohibited by this Act or by other law for the time being in force to manufacture, possess, sell, transport, import or export any explosive, or is of unsound mind, or is for any reason unfit for a licence under this Act; or

(b) If the licensing authority deems it necessary for the security of the public peace or for public safety to suspend or revoke the licence; or

(c) If the licence was obtained by the suppression of material information or on the basis of wrong information provided by the holder of the licence or any other person on his behalf at the time of applying for the licence; or

(d) If any of the conditions of the licence has been contravened; or

(e) If the holder of the licence has failed to comply with a notice under sub-section (I requiring him to deliver-up the licence.

(4) The licensing authority may also revoke a licence on the application of the holder- thereof.

(5) Where the licensing authority makes an order varying the conditions of a license under sub-section (1) or an order suspending or revoking a licence under sub-section(3) It shall record in writing the reasons therefor and furnish to the holder of the licence on demand a brief statement of the same unless in any case the licensing authority is of the opinion that it will not be in the public interest to furnish such statement.

(6) A court convicting the holder of a licence of any offence under this Act or the rules made thereunder may also suspend or revoke a licence

Provided that if the conviction is set-aside on appeal or otherwise, the suspension or revocation shall become void.

(7) An order of suspension or revocation under sub-section (6) may also be made by an appellate court or by the High Court when exercising its powers of revision.

(8) The Central Government may, by order in the Official Gazette suspend or revoke, or direct any licensing authority to suspend or revoke, all or any licences granted wider this Act throughout India or any part thereof.

(9) On the suspension or revocation of a licence under this section, the holder thereof shall without delay surrender the licence to the authority by which it has been suspended or revoked or to such other authority as may be specified in this behalf in the order of suspension or revocation.

Section 6-F. Appeals.

(1) Any person aggrieved by an order of the licensing authority refusing to grant a licence or varying the conditions of a licence or by an order of the licensing authority suspending or evoking a licence may prefer an appeal against that order to such authority (hereinafter referred to as the appellate authority) and within such period as may be prescribed:

Provided that no appeal shall lie against an order made by, or under the direction of, the Central Government.

(2) No appeal shall be admitted if it is preferred after the expiry of the period prescribed therefor

Provided that an appeal may be admitted after the expiry of the period prescribed therefor if the appellant satisfies the appellate authority that he had sufficient cause for not preferring the appeal within that period.

(3) The period prescribed for an appeal shall be computed in accordance with the provisions of the Limitation Act, 1963 (36 of 1963), with respect to the computation of periods of limitation thereunder.

(4) Every appeal under this section shall be made by a petition in writing and shall be accompanied by a brief statement of the reasons for the order appealed where such statement has been furnished to the appellant and by such fee as may be prescribed.

(5) In disposing of at) appeal the appellate authority shall follow such procedure as may be prescribed

Provided that no appeal shall be disposed of unless the appellant has been given a reasonable opportunity of being heard.

6) The order appealed against shall, unless the appellate authority conditionally or unconditionally directs otherwise, be in force pending the disposal of the appeal against such order.

(7) Every order of the appellate authority confirming, modifying or reversing the order appealed against shall be final.

Section 7. Power to make rules conferring powers of inspection, search, seizure, detention’ and removal.

(1) The Central Government may make rules consistent with this Act authorising any officer either by name or in virtue of his office-

(a) To enter, inspect and examine any place, aircraft, carriage or vessel in which an explosive is being manufactured, possessed, used, sold, transported or imported under a licence granted under this Act, or in which he has reason to believe that an explosive has been or is manufactured, possessed, used, sold, transported, imported or exported, in contravention of this Act or of the rules made under this Act;

(b) To search for explosive therein;

(c) To take samples of any explosive found therein on payment of the value thereof; and ze, detain and remove any explosive or ingredient thereof found therein

(d) To seize and, if necessary, also destroy such explosive or ingredient.

(2) The provisions of the Code of Criminal Procedure, 1973 (2 of 1974) relating to searches under that Code shall, so far as the same are applicable, apply to searches by officers authorized by rules this section.

Section 8. Notice of accidents.

(1) Whenever there occurs in or about, or in connection with, any place in which an explosive is manufactured, possessed or used, or any aircraft, carriage or vessel either conveying an explosive or on or from which an explosive is being loaded or unloaded, any accident by explosion or by fire attended with loss of human life or serious injury to person or property, or of a description usually attended with such loss or injury, the occupier of the place, or the master of the aircraft or vessel or the person in charge of the carriage, as the case may be, shall within such hire and in such manner as may be by rule prescribed, give notice thereof and of the attendant loss of human life or personal injury, if any, to the Chief Controller of Explosives in India and to the officer-in-charge of the nearest police station.

(2) 1[ * * * ]

1. Sub-section (2) omitted by Act No. 32 of 1978.

Section 9. Inquiry into accidents.

(1) Where any accident such as is referred to in Section 8 occurs in or about or in connection with any place, aircraft, carriage or vessel under the control of any of Armed forces of the Union an inquiry into the causes of the accident shall be held by the naval, military or air force authority concerned, and where any such accident occurs in any other circumstances, the District Magistrate shall, in cases attended by loss of human life, or may, in any other case, hold or direct a Magistrate subordinate to him to hold, such an inquiry.

(2) Any person holding an inquiry under this section shall have all the powers of Magistrate in holding an inquiry into an offence under the Code of Criminal Procedure, 1973(2 of 1974) and may exercise each of the powers conferred on any officer by rules under Section 7 as he may think it necessary or expedient to exercise for the purpose of the inquiry.

(3) The person holding an inquiry under this section shall make a report to the Central Government stating the causes of the accident and its circumstances.

(4) The Central Government may make rules-

(a) To regulate the procedure at inquires under this section;

(b) To enable the Chief Controller of Explosive in India to be present or represented at any such inquiry;

(c) To permit the Chief Controller of Explosives in India or his representative to examine any witnesses at the inquiry;

(d) To provide that where the Chief Controller of Explosives in India is not present or represented at any such inquiry, a report of the proceedings thereof shall be sent to him;

(e) To prescribe the manner in which and the time within which notices referred to in Section 8 shall be given.

Section 9-A. Inquiry into more serious accidents.

(1) The Central Government may, where it is of opinion, whether or not it has received the report of an inquiry under Section 9, that an inquiry of more formal character should be held into the causes of an accident such as is referred to in Section 8, appoint the Chief Controller of Explosives or any other competent person to hold such inquiry, and may also appoint one or more persons possessing legal or special knowledge to act as assessors in such inquiry.

(2) Where the Central Government orders in an inquiry under this Section, it may also direct that any inquiry under Section 9 pending at the time shall be discontinued.

(3) The person appointed to hold an inquiry under this section, shall have all the powers of Civil Court under the Code of Civil Procedure, 1908 (V of 1980), for the purpose of enforcing the attendance of witnesses and compelling the production of documents and material objects; and every person required by such person as aforesaid to furnish any information shall be deemed to be legally bound so to do within the meaning of Section 176 of the Indian Penal Code (XLV of 1860).

(4) Any person holding an inquiry under this section may exercise such of the powers conferred on any officer by rules under Section 7 as he may think it necessary or expedient to exercise for the purposes of the inquiry.

(5) The person holding an inquiry under this section shall make a report to the Central Government stating the causes of the accident and its circumstances, and adding any observations which he or any of the assessors may think fit to make; and the Central Government shall cause every report so made to be published at such time and in such manner as it may think fit.

(6) The Central Government may make rules for regulating the procedure at inquiries under this section.

Section 9-B. Punishment of certain offences.

(1) Whoever, in contravention of rules made under Section 5 or of the conditions of a licence granted under the said rules-

(a) Manufactures, imports or exports any explosive shall be punishable with imprisonment for a term, which may extend to three years, or with fine, which may extend to five thousand rupees, or with both;

b) Possesses, uses, sells or transports any explosive shall be punishable with imprisonment for a term which may extend to two years or with fine which may extend to three thousand rupees or with both; and

(c) In any other case, with fine which may extend to one thousand rupees.

(2) Whoever in contravention of a notification issued under Section 6, manufactures, possesses or imports any explosive shall be punishable with imprisonment for a term which may extend to three years or with fine which may extend to five thousand rupees or with both; and in the case of importation by water, the owner and master of the vessel or in the case of importation by air, the owner and the master of the aircraft, in which the explosive is imported shall, in the absence of reasonable excuse, each to be punishable with fine which may extend to five thousand rupees.

(3) Whoever, -

(a) Manufactures, sells, transports, imports, exports or possesses any explosive in contravention of the provisions of clause (a) of Section 6; or

(b) Sells, delivers or dispatches any explosive in contravention of the provisions of Clause (b) of that section, shall be punishable with imprisonment for ay extend to three years or with fine or with both; or

(c) In contravention of the provisions of section 8 fails to give notice of any accident shall be punishable-

(i) With fine which may extend to five hundred rupees, or

(ii) If the accident is attended by loss of human life, with imprisonment for a term, which may which, may extend to three months or fine or with both.

Section 9-C. Offences by companies.

(1) Whenever an offence under this Act has been committed by a company, every person who at the time the offence was committed was in charge of, or was responsible to the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence and shall against and punished accordingly be liable to be proceeded

Provided that nothing contained in this sub-section shall render any such person liable to any punishment under this Act if he proves that the offence was committed without edge and that he exercised all due diligence to prevent the commission of such offence. (2) Notwithstanding anything contained in sub-section (1), where an offence under this Act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to any neglect on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.

Explanation. -For the purposes of this section, -

(a) “Company” means any body corporate, and includes a firm or other association of individuals; and

(b) “Director”, in relation to a firm, means a partner in the firm.

Section 10. Forfeiture of explosives.

Where a person is convicted of an offence punishable under this Act, or the rules made under this Act, the court before which he is convicted may direct that the explosive, or ingredient of the explosive or the substance (if any) in respect of which the offence has been committed, or any part of that explosive, ingredient or substance, shall with the receptacles containing the same, be forfeited.

Section 11. Distress of aircraft or vessel.

Where the owner or master of any aircraft or vessel is adjudged under this Act to pay a fine for any offence committed with, or in relation to, that aircraft or vessel, the court may, in addition to any power it may have for the purpose of compelling payment of the fine, direct it to be levied by distress and sale of, -

(a) The aircraft and its furniture or so much of the furniture, or (a)

(b) The vessel and the tackle, apparel and furniture of such vessel or so much of the tackle, apparel and furniture thereof, as is necessary for the payment of the fine.

Section 12. Abetment and attempts.

Whoever abets, within the meaning of the Indian Penal Code (XLV of 1860), the commission of an offence punishable under this Act, or the rules made under this Act, or attempts to commit any such offence and in such attempt does any act towards the commission of the same, c ,hall be punished as if he had committed the offence.

Section 13. Power to arrest without warrant persons committing dangerous offences.

Whoever is found committing any act for which he is punishable under this Act, and which tends to cause explosion or fire in or about any place where an explosive is manufactured or stored, or any railway or port, or any carriage, aircraft or vessel may be apprehended without a warrant by a police officer or by the occupier of, or the agent or servant of, or other person authorised by the occupier of, that place or by any agent or servant of, or other person authorised by the Railway Administration or conservator of the port or officer in charge of the airport and be removed from the place where he is arrested and conveyed as soon as conveniently may be before a Magistrate.

Section 14. Saving and power to exempt.

(1) Nothing in this Act, except Sections 8, 9 and 9-A, shall apply to the manufacture, possession, use transport or importation of any explosive-

(a) By any of Armed Forces of the Union and Ordnance Factories or other establishment or such Forces in accordance with rules or regulations made by the Central Government.

(b) By any person employed under the Central Government or under a State Government in execution of this Act.

(2) The Central Government may, by notification in the official Gazette exempt, absolutely or subject to any such condition as it may think fit to impose, any explosive and any person or class of persons from all or any of the provisions of this Act or the rules made thereunder.

Section 15. Saving of Indian Arms Act, 1978.

Nothing under this Act shall affect the provisions of the Arms Act, 1959 (54 of 1959) :

Provided that all authority granting a licence under this Act for the manufacture, possession, sale, transport or importation of all explosive may, if empowered in this behalf by the rules under which the licence is granted, direct by an order in writing on the licence that it shall have the effect of a like licence granted under the said Indian Arms Act.

Section 16. Saving as to liability under other law.

Nothing in this Act or the rules under this Act shall prevent any person from being prosecuted under any other law for any act or omission which constitutes an offence against this Act or those rules, or from being liable under that other law to any other or higher punishment or penalty than that provided by this Act or those miles:

Provided that a person shall not be punished twice for the same offence.

Section 17. Extension of definition of “explosive” to other explosive substances.

The Central Government may, from time to time, by notification in the Official Gazette, declare that any substance which appears to the Central Government to be specially dangerous to life or property, by reason either of its explosive properties or of any process in the manufacture thereof being liable to explosion, shall be deemed to be an explosive within the meaning of this Act, and the provisions of this Act (subject to such exceptions, limitations and restrictions as may be specified in the, notification) shall accordingly extend to that substance in like manner as if it were included in the definition of the term “explosive” in this Act.

Section 17-A. Power to delegate.

The Central Government may, by notification in the Official Gazette, direct that any power to function which may be exercised or performed by it under this Act other than the power under Sections 5, 6, 6-A, 14 and 17 may, in relation to such matters and subject to such conditions, if any, as it may specify in the notification, be exercised Or performed also by-

(a) Such officer or authority subordinate to the Central Government, or

(b) Such State Government or such officer or authority subordinate to the state Government.

Section 18. Procedure for making publication and confirmation or rules.

(1) An authority making rules under this Act shall, before making the rule, publish a draft of the proposed information of persons likely to be affected thereby.

(2) The publication shall be made in such manner as the Central Government, from time to time, by notification in the Official Gazette, prescribes.

(3) There shall be published with the draft a notice specifying date at or after which (3) the draft will be taken into consideration.

(4) The authority making the rule, shall receive and consider any objection or suggestion, which may be made by any person with respect to the draft before the date so specified.

(5) A rule made under this Act shall not take effect until it has been published in the Official Gazette.

(6) The publication in the Official Gazette of a rule purporting to be made under this Act shall be conclusive evidence that it has been duly made, and, if it requires sanctions that, it has been duly sanctioned.

(7) All powers to make rules conferred by this Act may be exercised from time to time, as occasion requires.

(8) Every rule made under this Act shall be laid, as soon as may be after it is made, before each House of Parliament, while it is in session for a total period of thirty days which may be comprised in one session or in two or more successive sessions, and if, before the expiry of the session immediately following the session or the successive sessions aforesaid, both Houses agree in making any modification in the rule or both Houses agree that the rule should not be made, the rule shall thereafter have effect only in such modified form or be of no effect, as the case may be; so, however, that any such modification or annulment shall be without prejudice to the validity of anything previously done under the rule.

Customs Act

November 30, 2014

Preamble

[ACT NO. 52 OF 1962]

An Act to consolidate and amend the law relating to customs.

Be it enacted by Parliament in the Thirteenth Year of the Republic of India as follows. -

Section 1. Short title, extent and commencement.

ACT NO. 52 OF 1962 [13th December, 1962.]

An Act to consolidate and amend the law relating to customs. BE it enacted by Parliament in the Thirteenth Year of the Republic of India as follows:-

(1) This Act may be called the Customs Act, 1962.

(2) It extends to the whole of India.

(3) It shall come into force on such date 2 as the Central Government may by notification in the Official Gazette, appoint.

—————

1. Came into force on 1-2-1963, vide G.S.R. 155, dated 23rd January, 1963, published in the Gazette of India, Extra., Pt. II, Sec. 3 (i), dated 23rd January, 1963.

Section 2. Definitions.

¹[(1) “adjudicating authority” means any authority competent to pass any order or decision under this Act, but does not include the Board, ²[Commissioner (Appeals)] or Appellate Tribunal;

(1A) “aircraft” has the same meaning in the Aircraft Act, 1934 (22 of 1934);

(1B) “Appellate Tribunal” means the Customs, Excise and ³[Service Tax] Appellate Tribunal constituted under section 129;]

(2) “assessment” includes provisional assessment, reassessment and any order of assessment in which the duty assessed is nil;

(3) “baggage” includes unaccompanied baggage but does not include motor vehicles;

(4) “bill of entry” means a bill of entry referred to in section 46;

(5) “bill of export” means a bill of export referred to in section 50;

(6) “Board” means the ⁴[Central Board of Excise and Customs constituted under the Central Boards of Revenue Act, 1963 (54 of 1963)];

(7) “coastal goods” means goods, other than imported goods, transported in a vessel from one port in India to another;

⁵[(7A) “Commissioner (Appeals)” means a person appointed to be a Commissioner of Customs (Appeals) under sub-section (1) of section 4;]

⁶[(8) “Commissioner of Customs”, except for the purposes of Chapter XV, includes an Additional Commissioner of Customs;]

(9) “conveyance” includes a vessel, an aircraft and a vehicle;

(10) “customs airport” means any airport appointed under clause (a) of section 7 to be a customs airport;

(11) “customs area” means the area of a customs station and includes any area in which imported goods or export goods are ordinarily kept before clearance by Customs Authorities;

(12) “customs port” means any port appointed under clause (a) of section 7 to be a customs port ⁷[and includes a place appointed under clause (aa) of that section to be an inland container depot];

(13) “customs station” means any customs port, customs airport or land customs station;

(14) “dutiable goods” means any goods which are chargeable to duty and on which duty has not been paid;

(15) “duty” means a duty of customs leviable under this Act;

(16) “entry”, in relation to goods means an entry made in a bill of entry, shipping bill or bill of export and includes in the case of goods imported or to be exported by post, the entry referred to in section 82 or the entry made under the regulations made under section 84;

(17) “examination”, in relation to any goods, includes measurement and weighment thereof;

(18) “export”, with its grammatical variations and cognate expressions, means taking out of India to a place outside India;

(19) “export goods” means any goods which are to be taken out of India to a place outside India;

(20) “exporter”, in relation to any goods at any time between their entry for export and the time when they are exported, includes any owner or any person holding himself out to be the exporter;

(21) “foreign-going vessel or aircraft” means any vessel or aircraft for the time being engaged in the carriage of goods or passengers between any port or airport in India and any port or airport outside India, whether touching any intermediate port or airport in India or not, and includes—

(i) any naval vessel of a foreign Government taking part in any naval exercises;

(ii) any vessel engaged in fishing or any other operations outside the territorial waters of India;

(iii) any vessel or aircraft proceeding to a place outside India for any purpose whatsoever;

⁸[(21A) “Fund” means the Consumer Welfare Fund established under section 12C of the Central Excises and Salt Act, 1944 (1 of 1944)*;]

(22) “goods” includes—

(a) vessels, aircrafts and vehicles;

(b) stores;

(c) baggage;

(d) currency and negotiable instruments; and

(e) any other kind of movable property;

(23) “import”, with its grammatical variations and cognate expressions, means bringing into India from a place outside India;

(24) “import manifest” or “import report” means the manifest or report required to be delivered under section 30;

(25) “imported goods” means any goods brought into India from a place outside India but does not include goods which have been cleared for home consumption;

(26) “importer”, in relation to any goods at any time between their importation and the time when they are cleared for home consumption, includes any owner or any person holding himself out to be the importer;

(27) “India” includes the territorial waters of India;

(28) “Indian Customs Water” means the 9[waters extending into the sea upto the limit of contiguous zone of India under section 5 of the Territorial Waters Continental Shelf, Exclusive Economic Zone and other Maritime Zones Act, 1976, (80 of 1976)] and includes any bay, gulf, harbour, creek or tidal river;

(29) “land customs station” means any place appointed under clause (b) of section 7 to be a land customs station;

(30) “market price”, in relation to any goods, means the wholesale price of the goods in the ordinary course of trade in India;

¹⁰[(30A) “National Tax Tribunal” means the National Tax Tribunal established under section 3 of the National Tax Tribunal Act, 2005 (49 of 2005);]

(31) “person-in-charge” means,—

(a) in relation to a vessel, the master of the vessel;

(b) in relation to an aircraft, the commander or pilot-in-charge of the aircraft;

(c) in relation to a railway train, the conductor, guard or other person having the chief direction of the train;

(d) in relation to any other conveyance, the driver or other person-in-charge of the conveyance;

(32) “prescribed” means prescribed by regulations made under this Act;

(33) “prohibited goods” means any goods the import or export of which is subject to any prohibition under this Act or any other law for the time being in force but does not include any such goods in respect of which the conditions subject to which the goods are permitted to be imported or exported, have been complied with;

(34) “proper officer”, in relation to any functions to be performed under this Act, means the officer of customs who is assigned those functions by the Board or the ¹¹[Commissioner of Customs];

(35) “regulations” means the regulations made by the Board under any provision of this Act;

(36) “rules” means the rules made by the Central Government under any provision of this Act;

(37) “shipping bill” means a shipping bill referred to in section 50;

(38) “stores” means goods for use in a vessel or aircraft and includes fuel and spare parts and other articles of equipment, whether or not for immediate fitting;

(39) “smuggling”, in relation to any goods, means any act or omission which will render such goods liable to confiscation under section 111 or section 113;

(40) “tariff value”, in relation to any goods, means the tariff value fixed in respect thereof under sub-section (2) of section 14;

(41) “value”, in relation to any goods, means the value thereof determined in accordance with the provisions of ¹²[sub-section (1) or sub-section (2) of section 14];

(42) “vehicle” means conveyance of any kind used on land and includes a railway vehicle;

(43) “warehouse” means a public warehouse appointed under section 57 or a private warehouse licensed under section 58;

(44) “warehoused goods” means goods deposited in a warehouse;

(45) “warehousing station” means a place declared as a warehousing station under section 9.

——-

1. Subs. by Act 44 of 1980, sec. 50 and Fifth Sch., Pt. I, for clause (1) (w.e.f. 11-10-1982).

2. Subs. by Act 22 of 1995, sec. 51, for “Collector (Appeals)” (w.e.f. 26-5-1995).

3. Subs. by Act 32 of 2003, sec. 104, for “Gold (Control)” (w.e.f. 14-5-2003).

4. Subs. by Act 54 of 1963, sec. 5, for certain words (w.e.f. 1-1-1964).

5. Subs. by Act 22 of 1995, sec. 51, for clause (7A) (w.e.f. 26-5-1995).

Earlier clause (7A) was inserted by Act 44 of 1980, sec. 50 and Fifth Sch., Pt. I (w.e.f. 11-10-1982).

6. Subs. by Act 22 of 1995, sec. 51, for clause (8) (w.e.f. 26-5-1995). Earlier clause (8) was substituted by Act 18 of 1992, sec. 109 (w.e.f. 14-5-1992).

7.Ins. by Act 11 of 1983, sec. 46 (w.e.f. 13-5-1983).

8. Ins. by Act 40 of 1991, sec. 9 (w.e.f. 20-9-1991).

* Now the Central Excises Act, 1944 (1 of 1944).

9. Subs. by Act 25 of 1978, sec. 2, for certain words (w.e.f. 1-7-1978).

10.Ins. by Act 49 of 2005, sec. 30 and Sch., Pt. VI-1 (w.e.f. 28-12-2005).

11. Subs. by Act 22 of 1995, sec. 50, for “Collector of Customs” (w.e.f. 26-5-1995).

12. Subs. by Act 22 of 2007, sec. 94, for “sub-section (1) of section 14” (w.e.f. 11-5-2007).

Section 3. Classes of officers of customs.

There shall be the following classes of officers of customs, namely :-

(a) Chief Commissioners of Customs;

(b) Commissioners of Customs;

(c) Commissioners of Customs (Appeals);

²(cc) Joint Commissioners of Customs;

(d) Deputy Commissioners of Customs;

(e) Assistant Commissioners of Customs; and

(f) such other class of officers of customs as may be appointed for the purposes of this Act.

—————

1. Subs. by Act 22 of 1995, sec. 52, for section 3 (w.e.f. 26-5-1995).

2. Ins. by Act, 27 of 1999, sec. 101 (w.e.f. 11-5-1999).

Section 4. Appointment of officers of customs.

¹[4. Appointment of officers of customs.—(1) The ²[Board] may appoint such persons as it thinks fit to be officers of customs.

(2) Without prejudice to the provisions of sub-section (1), ³[Board may authorise a Chief Commissioner of Customs or] a ⁴[Joint or Assistant or Deputy Commissioner of Customs] to appoint officers of customs below the rank of Assistant Commissioner of Customs.]

—————

1. Subs. by Act 22 of 1995, sec. 52, for section 4 (w.e.f. 26-5-1995).

2. Subs. by Act 20 of 2002, sec. 117, for “Central Government” (w.e.f. 11-5-2002).

3. Subs. by Act 20 of 2002, sec. 117, for “Central Government may authorise the Board” (w.e.f. 11-5-2002).

4. Subs. by Act 27 of 1999, sec. 100, for “Deputy or Assistant Commissioner of Customs” (w.e.f. 11-5-1999)./

Section 5. Powers of officers of customs. Sub-section.

(1) Subject to such conditions and limitations as the Board may impose, an officer of customs may exercise the powers and discharge the duties conferred or imposed on him under this Act.

(2) An officer of customs may exercise the powers and discharge the duties conferred or imposed under this Act on any other officer of customs who is subordinate to him.

(3) Notwithstanding anything contained in this section, a Commissioner (Appeals) shall not exercise the powers and discharge the duties conferred or imposed on an officer of customs other than those specified in Chapter XV and section 108.

—————

1. Subs. by Act 44 of 1980, sec. 50, Fifth Sch., Pt. I, for “an Appellate Collector of Customs” (w.e.f. 11-10-1982).

2. Subs. by Act 22 of 1995, sec. 50, for “Collector (Appeals)” (w.e.f. 26-5-1995).

Section 6. Entrustment of functions of board and customs officers on certain other officers.

The Central Government may, by notification in the Official Gazette, entrust either conditionally or unconditionally to any officer of the Central or the State Government or a local authority any functions of the Board or any officer of customs under this Act.

Section 7. Appointment of customs ports, airports, etc.

¹The ²[Board] may, by notification in the Official Gazette, appoint -

(a) the ports and airports which alone shall be customs ports or customs airports for the unloading of imported goods and the loading of export goods or any class of such goods;

³(aa) the places which alone shall be inland container depots for the unloading of imported goods and the loading of export goods or any class of such goods;

(b) the places which alone shall be land customs stations for the clearance of goods imported or to be exported by land or inland water or any class of such goods;

(c) the routes by which alone goods or any class of goods specified in the notification may pass by land or inland water into or out of India, or to or from any land customs station from or to any land frontier;

(d) the ports which alone shall be coastal ports for the carrying on of trade in coastal goods or any class of such goods with all or any specified ports in India.

⁴[(2) every notification issued under this section and in force immediately before the commencement of the Finance Act, 2003 shall, on such commencement, be deemed to have been issued under the provisions of this section as amended by section 105 of the Finance Act, 2003 and shall continue to have the same force and effect after such commencement until it is amended, rescinded or superseded under the provisions of this section.]

—————

1. Section 7 renumbered as sub-section (1) thereof by Act 32 of 2003, sec. 105 (w.e.f. 14-5-2003).

2. Subs. by Act 32 of 2003, sec. 105, for “Central Government” (w.e.f. 14-5-2003).

3. Ins. by Act 11 of 1983, sec. 47 (w.e.f. 13-5-1983).

4. Ins. by Act 32 of 2003, sec. 105 (w.e.f. 14-5-2003).

Section 8. Power to approve landing places and specify limits of customs area.

The ¹[Commissioner of Customs] may, -

(a) approve proper places in any customs port or customs airport or coastal port for the unloading and loading of goods or for any class of goods;

(b) specify the limits of any customs area.

—————

1. Subs. by Act 22 of 1995, sec. 50, for “Collector of Customs” (w.e.f. 26-5-1995).

Section 9. Power to declare places to be warehousing stations.

The Board may, by notification Official Gazette, declare places to be warehousing stations at which alone public warehouses may be appointed and private warehouses may be licensed.

Section 10. Appointment of boarding stations.

The ¹[Commissioner of Customs] may, by notification in the Official Gazette, appoint, in or near any customs port, a boarding station for the purpose of boarding of, or disembarkation from, vessels by officers of customs.

———

1. Subs. by Act 22 of 1995, sec. 50, for “Collector of Customs” (w.e.f. 26-5-1995).

Section 11. Power to prohibit importation or exportation of goods. Sub section

(1) If the Central Government is satisfied that it is necessary so to do for any of the purposes specified in sub-section (2), it may, by notification in the Official Gazette, prohibit either absolutely or subject to such conditions (to be fulfilled before or after clearance) as may be specified in the notification, the import or export of goods of any specified description.

(2) The purposes referred to in sub-section (1) are the following :-

(a) the maintenance of the security of India;

(b) the maintenance of public order and standards of decency or morality;

(c) the prevention of smuggling;

(d) the prevention of shortage of goods of any description;

(e) the conservation of foreign exchange and the safeguarding of balance of payments;

(f) the prevention of injury to the economy of the country by the uncontrolled import or export of gold or silver;

(g) the prevention of surplus of any agricultural product or the product of fisheries;

(h) the maintenance of standards for the classification, grading or marketing of goods in international trade;

(i) the establishment of any industry;

(j) the prevention of serious injury to domestic production of goods of any description;

(k) the protection of human, animal or plant life or health;

(l) the protection of national treasures of artistic, historic or archaeological value;

(m) the conservation of exhaustible natural resources;

(n) the protection of patents, trade marks and copyrights;

(o) the prevention of deceptive practices;

(p) the carrying on of foreign trade in any goods by the State, or by a Corporation owned or controlled by the State to the exclusion, complete or partial, of citizens of India;

(q) the fulfillment of obligations under the Charter of the United Nations for the maintenance of international peace and security;

(r) the implementation of any treaty, agreement or convention with any country;

(s) the compliance of imported goods with any laws which are applicable to similar goods produced or manufactured in India;

(t) the prevention of dissemination of documents containing any matter which is likely to prejudicially affect friendly relations with any foreign State or is derogatory to national prestige;

(u) the prevention of the contravention of any law for the time being in force; and

(v) any other purpose conducive to the interests of the general public.

Section 11A. Definitions.

In this Chapter, unless the context otherwise requires, -

(a) “illegal import” means the import of any goods in contravention of the provisions of this Act or any other law for the time being in force;

(b) “intimated place” means a place intimated under sub-section (1), sub-section (2) or sub-section (3), as the case may be, of section 11C;

(c) “notified date”, in relation to goods of any description, means the date on which the notification in relation to such goods is issued under section 11B;

(d) “notified goods” means goods specified in the notification issued under section 11B.

———

* Chapter IVA (containing sections 11A to 11G) ins. by Act 12 of 1969, sec. 2 (w.r.e.f. 3-1-1969).

Section 11B. Power of central government to notify goods.

If, having regard to the magnitude of the illegal import of goods of any class or description, the Central Government is satisfied that it is expedient in the public interest to take special measures for the purpose of checking the illegal import, circulation or disposal of such goods, it may, by notification in the Official Gazette, specify goods of such class or description

—————

* Chapter IVA (containing sections 11A to 11G) ins. by Act 12 of 1969, sec. 2 (w.r.e.f. 3-1-1969).

Section 11C. Persons possessing notified goods to intimate the place of storage, etc.

(1) Every person who owns, possesses or controls, on the notified date, any notified goods, shall, within seven days from that date, deliver to the proper officer a statement (in such form, in such manner and containing such particulars as may be specified by rules made in this behalf) in relation to the notified goods owned, possessed or controlled by him and the place where such goods are kept or stored.

(2) Every person who acquires, after the notified date, any notified goods, shall, before making such acquisition, deliver to the proper officer an intimation containing the particulars of the place where such goods are proposed to be kept or stored after such acquisition and shall, immediately on such acquisition, deliver to the proper officer a statement (in such form, in such manner and containing such particulars as may be specified by rules made in this behalf) in relation to the notified goods acquired by him :

Provided that a person who has delivered a statement, whether under sub-section (1) or sub-section (2), in relation to any notified goods, owned, possessed, controlled or acquired by him, shall not be required to deliver any further statement in relation to any notified goods acquired by him, after the date of delivery of the said statement, so long as the notified goods so acquired are kept or stored at the intimated place.

(3) If any person intends to shift any notified goods to any place other than the intimated place, he shall, before taking out such goods from the intimated place, deliver to the proper officer an intimation containing the particulars of the place to which such goods are proposed to be shifted.

(4) No person shall, after the expiry of seven days from the notified date, keep or store any notified goods at any place other than the intimated place.

(5) Where any notified goods have been sold or transferred, such goods shall not be taken from one place to another unless they are accompanied by the voucher referred to in section 11F.

(6) No notified goods (other than those which have been sold or transferred) shall be taken from one place to another unless they are accompanied by a transport voucher (in such form and containing such particulars as may be specified by rules made in this behalf) prepared by the persons owning, possessing or controlling such goods.

—————

* Chapter IVA (containing sections 11A to 11G) ins. by Act 12 of 1969, sec. 2 (w.r.e.f. 3-1-1969).

Section 11D. Precautions to be taken by persons acquiring notified goods.

No person shall acquire (except by gift or succession, from any other individual in India), after the notified date, any notified goods -

(i) unless such goods are accompanied by, -

(a) the voucher referred to in section 11F or the memorandum referred to in sub-section (2) of section 11G, as the case may be, or

(b) in the case of a person who has himself imported any goods, any evidence showing clearance of such goods by the Customs Authorities; and

(ii) unless he has taken, before acquiring such goods from a person other than a dealer having a fixed place of business, such reasonable steps as may be specified by rules made in this behalf, to ensure that the goods, so acquired by him are not goods which have been illegally imported.

—————

* Chapter IVA (containing sections 11A to 11G) ins. by Act 12 of 1969, sec. 2 (w.r.e.f. 3-1-1969).

Section 11E. Persons possessing notified goods to maintain accounts.

(1) Every person who, on or after the notified date, owns, possesses, controls or acquires any notified goods shall maintain (in such form and in such manner as may be specified by rules made in this behalf) a true and complete account of such goods and shall, as often as he acquires or parts with any notified goods, make an entry in the said account in relation to such acquisition or parting with, and shall also state therein the particulars of the person from whom such goods have been acquired or in whose favour such goods have been parted with, as the case may be, and such account shall be kept, along with the goods, at the place of storage of the notified goods to which such accounts relate :

Provided that it shall not be necessary to maintain separately accounts in the form and manner specified by rules made in this behalf in the case of a person who is already maintaining accounts which contain the particulars specified by the said rules.

(2) Every person who owns, possesses or controls any notified goods and who uses any such goods for the manufacture of any other goods, shall maintain (in such form, in such manner and containing such particulars as may be specified by rules made in this behalf) a true and complete account of the notified goods so used by him and shall keep such account at the intimated place.

———

* Chapter IVA (containing sections 11A to 11G) ins. by Act 12 of 1969, sec. 2 (w.r.e.f. 3-1-1969).

Section 11F. Sale, etc., of notified goods to be evidenced by vouchers.

On and from the notified date, no person shall sell or otherwise transfer any notified goods, unless every transaction in relation to the sale or transfer of such goods is evidenced by a voucher in such form and containing such particulars as may be specified by rules made in this behalf.

————

* Chapter IVA (containing sections 11A to 11G) ins. by Act 12 of 1969, sec. 2 (w.r.e.f. 3-1-1969).

Section 11G. Sections 11C, 11E and 11F not to apply to goods in personal use.

(1) Nothing in sections 11C, 11E and 11F shall apply to any notified goods which are -

(a) in personal use of the person by whom they are owned, possessed or controlled, or

(b) kept in the residential premises of a person for his personal use.

(2) If any person, who is in possession of any notified goods referred to in sub-section (1), sells, or otherwise transfers for a valuable consideration, any such goods, he shall issue to the purchaser or transferee, as the case may be, a memorandum containing such particulars as may be specified by rules made in this behalf and no such goods shall be taken from one place to another unless they are accompanied by the said memorandum.

————

* Chapter IVA (containing sections 11A to 11G) ins. by Act 12 of 1969, sec. 2 (w.r.e.f. 3-1-1969).

Section 11H. Definitions.

In this Chapter, unless the context otherwise requires, -

(a) “illegal export” means the export of any goods in contravention of the provisions of this Act or any other law for the time being in force;

(b) “intimated place” means a place intimated under sub-section (1), sub-section (2) or sub-section (3), as the case may be, of section 11J;

(c) “specified area” includes the Indian customs waters, and such inland area, not exceeding one hundred kilometres in width from any coast or other border of India, as the Central Government may, having regard to the vulnerability of that area to smuggling, by notification in the Official Gazette, specify in this behalf :

Provided that where a part of any village, town or city falls within a specified area, the whole of such village, town or city shall, notwithstanding that the whole of it is not within one hundred kilometres from any coast or other border of India, be deemed to be included in such specified area;

(d) “specified date”, in relation to specified goods, means the date on which any notification is issued under section 11-I in relation to those goods in any specified area;

(e) “specified goods” means goods of any description specified in the notification issued under section 11-I in relation to a specified area.

—————

* Chapter IVB (containing sections 11H to 11M) ins. by Act 12 of 1969, sec. 2 (w.r.e.f. 3-1-1969).

Section 11-I. Power of central government to specify goods.

If, having regard to the magnitude of the illegal export of goods of any class or description, the Central Government is satisfied that it is expedient in the public interest to take special measures for the purpose of checking the illegal export or facilitating the detection of goods which are likely to be illegally exported, it may, by notification in the Official Gazette, specify goods of such class or description.

—————

* Chapter IVB (containing sections 11H to 11M) ins. by Act 12 of 1969, sec. 2 (w.r.e.f. 3-1-1969).

Section 11J. Persons possessing specified goods to intimate the place of storage, etc.

(1) Every person who owns, possesses or controls, on the specified date, any specified goods, the market price of which exceeds fifteen thousand rupees shall, within seven days from that date, deliver to the proper officer an intimation containing the particulars of the place where such goods are kept or stored within the specified area.

(2) Every person who acquires (within the specified area), after the specified date, any specified goods, -

(i) the market price of which, or

(ii) the market price of which together with the market price of any specified goods of the same class or description, if any, owned, possessed or controlled by him on the date of such acquisition, exceeds fifteen thousand rupees shall, before making such acquisition, deliver to the proper officer an intimation containing the particulars of the place where such goods are proposed to be kept or stored after such acquisition :

Provided that a person who has delivered an intimation, whether under sub-section (1) or sub-section (2), in relation to any specified goods, owned, possessed, controlled or acquired by him, shall not be required to deliver any further intimation so long as the specified goods are kept or stored at the intimated place.

(3) If any person intends to shift any specified goods to which sub-section (1) or sub-section (2) applies, to any place other than the intimated place, he shall, before taking out such goods from the intimated place, deliver to the proper officer an intimation containing the particulars of the place to which such goods are proposed to be shifted.

(4) No person shall, after the expiry of seven days from the specified date, keep or store any specified goods to which sub-section (1) or sub-section (2) applies, at any place other than the intimated place.

—————

* Chapter IVB (containing sections 11H to 11M) ins. by Act 12 of 1969, sec. 2 (w.r.e.f. 3-1-1969).

Section 11K. Transport of specified goods to be covered by vouchers.

(1) No specified goods shall be transported from, into or within any specified area or loaded on any animal or conveyance in such area, unless they are accompanied by a transport voucher (in such form and containing such particulars as may be specified by rules made in this behalf) prepared by the person owning, possessing, controlling or selling such goods :

Provided that no transport voucher shall be necessary for the transport, within a village, town or city, of any specified goods the market price of which, on the date of transport, does not exceed one thousand rupees.

(2) Notwithstanding anything contained in sub-section (1), where the Central Government, after considering the nature of any specified goods, the time, mode, route and the market price of the goods intended to be transported, the purpose of the transportation and the vulnerability of the specified area with regard to the illegal export of such goods, is satisfied that it is expedient in the public interest so to do, it may, -

(i) by notification in the Official Gazette, specify goods of such class or description and of a market price exceeding such sum as that Government may notify; and different sums in relation to the specified goods of the same class or description, or different classes or descriptions, may be notified for the same specified area or for different specified areas, and

(ii) direct that no person shall transport any goods so specified unless the transport voucher in relation to them has been countersigned by the proper officer.

—————

* Chapter IVB (containing sections 11H to 11M) ins. by Act 12 of 1969, sec. 2 (w.r.e.f. 3-1-1969).

Section 11L. Persons possessing specified goods to maintain accounts.

(1) Every person who, on or after the specified date, owns, possesses or controls, within a specified area, any specified goods of a market price exceeding fifteen thousand rupees, shall maintain (in such form and in such manner as may be specified by rules made in this behalf) a true and complete account of such goods and shall, as often as he acquires or parts with any specified goods, make an entry in the said account in relation to such acquisition or parting with, and shall also state therein the particulars of the person from whom such goods have been acquired or in whose favour such goods have been parted with, as the case may be, and such account shall be kept, along with the goods, at the place of storage of the specified goods to which such accounts relate :

Provided that it shall not be necessary to maintain separately accounts in the form and manner specified by rules made in this behalf in the case of a person who is already maintaining accounts which contain the particulars specified by the said rules.

(2) Every person who owns, possesses or controls any specified goods to which the provisions of sub-section (1) apply, and who uses any such goods for the manufacture of any other goods, shall maintain (in such form, in such manner and containing such particulars as may be specified by rules made in this behalf) a true and complete account of the specified goods so used by him and shall keep such account at the intimated place.

————

* Chapter IVB (containing sections 11H to 11M) ins. by Act 12 of 1969, sec. 2 (w.r.e.f. 3-1-1969).

Section 11M. Steps to be taken by persons selling or transferring any specified goods.

Except where he receives payment by cheque drawn by the purchaser, every person who sells or otherwise transfers within any specified area, any specified goods, shall obtain, on his copy of the sale or transfer voucher, the signature and full postal address of the person to whom such sale or transfer is made and shall also take such other reasonable steps as may be specified by rules made in this behalf to satisfy himself as to the identity of the purchaser or the transferee, as the case may be, and if after an inquiry made by a proper officer, it is found that the purchaser or the transferee, as the case may be, is not either readily traceable or is a fictitious person, it shall be presumed, unless the contrary is proved, that such goods have been illegally exported and the person who had sold or otherwise transferred such goods had been concerned in such illegal export :

Provided that nothing in this section shall apply to petty sales of any specified goods if the aggregate market price obtained by such petty sales, made in the course of a day, does not exceed two thousand and five hundred rupees.

Explanation : In this section “petty sale” means a sale at a price which does not exceed one thousand rupees.

————

* Chapter IVB (containing sections 11H to 11M) ins. by Act 12 of 1969, sec. 2 (w.r.e.f. 3-1-1969).

Section 11N. Power to exempt.

If the Central Government is satisfied that it is necessary in the public interest so to do, it may, by notification in the Official Gazette, exempt generally, either absolutely or subject to such conditions as may be specified in the notification, goods of any class or description from all or any of the provisions of Chapter IVA or Chapter IVB.

Section 12. Dutiable goods.

(1) Except as otherwise provided in this Act, or any other law for the time being in force, duties of customs shall be levied at such rates as may be specified under the Customs Tariff Act, 1975 (51 of 1975), or any other law for the time being in force, on goods imported into, or exported from, India.

(2) The provisions of sub-section (1) shall apply in respect of all goods, belonging to Government as they apply in respect of goods not belonging to Government.

__________

1. Subs. by Act 51 of 1975, sec. 13, for “Indian Tariff Act, 1934 (32 of 1934)” (w.e.f. 2-8-1976).

2. Subs. by Act 30 of 1963, sec. 2, for sub-section (2) (w.e.f. 1-10-1963).

Section 13. Duty on pilfered goods.

If any imported goods are pilfered after the unloading thereof and before the proper officer has made an order for clearance for home consumption or deposit in a warehouse, the importer shall not be liable to pay the duty livable on such goods except where such goods are restored to the importer after pilferage.

Section 14. Valuation of goods for purposes of assessment.

¹(1) For the purposes of the Customs Tariff Act, 1975 (51 of 1975), or any other law for the time being in force where under a duty of customs is chargeable on any goods by reference to their value, the value of such goods shall be deemed to be the price at which such or like goods are ordinarily sold, or offered for sale, for delivery at the time and place of importation or exportation, as the case may be, in the course of international trade, where the seller and the buyer have no interest in the business of each other and the price is the sole consideration for the sale or offer for sale :

Provided that such price shall be calculated with reference to the rate of exchange as in force on the date on which a bill of entry is presented under section 46, or a shipping bill or bill of export, as the case may be, is presented under section 50;

(1A) Subject to the provisions of sub-section (1), the price referred to in that sub-section in respect of imported goods shall be determined in accordance with the rules made in this behalf.

(2) Notwithstanding anything contained in sub-section (1) or sub-section (1A), if the Central Government is satisfied that it is necessary or expedient so to do it may, by notification in the Official Gazette, fix tariff values for any class of imported goods or export goods, having regard to the trend of value of such or like goods, and where any such tariff values are fixed, the duty shall be chargeable with reference to such tariff value.

(3) For the purposes of this section – (a) “rate of exchange” means the rate of exchange – (i) determined by the Central Government, or

(ii) ascertained in such manner as the Central Government may direct, for the conversion of Indian currency into foreign currency or foreign currency into Indian currency;

(b) “foreign currency” and “Indian currency” have the meanings respectively assigned to them in the Foreign Exchange Regulation Act, 1973 (46 of 1973)

——–

1. Subs. by Act 22 of 2007, sec. 95, for section 14. Earlier section 14 was amended by Act 20 of 1966, sec. 2 (w.e.f. 31-8-1966), by Act 51 of 1975, sec. 13 (w.e.f. 2-8-1976), by Act 25 of 1978, sec. 3 (w.e.f. 1-7-1978), by Act 27 of 1988, sec. 2 (w.e.f. 16-8-1988), by Act 20 of 2002, sec. 118 (w.e.f. 11-5-2002). Section 14, before substitution, stood as under:—

‘14. Valuation of goods for purposes of assessment .—(1) For the purposes of the Customs Tariff Act, 1975 (51 of 1975), or any other law for the time being in force whereunder a duty of customs is chargeable on any goods by reference to their value, the value of such goods shall be deemed to be—

the price at which such or like goods are ordinarily sold, or offered for sale, for delivery at the time and place of importation or exportation, as the case may be, in the course of international trade, where—

(a) the seller and the buyer have no interest in the business of each other; or

(b) one of them has no interest in the business of the other,

and the price is the sole consideration for the sale or offer for sale:

Provided that such price shall be calculated with reference to the rate of exchange as in force on the date on which a bill of entry is presented under section 46, or a shipping bill or bill of export, as the case may be, is presented under section 50;

(1A) Subject to the provisions of sub-section (1), the price referred to in that sub-section in respect of imported goods shall be determined in accordance with the rules made in this behalf.

(2) Notwithstanding anything contained in sub-section (1) or sub-section (1A) if the Board is satisfied that it is necessary or expedient so to do, it may, by notification in the Official Gazette, fix tariff values for any class of imported goods or export goods, having regard to the trend of value of such or like goods, and where any such tariff values are fixed, the duty shall be chargeable with reference to such tariff value.

(3) For the purposes of this section—

(a) “rate of exchange” means the rate of exchange—

(i) determined by the Board, or

(ii) ascertained in such manner as the Board may direct,

for the conversion of Indian currency into foreign currency or foreign currency into Indian currency;

(b) “foreign currency” and “Indian currency” have the meanings respectively assigned to them in clause (m) and clause (q) of section 2 of the Foreign Exchange Management Act, 1999 (42 of 1999).’.

Section 15. Date for determination of rate of duty and tariff valuation of imported goods.

¹(1) The rate of duty ²[***]and tariff valuation, if any, applicable to any imported goods, shall be the rate and valuation in force, -

(a) in the case of goods entered for home consumption under section 46, on the date on which ³a bill of entry in respect of such goods is presented under that section;

(b) in the case of goods cleared from a warehouse under section 68, on the date on which the goods are actually removed from the warehouse;

(c) in the case of any other goods, on the date of payment of duty :

⁴Provided that if a bill of entry has been presented before the date of entry inwards of the vessel or the arrival of the aircraft by which the goods are imported, the bill of entry shall be deemed to have been presented on the date of such entry inwards or the arrival, as the case may be.

(2) The provisions of this section shall not apply to baggage and goods imported by post.

⁵[***]

—————

1. Subs. by Act 20 of 1966, sec. 3, for “The rate of duty” (w.e.f. 31-8-1966).

2. The words “, rate of exchange” omitted by Act 25 of 1978, sec. 4 (w.e.f. 1-7-1978).

3. Subs. by Act 32 of 2003, sec. 106, for “the goods are actually removed from the warehouse” (w.e.f. 14-5-2003).

4. Subs. by Act 33 of 1996, sec. 59, for the proviso (w.e.f. 28-9-1996).

5. Sub-section (3) omitted by Act 25 of 1978, sec. 4 (w.e.f. 1-7-1978).

Earlier sub-section (3) was inserted by Act 20 of 1966, sec. 3 (w.e.f. 31-8-1966).

Section 16. Date for determination of rate of duty and tariff valuation of export goods.

¹(1) The rate of duty and tariff valuation, if any, applicable to any export goods, shall be the rate and valuation in force, -

(a) in the case of goods entered for export under section 50, on the date on, which the proper officer makes an order permitting clearance and loading of the goods for exportation under section 51;

(b) in the case of any other goods, on the date of payment of duty.

(2) The provisions of this section shall not apply to baggage and goods exported by post.

—————

1. Subs. by Act 23 of 1986, sec. 50, for sub-section (1) (w.e.f. 13-5-1986).

Section 17. Assessment of duty.

(1) After an importer has entered any imported goods under section 46 or an exporter has entered any export goods under, section 50 the imported goods or the export goods, as the case may be, or such part thereof as may be necessary may, without undue delay, be examined and tested by the proper officer.

(2) After such examination and testing, the duty, if any, livable on such goods shall, save as otherwise provided in section 85, be assessed.

(3) For the purpose of assessing duty under sub-section (2), the proper officer may require the importer, exporter or any other person to produce any contract, broker’s note, policy of insurance, catalogue or other document whereby the duty livable on the imported goods or export goods, as the case may be, can be ascertained, and to furnish any information required for such ascertainment which it is in his power to produce or furnish, and thereupon the importer, exporter or such other person shall produce such document and furnish such information.

(4) Notwithstanding anything contained in this section, imported goods or export goods may, prior to the examination or testing thereof, be permitted by the proper officer to be assessed to duty on the basis of the statements made in the enter relating thereto and the documents produced and the information furnished under sub-section (3); but if it is found subsequently on examination or testing of the goods or otherwise that any statement in such entry or document or any information so furnished is not true in respect of any matter relevant to the assessment, the goods may, without prejudice to any other action which may be taken under this Act, be re-assessed to duty.

¹[(5) Where any assessment done under sub-section (2) is contrary to the claim of the importer or exporter regarding valuation of goods, classification, exemption or concessions of duty availed consequent to any notification therefor under this Act, and in cases other than those where the importer or the exporter, as the case may be, confirms his acceptance of the said assessment in writing, the proper officer shall pass a speaking order within fifteen days from the date of assessment of the bill of entry or the shipping bill, as the case may be].

—————

1. Ins. by Act 29 of 2006, sec. 20 (w.e.f. 13-7-2006).

Section 18. Provisional assessment of duty.

(1) Notwithstanding anything contained in this Act but without prejudice to the provisions contained in section 46 -

(a) where the proper officer is satisfied that an importer or exporter is unable to produce any document or furnish any information necessary for the assessment of duty on the imported goods or the export goods, as the case may be; or

(b) where the proper officer deems it necessary to subject any imported goods or export goods to any chemical or other test for the purpose of assessment of duty thereon; or

(c) where the importer or the exporter has produced all the necessary documents and furnished full information for the assessment of duty but the proper officer deems it necessary to make further enquiry for assessing the duty, the proper officer may direct that the duty livable on such goods may, pending the production of such documents or furnishing of such information or completion of such test or enquiry, be assessed provisionally if the importer or the exporter, as the case may be, furnishes such security as the proper officer deems fit for the payment of the deficiency, if any, between the duty finally assessed and the duty provisionally assessed.

(2) When the duty livable on such goods is assessed finally in accordance with the provisions of this Act, then – (a) in the case of goods cleared for home consumption or exportation, the amount paid shall be adjusted against ¹the duty finally assessed and if the amount so paid falls short of, or is in excess of the duty finally assessed, the importer or the exporter of the goods shall pay the deficiency or be entitled to a refund, as the case may be;

(b) in the case of warehoused goods, the proper officer may, where the duty finally assessed is in excess of the duty provisionally assessed, require the importer to execute a bond, binding himself in a sum equal to twice the amount of the excess duty.

²[(3) The importer or exporter shall be liable to pay interest, on any amount payable to the Central Government, consequent to the final assessment order under sub-section (2), at the rate fixed by the Central Government under section 28AB from the first day of the month in which the duty is provisionally assessed till the date of payment thereof.

(4) Subject to sub-section (5), if any refundable amount referred to in clause (a) of sub-section (2) is not refunded under that sub-section within three months from the date of assessment, of duty finally, there shall be paid an interest on such unrefunded amount at such rate fixed by the Central Government under section 27A till the date of refund of such amount.

(5) The amount of duty refundable under sub-section (2) and the interest under sub-section (4), if any, shall, instead of being credited to the Fund, be paid to the importer or the exporter, as the case may be, if such amount is relatable to—

(a) the duty and interest, if any, paid on such duty paid by the importer, or the exporter, as the case may be, if he had not passed on the incidence of such duty and interest, if any, paid on such duty to any other person;

(b) the duty and interest, if any, paid on such duty on imports made by an individual for his personal use;

(c) the duty and interest, if any, paid on such duty borne by the buyer, if he had not passed on the incidence of such duty and interest, if any, paid on such duty to any other person;

(d) the export duty as specified in section 26;

(e) drawback of duty payable under sections 74 and 75.]

—————

1. Subs. by Act 56 of 1974, sec. 3 and Second Sch., for “the finally assessed” (w.e.f. 20-12-1974).

2. Ins. by Act 29 of 2006, sec. 21 (w.e.f. 13-7-2006).

Section 19. Determination of duty where goods consist of articles liable to different rates of duty.

Except as otherwise provided in any law for the time being in force, where goods consist of a set of articles, duty shall be calculated as follows :-

(a) articles liable to duty with reference to quantity shall be chargeable to that duty;

(b) articles liable to duty with reference to value shall, if they are liable to duty at the same rate, be chargeable to duty at that rate, and if they are liable to duty at different rates, be chargeable to duty at the highest of such rates;

(c) articles not liable to duty shall be chargeable to duty at the rate at which articles liable to duty with reference to value are liable under clause (b) :

Provided that, -

(a) accessories of, and spare parts or maintenance and repairing implements for, any article which satisfy the conditions specified in the rules made in this behalf shall be chargeable at the same rate of duty as that article;

(b) if the importer produces evidence to the satisfaction of the proper officer regarding the value of any of the articles liable to different rates of duty, such article shall be chargeable to duty separately at the rate applicable to it.

Section 20. Re-importation of goods.

¹If goods are imported into India after exportation there from, such goods shall be liable to duty and be subject to all the conditions and restrictions, if any, to which goods of the like kind and value are liable or subject, on the importation thereof.

²[***]]

—————

1. Subs. by Act 32 of 1994, sec. 60, for section 20 (w.e.f. 13-5-1994).

2. Provisos and Explanations omitted by Act 22 of 1995, sec. 53 (w.e.f. 26-5-1995).

Section 21. Goods derelict, wreck, etc.

All goods, derelict, jetsam, flotsam and wreck brought or coming into India, shall be dealt with as if they were imported into India, unless it be shown to the satisfaction of the proper officer that they are entitled to be admitted duty-free under this Act.

Section 22. Abatement of duty on damaged or deteriorated goods.

(1) Where it is shown to the satisfaction of the ¹Assistant Commissioner of Customs -

(a) that any imported goods had been damaged or had deteriorated at any time before or during the unloading of the goods in India; or

(b) that any imported goods, other than warehoused goods, had been damaged at any time after the unloading thereof in India but before their examination under section 17, on account of any accident not due to any willful act, negligence or default of the importer, his employee or agent; or

(c) that any warehoused goods had been damaged at any time before clearance for home consumption on account of any accident not due to any willful act, negligence or default of the owner, his employee or agent, such goods shall be chargeable to duty in accordance with the provisions of sub-section (2).

(2) The duty to be charged on the goods referred to in sub-section (1) shall bear the same proportion to the duty chargeable on the goods before the damage or deterioration which the value of the damaged or deteriorated goods bears to the value of the goods before the damage or deterioration.

(3) For the purposes of this section, the value of damaged or deteriorated goods may be ascertained by either of the following methods at the option of the owner :-

(a) the value of such goods may be ascertained by the proper officer, or

(b) such goods may be sold by the proper officer by public auction or by tender, or with the consent of the owner in any other manner, and the gross sale proceeds shall be deemed to be the value of such goods.

—————

1. Subs. by Act 27 of 1999, sec. 100, for “Assistant Commissioner of Customs” (w.e.f. 11-5-1999). Earlier the words “Assistant Commissioner of Customs” were substituted by Act 22 of 1995, sec. 50, for the words “Assistant Collector of Customs” (w.e.f. 26-5-1995).

Section 23. Remission of duty on lost, destroyed or abandoned goods.

(1) Without prejudice to the provisions of section 13, where it is shown to the satisfaction of the ²Assistant Commissioner of Customs that any imported goods have been lost ³(otherwise than as a result of pilferage) or destroyed, at any time before clearance for home consumption, the⁵ Assistant Commissioner of Customs shall remit the duty on such goods.

⁴(2) The owner of any imported goods may, at any time before an order for clearance of goods for home consumption under section 47 or an order for permitting the deposit of goods in a warehouse under section 60 has been made, relinquish his title to the goods and thereupon he shall not be liable to pay the duty thereon.

⁵[Provided that the owner of any such imported goods shall not be allowed to relinquish his title to such goods regarding which an offence appears to have been committed under this Act or any other law for the time being in force.]

—————

1. Subs. by Act 11 of 1983, sec. 48, for “where it is shown” (w.e.f. 13-5-1983).

2. Subs. by Act 27 of 1999, sec. 100, for “Assistant Commissioner of Customs” (w.e.f. 11-5-1999). Earlier the words “Assistant Commissioner of Customs” were substituted by Act 22 of 1995, sec. 50, for the words “Assistant Collector of Customs” (w.e.f. 26-5-1995).

3. Ins. by Act 11 of 1983, sec. 48 (w.e.f. 13-5-1983).

4. Subs. by Act 32 of 1994, sec. 60, for sub-section (2) (w.e.f. 13-5-1994).

5. Ins. by Act 21 of 2006, sec. 58 (w.e.f. 18-4-2006).

Section 24. Power to make rules for denaturing or mutilation of goods.

The Central Government may make rules for permitting at the request of the owner the denaturing or mutilation of imported goods which are ordinarily used for more than one purpose so as to render them unfit for one or more of such purposes; and where any goods are so denatured or mutilated they shall be chargeable to duty at such rate as would be applicable if the goods had been imported in the denatured or mutilated form.

Section 25. Power to grant exemption from duty.

(1) If the Central Government is satisfied that it is necessary in the public interest so to do, it may, by notification in the Official Gazette, exempt generally either absolutely or subject to such conditions (to be fulfilled before or after clearance) as may be specified in the notification goods of any specified description from the whole or any part of duty of customs leviable thereon.

¹(2) If the Central Government is satisfied that it is necessary in the public interest so to do, it may, by special order in each case, exempt from payment of duty, for reasons to be stated in such order, any goods, of strategic or secret nature, or for charitable purpose, on which duty is leviable.

²[(2A) The Central Government may, if it considers it necessary or expedient so to do for the purpose of clarifying the scope or applicability of any notification issued under sub-section (1) or order issued under sub-section (2) insert an explanation in such notification or order, as the case may be, by notification in the Official Gazette at any time within one year of issue of the notification under sub-section (1) or order under sub-section (2), and every such explanation shall have effect as if it had always been the part of the first such notification or order, as the case may be.]

³(3) An exemption under sub-section (1) or sub-section (2) in respect of any goods from any part of the duty of customs leviable thereon (the duty of customs leviable thereon being hereinafter referred to as the statutory duty) may be granted by providing for the levy of a duty on such goods at a rate expressed in a form or method different from the form or method in which the statutory duty is leviable and any exemption granted in relation to any goods in the manner provided in this sub-section shall have effect subject to the condition that the duty of customs chargeable on such goods shall in no case exceed the statutory duty.

Explanation : “Form or method”, in relation to a rate of duty of customs, means the basis, namely, valuation, weight, number, length, area, volume or other measure with reference to which the duty is leviable.

⁴(4) Every notification issued under (1) ⁵ [sub-section 2A] shall

(a) unless otherwise provided, come into force on the date of its issue by the Central Government for publication in the Official Gazette;

(b) also be published and offered for sale on the date of its issue by the Directorate of Publicity and Public Relations of the Board, New Delhi.

(5) Notwithstanding anything contained in sub-section (4), where a notification comes into force on a date later than the date of its issue, the same shall be published and offered for sale by the said Directorate of Publicity and Public Relations on a date on or before the date on which the said notification comes into force.

⁶[(6) Notwithstanding anything contained in this Act, no duty shall be collected if the amount of duty leviable is equal to, or less than, one hundred rupees.]

—————

1. Subs. by Act 32 of 2003, sec. 107, for sub-section (2) (w.e.f. 14-5-2003). Earlier sub-section (2) was substituted by Act 27 of 1999, sec. 102 (w.e.f. 11-5-1999).

2. Ins. by Act 20 of 2002, sec. 119 (w.e.f. 11-5-2002).

3. Ins. by Act 11 of 1983, sec. 49 (w.e.f. 13-5-1983).

4. Ins. by Act 21 of 1998, sec. 99 (w.e.f. 1-8-1998).

5. Ins. by Act 20 of 2002, sec. 119 (w.e.f. 11-5-2002).

6. Ins. by Act 32 of 2003, sec. 107 (w.e.f. 14-5-2003).

Section 26. Refund of export duty in certain cases.

Where on the exportation of any goods any duty has been paid, such duty shall be refunded to the person by whom or on whose behalf it was paid, if -

(a) the goods are returned to such person otherwise than by way of re-sale;

(b) the goods are re-imported within one year from the date of exportation; and

(c) an application for refund of such duty is made before the expiry of six months from the date on which the proper officer makes an order for the clearance of the goods.

Section 27. Claim for refund of duty.

(1) Any person claiming refund of any duty and interest, if any, paid on such duty -

(i) paid by him in pursuance of an order of assessment; or

(ii) borne by him, may make an application for refund of such ²duty and interest, if any, paid on such duty to the ³Assistant Commissioner of Customs

(a) in the case of any import made by any individual for his personal use or by Government or by any educational, research or charitable institution or hospital, before the expiry of one year;

(b) in any other case, before the expiry of six months, from the date of payment of ⁴duty and interest, if any, paid on such duty, ⁵in such form and manner as may be specified in the regulations made in this behalf and the application shall be accompanied by such documentary or other evidence (including the documents referred to in section 28C) as the applicant may furnish to establish that the amount of ⁴duty and interest, if any, paid on such duty in relation to which such refund is claimed was collected from, or paid by, him and the incidence of such ⁴duty and interest, if any, paid on such duty had not been passed on by him to any other person :

Provided that where an application for refund has been made before the commencement of the Central Excises and Customs Laws (Amendment) Act, 1991, such application shall be deemed to have been made under this sub-section and the same shall be dealt with in accordance with the provisions of sub-section (2) :

Provided further that the limitation of one year or six months, as the case may be, shall not apply where any duty and interest, if any, paid on such duty has been paid under protest.

⁶Provided also that in the case of goods which are exempt from payment Of duty by a special order issued under sub-section (2) of section 25, the limitation of one year or six months, as the case may be, shall be computed from the date of issue of such order.

⁷[Provided also that where the duty becomes refundable as a consequence of judgment, decree, order or direction of the appellate authority, Appellate Tribunal or any court, the limitation of one year or six months, as the case may be, shall be computed from the date of such judgment, decree, order or direction.]

Explanation ⁸I : For the purposes of this sub-section, “the date of payment of duty and interest, if any, paid on such duty”, in relation to a person, other than the importer, shall be construed as “the date of purchase of goods” by such person.

⁹Explanation II : Where any duty is paid provisionally under section 18, the limitation of one year or six months, as the case may be, shall be computed from the date of adjustment of duty after the final assessment thereof.

(2) If, on receipt of any such application, the ¹⁰Assistant Commissioner of Customs is satisfied that the whole or any part of the ⁴duty and interest, if any, paid on such duty paid by the applicant is refundable, he may make an order accordingly and the amount so determined shall be credited to the Fund :

Provided that the amount of ⁴duty and interest, if any, paid on such duty as determined by the ¹⁰Assistant Commissioner of Customs under the foregoing provisions of this sub-section shall, instead of being credited to the Fund, be paid to the applicant, if such amount is relatable to -

(a)the ⁴duty and interest, if any, paid on such duty paid by the importer, if he had not passed on the incidence of such duty and interest, if any, paid on such duty to any other person;

(b) the ⁴duty and interest, if any, paid on such duty on imports made by an individual for his personal use;

(c) the ⁴duty and interest, if any, paid on such duty borne by the buyer, if he had not passed on the incidence of such ⁴duty and interest, if any, paid on such duty 61 ] to any other person;

(d) the export duty as specified in section 26;

(e) drawback of duty payable under sections 74 and 75;

(f) the ⁴duty and interest, if any, paid on such duty borne by any other such class of applicants as the Central Government may, by notification in the Official Gazette, specify :

Provided further that no notification under clause (f) of the first proviso shall be issued unless in the opinion of the Central Government the incidence of ⁴duty and interest, if any, paid on such duty has not been passed on by the persons concerned to any other person.

(3) Notwithstanding anything to the contrary contained in any judgment, decree, order or direction of the Appellate Tribunal ¹² [, the National Tax Tribunal]or any Court or in any other provision of this Act or the regulations made there under or any other law for the time being in force, no refund shall be made except as provided in sub-section (2).

(4) Every notification under clause (f) of the first proviso to sub-section (2) shall be laid before each House of Parliament, if it is sitting, as soon as may be after the issue of the notification, and, if it is not sitting, within seven days of its re-assembly, and the Central Government shall seek the approval of Parliament to the notification by a resolution moved within a period of fifteen days beginning with the day on which the notification is so laid before the House of the People and if Parliament makes any modification in the notification or directs that the notification should cease to have effect, the notification shall thereafter have effect only in such modified form or be of no effect, as the case may be, but without prejudice to the validity of anything previously done there under.

(5) For the removal of doubts, it is hereby declared that any notification issued under clause (f) of the first proviso to sub-section (2), including any such notification approved or modified under sub-section (4), may be rescinded by the Central Government at any time by notification in the Official Gazette.

———–

1. Subs. by Act 40 of 1991, sec. 10, for section 27 (w.e.f. 20-9-1991).

2. Subs. by Act 55 of 1991, sec. 2, for “duty” (w.e.f. 23-12-1991).

3. Subs. by Act 27 of 1999, sec. 100, for “Assistant Commissioner of Customs” (w.e.f. 11-5-1999). Earlier the words “Assistant Commissioner of Customs” were substituted by Act 22 of 1995,

sec. 50, for the words “Assistant Collector of Customs” (w.e.f. 26-5-1995).

4. Subs. by Act 55 of 1991, sec. 2, for “duty” (w.e.f. 23-12-1991).

5. Subs. by Act 22 of 1995, sec. 54, for “in such form” (w.e.f. 26-5-1995).

6. Ins. by Act 33 of 1996, sec. 60 (w.e.f. 28-9-1996).

7. Ins. by Act 22 of 2007, sec. 96 (w.e.f. 11-5-2007).

8. Explanation renumbered as Explanation I by Act 21 of 1998, sec. 100 (w.e.f. 1-8-1998).

9. Ins. by Act 21 of 1998, sec. 100 (w.e.f. 1-8-1998).

10.Subs. by Act 27 of 1999, sec. 100, for “Assistant Commissioner of Customs” (w.e.f. 11-5-1999). Earlier the words “Assistant Commissioner of Customs” were substituted by Act 22 of 1995,

11. Ins. by Act 32 of 2003, sec. 108 (w.e.f. 14-5-2003).

12.Ins. by Act 49 of 2005, sec. 30 and Sch., Pt. VI-2 (w.e.f. 28-12-2005).

Section 27A. Interest on delayed refunds.

If any duty ordered to be refunded under sub-section (2) of section 27 to an applicant is not refunded within three months from the date of receipt of application under sub-section (1) of that section, there shall be paid to that applicant interest at such rate,² not below ten per cent and not exceeding thirty per cent per annum as is for the time being fixed ³[by the Central Government, by notification in the Official Gazette], , on such duty from the date immediately after the expiry of three months from the date of receipt of such application till the date of refund of such duty :

Provided that where any duty, ordered to be refunded under sub-section (2) of section 27 in respect of an application under sub-section (1) of that section made before the date on which the Finance Bill, 1995 receives the assent of the President, is not refunded within three months from such date, there shall be paid to the applicant interest under this section from the date immediately after three months from such date, till the date of refund of such duty.

Explanation : Where any order of refund is made by the Commissioner Appeals, Appellate Tribunal ⁴[, National Tax Tribunal] or any court against an order of the ⁵Assistant commissioner of Customs under sub-section (2) of section 27, the order passed by the Commissioner (Appeals), Appellate Tribunal or as the case may be, by the court shall be deemed to be an order passed under that sub-section for the purposes of this section.

—————

1. Ins. by Act 22 of 1995, sec. 55 (w.e.f. 26-5-1995).

2. Subs. by Act 14 of 2001, sec. 102, for “not below ten per cent.” (w.e.f. 11-5-2001).

3. Subs. by Act 10 of 2000, sec. 78, for “by the Board” (w.e.f. 12-5-2000).

*. Ed. The Finance Bill, 1995 received the assent of the President on 26th May, 1995.

4. Ins. by Act 49 of 2005, sec. 30 and Sch., Pt. VI-3.

5. Subs. by Act 27 of 1999, sec. 100, for “Assistant Commissioner of Customs” (w.e.f. 11-5-1999).

Section 28. Notice for payment of duties, interest etc.

¹(1) When any duty has not been levied or has been short-levied or erroneously refunded, or when any interest payable has not been paid, part paid or erroneously refunded, the proper officer may, -

(a) in the case of any import made by any individual for his personal use or by Government or by any educational, research or charitable institution or hospital, within one year;

(b) in an other case, within six months, from the relevant date, serve notice on the person chargeable with the duty or interest which has not been levied or charged or which has been so short-levied or part paid or to whom the refund has erroneously been made requiring him to show cause

why he should not pay the amount specified in the notice :

Provided that where any duty has not been levied or has been short-levied or the interest has not been charged or has been part paid or the duty or interest has been erroneously refunded by reason of collusion or any willful mis-statement or suppression of facts by the importer or the exporter or the agent or employee of the importer or exporter, the provisions of this sub-section shall have effect as if for the words “one year” and “six months”, the words “five years” were substituted.

²[***]

Explanation : Where the service of the notice is stayed by an order of a court, the period of such stay shall be excluded in computing the aforesaid period of one year or six months or five years, as the case may be.

³[(1A) When any duty has not been levied or has been short-levied or the interest has not been charged or has been part paid or the duty or interest has been erroneously refunded by reason of collusion or any wilful misstatement or suppression of facts by the importer or the exporter or the agent or employee of the importer or exporter, to whom a notice is served under the proviso to sub­-section (1) by the proper officer, may pay duty in full or in part as may be accepted by him, and the interest payable thereon under section 28AB and penalty equal to twenty-five per cent. of the duty specified in the notice or the duty so accepted by such person within thirty days of the receipt of the notice.]

(2) The proper officer, after considering the representation, if any made by the person on whom notice is served under sub-section (1), shall determine the amount of duty or interest due from such person (not being in excess of the amount specified in the notice) and thereupon such person shall pay the amount determined.

⁴[Provided that if such person has paid the duty in full together with interest and penalty under sub-section (1A), the proceedings in respect of such person and other persons to whom notice is served under sub-section (1) shall, without prejudice to the provisions of sections 135, 135A and 140, be deemed to be conclusive as to the matters stated therein:

Provided further that, if such person has paid duty in part, interest and penalty under sub-section (1A), the proper officer shall determine the amount of duty or interest not being in excess of the amount partly due from such person.]

⁵[(2A) Where any notice has been served on a person under sub-section (1), the proper officer,—

(i) In case any duty has not been levied or has been short-levied, or the interest has not been paid or has been part paid or the duty or interest has been erroneously refunded by reason of collusion or any wilful mis-statement or suppression of facts, where it is possible to do so, shall determine the amount of such duty or the interest, within a period of one year; and

(ii) In any other case, where it is possible to do so, shall determine the amount of duty which has not been levied or has been short-levied or erroneously refunded or the interest payable which has not been paid, part paid or erroneously refunded, within a period of six months,

from the date of service of the notice on the person under sub-section (1).

(2B) Where any duty has not been levied or has been short-levied or erroneously refunded, or any interest payable has not been paid, part paid or erroneously refunded, the person, chargeable with the duty or the interest, may pay the amount of duty or interest before service of notice on him under sub-section (1) in respect of the duty or the interest, as the case may be, and inform the proper officer of such payment in writing, who, on receipt of such information, shall not serve any notice under sub-section (1) in respect of the duty or the interest so paid:

Provided that the proper officer may determine the amount of short-payment of duty or interest, if any, which in his opinion has not been paid by such person and, then, the proper officer shall proceed to recover such amount in the manner specified in this section, and the period of “one year” or “six months” as the case may be, referred to in sub-section (1) shall be counted from the date of receipt of such information of payment.

Explanation 1.—Nothing contained in this sub-section shall apply in a case where the duty was not levied or was not paid or the interest was not paid or was part paid or the duty or interest was erroneously refunded by reason of collusion or any wilful mis-statement or suppression of facts by the importer or the exporter or the agent or employee of the importer or exporter.

Explanation 2.—For the removal of doubts, it is hereby declared that the interest under section 28AB shall be payable on the amount paid by the person under this sub-section and also on the amount of short-payment of duty, if any, as may be determined by the proper officer, but for this sub-section.

(2C) The provisions of sub-section (2B) shall not apply to any case where the duty or the interest had become payable or ought to have been paid before the date on which the Finance Bill, 2001 receives the assent of the President*.]

(3) For the purposes of sub-section (1), the expression “relevant date” means -

(a) in a case where duty is not levied, or interest is not charged, the date on which the proper officer makes an order for the clearance of the goods;

(b) in a case where duty is provisionally assessed under section 18, the date of adjustment of duty after the final assessment thereof;

(c) in a case where duty or interest has been erroneously refunded, the date of refund;

(d) in any other case, the date of payment of duty or interest.

———

1. Subs. by Act 22 of 1995, sec. 56, for section 28 (w.e.f. 26-5-1995).

2. Second and third provisos omitted by Act 32 of 2003, sec. 109 (w.e.f. 14-5-2003). Earlier second and third provisos were inserted by Act 10 of 2000, sec. 79 (w.e.f. 12-5-2000).

3. Ins. by Act 29 of 2006, sec. 22 (w.e.f. 13-7-2006)

4. Added by Act 29 of 2006, sec. 22 (w.e.f. 13-7-2006).

5. Ins. by Act 14 of 2001, sec. 103 (w.e.f. 11-5-2001).

*. Ed. The Finance Bill, 2001 received the assent of the President on 11th May, 2001.

Section 28A. Power not to recover duties not levied or short-levied as a result of general practice.

¹[28A. Power not to recover duties not levied or short-levied as a result of general practice.—²[(1)] Notwithstanding anything contained in this Act, if the Central Government is satisfied—

(a) that a practice was, or is, generally prevalent regarding levy of duty (including non-levy thereof) on any goods imported into, or exported from, India; and

(b) that such goods were, or are, liable—

(i) to duty, in case where according to the said practice the duty was not, or is not being, levied, or

(ii) to a higher amount of duty than what was, or is being, levied according to the said practice,

then, the Central Government may by notification in the Official Gazette, direct that the whole of the duty payable on such goods, or, as the case may be, the duty in excess of that payable on such goods, but for the said practice, shall not be required to be paid in respect of the goods on which the duty was not, or is not being, levied, or was, or is being, short-levied, in accordance with the said practice.]

³[(2) Where any notification, under sub-section (1) in respect of any goods has been issued, the whole of the duty paid on such goods, or, as the case may be, the duty paid in excess of that payable on such goods, which would not have been paid if the said notification had been in force, shall be dealt with in accordance with the provisions of sub-section (2) of section 27:

Provided that the person claiming the refund of such duty or, as the case may be, excess duty, makes an application in this behalf to the ⁴[Assistant Commissioner of Customs or Deputy Commissioner of Customs], in the form referred to in sub-section (1) of section 27, before the expiry of six months from the date of issue of the said notification.]

—————

1. Ins. by Act 25 of 1978, sec. 7 (w.e.f. 1-7-1978).

2. Section 28A re-numbered as sub-section (1), thereof by Act 29 of 1988, sec. 3 (w.e.f. 1-7-1988).

3. Subs. by Act 40 of 1991, sec. 11, for sub-section (2) (w.e.f. 20-9-1991). Earlier sub-section (2) was inserted by Act 29 of 1988, sec. 3 (w.e.f. 1-7-1988).

4. Subs. by Act 27 of 1999, sec. 100, for “Assistant Commissioner of Customs” (w.e.f. 11-5-1999). Earlier the words “Assistant Commissioner of Customs” were substituted by Act 22 of 1995, sec. 50, for the words “Assistant Collector of Customs” (w.e.f. 26-5-1995).

Section 28AA. Interest on delayed payment of duty.

¹[28AA. Interest on delayed payment of duty.—²[(1)] ³[Subject to the provisions contained in section 28AB, where a person,] chargeable with the duty determined under sub-section (2) of section 28, fails to pay such duty within three months from the date of such determination, he shall pay, in addition to the duty, interest ⁴[at such rate not below ⁵[ten per cent.] and not exceeding thirty-six per cent. per annum, as is for the time being fixed by the Central Government, by notification in the Official Gazette], on such duty from the date immediately after the expiry of the said period of three months till the date of payment of such duty:

Provided that where a person, chargeable with duty determined under sub-section (2) of section 28 before the date on which the Finance Bill, 1995 receives the assent of the President*, fails to pay such duty within three months from such date, then, such person shall be liable to pay interest under this section from the date immediately after three months from such date, till the date of payment of such duty.

Explanation 1.—Where the duty determined to be payable is reduced by the Commissioner (Appeals), Appellate Tribunal ⁶[, the National Tax Tribunal] or, as the case may be, the court, the date of such determination shall be the date on which an amount of duty is first determined to be payable.

Explanation 2.—Where the duty determined to be payable is increased or further increased by the Commissioner (Appeals), Appellate Tribunal 6[, the National Tax Tribunal] or, as the case may be, the court, the date of such determination shall be,—

(a) for the amount of duty first determined to be payable, the date on which the duty is so determined;

(b) for the amount of increased duty, the date of order by which the increased amount of duty is first determined to be payable;

(c) for the amount of further increase of duty, the date of order on which the duty is so further increased.]

⁷[(2) The provisions of sub-section (1) shall not apply to cases where the duty or the interest becomes payable or ought to be paid on and after the date on which the Finance Bill, 2001 receives the assent of the President**.]

—————

1. Ins. by Act 22 of 1995, sec. 57 (w.e.f. 26-5-1995).

2. Section 28AA renumbered as sub-section (1) thereof by Act 14 of 2001, sec. 104 (w.e.f. 11-5-2001).

3. Subs. by Act 33 of 1996, sec. 61, for “Where a person” (w.e.f. 28-9-1996).

4. Subs. by Act 10 of 2000, sec. 80, for certain words (w.e.f. 12-5-2000).

5. Subs. by Act 20 of 2002, sec. 120, for “eighteen per cent.” (w.e.f. 11-5-2002).

* Ed. The Finance Bill, 1995 received the assent of the President on 26th May, 1995.

6. Ins. by Act 49 of 2005, sec. 30 and Sch., Pt. VI-4 (w.e.f. 28-12-2005).

7. Ins. by Act 14 of 2001, sec. 104 (w.e.f. 11-5-2001).

** Ed. The Finance Bill, 2001 received the assent of the President on 11th May, 2001.

Section 28AB. Interest on delayed payment of duty in special cases.

¹[28AB. Interest on delayed payment of duty in special cases.—²[(1) Where any duty has not been levied or paid or has been short-levied or short-paid or erroneously refunded, the person who is liable to pay the duty as determined under sub-section (2), or has paid the duty under sub-section (2B) of section 28, shall, in addition to the duty, be liable to pay interest at such rate not below ³[ten per cent.] and not exceeding thirty-six per cent. per annum, as is for the time being fixed by the Central Government, by notification in the Official Gazette, from the first day of the month succeeding the month in which the duty ought to have been paid under this Act, or from the date of such erroneous refund, as the case may be, but for the provisions contained in sub-section (2) or sub-section (2B) of section 28, till the date of payment of such duty:

Provided that in such cases where the duty becomes payable consequent to issue of an order, instruction or direction by the Board under section 151A, and such amount of duty payable is voluntarily paid in full, without reserving any right to appeal against such payment at any subsequent stage, within forty-five days from the date of issue of such order, instruction or direction, as the case may be, no interest shall be payable and in other cases the interest shall be payable on the whole of the amount, including the amount already paid.]

⁴[(2) The provisions of sub-section (1) shall not apply to cases where the duty or interest had become payable or ought to have been paid before the date on which the Finance Bill, 2001 receives the assent of the President*.]

Explanation 1.—Where the duty determined to be payable is reduced by theCommissioner (Appeals), the Appellate Tribunal 5[, National Tax Tribunal] or, as the case may be, the court, the interest shall be payable on such reduced amount of duty.

Explanation 2.—Where the duty determined to be payable is increased or further increased by the Commissioner (Appeals), the Appellate Tribunal 5[, National Tax Tribunal] or, as the case may be, the court, the interest shall be payable on such increased or further increased amount of duty].

—————

1. Ins. by Act 33 of 1996, sec. 62 (w.e.f. 28-9-1996).

2. Subs. by Act 14 of 2001, sec. 105, for sub-section (1) (w.e.f. 11-5-2001).

3. Subs. by Act 20 of 2002, sec. 121, for “eighteen per cent.” (w.e.f. 11-5-2002).

4. Subs. by Act 14 of 2001, sec. 105, for sub-section (2) (w.e.f. 11-5-2001).

* Ed. The Finance Bill, 2001 received the assent of the President on 11th May, 2001.

5. Ins. by Act 49 of 2005, sec. 30 and Sch., Pt. VI-5 (w.e.f. 28-12-2005).

Section 28B. Duties collected from the buyer to be deposited with the central government.

¹[28B. Duties collected from the buyer to be deposited with the Central Government.—(1) Notwithstanding anything to the contrary contained in any order or direction of the Appellate Tribunal ²[, National Tax Tribunal] or any court or in any other provision of this Act or the regulations made thereunder, ³[every person who is liable to pay duty under this Act and has collected any amount in excess of the duty assessed or determined or paid on any goods under this Act from the buyer of such goods] in any manner as representing duty of customs, shall forthwith pay the amount so col­lected to the credit of the Central Government.

⁴[(2) Where any amount is required to be paid to the credit of the Central Government under sub-section (1) and which has not been so paid, the proper officer may serve on the person liable to pay such amount, a notice requiring him to show cause why he should not pay the amount, as specified in the notice to the credit of the Central Government.

(3) The proper officer shall, after considering the representation, if any, made by the person on whom the notice is served under sub-section (2), determine the amount due from such person (not being in excess of the amount specified in the notice) and thereupon such person shall pay the amount so determined.

(4) The amount paid to the credit of the Central Government under sub-section (1) or sub-section (3) shall be adjusted against the duly payable by the person on finalisation of assessment or any other proceeding for determination of the duty relating to the goods referred to in sub-section (1).

(5) Where any surplus is left after the adjustment made under sub-section (4), the amount of such surplus shall either be credited to the Fund or, as the case may be, refunded to the person who has borne the incidence of such amount, in accordance with the provisions of section 27 and such person may make an application under that section in such cases within six months from the date of the public notice to be issued by the Assistant Commissioner of Customs for the refund of such surplus amount.]

—————

1. Ins. by Act 40 of 1991, sec. 12 (w.e.f. 20-9-1991).

2. Ins. by Act 49 of 2005, sec. 30 and Sch., Pt. VI-6 (w.e.f. 28-12-2005).

3. Subs. by Act 10 of 2000, sec. 82, for certain words (w.r.e.f. 20-9-1991).

4. Subs. by Act 10 of 2000, sec. 82, for sub-section (2) (w.r.e.f. 20-9-1991).

Section 28C. Price of goods to indicate the amount of duty paid thereon.

Notwithstanding anything contained in this Act or any other law for the time being in force, every person who is liable to pay duty on any goods shall, at the time of clearance of the goods, prominently indicate in all the documents relating to assessment, sales invoice, and other like documents, the amount of such duty which will form part of the price at which such goods are to be sold.

Section 28D. Presumption that incidence of duty has been passed on to the buyer.

Every person who has paid the duty on any goods under this Act shall, unless the contrary is proved by him, be deemed to have passed on the full incidence of such duty to the buyer of such goods.

Section 28E. Definitions.

In this Chapter, unless the context otherwise requires,-

(a) “activity” means import or export;

(b) “advance ruling” means the determination, by the Authority, of a question of law or fact specified in the application regarding the liability to pay duty in relation to an activity which is proposed to be undertaken, by the applicant;

(c) “applicant” means a non-resident setting up a joint venture in India in collaboration with a non-resident or resident, or a resident setting up a joint venture in India in collaboration with a non-resident, making application;

(d) “application” means an application made to the Authority under sub-section (1) of section 28H;

(e) “Authority” means the Authority for Advance Rulings constituted under section 28F;

(f) “Chairperson” means the Chairperson of the Authority;

(g) “Member” means a Member of the Authority and includes the Chairperson; and

(h) “non-resident” shall have the meaning assigned to it in clause (30) of section 2 of the Income-tax Act, 1961.

Section 28F. Authority for advance rulings.

(1) The Central Government shall, by notification in the Official Gazette, constitute an Authority for giving advance rulings, to be called as “the Authority for Advance Rulings”.

(2) The Authority shall consist of the following Members appointed by the Central Government, namely:-

(a) a Chairperson, who is a retired Judge of the Supreme Court;

(b) an officer of the Indian Customs and Central Excise Service who is qualified to be a Member of the Board;

(c) an officer of the Indian Legal Service who is, or is qualified to be, an Additional Secretary to the Government of India.

(3) The salaries and allowances payable to, and the terms and conditions of service of, the Members shall be such as the Central Government may by rules determine.

(4) The Central Government shall provide the Authority with such officers and staff as may be necessary for the efficient exercise of the powers of the Authority under this Act.

(5) The office of the Authority shall be located in Delhi.

Section 28G. Vacancies, etc., not to invalidate proceedings.

No proceeding before, or pronouncement of advance ruling by, the Authority under this Chapter shall be questioned or shall be invalid on the ground merely of the existence of any vacancy or defect in the constitution of the Authority.

Section 28H. Application for advance ruling.

(1) An applicant desirous of obtaining an advance ruling under this Chapter may make an application in such form and in such manner as may be prescribed, stating the question on which the advance ruling is sought.

(2) The question on which the advance ruling is sought shall be in respect of,-

(a) classification of goods under the Customs Tariff Act, 1975;

(b) applicability of a notification issued under sub-section (1) of section

25, having a bearing on the rate of duty;

(c) the principles to be adopted for the purposes of determination of value of the goods under the provisions of this Act.

¹[(d) applicability of notifications issued in respect of duties under this Act, the Customs Tariff Act, 1975 (51 of 1975) and any duty chargeable under any other law for the time being in force in the same manner as duty of customs leviable under this Act.]

²[(e)  determination of origin of the goods in terms of the rules notified under the Customs Tariff Act, 1975 (51 of 1975) and matters relating thereto.]

(3) The application shall be made in quadruplicate and be accompanied by a fee of two thousand five hundred rupees.

(4) An applicant may withdraw his application within thirty days from the date of the application.

————

* Chapter VB (containing sections 28E to 28M) ins. by Act 27 of 1999, sec. 103 (w.e.f. 11-5-1999).

1. Ins. by Act 32 of 2003, sec. 111 (w.e.f. 14-5-2003).

2. Ins. by Act 18 of 2005, sec. 67 (w.e.f. 13-5-2005).

Section 28-I. Procedure on receipt of application.

^*28-I. Procedure on receipt of application.—(1) On receipt of an application, the Authority shall cause a copy thereof to be forwarded to the Commissioner of Customs and, if necessary, call upon him to furnish the relevant records: Provided that where any records have been called for by the Authority in any case, such records shall, as soon as possible, be returned to the Commissioner of Customs.

(2) The Authority may, after examining the application and the records called for, by order, either allow or reject the application:

Provided that the Authority shall not allow the application except in the case of a resident applicant ¹[***] where the question raised in the application is,-

(a) already pending in the applicant’s case before any officer of customs, the Appellate Tribunal or any Court;

(b) the same as in a matter already decided by the Appellate Tribunal or any Court:

Provided further that no application shall be rejected under this sub-section unless an opportunity has been given to the applicant of being heard: Provided also that where the application is rejected, reasons for such rejection shall be given in the order.

(3) A copy of every order made under sub-section (2) shall be sent to the applicant and to the Commissioner of Customs.

(4) Where an application is allowed under sub-section (2), the Authority shall, after examining such further material as may be placed before it by the applicant or obtained by the Authority, pronounce its advance ruling on the question specified in the application.

(5) On a request received from the applicant, the Authority shall, before pronouncing its advance ruling, provide an opportunity to the applicant of being heard, either in person or through a duly authorised representative.

Explanation : For the purposes of this sub-section, “authorised representative” shall have the meaning assigned to it in sub-section (2) of section 146A.

(6) The Authority shall pronounce its advance ruling in writing within ninety days of the receipt of application.

(7) A copy of the advance ruling pronounced by the Authority, duly signed by the Members and certified in the prescribed manner shall be sent to the applicant and to the Commissioner of Customs, as soon as may be, after such pronouncement.

—————

* Chapter VB (containing sections 28E to 28M) ins. by Act 27 of 1999, sec. 103 (w.e.f. 11-5-1999).

1. The words “except in the case of a resident applicant” omitted by Act 20 of 2002, sec. 122 (w.e.f. 11-5-2002).

Section 28J. Applicability of advance ruling.

^*28J. Applicability of advance ruling.— (1) The advance ruling pronounced by the Authority under section 28-I shall be binding only-

(a) on the applicant who had sought it;

(b) in respect of any matter referred to in sub-section (2) of section 28H;

(c) on the Commissioner of Customs, and the customs authorities subordinate to him, in respect of the applicant.

(2) The advance ruling referred to in sub-section (1) shall be binding as aforesaid unless there is a change in law or facts on the basis of which the advance ruling has been pronounced.

————

* Chapter VB (containing sections 28E to 28M) ins. by Act 27 of 1999, sec. 103 (w.e.f. 11-5-1999).

Section 28K. Advance ruling to be void in certain circumstances.

^*28K. Advance ruling to be void in certain circumstances.—(1) Where the Authority finds, on a representation made to it by the Commissioner of Customs or otherwise, that an advance ruling pronounced by it under sub-section (6) of section 28-I has been obtained by the applicant by fraud or misrepresentation of facts, it may, by order, declare such ruling to be void abilities and thereupon all the provisions of this Act shall apply (after excluding the period beginning with the date of such advance ruling and ending with the date of order under this sub-section) to the applicant as if such advance ruling had never been made.

(2) A copy of the order made under sub-section (1) shall be sent to the applicant and the Commissioner of Customs.

—————

* Chapter VB (containing sections 28E to 28M) ins. by Act 27 of 1999, sec. 103 (w.e.f. 11-5-1999).

Section 28L. Powers of authority.

^* POWERS OF AUTHORITY.(1) The Authority shall, for the purpose of exercising its powers regarding discovery and inspection, enforcing the attendance of any person and examining him on oath, issuing commissions and compelling production of books of account and other records, have all the powers of a civil court under the Code of Civil Procedure, 1908 (5 of 1908).

(2) The Authority shall be deemed to be a civil court for the purposes of section 195, but not for the purposes of Chapter XXVI of the Code of Criminal Procedure, 1973 (2 of 1974), and every proceeding before the Authority shall be deemed to be a judicial proceeding within the meaning of sections 193 and 228, and for the purpose of section 196, of the Indian Penal Code.

—————

* Chapter VB (containing sections 28E to 28M) ins. by Act 27 of 1999, sec. 103 (w.e.f. 11-5-1999).

Section 28M. Procedure of authority.

^*28M. Procedure of Authority. The Authority shall, subject to the provisions of this Chapter, have power to regulate its own procedure in all matters arising out of the exercise of its powers under this Act.

————

* Chapter VB (containing sections 28E to 28M) ins. by Act 27 of 1999, sec. 103 (w.e.f. 11-5-1999).

Section 29. Arrival of vessels and aircrafts in india.

(1) The person-in-charge of a vessel or an aircraft entering India from any place outside India shall not cause or permit the vessel or aircraft to call or land -

(a) for the first time after arrival in India; or

(b) at any time while it is carrying passengers or cargo brought in that vessel or aircraft; at any place other than a customs port or a customs airport, as the case may be.

(2) The provisions of sub-section (1) shall not apply in relation to any vessel or aircraft which is compelled by accident, stress of weather or other unavoidable cause to call or land at a place other than a customs port or customs airport but the person-in-charge of any such vessel or aircraft – (a) shall immediately report the arrival of the vessel or the landing of the aircraft to the nearest customs officer or the officer-in-charge of a police station and shall on demand produce to him the log book belonging to the vessel or the aircraft;

(b) shall not without the consent of any such officer permit any goods carried in the vessel or the aircraft to be unloaded from, or any of the crew or passengers to depart from the vicinity of, the vessel or the aircraft; and

(c) shall comply with any directions given by any such officer with respect to any such goods, and no passenger or member of the crew shall, without the consent of any such officer, leave the immediate vicinity of the vessel or the aircraft :

Provided that nothing in this section shall prohibit the departure of any crew or passengers from the vicinity of, or the removal of goods from, the vessel or aircraft where the departure or removal is necessary for reasons of health, safety or the preservation of life or property.

Section 30. Delivery of import manifest or import report.

(1) The person-in-charge of a vessel or an aircraft carrying imported goods shall, deliver to the proper officer, an import manifest, and in the case of a vehicle, an import report, within twenty-four hours after arrival thereof at a customs station in the case of a vessel and twelve hours after arrival in the case of an aircraft or a vehicle, in the prescribed form: Provided that,-

(a) in the case of a vessel or an aircraft, any such manifest may be delivered to the proper officer before the arrival of the vessel or aircraft;

(b) if the proper officer is satisfied that there was sufficient cause for not delivering the import manifest or import report or any part thereof within the time specified in this sub-section, he may accept it at any time thereafter.”.

(2) The person delivering the import manifest or import report shall at the foot thereof make and subscribe to a declaration as to the truth of its contents.

(3) If the proper officer is satisfied that the import manifest or import report is in any way incorrect or incomplete, and that there was no fraudulent intention, he may permit it to be amended or supplemented.

Section 31. Imported goods not to be unloaded from vessel until entry inwards granted.

(1) The master of a vessel shall not permit the unloading of any imported goods until an order has been given by the proper officer granting entry inwards to such vessel.

(2) No order under sub-section (1) shall be given until an import manifest has been delivered or the proper officer is satisfied that there was sufficient cause for not delivering it.

(3) Nothing in this section shall apply to the unloading of baggage accompanying a passenger or a member of the crew, mail bags, animals, perishable goods and hazardous goods.

Section 32. Imported goods not to be unloaded unless mentioned in import manifest or import report.

No imported goods required to be mentioned under the regulations in an import manifest or import report shall, except with the permission of the proper officer, be unloaded at any customs station unless they are specified in such manifest or report for being unloaded at that customs station.

Section 33. Unloading and loading of goods at approved places only.

Except with the permission of the proper officer, no imported goods shall be unloaded, and no export goods shall be loaded, at any place other than a place approved under clause (a) of section 8 for the unloading or loading of such goods.

Section 34. Goods not to be unloaded or loaded except under supervision of customs officer.

Imported goods shall not be unloaded from, and export goods shall not be loaded on, any conveyance except under the supervision of the proper officer:

Provided that the Board may, by notification in the Official Gazette, give general permission and the proper officer may in any particular case give special permission, for any goods or class of goods to be unloaded or loaded without the supervision of the proper officer.

Section 35. Restrictions on goods being water-borne.

No imported goods shall be water-borne for being landed from any vessel, and no export goods which are not accompanied by a shipping bill, shall be water-borne for being shipped, unless the goods are accompanied by a boat-note in the prescribed form:

Provided that the Board may, by notification in the Official Gazette, give general permission, and the proper officer may in any particular case give special permission, for any goods or any class of goods to be water-borne without being accompanied by a boat-note.

Section 36. Restrictions on unloading and loading of goods on holidays, etc.

No imported goods shall be unloaded from, and no export goods shall be loaded on, any conveyance on any Sunday or on any holiday observed by the Customs Department or on any other day after the working hours, except after giving the prescribed notice and on payment of the prescribed fees, if any :

Provided that no fees shall be levied for the unloading and loading of baggage accompanying a passenger or a member of the crew, and mail bags.

Section 37. Power to board conveyances.

The proper officer may, at any time, board any conveyance carrying imported goods or export goods and may remain on such conveyance for such period as he considers necessary.

Section 38. Power to require production of documents and ask questions.

For the purposes of carrying out the provisions of this Act, the proper officer may require the person-in-charge of any conveyance or animal carrying imported goods or export goods to produce any document and to answer any questions and thereupon such person shall produce such documents and answer such questions.

Section 39. Export goods not to be loaded on vessel until entry-out-wards granted.

The master of a vessel shall not permit the loading of any export goods, other than baggage and mail bags, until an order has been given by the proper officer granting entry-outwards to such vessel.

Section 40. Export goods not to be loaded unless duly passed by proper officer.

The person-in-charge of a conveyance shall not permit the loading at a customs station- (a) of export goods other than baggage and mail bags, unless a shipping bill or bill of export or a bill of transshipment, as the case may be, duly passed by the proper officer, has been handed over to him by the exporter;

(b) of baggage and mail bags, unless their export has been duly permitted by the proper officer.

Section 41. Delivery of export manifest or export report.

(1) The person-in-charge of a conveyance carrying export goods shall, before departure of the conveyance from a customs station, deliver to the proper officer in the case of a vessel or aircraft, an export manifest, and in the case of a vehicle, an export report, in the prescribed form:

¹[***]

(2) The person delivering the export manifest or export report shall at the foot thereof make and subscribe to a declaration as to the truth of its contents.

(3) If the proper officer is satisfied that the export manifest or export report is in any way incorrect or incomplete and that there was no fraudulent intention, he may permit such manifest or report to be amended or supplemented.

———

1. Proviso omitted by the Finance (No. 2) Act, 2004 (23 of 2004), sec. 66 (w.e.f. 10-9-2004). The proviso, before omission, stood as under:

“Provided that if the agent of the person-in-charge of the conveyance furnishes such security as the proper officer deems sufficient for duly delivering within seven days from the date of departure of the conveyance the export manifest or the export report, as the case may be, the proper officer may (subject to such rules as the Central Government may make in this behalf) accept such manifest or report within the aforesaid period.”

Section 42. No conveyance to leave without written order.

(1) The person-in-charge of a conveyance which has brought any imported goods or has loaded any export goods at a customs station shall not cause or permit the conveyance to depart from that customs station until a written order to that effect has been given by the proper officer.

(2) No such order shall be given until -

(a) the person-in-charge of the conveyance has answered the questions put to him under section 38;

(b) the provisions of section 41 have been complied with;

(c) the shipping bills or bills of export, the bills of transshipment, if any, and

such other documents as the proper officer may require have been delivered to him;

(d) all duties leviable on any stores consumed in such conveyance, and all charges and penalties due in respect of such conveyance or from the person-in-charge thereof have been paid or the payment secured by such guarantee or deposit of such amount as the proper officer may direct;

(e) the person-in-charge of the conveyance has satisfied the proper officer that no penalty is leviable on him under section 116 or the payment of any penalty that may be levied upon him under that section has been secured by such guarantee or deposit of such amount as the proper officer may direct;

(f) in any case where any export goods have been loaded without payment of export duty or in contravention of any provision of this Act or any other law for the time being in force relating to export of goods, – (i) such goods have been unloaded, or

(ii) where the ¹Assistant Commissioner of Customs is satisfied that it is not practicable to unload such goods, the person-in charge of the conveyance has given an undertaking, secured by such guarantee or deposit of such amount as the proper officer may direct, for bringing back the goods to India.

—————

1. Subs. by Act 27 of 1999, sec. 100, for “Assistant Commissioner of Customs” (w.e.f. 11-5-1999). Earlier the words “Assistant Commissioner of Customs” were substituted by Act 22 of 1995, sec 50, for the words “Assistant Collector of Customs” (w.e.f. 26-5-1995).

Section 43. Exemption of certain classes of conveyances from certain provisions of this chapter.

(1) The provisions of sections 30, 41 and 42 shall not apply to a vehicle which carries no goods other than the luggage of its occupants.

(2) The Central Government may, by notification in the Official Gazette, exempt the following classes of conveyances from all or any of the provisions of this Chapter -

(a) conveyances belonging to the Government or any foreign Government;

(b) vessels and aircraft which temporarily enter India by reason of any emergency.

Section 44. Chapter not to apply to baggage and postal articles.

The provisions of this Chapter shall not apply to (a) baggage, and

(b) goods imported or to be exported by post. CLEARANCE OF IMPORTED GOODS

Section 45. Restrictions on custody and removal of imported goods.

(1) Save as otherwise provided in any law for the time being in force, all imported goods unloaded in a customs area shall remain in the custody of such person as may be approved by the ¹Commissioner of Customs until they are cleared for home consumption or are warehoused or are transshipped in accordance with the provisions of Chapter VIII.

(2) The person having custody of any imported goods in a customs area, whether under the provisions of sub-section (1) or under any law for the time being in force, -

(a) shall keep a record of such goods and send a copy thereof to the proper officer;

(b) shall not permit such goods to be removed from the customs area or otherwise dealt with, except under and in accordance with the permission in writing of the proper officer.

²(3) Notwithstanding anything contained in any law for the time being in force, if any imported goods are pilfered after unloading thereof in a customs area while in the custody of a person referred to in sub-section (1), that person shall be liable to pay duty on such goods at the rate prevailing on the date of delivery of an import manifest or, as the case may be, an import report to the proper officer under section 30 for the arrival of the conveyance in which the said goods were carried.

—————

1. Subs. by Act 22 of 1995, sec. 50, for “Collector of Customs” (w.e.f. 26-5-1995).

2. Ins. by Act 22 of 1995, sec. 58 (w.e.f. 26-5-1995).

Section 46. Entry of goods on importation.

(1) The importer of any goods, other than goods intended for transit or transshipment, shall make entry thereof by presenting to the proper officer a bill of entry for home consumption or warehousing in the prescribed form :

Provided that if the importer makes and subscribes to a declaration before the proper officer, to the effect that he is unable for want of full information to furnish all the particulars of the goods required under this sub-section, the proper officer may, pending the production of such information, permit him, previous to the entry thereof

(a) to examine the goods in the presence of an officer of customs, or

(b) to deposit the goods in a public warehouse appointed under section 57 without warehousing the same.

(2) Save as otherwise permitted by the proper officer, a bill of entry shall include all the goods mentioned in the bill of lading or other receipt given by the carrier to the consignor.

(3) A bill of entry under sub-section (1) may be presented at any time after the delivery of the import manifest or import report as the case may be :

Provided that the ¹Commissioner of Customs may in any special circumstances permit a bill of entry to be presented before the delivery of ²such report :

³Provided further that a bill of entry may be presented even before the delivery of such manifest if the vessel or the aircraft by which the goods have been shipped for importation into India is expected to arrive within thirty days from the date of such presentation.

(4) The importer while presenting a bill of entry shall at the foot thereof make and subscribe to a declaration as to the truth of the contents of such bill of entry and shall, in support of such declaration, produce to the proper officer the invoice, if any, relating to the imported goods.

(5) If the proper officer is satisfied that the interests of revenue are not prejudicially affected and that there was no fraudulent intention, he may permit substitution of a bill of entry for home consumption for a bill of entry for warehousing or vice versa.

—————

1. Subs. by Act 22 of 1995, sec. 50, for “Collector of Customs” (w.e.f. 26-5-1995).

2. Subs. by Act 25 of 1978, sec. 8, for “such manifest or report” (w.e.f. 11-7-1978).

3. Subs. by Act 33 of 1996, sec. 63, for the second proviso (w.e.f. 28-9-1996).

Section 47. Clearance of goods for home consumption.

¹(1) Where the proper officer is satisfied that any goods entered for home consumption are not prohibited goods and the importer has paid the import duty, if any, assessed thereon and any charges payable under this Act in respect of the same, the proper officer may make an order permitting clearance of the goods for home consumption.

²[(2) Where the importer fails to pay the import duty under sub-section (1) ³[within ⁴[five days], excluding holidays] from the date on which the bill of entry is returned to him for payment of duty, he shall pay interest ⁵[at such rate, not below ⁶[ten per cent.] and not exceeding thirty-six per cent. per annum, as is for the time being fixed by the Central Government, by notification in the Official Gazette] on such duty till the date of payment of said duty:

Provided that where the bill of entry is returned for payment of duty before the commencement of the Customs (Amendment) Act, 1991 and the importer has not paid such duty before such commencement, the date of return of such bill of entry to him shall be deemed to be the date of such commencement for the purpose of this section.

⁷Provided further that if the Board is satisfied that it is necessary in the public interest so to do, it may, by order for reasons to be recorded, waive the whole or part of any interest payable under this section.

—————

1. Section 47 re-numbered as sub-section (1) of that section by Act 55 of 1991, sec. 3 (w.e.f. 23-12-1991).

2. Ins. by Act 55 of 1991, sec. 3 (w.e.f. 23-12-1991).

3. Subs. by Act 27 of 1999, sec. 105, for “within seven days” (w.e.f. 11-5-1999).

4. Subs. by Act 20 of 2002, sec. 123, for “two days” (w.e.f. 11-5-2002).

5. Subs. by Act 10 of 2000, sec. 83, for certain words (w.e.f. 12-5-2000).

6. Subs. by Act 20 of 2002, sec. 123, for “eighteen per cent.” (w.e.f. 11-5-2002).

7. Ins. by Act 22 of 1995, sec. 59 (w.e.f. 26-5-1995).

Section 48. Procedure in case of goods not cleared, warehoused, or transshipped within thirty days after unloading.

48. Procedure in case of goods not cleared, warehoused or transhipped within ¹[thirty days] after unloading.—If any goods brought into India from a place outside India are not cleared for home consumption or warehoused or transshipped ²[within ³[thirty days]] from the date of the unloading thereof at a customs station or within such further time as the proper officer may allow or if the title to any imported goods is relinquished, such goods may, after notice to the importer and with the permission of the proper officer be sold by the person having the custody thereof :

Provided that -

(a) animals, perishable goods and hazardous goods, may, with the permission of the proper officer, be sold at any time;

(b) arms and ammunition may be sold at such time and place and in such manner as the Central Government may direct.

Explanation : In this section, “arms” and “ammunition” have the meanings respectively assigned to them in the Arms Act, 1959 (54 of 1959).

—————

1. Subs. by Act 55 of 1991, sec. 4, for “two months” (w.e.f. 23-12-1991).

2. Subs. by Act 80 of 1985, sec. 4, for “within two months” (w.e.f. 27-12-1985).

3. Subs. by Act 55 of 1991, sec. 4, for “forty-five days” (w.e.f. 23-12-1991).

Section 49. Storage of imported goods in warehouse pending clearance.

Where in the case of any imported goods, whether dutiable or not, entered for home consumption, the Assistant Commissioner of Customs is satisfied on the application of the importer that the goods cannot be cleared within a reasonable time, the goods may, pending clearance, be permitted to be stored in a public warehouse, or in a private warehouse if facilities for deposit in a public warehouse are not available; but such goods shall not be deemed to be warehoused goods for the purposes of this Act, and accordingly the provisions of Chapter IX shall not apply to such goods.

————

1. Subs. by Act 27 of 1999, sec. 100, for “Assistant Commissioner of Customs” (w.e.f. 11-5-1999). Earlier the words “Assistant Commissioner of Customs” were substituted by Act 22 of 1995, sec. 50, for the words “Assistant Collector of Customs” (w.e.f. 26-5-1995).

Section 50. Entry of goods for exportation.

(1) The exporter of any goods shall make entry thereof by presenting to the proper officer in the case of goods to be exported in a vessel or aircraft, a shipping bill, and in the case of goods to be exported by land, a bill of export in the prescribed form.

(2) The exporter of any goods, while presenting a shipping bill or bill of export, shall at the foot thereof make and subscribe to a declaration as to the truth of its Contents.

Section 51. Clearance of goods for exportation.

Where the proper officer is satisfied that any goods entered for export are not prohibited goods and the exporter has paid the duty, if any, assessed thereon and any charges payable under this Act in respect of the same, the proper officer may make an order permitting clearance and loading of the goods for exportation.

Section 52. Chapter not to apply to baggage, postal articles and stores.

The provisions of this Chapter shall not apply to

(a) baggage,

(b) goods imported by post, and

(c) stores.

Section 53. Transit of certain goods without payment of duty.

¹[53. Transit of certain goods without payment of duty.—Subject to the provisions of section 11, any goods imported in a conveyance and mentioned in the import manifest or the import report, as the case may be, as for transit in the same conveyance to any place outside India or any customs station may be allowed to be so transited without payment of duty.

————

1. Subs. by Act 21 of 1998, sec. 101, for section 53 (w.e.f. 1-8-1998).

Section 54. Transshipment of certain goods without payment of duty.

¹[54. Transhipment of goods without payment of duty.—(1) Where any goods imported into a customs station are intended for transshipment, a bill of transshipment shall be presented to the proper officer in the prescribed form.

²Provided that where the goods are being transshipped under an international treaty or bilateral agreement between the Government of India and Government of a foreign country, a declaration for transshipment instead of a bill of transshipment shall be presented to the proper officer in the prescribed form.

(2) Subject to the provisions of section 11, where any goods imported into a customs station are mentioned in the import manifest or the import report, as the case may be, as for transshipment to any place outside India, such goods may be allowed to be so transshipped without payment of duty.

(3) Where any goods imported into a customs station are mentioned in the import manifest or the import report, as the case may be, as for transshipment D (a) to any major port as defined in the Indian Ports Act, 1908 (15 of 1908), or the customs airport at Mumbai, Calcutta, Delhi or Chennai or any other customs port or customs airport which the Board may, by notification in the Official Gazette, specify in this behalf, or

(b) to any other customs station and the proper officer is satisfied that the goods are bona fide intended for transshipment to such customs station, the proper officer may allow the goods to be transshipped, without payment of duty, subject to such conditions as may be prescribed for the due arrival of such goods at the customs station to which transshipment is allowed.

————

1.  Subs. by Act 21 of 1998, sec. 101, for section 54 (w.e.f. 1-8-1998).

2.  Ins. by Act 27 of 1999, sec. 106 (w.e.f. 11-5-1999).

Section 55. Liability of duty on goods transited under section 53 or transshipped under section 54.

¹[55. Liability of duty on goods transited under section 53 or transhipped under section 54. Where any goods are allowed to be transited under section 53 or transshipped under sub-section (3) of section 54 to any customs station, they shall, on their arrival at such station, be liable to duty and shall be entered in like manner as goods are entered on the first importation thereof and the provisions of this Act and any rules and regulations shall, so far as may be, apply in relation to such goods.

—————

1. Subs. by Act 21 of 1998, sec. 101, for section 55 (w.e.f. 1-8-1998).

Section 56. Transport of certain classes of goods subject to prescribed conditions.

Imported goods may be transported without payment of duty from one land customs station to another, and any goods may be transported from one part of India to another part through any foreign territory, subject to such conditions as may be prescribed for the due arrival of such goods at the place of destination.

Section 57. Appointing of public warehouses.

¹At any warehousing station, the Assistant Commissioner of Customs may appoint public warehouses wherein dutiable goods may be deposited

²[***].

—————

1. Subs. by Act 27 of 1999, sec. 100, for “Assistant Commissioner of Customs” (w.e.f. 11-5-1999). Earlier the words “Assistant Commissioner of Customs” were substituted by Act 22 of 1995, sec. 50, for the words “Assistant Collector of Customs” (w.e.f. 26-5-1995).

2. The words “without payment of duty” omitted by Act 55 of 1991, sec. 5 (w.e.f. 23-12-1991).

Section 58. Licensing of private warehouses.

(1) At any warehousing station, the ¹[Assistant Commissioner of Customs or Deputy Commissioner of Customs] may license private warehouses wherein dutiable goods imported by or on behalf of the licensee, or any other imported goods in respect of which facilities for deposit in a public warehouse are not available, may be deposited ²[***].

(2) The ¹[Assistant Commissioner of Customs or Deputy Commissioner of Customs] may cancel a licence granted under sub-section (1)—

(a) by giving one month’s notice in writing to the licensee; or

(b) if the licensee has contravened any provision of this Act or the rules or regulations or committed breach of any of the conditions of the licence:

Provided that before any licence is cancelled under clause (b), the licensee shall be given a reasonable opportunity of being heard.

(3) Pending an enquiry whether a licence granted under sub-section (1) should be cancelled under clause (b) of sub-section (2), the Assistant Commissioner of Customs may suspend the licence.

————

1. Subs. by Act 27 of 1999, sec. 100, for “Assistant Commissioner of Customs” (w.e.f. 11-5-1999). Earlier the words “Assistant Commissioner of Customs” were substituted by Act 22 of 1995, sec. 50, for the words “Assistant Collector of Customs” (w.e.f. 26-5-1995).

2. The words “without payment of duty” omitted by Act 55 of 1991, sec. 5 (w.e.f. 23-12-1991).

Section 59. Warehousing bond.

¹(1) The importer of any goods specified ²[***]in sub-section (1) of section 61, which have been entered for warehousing and assessed to duty under section 17 or section 18 shall execute a bond binding himself in a sum equal to twice the amount of the duty assessed on such goods -

(a) to observe all the provisions of this Act and the rules and regulations in respect of such goods;

(b) to pay on or before a date specified in a notice of demand, -

(i) all duties, and interest, if any, payable under sub-section (2) of section 61;

(ii) rent and charges claimable on account of such goods under this Act, together with interest on the same from the date so specified ³[at such rate not below eighteen per cent. and not exceeding thirty-six per cent. per annum, as is for the time being fixed by the Central Government, by notification in the Official Gazette]; and

(c) to discharge all penalties incurred for violation of the provisions of this Act and the rules and regulations in respect of such goods.

(2) For the purposes of sub-section (1), the ⁴[Assistant Commissioner of Customs or Deputy Commissioner of Customs] may permit an importer to enter into a general bond in such amount as the ⁴[Assistant Commissioner of Customs or Deputy Commissioner of Customs] may approve in respect of the warehousing of goods to be imported by him within a specified period.

(3) A bond executed under this section by an importer in respect of any goods shall continue in force notwithstanding the transfer of the goods to any other person or the removal of the goods to another warehouse :

Provided that where the whole of the goods or any part thereof are transferred to another person, the proper officer may accept a fresh bond from the transferee in a sum equal to twice the amount of duty assessed on the goods transferred and thereupon the bond executed by the transferor shall be enforceable only for a sum mentioned therein less the amount for which a fresh bond is accepted from the transferee.

———

1. Subs. by Act 55 of 1991, sec. 6, for sub-section (1) (w.e.f. 23-12-1991).

2. The words, brackets and letter “clause (a) of” omit­ted by Act 32 of 1994, sec. 60 (w.e.f. 13-5-1994).

3. Subs. by Act 10 of 2000, sec. 84, for certain words (w.e.f. 12-5-2000).

4. Subs. by Act 27 of 1999, sec. 100, for “Assistant Commissioner of Customs” (w.e.f. 11-5-1999). Earlier the words “Assistant Commissioner of Customs” were substituted by Act 22 of 1995, sec. 50, for the words “Assistant Collector of Customs” (w.e.f. 26-5-1995).

Section 59A. Conditions For Warehousing Of Certain Goods.

¹[59A. Conditions for warehousing of certain goods.—[Rep. by the Finance Act, 1994 (32 of 1994), sec. 60 (w.e.f. 13-5-1994).]]

—————

1. Ins. by Act 55 of 1991, sec. 7 (w.e.f. 23-12-1991).

Section 60. Permission for deposit of goods in a warehouse.

When the provisions of ¹[section 59 ²[***]] have been complied with in respect of any goods, the proper officer may make an order permitting the deposit of the goods in a warehouse, ³[***].

—————

1. Subs. by Act 55 of 1991, sec. 9, for “section 59” (w.e.f. 23-12-1991).

2. The words, figures and letters, “or section 59A” omitted by Act 32 of 1994, sec. 60 (w.e.f. 13-5-1994.)

3. The words “without payment of duty” omitted by Act 55 of 1991, sec. 5 (w.e.f. 23-12-1991).

Section 61. Period for which goods may remain warehoused.

(1) Any warehoused goods may be left in the warehouse in which they are deposited or in any warehouse to which they may be removed, -

(a) in the case of capital goods intended for use in any hundred per cent. export oriented undertaking, till the expiry of five years; ²[***]

³[(aa)  in the case of goods other than capital goods intended for use in any hundred per cent. export-oriented undertaking, till the expiry of three years; and]

(b) in the case of any other goods, till the expiry of one year, after the date on which the proper officer has made an order under section 60 permitting the deposit of the goods in a warehouse : Provided that -

⁴(i) in the case of any goods which are not likely to deteriorate, the period specified in ⁵[clause (a) or clause (aa) or clause (b)] may, on sufficient cause being shown, be extended—

(A)  in the case of such goods intended for use in any hundred per cent. export-oriented undertaking, by the Commissioner of Customs, for such period as he may deem fit; and

(B)  in any other case, by the Commissioner of Customs, for a period not exceeding six months and by the Chief Commissioner of Customs for such further period as he may deem fit;]

(ii) in the case of any goods referred to in clause (b), if they are likely to deteriorate, the aforesaid period of one year may be reduced by the ⁶Commissioner of Customs to such shorter period as he may deem fit

Provided further that when the licence for any private warehouse is cancelled, the owner of any goods warehoused therein shall, within seven days from the date on which notice of such cancellation is given or within such extended period as the proper officer may allow, remove the goods from such warehouse to another warehouse or clear them for home consumption or exportation.

⁷where any warehoused goods-

(i) specified in sub-clause (a) of sub-section (1), remain in a warehouse beyond the period specified in that sub-section by reason of extension of the aforesaid period or otherwise, interest at such rate as is specified in section 47 shall be payable, on the amount of duty payable at the time of clearance of the goods in accordance with the provisions of section 15 on the warehoused goods, for the period from the expiry of the said warehousing period till the date of payment of duty on the warehoused goods;

(i)  specified in ⁸[sub-clause (a)  or sub-clause (aa)] of sub-section (1), remain in a warehouse beyond the period specified in that sub-section by reason of extension of the aforesaid period or otherwise, interest at such rate as is specified in section 47 shall be payable, on the amount of duty payable at the time of clearance of the goods in accordance with the provisions of section 15 on the warehoused goods, for the period from the expiry of the said warehousing period till the date of payment of duty on the warehoused goods;

(ii)  specified in sub-clause (b) of sub-section (1), remain in warehouse beyond a period of ⁹[ninety days], interest shall be payable at such rate or rates not exceeding the rate specified in section 47, as may be fixed by the Board, on the amount of duty payable at the time of clearance of the goods in accordance with the provisions of section 15 on the warehoused goods, for the period from the expiry of the said 9[ninety days], till the date of payment of duty on the warehoused goods]:

Provided that the Board may, if it considers it necessary so to do in the public interest, by order and under circumstances of an exceptional nature, to be specified in such order, waive the whole or part of any interest payable under this section in respect of any warehoused goods :

Provided further that the Board may, if it is satisfied that it is necessary so to do in the public interest, by notification in the Official Gazette, specify the class of goods in respect of which no interest shall be charged under this section.

Explanation : For the purposes of this section, “hundred per cent export oriented undertaking” has the same meaning as in Explanation 2 to sub-section (1) of section 3 of the Central Excises and Salt Act, 1944 (1 of 1944).

—————

1. Subs. by Act 32 of 1994, sec. 60, for section 61 (w.e.f. 13-5-1994).

2. The word “and” omitted by Act 32 of 2003, sec. 113 (w.e.f. 14-5-2003).

3. Ins. by Act 32 of 2003, sec. 113 (w.e.f. 14-5-2003).

4. Subs. by Act 20 of 2002, sec. 124, for clause (i) (w.e.f. 11-5-2002).

5. Subs. by Act 32 of 2003, sec. 113, for “clause (a) or clause (b)” (w.e.f. 14-5-2003).

6. Subs. by Act 22 of 1995, sec. 50, for “Collector of Customs” (w.e.f. 26-5-1995).

7. Subs. by Act 27 of 1999, sec. 107, for certain words (w.e.f. 11-5-1999).

8. Subs. by Act 32 of 2003, sec. 113, for “sub-clause (a)” (w.e.f. 14-5-2003).

9. Subs. by Act 32 of 2003, sec. 113, for “thirty days” (w.e.f. 14-5-2003). Earlier the words “thirty days” were substituted by Act 14 of 2001, sec.106, for the words “six months” (w.e.f. 1-6-2001).

*. Now the Central Excise Act, 1944 (1 of 1944).

Section 62. Control over warehoused goods.

(1) All warehoused goods shall be subject to the control of the proper officer.

(2) No person shall enter a warehouse or remove any goods there from without the permission of the proper officer.

(3) The proper officer may cause any warehouse to be locked with the lock of the Customs Department and no person shall remove or break such lock.

(4) The proper officer shall have access to every part of a warehouse and power to examine the goods therein.

Section 63. Payment of rent and warehouse charges.

(1) The owner of any warehoused goods shall pay to the warehouse-keeper rent and warehouse charges at the rates fixed under any law for the time being in force or where no rates are so fixed, at such rates as may be fixed by the ¹Commissioner of Customs.

(2) If any rent or warehouse charges are not paid within ten days from the date when they became due, the warehouse-keeper may, after notice to the owner of the warehoused goods and with the permission of the proper officer cause to be sold (any transfer of the warehoused goods notwithstanding) such sufficient portion of the goods as the warehouse-keeper may select.

———

1. Subs. by Act 22 of 1995, sec. 50, for “Collector of Customs” (w.e.f. 26-5-1999).

Section 64. Owner’s right to deal with warehoused goods.

With the sanction of the proper officer and on payment of the prescribed fees, the owner of any goods may either before or after warehousing the same -

(a) inspect the goods;

(b) separate damaged or deteriorated goods from the rest;

(c) sort the goods or change their containers for the purpose of preservation, sale, export or disposal of the goods;

(d) deal with the goods and their containers in such manner as may be necessary to prevent loss or deterioration or damage to the goods;

(e) show the goods for sale; or

(f) take samples of goods without entry for home consumption, and if the proper officer so permits, without payment of duty on such samples.

Section 65. Manufacture and other operations in relation to goods in a warehouse.

(1) With the sanction of the¹[Assistant Commissioner of Customs or Deputy Commissioner of Customs] and subject to such conditions and on payment of such fees as may be prescribed, the owner of any warehoused goods may carry on any manufacturing process or other operations in the warehouse in relation to such goods.

(2) Where in the course of any operations permissible in relation to any warehoused goods under sub-section (1), there is any waste or refuse, the following provisions shall apply :-

(a) if the whole or any part of the goods resulting from such operations are exported, import duty shall be remitted on the quantity of the warehoused goods contained in so much of the waste or refuse as has arisen from the operations carried on in relation to the goods exported :

Provided that such waste or refuse is either destroyed or duty is paid on such waste or refuse as if it had been imported into India in that form;

(b) if the whole or any part of the goods resulting from such operations are cleared from the warehouse for home consumption, import duty shall be charged on the quantity of the warehoused goods contained in so much of the waste or refuse as has arisen from the operations carried on in relation to the goods cleared for home consumption.

———

1.  Subs. by Act 27 of 1999, sec. 100, for “Assistant Commissioner of Customs” (w.e.f. 11-5-1999). Earlier the words “Assistant Commissioner of Customs” were substituted by Act 22 of 1995, sec. 50, for the words “Assistant Collector of Customs” (w.e.f. 26-5-1995).

Section 66. Power to exempt imported materials used in the manufacture of goods in warehouse.

If any imported materials are used in accordance with the provisions of section 65 for the manufacture of any goods and the rate of duty leviable on the imported materials exceeds the rate of duty leviable on such goods, the Central Government, if satisfied that in the interests of the establishment or development of any domestic industry it is necessary so to do, may, by notification in the Official Gazette, exempt the imported materials from the whole or part of the excess rate of duty.

Section 67. Removal of goods from one warehouse to another.

The owner of any warehoused goods may, with the permission of the proper officer, remove them from one warehouse to another, ¹[***] subject to such conditions as may be prescribed for the due arrival of the warehoused goods at the warehouse to which removal is permitted.

—————

1.  The words “without payment of duty” omitted by Act 55 of 1991, sec. 5 (w.e.f. 23-12-1991).

Section 68. Clearance of warehoused goods for home consumption.

The importer of any warehoused goods may clear them for home consumption, if -

(a) a bill of entry for home consumption in respect of such goods has been presented in the prescribed form;

(b) the import duty leviable on such goods and all penalties, rent, interest and other charges payable in respect of such goods have been paid; and

(c) an order for clearance of such goods for home consumption has been made by the proper officer.

¹[Provided that the owner of any warehoused goods may, at any time before an order for clearance of goods for home consumption has been made in respect of such goods, relinquish his title to the goods upon payment of rent, interest, other charges and penalties that may be payable in respect of the goods and upon such relinquishment, he shall not be liable to pay duty thereon.]

²[Provided further that the owner of any such warehoused goods shall not be allowed to relinquish his title to such goods regarding which an offence appears to have been committed under this Act or any other law for the time being in force.]

—————

1.  Ins. by Act 32 of 2003, sec. 114 (w.e.f. 14-5-2003).

2.  Ins. by Act 21 of 2006, sec. 59 (w.e.f. 18-4-2006).

Section 69. Clearance of warehoused goods for exportation.

(1) Any Warehoused goods may be exported to a place outside India without payment of import duty if -

(a) a shipping bill or a bill of export has been presented in respect of such goods in the prescribed form;

(b) the export duty, penalties, rent, interest and other charges payable in respect of such goods have been paid; and

(c) an order for clearance of such goods for exportation has been made by the proper officer.

(2) Notwithstanding anything contained in sub-section (1), if the Central Government is of opinion that warehoused goods of any specified description are likely to be smuggled back into India, it may, by notification in the Official Gazette, direct that such goods shall not be exported to any place outside India without payment of duty or may be allowed to be so exported subject to such restrictions and conditions as may be specified in the notification.

Section 70. Allowance in case of volatile goods.

(1) When any warehoused goods to which this section applies are at the time of delivery from a warehouse found to be deficient in quantity on account of natural loss, the ¹[Assistant Commissioner of Customs or Deputy Commissioner of Customs] may remit the duty on such deficiency.

(2) This section applies to such warehoused goods as the Central Government, having regard to the volatility of the goods and the manner of their storage, may, by notification in the Official Gazette, specify.

—————

1. Subs. by Act 27 of 1999, sec. 100, for “Assistant Commissioner of Customs” (w.e.f. 11-5-1999). Earlier the words “Assistant Commissioner of Customs” were substituted by Act 22 of 1995, sec. 50, for the words “Assistant Collector of Customs” (w.e.f. 26-5-1995).

Section 71. Goods not to be taken out of warehouse except as provided by this act.

No warehoused goods shall be taken out of a warehouse except on clearance for home consumption or re-exportation, or for removal to another warehouse, or as otherwise provided by this Act.

Section 72. Goods improperly removed from warehouse, etc.

(1) In any of the following cases, that is to say, -

(a) where any warehoused goods are removed from a warehouse in contravention of section 71;

(b) where any warehoused goods have not been removed from a warehouse at the expiration of the period during which such goods are permitted under section 61 to remain in a warehouse;

(c) where any warehoused goods have been taken under section 64 as samples without payment of duty;

(d) where any goods in respect of which a bond has been executed under ¹[section 59 ²[***]] and which have not been cleared for home consumption or exportation are not duly accounted for to the satisfaction of the proper officer,

(2) If any owner fails to pay any amount demanded under sub-section (1), the proper officer may, without prejudice to any other remedy, cause to be detained and sold, after notice to the owner (any transfer of the goods notwithstanding) such sufficient portion of his goods, if any, in the warehouse, as the said officer may select.

————

1.  Subs. by Act 55 of 1991, sec. 9, for “section 59” (w.e.f. 23-12-1991).

2.  The words, figures and letter “or section 59A” omitted by Act 32 of 1994, sec. 60 (w.e.f. 13-5-1994).

Section 73. Cancellation and return of warehousing bond.

When the whole of the goods covered by any bond executed under ¹[section 59 ²[***]] have been cleared for home consumption or exported or are otherwise duly accounted for, and when all amounts due on account of such goods have been paid, the proper officer shall cancel the bond as discharged in full, and shall on demand deliver it, so cancelled, to the person who has executed or is entitled to receive it.

—————

1. Subs. by Act 55 of 1991, sec. 9, for “section 59” (w.e.f. 23-12-1991).

2. The words, figures and letter “or section 59A” omitted by Act 32 of 1994, sec. 60 (w.e.f. 13-5-1994).

Section 74. Drawback allowable on re-export of duty-paid goods.

(1) When any goods capable of being easily identified which have been imported into India and upon which ¹any duty has been paid on importation-

(i) are entered for export and the proper officer makes an order permitting clearance and loading of the goods for exportation under section 51; or

(ii) are to be exported as baggage and the owner of such baggage, for the purpose of clearing it, makes a declaration of its contents to the proper officer under section 77 (which declaration shall be deemed to be an entry for export for the purposes of this section) and such officer makes an order permitting clearance of the goods for exportation; or

(iii) are entered for export by post under section 82 and the proper officer makes an order permitting clearance of the goods for exportation, ninety-eight per cent of such duty shall, except as otherwise hereinafter provided, be re-paid as drawback, if -

(a) the goods are identified to the satisfaction of the² Assistant Commissioner of Customs as the goods which were imported; and

(b) the goods are entered for export within two years from the date of payment of duty on the importation thereof :

Provided that in any particular case the aforesaid period of two years may, on sufficient cause being shown, be extended by the Board by such further period as it may deem fit.

(2) Notwithstanding anything contained in sub-section (1), the rate of drawback in the case of goods which have been used after the importation thereof shall be such as the Central Government, having regard to the duration of use, depreciation in value and other relevant circumstances, may, by notification in the Official Gazette, fix.

³(3) The Central Government may make rules for the purpose of carrying out the provisions of this section and, in particular, such rules may – (a) provide for the manner in which the identity of goods imported in different consignments which are ordinarily stored together in bulk, may be established;

(b) specify the goods which shall be deemed to be not capable of being easily identified; and

(c) provide for the manner and the time within which a claim for payment of drawback is to be filed.

(4) For the purposes of this section – (a) goods shall be deemed to have been entered for export on the date with reference to which the rate of duty is calculated under section 16;

(b) in the case of goods assessed to duty provisionally under section 18, the date of payment of the provisional duty shall be deemed to be the date of payment of duty.

————

1. Subs. by Act 80 of 1985, sec. 6, for certain words (w.e.f. 27-12-1985).

2. Subs. by Act 27 of 1999, sec. 100, for “Assistant Commissioner of Customs” (w.e.f. 11-5-1999). Earlier the words “Assistant Commissioner of Customs” were substituted by Act 22 of 1995, sec. 50, for the words “Assistant Collector of Customs” (w.e.f. 26-5-1995).

3. Subs. by Act 22 of 1995, sec. 60, for sub-section (3) (w.e.f. 26-5-1995).

Section 75. Drawback on imported materials used in the manufacture of goods which are exported.

(1) Where it appears to the Central Government that in respect of goods of any class or description ¹[manufactured, processed or on which any operation has been carried out in India] ²[, being goods which have been entered for export and in respect of which an order permitting the clearance and loading thereof for exportation has been made under section 51 by the proper officer], ³[or being goods entered for export by post under section 82 and in respect of which an order permitting clearance for exportation has been made by the proper officer], a drawback should be allowed of duties of customs chargeable under this Act on any imported materials of a class or description used in the ⁴[manufacture or processing of such goods or carrying out any operation on such goods], the Central Government may, by notification in the Official Gazette, direct that drawback shall be allowed in respect of such goods in accordance with, and subject to, the rules made under sub-section (2):

⁵[Provided that no drawback shall be allowed under this sub-section in respect of any of the aforesaid goods which the Central Government may, by rules made under sub-section (2), specify, if the export value of such goods or class of goods is less than the value of the imported materials used in the 4[manufacture or processing of such goods or carrying out any operation on such goods] or class of goods, or is not more than such percentage of the value of the imported materials used in the ⁴[manufacture or processing of such goods or carrying out any operation on such goods] or class of goods as the Central Government may, by notification in the Official Gazette, specify in this behalf:

Provided further that where any drawback has been allowed on any goods under this sub-section and the sale proceeds in respect of such goods are not received by or on behalf of the exporter in India within the time allowed under the ⁶[Foreign Exchange Management Act, 1999 (42 of 1999)], such drawback shall be deemed never to have been allowed and the Central Government may, by rules made under sub-section (2), specify the procedure for the recovery or adjustment of the amount of such drawback].

⁷[(1A) Where it appears to the Central Government that the quantity of a particular material imported into India is more than the total quantity of like material that has been used in the goods ¹[manufactured, processed or on which any operation has been carried out in India] and exported outside India, then, the Central Government may, by notification in the Official Gazette, declare that so much of the material as is contained in the goods exported shall, for the purpose of sub-section (1), be deemed to be imported material.]

(2) The Central Government may make rules for the purpose of carrying out the provisions of sub-section (1) and, in particular, such rules may provide—

⁸[(a) for the payment of drawback equal to the amount of duty actually paid on the imported materials used in the manufacture or processing of the goods or carrying out any operation on the goods or as is specified in the rules as the average amount of duty paid on the materials of that class or description used in the manufacture or processing of export goods or carrying out any operation on export goods of that class or description either by manufacturers generally or by persons processing or carrying on any operation generally or by any particular manufacturer or particular person carrying on any process or other operation, and interest, if any, payable thereon;]

⁹[(aa) for specifying the goods in respect of which no drawback shall be allowed;

(ab) for specifying the procedure for recovery or adjustment of the amount of any drawback which had been allowed under sub-section (1) ¹⁰[or interest chargeable thereon];]

(b) for the production of such certificates, documents and other evidence in support of each claim of drawback as may be necessary;

(c) for requiring the ¹¹[manufacturer or the person carrying on any process or other operation] to give access to every part of his manufactory to any officer of customs specially authorised in this behalf by the ¹²[Assistant Commissioner of Customs or Deputy Commissioner of Customs] to enable such authorised officer to inspect the processes of ¹³[manufacture, process or any other operation carried out] and to verify by actual check or otherwise the statements made in support of the claim for drawback.

¹⁰[(d) for the manner and the time within which the claim for payment of drawback may be filed;]

¹⁰[(3) The power to make rules conferred by sub-section (2) shall include the power to give drawback with retrospective effect from a date not earlier than the date of changes in the rates of duty on inputs used in the export goods.]

—————

1. Subs. by Act 22 of 1995, sec. 61, for “manufactured in India” (w.e.f. 26-5-1995).

2. Subs. by Act 11 of 1983, sec. 52, for “and exported to any place outside India” (w.e.f. 13-5-1983).

3. Ins. by Act 80 of 1985, sec. 7 (w.e.f. 27-12-1985).

4. Subs. by Act 22 of 1995, sec. 61, for “manufacture of such goods” (w.e.f. 26-5-1995).

5. Ins. by Act 49 of 1991, sec. 120 (w.e.f. 27-12-1991).

6. Subs. by Act 20 of 2002, sec. 125, for “Foreign Exchange Regulation Act, 1973 (46 of 1973)” (w.e.f. 11-5-2002).

7. Ins. by Act 25 of 1978, sec. 10 (w.e.f. 1-7-1978).

8. Subs. by Act 22 of 1995, sec. 61, for clause (a) (w.e.f. 26-5-1995).

9. Ins. by Act 49 of 1991, sec. 120 (w.e.f. 27-12-1991).

10. Ins. by Act 22 of 1995, sec. 61 (w.e.f. 26-5-1995).

11. Subs. by Act 22 of 1995, sec. 61, for “manufacturer” (w.e.f. 26-5-1995).

12. Subs. by Act 27 of 1999, sec. 100, for “Assistant Commissioner of Customs” (w.e.f. 11-5-1999). Earlier the words “Assistant Commissioner of Customs” were substituted by Act 22 of 1995, sec. 50, for the words “Assistant Collector of Customs” (w.e.f. 26-5-1995).

13. Subs. by Act 22 of 1995, sec. 61, for “manufacture” (w.e.f. 26-5-1995).

Section 75A. Interest on drawback.

¹[75A. Interest on drawback.—(1) Where any drawback payable to a claimant under section 74 or section 75 is not paid within a ²[period of ³[one month]] from the date of filing a claim for payment of such drawback, there shall be paid to that claimant in addition to the amount of drawback, interest at the rate fixed under section 27A from the date after the expiry of the said 2[period of 3[one month]] till the date of payment of such drawback:

⁴[***]

⁵[(2) Where any drawback has been paid to the claimant erroneously or it becomes otherwise recoverable under this Act or the rules made thereunder, the claimant shall, within a period of two months from the date of demand, pay in addition to the said amount of drawback, interest at the rate fixed under section 28AB and the amount of interest shall be calculated for the period beginning from the date of payment of such drawback to the claimant till the date of recovery of such drawback.]

———-

1.  Ins. by Act 22 of 1995, sec. 62 (w.e.f. 26-5-1995).

2.  Subs. by Act 8 of 1999, sec. 2, for “period of three months” (w.e.f. 8-1-1999).

3.  Subs. by Act 32 of 2003, sec. 115, for “two months” (w.e.f. 14-5-2003).

4.  Proviso omitted by Act 32 of 2003, sec. 115 (w.e.f. 14-5-2003).

5.  Subs. by Act 22 of 2007, sec. 98, for sub-section (2)  (w.e.f. 11-5-2007). Earlier sub-section (2) was amended by Act 8 of 1999, sec. 2 (w.e.f. 8-1-1999). Sub-section (2), before substitution by Act 22 of 2007, stood as under:

Section 76. Prohibition and regulation of drawback in certain cases.

(1) Notwithstanding anything hereinbefore contained, no drawback shall be allowed -

¹[***]

(b) in respect of any goods the market-price of which is less than the amount of drawback due thereon;

(c) where the drawback due in respect of any goods is less than ²fifty rupees.

(2) Without prejudice to the provisions of sub-section (1), if the Central Government is of opinion that goods of any specified description in respect of which drawback may be claimed under this Chapter are likely to be smuggled back into India, it may, by notification in the Official Gazette, direct that drawback shall not be allowed in respect of such goods or may be allowed subject to such restrictions and conditions as may be specified in the notification..

—————

1. Clause (a) omitted by Act 11 of 1983, sec. 53 (w.e.f. 13-5-1983).

2. Subs. by Act 11 of 1983, sec. 53, for “five rupees” (w.e.f. 13-5-1983).

Section 77. Declaration by owner of baggage.

The owner of any baggage shall, for the purpose of clearing it, make a declaration of its contents to the proper officer.

Section 78. Determination of rate of duty and tariff valuation in respect of baggage.

The rate of duty and tariff valuation, if any, applicable to baggage shall be the rate and valuation in force on the date on which a declaration is made in respect of such baggage under section 77.

Section 79. Bona fide baggage exempted from duty.

(1) The proper officer may, subject to any rules made under sub-section

(2), pass free of duty -

(a) any article in the baggage of a passenger or a member of the crew in respect of which the said officer is satisfied that it has been in his use for such minimum period as may be specified in the rules;

(b) any article in the baggage of a passenger in respect of which the said officer is satisfied that it is for the use of the passenger or his family or is a bona fide gift or souvenir; P

Provided that the value of each such article and the total value of all such articles does not exceed such limits as may be specified in the rules.

(2) the Central Government may make rules for the purpose of carrying out the provisions of this section and, in particular, such rules may specify -

(a) the minimum period for which any article has been used by a passenger or a member of the crew for the purpose of clause (a) of sub-section (1);

(b) the maximum value of any individual article and the maximum total value of all the articles which may be passed free of duty under, clause (b) of sub-section (1);

(c) the conditions (to be fulfilled before or after clearance) subject to which any baggage may be passed free of duty.

(3) Different rules may be made under sub-section (2) for different classes of persons.

Section 80. Temporary detention of baggage.

Where the baggage of a passenger contains any article which is dutiable or the import of which is prohibited and in respect of which a true declaration has been made under section 77, the proper officer may, at the request of the passenger, detain such article for the purpose of being returned to him on his leaving India ¹[and if for any reason, the passenger is not able to collect the article at the time of his leaving India, the article may be returned to him through any other passenger authorised by him and leaving India or as cargo consigned in his name].

—————

1. Ins. by Act 22 of 1995, sec. 63 (w.e.f. 26-5-1995).

Section 81. Regulations in respect of baggage.

The Board may make regulations, -

(a) providing for the manner of declaring the contents of any baggage;

(b) providing for the custody, examination, assessment to duty and clearance of baggage;

(c) providing for the transit or transshipment of baggage from one customs station to another or to a place outside India.

Section 82. Label or declaration accompanying goods to be treated as entry.

In the case of goods imported or exported by post, any label or declaration accompanying the goods, which contains the description, quantity and value thereof, shall be deemed to be an entry for import or export, as the case may be, for the purposes of this Act.

Section 83. Rate of duty and tariff valuation in respect of goods imported or exported by post.

(1) The rate of duty and tariff value, if any, applicable to any goods imported by, post shall be the rate and valuation in force on the date on which the postal authorities present to the proper officer a list containing the particulars of such goods for the purpose of assessing the duty thereon :

Provided that if such goods are imported by a vessel and the list of the goods containing the particulars was presented before the date of the arrival of the vessel, it shall be deemed to have been presented on the date of such arrival.

(2) The rate of duty and tariff value, if any, applicable to any goods exported by post shall be the rate and valuation in force on the date on which the exporter delivers such goods to the postal authorities for exportation.

Section 84. Regulations regarding goods imported or to be exported by post.

The Board may make regulations providing for -

(a) the form and manner in which an entry may be made in respect of any specified class of goods imported or to be exported by post, other than goods which are accompanied by a label or declaration containing the description, quantity and value thereof;

(b) the examination, assessment to duty, and clearance of goods imported or to be exported by post;

(c) the transit or transshipment of goods imported by post, from one customs station to another or to a place outside India.

STORES

Section 85. Stores may be allowed to be warehoused without assessment to duty.

Where any imported goods are entered for warehousing and the importer makes and subscribes to a declaration that the goods are to be supplied as stores to vessels or aircrafts without payment of import duty under this Chapter, the proper officer may permit the goods to be warehoused without the goods being assessed to duty.

Section 86. Transit and transshipment of stores.

(1) Any stores imported in a vessel or aircraft may, without payment of duty, remain on board such vessel or aircraft while it is in India.

(2) Any stores imported in a vessel or aircraft may, with the permission of the proper officer, be transferred to any vessel or aircraft as stores for consumption therein as provided in section 87 or section 90.

Section 87. Imported stores may be consumed on board a foreign-going vessel or aircraft.

Any imported stores on board a vessel or aircraft (other than stores to which section 90 applies) may, without payment of duty, be consumed thereon as stores during the period such vessel or aircraft is a foreign-going vessel or aircraft.

Section 88. Application of section 69 and chapter x to stores.

The provisions of section 69 and Chapter X shall apply to stores (other than those to which section 90 applies) as they apply to other goods, subject to the modifications that-

(a) for the words “exported to any place outside India” or the word “exported”, wherever they occur, ¹the words “taken on board any foreign-going vessel or aircraft as stores” shall be substituted;

(b) in the case of drawback on fuel and lubricating oil taken on board any foreign-going aircraft as stores, sub-section (1) of section 74 shall have effect as if for the words “ninety-eight per cent”, the words “the whole” were substituted.

—————

1. These words occur in sub-sections (1) and (2) of section 69, sub-section (1) of section 74 and sub-section (1) of section 75.

Section 89. Stores to be free of export duty.

Goods produced or manufactured in India and required as stores on any foreign-going vessel or aircraft may be exported free of duty in such quantities as the proper officer may determine, having regard to the size of the vessel or aircraft, the number of passengers and crew and the length of the voyage or journey on which the vessel or aircraft is about to depart.

Section 90. Concessions in respect of imported stores for the navy.

(1) Imported stores specified in sub-section (3) may without payment of duty be consumed on board a ship of the Indian Navy.

(2) The provisions of section 69 and Chapter X shall apply to stores specified in sub-section (3) as they apply to other goods, subject to the modifications that -

(a) for the words “exported to any place outside India” or the word “exported” wherever they occur,¹ the words “taken on board a ship of the Indian Navy” shall be substituted;

(b) for the words “ninety-eight per cent” in sub-section (1) of section 74, the words “the whole” shall be substituted.

(3) The stores referred to in sub-sections (1) and (2) are the following :- (a) stores for the use of a ship of the Indian Navy;

(b) stores supplied free by the Government for the use of the crew of a ship of the Indian Navy in accordance with their conditions of service.

—————

1.  These words occur in sub-sections (1) and (2) of section 69, sub-section (1) of section 74 and sub-section (1) of section 75.

Section 91. Chapter not to apply to baggage and stores.

The provisions of this Chapter shall not apply to baggage and stores.

Section 92. Entry of coastal goods.

(1) The consignor of any coastal goods shall make an entry thereof by presenting to the proper officer a bill of coastal goods in the prescribed form.

(2) Every such consignor while presenting a bill of coastal goods shall, at the foot thereof, make and subscribe to a declaration as to the truth of the contents of such bill.

Section 93. Coastal goods not to be loaded until bill relating thereto is passed, etc.

The master of a vessel shall not permit the loading of any coastal goods on the vessel until a bill relating to such goods presented under section 92 has been passed by the proper officer and has been delivered to the master by the consignor.

Section 94. Clearance of coastal goods at destination.

(1) The master of a vessel carrying any coastal goods shall carry on board the vessel all bills relating to such goods delivered to him under section 93 and shall, immediately on arrival of the vessel at any customs or coastal port, deliver to the proper officer of that port all bills relating to the goods which are to be unloaded at that port.

(2) Where any coastal goods are unloaded at any port, the proper officer shall permit clearance thereof if he is satisfied that they are entered in a bill of coastal goods delivered to him under sub-section (1).

Section 95. Master of a coasting vessel to carry an advice book.

(1) The master of every vessel carrying coastal goods shall be supplied by the Customs authorities with a book to be called the “advice book”.

(2) The proper officer at each port of call by such vessel shall make such entries in the advice book as he deems fit, relating to the goods loaded on the vessel at that port.

(3) The master of every such vessel shall carry the advice book on board the vessel and shall on arrival at each port of call deliver it to the proper officer at that port for his inspection.

Section 96. Loading and unloading of coastal goods at customs port or coastal port only.

No coastal goods shall be loaded on, or unloaded from, any vessel at any port other than a customs port or a coastal port appointed under section 7 for the loading or unloading of such goods.

Section 97. No coasting vessel to leave without written order.

(1) The master of a vessel which has brought or loaded any coastal goods at a customs or coastal port shall not cause or permit the vessel to depart from such port until a written order to that effect has been given by the proper officer.

(2) No such order shall be given until -

(a) the master of the vessel has answered the questions put to him under section 38;

(b) all charges and penalties due in respect of that vessel or from the master thereof have been paid or the payment secured by such guarantee or deposit of such amount as the proper officer may direct;

(c) the master of the vessel has satisfied the proper officer that no penalty is leviable on him under section 116 or the payment of any penalty that may be levied upon him under that section has been secured by such guarantee or deposit of such amount as the proper officer may direct;

(d) the provisions of this Chapter and any rules and regulations relating to coastal goods and vessels carrying coastal goods have been complied with.

Section 98. Application of certain provisions of this act to coastal goods, etc.

(1) Sections 33, 34, and 36 shall, so far as may be, apply to coastal goods as they apply to imported goods or export goods.

(2) Sections 37 and 38 shall, so far as may be, apply to vessels carrying coastal goods as they apply to vessel carrying imported goods or export goods.

(3) The Central Government may, by notification in the Official Gazette, direct that all or any of the other provisions of Chapter VI and the provisions of section 45 shall apply to coastal goods or vessels carrying coastal goods subject to such exceptions and modifications as may be specified in the notification.

Section 98A. Power to relax.

If the Central Government is satisfied that it is necessary in the public interest so to do it may, by notification in the Official Gazette, exempt generally, either absolutely or subject to such conditions as may be specified in the notification, coastal goods or vessels carrying coastal goods from all or any of the provisions of this Chapter.

—————

1. Ins. by Act 22 of 1995, sec. 64 (w.e.f. 26-5-1995).

Section 99. Power to make rules in respect of coastal goods and coasting vessels.

The Central Government may make rules for -

(a) preventing the taking out of India of any coastal goods the export of which is dutiable or prohibited under this Act or any other law for the time being in force;

(b) preventing, in the case of a vessel carrying coastal goods as well as imported or export goods, the substitution of imported or export goods by coastal goods.

Section 100. Power to search suspected persons entering or leaving india, etc.

(1) If the proper officer has reason to believe that any person to whom this section applies has secreted about his person, any goods liable to confiscation or any documents relating thereto, he may search that person.

(2) This section applies to the following persons, namely :-

(a) any person who has landed from or is about to board, or is on board any vessel within the Indian customs waters;

(b) any person who has landed from or is about to board, or is on board a foreign-going aircraft;

(c) any person who has got out of, or is about to get into, or is in, a vehicle, which has arrived from, or is to proceed to any place outside India;

(d) any person not included in clauses (a), (b) or (c) who has entered or is about to leave India;

(e) any person in a customs area.

Section 101. Power to search suspected persons in certain other cases.

(1) Without prejudice to the provisions of section 100, if an officer of customs empowered in this behalf by general or special order of the ¹Commissioner of Customs, has reason to believe that any person has secreted about his person any goods of the description specified in sub-section (2) which are liable to confiscation, or documents relating thereto, he may search that person.

(2) The goods referred to in sub-section (1) are the following : -

(a) gold;

(b) diamonds;

(c) manufactures of gold or diamonds;

(d) watches;

(e) any other class of goods which the Central Government may, by notification in the Official Gazette, specify.

—————

1. Subs. by Act 22 of 1995, sec. 50, for “Collector of Customs” (w.e.f. 26-5-1995).

Section 102. Persons to be searched may require to be taken before gazetted officer of customs or magistrate.

(1) When any officer of customs is about to search any person under the provisions of section 100 or section 101, the officer of customs shall, if such person so requires, take him without unnecessary delay to the nearest gazetted officer of customs or magistrate.

(2) If such requisition is made, the officer of customs may detain the person making it until he can bring him before the gazetted officer of customs or the magistrate.

(3) The gazetted officer of customs or the magistrate before whom any such person is brought shall, if he sees no reasonable ground for search, forthwith discharge the person but otherwise shall direct that search be made.

(4) Before making a search under the provisions of section 100 or section 101, the officer of customs shall call upon two or more persons to attend and witness the search and may issue an order in writing to them or any of them so to do; and the search shall be made in the presence of such persons and a list of all things seized in the course of such search shall be prepared by such officer or other person and signed by such witnesses.

(5) No female shall be searched by any one excepting a female.

Section 103. Power to screen or x-ray bodies of suspected persons for detecting secreted goods.

(1) Where the proper officer has reason to believe that any person referred to in sub-section (2) of section 100 has any goods liable to confiscation secreted inside his body, he may detain such person and produce him without unnecessary delay before the nearest magistrate.

(2) A magistrate before whom any person is brought under sub-section (1) shall, if he sees no reasonable ground for believing that such person has any such goods secreted inside his body, forthwith discharge such person.

(3) Where any such magistrate has reasonable ground for believing that such person has any such goods secreted inside his body and the magistrate is satisfied that for the purpose of discovering such goods it is necessary to have the body of such person screened or X-rayed, he may make an order to that effect.

(4) Where a magistrate has made any order under sub-section (3), in rotation to any person, the proper officer shall, as soon as practicable, take such person before a radiologist possessing qualifications recognized by the Central Government for the purpose of this section, and such person shall allow the radiologist to screen or X-ray his body.

(5) A radiologist before whom any person is brought under sub-section (4) shall, after screening or X-raying the body of such person, forward his report, together with any X-ray pictures taken by him, to the magistrate without unnecessary delay.

(6) Where on receipt of a report from a radiologist under sub-section (5) or otherwise, the magistrate is satisfied that any person has any goods liable to confiscation secreted inside his body, he may direct that suitable action for bringing out such goods be taken on the advice and under the supervision of a registered medical practitioner and such person shall be bound to comply with such direction :

Provided that in the case of a female no such action shall be taken except on the advice and under the supervision of a female registered medical practitioner.

(7) Where any person is brought before a magistrate under this section, such magistrate may for the purpose of enforcing the provisions of this section order such person to be kept in such custody and for such period as he may direct.

(8) Nothing in this section shall apply to any person referred to in sub-section (1), who admits that goods liable to confiscation are secreted inside his body, and who voluntarily submits himself for suitable action being taken for bringing out such goods.

Explanation : For the purposes of this section, the expression “registered medical practitioner” means any person who holds a qualification granted by an authority specified in the Schedule to the Indian Medical Degrees Act, 1916 (7 of 1916), or notified under section 3 of that Act, or by an authority specified in any of the Schedules to the Indian Medical Council Act, 1956 (102 of 1956).

Section 104. Power to arrest.

¹ (1) If an officer of customs empowered in this behalf by general or special order of the Commissioner of Customs has reason to believe that any person in India or within the Indian customs waters has been guilty of an offence punishable under section 135, he may arrest such person and shall, as soon as may be, inform him of the grounds for such arrest.

(2) Every person arrested under sub-section (1) shall, without unnecessary delay, be taken to a magistrate.

(3) Where an officer of customs has arrested any person under sub-section (1), he shall, for the purpose of releasing such person on bail or otherwise, have the same powers and be subject to the same provisions as the officer-in-charge of a police-station has and is subject to under the 142 Code of Criminal Procedure, 1898 (5 of 1898).

(4) Notwithstanding anything contained in the 143 Code of Criminal Procedure, 1898 (5 of 1898)², an offence under this Act shall not be cognizable.

—————

1. Subs. by Act 29 of 2006, sec. 24, for sub-section (1) (w.e.f. 13-7-2006). Sub-section (1), before substitution, stood as under:

“(1) If an officer of customs empowered in this behalf by general or special order of the Commissioner of Customs has reason to believe that any person in India or within the Indian Customs waters has been guilty of an offence punishable under section 135, he may arrest such person and shall, as soon as may be, inform him of the grounds for such arrest.”.

2. See now the Code of Criminal Procedure, 1973 (2 of 1974).

Section 105. Power To Search Premises

(1) If the ¹Assistant Commissioner of Customs, or in any area adjoining the land frontier or the coast of India an officer of customs specially empowered by name in this behalf by the Board, has reason to believe that any goods liable to confiscation, or any documents or things which in his opinion will be useful for or relevant to any proceeding under this Act, are secreted in any place, he may authorise any officer of customs to search or may himself search for such goods, documents or things.

(2) The provisions of the 145 ²Code of Criminal Procedure, 1898 (5 of 1898), relating to searches shall, so far as may be, apply to searches under this section subject to the modification that sub-section (5) of section 165 of the said Code shall have effect as if for the word “Magistrate”, wherever it occurs, the words ³[“Commissioner of Customs”] were substituted.

—————

1. Subs. by Act 27 of 1999, sec. 100, for “Assistant Commissioner of  Customs” (w.e.f. 11-5-1999). Earlier the words “Assistant Commissioner of Customs” were substituted by Act 22 of 1995, sec. 50, for the words “Assistant Collector of Customs” (w.e.f. 26-5-1995).

2.See now the Code of Criminal Procedure, 1973 (2 of 1974).

3. Subs. by Act 22 of 1995, sec. 50, for “Collector of Customs” (w.e.f. 26-5-1995).

Section 106. Power to stop and search conveyances.

(1) Where the proper officer has reason to believe that any aircraft, vehicle or animal in India or any vessel in India or within the Indian customs waters has been, is being, or is about to be, used in the smuggling of any goods or in the carriage of any goods which have been smuggled, he may at any time stop any such vehicle, animal or vessel or, in the case of an aircraft, compel it to land, and -

(a) rummage and search any part of the aircraft, vehicle or vessel;

(b) examine and search any goods in the aircraft, vehicle or vessel or on the animal;

(c) break open the lock of any door or package for exercising the powers conferred by clauses (a) and (b), if the keys are withheld.

(2) Where for the purposes of sub-section (1) – (a) it becomes necessary to stop any vessel or compel any aircraft to land, it shall be lawful for any vessel or aircraft in the service of the Government while flying her proper flag and any authority authorised in this behalf by the Central Government to summon such vessel to stop or the aircraft to land, by means of an international signal, code or other recognized means, and thereupon, such vessel shall forthwith stop or such aircraft shall forthwith land; and if it fails to do so, chase may be given thereto by any vessel or aircraft as aforesaid and if after a gun is fired as a signal the vessel fails to stop or the aircraft fails to land, it may be fired upon;

(b) it becomes necessary to stop any vehicle or animal, the proper officer may use all lawful means for stopping it, and where such means fail, the vehicle or animal may be fired upon.

Section 106A. Power to inspect.

¹[106A. Power to inspect.—Any proper officer authorised in this behalf by the ²[Commissioner of Customs] may, for the purpose of ascertaining whether or not the requirements of this Act have been complied with at any reasonable time, enter any place intimated under Chapter IVA or Chapter IVB, as the case may be, and inspect the goods kept or stored therein and require any person found therein, who is for the time being in charge thereof, to produce to him for his inspection the accounts maintained under the said Chapter IVA or Chapter IVB, as the case may be, and to furnish to him such other information as he may reasonably require for the purpose of ascertaining whether or not such goods have been illegally imported, exported or are likely to be illegally exported.]

—————

1. Ins. by Act 12 of 1969, sec. 3 (w.r.e.f. 3-1-1969).

2. Subs. by Act 22 of 1995, sec. 50, for “Collector of Customs” (w.e.f. 26-5-1995).

Section 107. Power to examine persons.

Any officer of customs empowered in this behalf by general or special order of the ¹Commissioner of Customs may, during the course of any enquiry in connection with the smuggling of any goods, -

(a) require any person to produce or deliver any document or thing relevant to the enquiry;

(b) examine any person acquainted with the facts and circumstances of the case.

—————

1. Subs. by Act 22 of 1995, sec. 50, for “Collector of Customs” (w.e.f. 26-5-1995).

Section 108. Power to summon persons to give evidence and produce documents.

¹(1) Any gazetted officer of customs shall have power to summon any person whose attendance he considers necessary either to give evidence or to produce a document or any other thing in any inquiry which such officer is making in connection with the smuggling of any goods.

(2) A summons to produce documents or other things may be for the production of certain specified documents or things or for the production of all documents or things of a certain description in the possession or under the control of the person summoned.

(3) All persons so summoned shall be bound to attend either in person or by an authorised agent, as such officer may direct; and all persons so summoned shall be bound to state the truth upon any subject respecting which they are examined or make statements and produce such documents and other things as may be required :

Provided that the exemption under section 132 of the Code of Civil Procedure, 1908 (5 of 1908), shall be applicable to any requisition for attendance under this section.

(4) Every such inquiry as aforesaid shall be deemed to be a judicial proceeding within the meaning of section 193 and section 228 of the Indian Penal Code, 1860 (45 of 1860).

—————

1.  Subs. by Act 29 of 2006, sec. 25, for sub-section (1) (w.e.f. 13-7-2006). Sub-section (1), before substitution, stood as under:

“(1) Any gazetted officer of custom shall have power to summon any person whose attendance he considers necessary either to give evidence or to produce a document or any other thing in any inquiry which such officer is making in connection with the smuggling of any goods.”.

Section 109. Power to require production of order permitting clearance of goods imported by land.

Any officer of customs appointed for any area adjoining the land frontier of India and empowered in this behalf by general or special order of the Board, may require any person in possession of any goods which such officer has reason to believe to have been imported, into India by land, to produce the order made under section 47 permitting clearance of the goods :

Provided that nothing in this section shall apply to any imported goods passing from a land frontier to a land customs station by a route appointed under clause (c) of section 7.

Section 110. Seizure of goods, documents and things.

(1) If the proper officer has reason to believe that any goods are liable to confiscation under this Act, he may seize such goods :

Provided that where it is not practicable to seize any such goods, the proper officer may serve on the owner of the goods an order that he shall not remove, part with, or otherwise deal with the goods except with the previous permission of such officer.

¹(1A) The Central Government may, having regard to the perishable or hazardous nature of any goods, depreciation in the value of the goods with the passage of time, constraints of storage space for the goods or any other relevant considerations, by notification in the Official Gazette, specify the goods or class of goods which shall, as soon as may be after its seizure under sub-section (1), be disposed of by the proper officer in such manner as the Central Government may, from time to time, determine after following the procedure hereinafter specified.

(1B) Where any goods, being goods specified under sub-section (1A), have been seized by a proper officer under sub-section (1), he shall prepare an inventory of such goods containing such details relating to their description, quality, quantity, mark, numbers, country of origin and other particulars as the proper officer may consider relevant to the identity of the goods in any proceedings under this Act and shall make an application to a Magistrate for the purpose of -

(a) certifying the correctness of the inventory so prepared; or

(b) taking, in the presence of the Magistrate, photographs of such goods, and certifying such photographs as true; or

(c) allowing to draw representative samples of such goods, in the presence of the Magistrate, and certifying the correctness of any list of samples so drawn.

(1C) Where an application is made under sub-section (1B), the Magistrate shall, as soon as may be, allow the application.

(2) Where any goods are seized under sub-section (1) and no notice in respect thereof is given under clause (a) of section 124 within six months of the seizure of the goods, the goods shall be returned to the person from whose possession they were seized :

Provided that the aforesaid period of six months may, on sufficient cause being shown, be extended by the ²Commissioner of Customs for a period not exceeding six months.

(3) The proper officer may seize any documents or things which, in his opinion, will be useful for, or relevant to, any proceeding under this Act.

(4) The person from whose custody any documents are seized under sub-section (3) shall be entitled to make copies thereof or take extracts there from in the presence of an officer of customs.

—————

1. Ins. by Act 80 of 1985, sec. 8 (w.e.f. 27-12-1985).

2.  Subs. by Act 22 of 1995, sec. 50, for “Collector  of Customs”  (w.e.f. 26-5-1995).

Section 110A. Seizure of goods, documents and things.

¹[110A. Provisional release of goods, documents and things seized pending adjudication.—Any goods, documents or things seized under section 110, may, pending the order of the adjudicating officer, be released to the owner on taking a bond from him in the proper form with such security and conditions as the Commissioner of Customs may require.]

1. Ins. by Act 29 of 2006, sec. 26 (w.e.f. 13-7-2006).

Section 111. Confiscation of improperly imported goods, etc.

The following goods brought from a place outside India shall be liable to confiscation :-

(a) any goods imported by sea or air which are unloaded or attempted to be unloaded at any place other than a customs port or customs airport appointed under clause (a) of section 7 for the unloading of such goods;

(b) any goods imported by land or inland water through any route other than a route specified in a notification issued under clause (c) of section 7 for the import of such goods;

(c) any dutiable or prohibited goods brought into any bay, gulf, creek or tidal river for the purpose of being landed at a place other than a customs port;

(d) any goods which are imported or attempted to be imported or are brought within the Indian customs waters for the purpose of being imported, contrary to any prohibition imposed by or under this Act or any other law for the time being in force;

(e) any dutiable or prohibited goods found concealed in any manner in any conveyance;

(f) any dutiable or prohibited goods required to be mentioned under the regulations in an import manifest or import report which are not so mentioned;

(g) any dutiable or prohibited goods which are unloaded from a conveyance in contravention of the provisions of section 32, other than goods inadvertently unloaded but included in the record kept under sub-section (2) of section 45;

(h) any dutiable or prohibited goods unloaded or attempted to be unloaded in contravention of the provisions of section 33 or section 34;

(i) any dutiable or prohibited goods found concealed in any manner in any package either before or after the unloading thereof;

(j) any dutiable or prohibited goods removed or attempted to be removed from a customs area or a warehouse without the permission of the proper officer or contrary to the terms of such permission;

(k) any dutiable or prohibited goods imported by land in respect of which the order permitting clearance of the goods required to be produced under section 109 is not produced or which do not correspond in any material particular with the specification contained therein;

(l) any dutiable or prohibited goods which are not included or are in excess of those included in the entry made under this Act, or in the case of baggage in the declaration made under section 77;

(m)¹[any goods which do not correspond in respect of value or in any other particular] with the entry made under this Act or in the case of baggage with the declaration made under section 77 ²[in respect thereof or in the case of goods under transhipment, with the declaration for transhipment referred to in the proviso to sub-section (1) of section 54];

(n) any dutiable or prohibited goods transisted with or without transhipment or attempted to be so transited in contravention of the provisions of Chapter VIII;

(o) any goods exempted, subject to any condition, from duty or any prohibition in respect of the import thereof under this Act or any other law for the time being in force, in respect of which the condition is not observed unless the non-observance of the condition was sanctioned by the proper officer;

³[(p)  any notified goods in relation to which any provisions of Chapter IVA or of any rule made under this Act for carrying out the purposes of that Chapter have been contravened.]

—————

1. Subs. by Act 36 of 1973, sec. 2, for certain words (w.e.f. 1-9-1973).

2.  Subs. by Act 27 of 1999, sec. 108, for “in respect thereof;” (w.e.f. 11-5-1999).

3. Ins. by Act 12 of 1969, sec. 4 (w.r.e.f. 3-1-1969).

Section 112. Penalty for improper importation of goods, etc.

Any person, – (a) who, in relation to any goods, does or omits to do any act which act or omission would render such goods liable to confiscation under section 111, or abets the doing or omission of such an act, or

(b) who acquires possession of or is in any way concerned in carrying, removing, depositing, harboring, keeping, concealing, selling or purchasing, or in any other manner dealing with any goods which he knows or has reason to believe are liable to confiscation under section 111, shall be liable,-

(i) in the case of goods in respect of which any prohibition is in force under this Act or any other law for the time being in force, to a penalty ¹not exceeding five times the value of the goods or one thousand rupees, whichever is the greater;

²(ii) in the case of dutiable goods, other than prohibited goods, to a penaltynot exceeding five times the duty sought to be evaded on such goods or one thousand rupees, whichever is the greater;

(iii) in the case of goods in respect of which the value stated in the entry made under this Act or in the case of baggage, in the declaration made under section 77 (in either case hereafter in this section referred to as the declared value) is higher than the value thereof, to a penalty not exceeding five times the difference between the declared value and the value thereof or one thousand rupees, whichever is the greater;

(iv) in the case of goods falling both under clauses (i) and (iii), to a penalty not exceeding five times the value of the goods or five times the difference between the declared value and the value thereof or one thousand rupees, whichever is the highest;

(v) in the case of goods falling both under clauses (ii) and (iii), to a penalty not exceeding five times the duty sought to be evaded on such goods or five times the difference between the declared value and the value thereof or one thousand rupees, whichever is the highest.

—————

1.  Subs. by Act 14 of  2001, sec. 107, for certain words (w.e.f. 11-5-2001).

2.  Ins. by Act 36 of 1973, sec. 3 (w.e.f. 1-9-1973).

Section 113. Confiscation of goods attempted to be improperly exported, etc.

The following export goods shall be liable to confiscation :- (a) any goods attempted to be exported by sea or air from any place other than a customs port or a customs airport appointed for the loading of such goods;

(b) any goods attempted to be exported by land or inland water through any route other than a route specified in a notification issued under clause

(c) of section 7 for the export of such goods;

(c) any ¹[***]dutiable or prohibited goods brought near the land frontier or the

coast of India or near any bay, gulf, creek or tidal river for the purpose of being exported from a place other than a land customs station or a customs port appointed for the loading of such goods;

(d) any goods attempted to be exported or brought within the limits of any customs area for the purpose of being exported, contrary to any prohibition imposed by or under this Act or any other law for the time being in force;

(e) any ²[***]dutiable or prohibited goods found concealed in a package which is brought within the limits of a customs area for the purpose of exportation;

(f) any ²[***]dutiable or prohibited goods which are loaded or attempted to be loaded in contravention of the provisions of section 33 or section 34;

(g)²[***] any dutiable or prohibited goods loaded or attempted to be loaded on

any conveyance, or water-borne, or attempted to be water-borne for being loaded on any vessel, the eventual destination of which is a place outside India, without the permission of the proper officer;

(h) any²[***] dutiable or prohibited goods which are not included or are in excess of those included in the entry made under this Act, or in the case of baggage in the declaration made under section 77;

³(i) any dutiable or prohibited goods or goods entered for exportation under claim for drawback which do not correspond in any material particular with the entry made under this Act or in the case of baggage with the declaration made under section 77 in respect thereof;

⁴(ii) any goods entered for exportation under claim for drawback which do not correspond in any material particular with any information furnished by the exporter or manufacturer under this Act in relation to the fixation of rate of drawback under section 75;

(j) any goods on which import duty has not been paid and which are entered for exportation under a claim for drawback under section 74;

(k) any goods cleared for exportation⁵ under a claim for drawback which are not loaded for exportation on account of any willful act, negligence or default of the exporter, his agent or employee, or which after having been loaded for exportation are unloaded without the permission of the proper officer;

⁶(l) any specified goods in relation to which any provisions of Chapter IVB or of any rule made under this Act for carrying out the purposes of that Chapter have been contravened.

—————

1.  The words “dutiable or prohibited” omitted by Act 32 of 2003, sec. 116 (w.e.f. 14-5-2003).

2.  The words “dutiable or prohibited” omitted by Act 32 of 2003, sec. 116 (w.e.f. 14-5-2003).

3. Subs. by Act 32 of 2003, sec. 116, for clause (i) (w.e.f. 14-5-2003).

4.  Ins. by Act 49 of 1991, sec. 120 (w.r.e.f. 1-4-1991).

5.  The words “under a claim for drawback” omitted by Act 32 of 2003, sec. 116 (w.e.f. 14-5-2003).

6.  Ins. by Act 12 of 1969, sec. 5 (w.r.e.f. 3-1-1969).

Section 114. Penalty for attempt to export goods improperly, etc.

Any person who, in relation to any goods, does or omits to do any act which act or omission would render such goods liable to confiscation under section 113, or abets the doing or omission of such an act, shall be liable,—

(i) in the case of goods in respect of which any prohibition is in force under this Act or any other law for the time being in force, to a penalty ¹[²[not exceeding three times the value of the goods as declared by the exporter or the value as determined under this Act]], whichever is the greater;

(ii) in the case of dutiable goods, other than prohibited goods, to a penalty ³[not exceeding the duty sought to be evaded or five thousand rupees], whichever is the greater;

⁴[(iii) in the case of any other goods, to a penalty not exceeding the value of the goods, as declared by the exporter or the value as determined under this Act, whichever is the greater.]

—————

1. Subs. by Act 14 of 2001, sec. 108, for “not exceeding five times the value of the goods or one thousand rupees” (w.e.f. 11-5-2001).

2. Subs. by Act 32 of 2003, sec. 117, for “not exceeding the value of the goods or five thousand rupees” (w.e.f. 14-5-2003).

3. Subs. by Act 14 of 2001, sec. 108, for “not exceeding five times the duty sought to be evaded on such goods or one thousand rupees” (w.e.f. 11-5-2001).

4. Subs. by Act 32 of 2003, sec. 117, for clause (iii) (w.e.f. 14-5-2003).

Section 114A. Penalty For Short-Levy Or Non-Levy Of Duty In Certain Cases.

¹[114A. Penalty for short-levy or non-levy of duty in certain cases.—Where the duty has not been levied or has not been short-levied or the interest has not been charged or paid or has been part paid or the duty or interest has been erroneously refunded by reason of collusion or any wilful mis-statement or suppression of facts, the person who is liable to pay the duty or interest, as the case may be, as determined under sub-section (2) of section 28 shall, also be liable to pay a penalty equal to the duty or interest so determined:]

²[Provided that where such duty or interest, as the case may be, as determined under sub-section (2) of section 28, and the interest payable thereon under section 28AB, is paid within thirty days from the date of the communication of the order of the proper officer determining such duty, the amount of penalty liable to be paid by such person under this section shall be twenty-five per cent. of the duty or interest, as the case may be, so determined:

Provided further that the benefit of reduced penalty under the first proviso shall be available subject to the condition that the amount of penalty so determined has also been paid within the period of thirty days referred to in that proviso:

Provided also that where the duty or interest determined to be payable is reduced or increased by the Commissioner (Appeals), the Appellate Tribunal or, as the case may be, the court, then, for the purposes of this section, the duty or interest as reduced or increased, as the case may be, shall be taken into account:

Provided also that where the duty or interest determined to be payable is increased by the Commissioner (Appeals), the Appellate Tribunal or, as the case may be, the court, then, the benefit of reduced penalty under the first proviso shall be available if the amount of the duty or the interest so increased, along with the interest payable thereon under section 28AB, and twenty-five per cent. of the consequential increase in penalty have also been paid within thirty days of the communication of the order by which such increase in the duty or interest takes effect:

Provided also that where any penalty has been levied under this section, no penalty shall be levied under section 112 or section 114.

Explanation.—For the removal of doubts, it is hereby declared that—

(i) the provisions of this section shall also apply to cases in which the order determining the duty or interest under sub-section (2) of section 28 relates to notices issued prior to the date on which the Finance Act, 2000 receives the assent of the President*;

(ii) any amount paid to the credit of the Central Government prior to the date of communication of the order referred to in the first proviso or the fourth proviso shall be adjusted against the total amount due from such person.]

—————

1. Ins. by Act 33 of 1996, sec. 64 (w.e.f. 28-9-1996).

2. Subs. by Act 10 of 2000, sec. 85, for the first and second provisos (w.e.f. 12-5-2000).

*. Ed. The Finance Act, 2000 received the assent of the President on 12th May, 2000.

Section 114AA. penalty for use of false and incorrect material.

¹[114AA. Penalty for use of false and incorrect material.—If a person knowingly or intentionally makes, signs or uses, or causes to be made, signed or used, any declaration, statement or document which is false or incorrect in any material particular, in the transaction of any business for the purposes of this Act, shall be liable to a penalty not exceeding five times the value of goods.]

—————

1. Ins. by Act 29 of 2006, sec. 27 (w.e.f. 13-7-2006).

Section 115. Confiscation of conveyances.

(1) The following conveyances shall be liable to confiscation :-

(a) any vessel which is or has been within the Indian customs waters, any aircraft which is or has been in India, or any vehicle which is or has been in a customs area, while constructed, adapted, altered or fitted in any manner for the purpose of concealing goods;

(b) any conveyance from which the whole or any part of the goods is thrown overboard, staved or destroyed so as to prevent seizure by an officer of customs;

(c) any conveyance which having been required to stop or land under section 106 fails to do so, except for good and sufficient cause;

(d) any conveyance from which any warehoused goods cleared for exportation, or any other goods cleared for exportation under a claim for drawback, are unloaded, without the permission of the proper officer;

(e) any conveyance carrying imported goods which has entered India and is afterwards found with the whole or substantial portion of such goods missing, unless the master of the vessel or aircraft is able to account for the loss of, or deficiency in, the goods.

(2) Any conveyance or animal used as a means of transport in the smuggling of any goods or in the carriage of any smuggled goods shall be liable to confiscation, unless the owner of the conveyance or animal proves that it was so used without the knowledge or connivance of the owner himself, his agent, if any, and the person in charge of the conveyance or animal : ¹[***]:

Provided that where any such conveyance is used for the carriage of goods or passengers for hire, the owner of any conveyance shall be given an option to pay in lieu of the confiscation of the conveyance a fine not exceeding the market price of the goods which are sought to be smuggled or the smuggled goods, as the case may be.

Explanation : In this section, “market price” means market price at the date when the goods are seized.

———

1. Certain words omitted by Act 26 of 1988, sec. 79 (w.e.f. 13-5-1988).

Section 116. Penalty for not accounting for goods.

If any goods loaded in a conveyance for importation into India, or any goods transshipped under the provisions of this Act or coastal goods carried in a conveyance, are not unloaded at their place of destination in India, or if the quantity unloaded is short of the quantity to be unloaded at that destination, and if the failure to unload or the deficiency is not accounted for to the satisfaction of the ¹[Assistant Commissioner of Customs or Deputy Commissioner of Customs], the person-in-charge of the conveyance shall be liable, -

(a) in the case of goods loaded in a conveyance for importation into India or goods transshipped under the provisions of this Act, to a penalty not exceeding twice the amount of duty that would have been chargeable on the goods not unloaded or the deficient goods, as the case may be, had such goods been imported;

(b) in the case of coastal goods, to a penalty not exceeding twice the amount of export duty that would have been chargeable on the goods not unloaded or the deficient goods, as the case may be, had such goods been exported.

—————

1.  Subs. by Act 27 of 1999, sec. 100, for “Assistant Commissioner of Customs” (w.e.f. 11-5-1999). Earlier the words “Assistant Commissioner of Customs” were substituted by Act 22 of 1995, sec. 50, for the words “Assistant Collector of Customs” (w.e.f. 26-5-1995).

Section 117. Penalties for contravention, etc., not expressly mentioned.

Any person who contravenes any provision of this Act or abets any such contravention or who fails to comply with any provision, of this Act with which it was his duty to comply, where no express penalty is elsewhere provided for such contravention or failure, shall be liable to a penalty not exceeding ¹ten thousand rupees.

—————

1.  Subs. by Act 27 of 1999, sec. 109, for “one thousand rupees” (w.e.f. 11-5-1999).

Section 118. Confiscation of packages and their contents.

(a) Where any goods imported in a package are liable to confiscation, the package and any other goods imported in that package shall also be liable to confiscation.

(b) Where any goods are brought in a package within the limits of a customs area for the purpose of exportation and are liable to confiscation, the package and any other goods contained therein shall also be liable to confiscation.

Section 119. Confiscation of goods used for concealing smuggled goods.

Any goods used for concealing smuggled goods shall also be liable to confiscation.

Explanation : In this section, “goods” does not include a conveyance used as a means of transport.

Section 120. Confiscation of smuggled goods notwithstanding any change in form, etc.

(1) Smuggled goods may be confiscated notwithstanding any change in their form.

(2) Where smuggled goods are mixed with other goods in such manner that the smuggled goods cannot be separated from such other goods, the whole of the goods shall be liable to confiscation :

Provided that where the owner of such goods proves that he had no knowledge or reason to believe that they included any smuggled goods, only such part of the goods the value of which is equal to the value of the smuggled goods shall be liable to confiscation.

Section 121. Confiscation of sale-proceeds of smuggled goods.

Where any smuggled goods are sold by a person having knowledge or reason to believe that the goods are smuggled goods, the sale-proceeds thereof shall be liable to confiscation. .

Section 122. Adjudication of confiscations and penalties.

In every case under this Chapter in which anything is liable to confiscation or any person is liable to a penalty, such confiscation or penalty may be adjudged, -

(a) without limit, by a ¹[Commissioner of Customs] or a ²[Deputy Commissioner of Customs];

³[(b) where the value of goods liable to confiscation does not exceed ⁴[two lakh] rupees, by an ²[Assistant Commissioner of Customs or Deputy Commissioner of Customs];]

⁵[(c) where the value of the goods liable to confiscation does not exceed 6[ten thousand] rupees, by a gazetted officer of customs lower in rank than an ²[Assistant Commissioner of Customs or Deputy Commissioner of Customs].]

—————

1. Subs. by Act 22 of 1995, sec. 50, for “Collector of Customs” (w.e.f. 26-5-1995).

2. Subs. by Act 27 of 1999, sec. 100, for “Assistant Commissioner of Customs” (w.e.f. 11-5-1999). Earlier the words “Assistant Commissioner of Customs” were substituted by Act 22 of 1995, sec. 50, for the words “Assistant Collector of Customs” (w.e.f. 26-5-1995).

3. Subs. by Act 25 of 1978, sec. 12, for clause (b) (w.e.f. 1-7-1978).

4. Subs. by Act 32 of 2003, sec. 118, for “fifty thousand” (w.e.f. 14-5-2003). Earlier the words “fifty thousand” were substituted by Act 18 of 1992, sec. 109(3), for the words “twenty five thousand” (w.e.f. 14-5-1992).

5. Subs. by Act 25 of 1978, sec. 12, for clause (c) (w.e.f. 1-7-1978).

6. Subs. by Act 32 of 2003, sec. 118, for “two thousand five hundred” (w.e.f. 14-5-2003).

Section 122A. Adjudication procedure.

¹[122A. Adjudication procedure.—(1) The adjudicating authority shall, in any proceeding under this Chapter or any other provision of this Act, give an opportunity of being heard to a party in a proceeding, if the party so desires.

(2) The adjudicating authority may, if sufficient cause is shown, at any stage of proceeding referred to in sub-section (1), grant time, from time to time, to the parties or any of them and adjourn the hearing for reasons to be recorded in writing:

Provided that no such adjournment shall be granted more than three times to a party during the proceeding.]

—————

1. Ins. by Act 23 of 2004, sec. 67 (w.e.f. 10-9-2004).

Section 123. Burden of proof in certain cases.

¹(1) Where any goods to which this section applies are seized under this Act in the reasonable belief that they are smuggled goods, the burden of proving that they are not smuggled goods shall be -

(a) in a case where such seizure is made from the possession of any person, -

(i) on the person from whose possession the goods were seized; and

(ii) if any person, other than the person from whose possession the goods were seized, claims to be the owner thereof, also on such other person;

(b) in any other case, on the person, if any, who claims to be the owner of the goods so seized.

(2) This section shall apply to gold, ²and manufactures thereof, watches,

and any other class of goods which the Central Government may by notification in the Official Gazette specify.

—————

1. Subs. by Act 36 of 1973, sec. 4, for sub-section (1) (w.e.f. 1-9-1973).

2. Subs. by Act 40 of 1989, sec. 2, for “diamonds, manufactures of gold or diamonds” (w.e.f. 26-10-1989).

Section 124. Issue Of Show Cause Notice Before Confiscation Of Goods, Etc.

No order confiscating any goods or imposing any penalty on any person shall be made under this Chapter unless the owner of the goods or such person -

(a) is given a notice in ¹[writing with the prior approval of the officer of customs not below the rank of a Deputy Commissioner of Customs, informing] him of the grounds on which it is proposed to confiscate the goods or to impose a penalty;

(b) is given an opportunity of making a representation in writing within such reasonable time as may be specified in the notice against the grounds of confiscation or imposition of penalty mentioned therein; and

(c) is given a reasonable opportunity of being heard in the matter :

Provided that the notice referred to in clause (a) and the representation referred to in clause (b) may, at the request of the person concerned be oral.

—————

1. Subs. by Act 29 of 2006, sec. 28, for “writing informing” (w.e.f. 13-7-2006).

Section 125. Option to pay fine in lieu of confiscation.

(1) Whenever confiscation of any goods is authorised by this act, the officer adjudging it may, in the case of any goods, the importation or exportation whereof is prohibited under this Act or under any other law for the time being in force, and shall, in the case of any other goods, give to the owner of the goods ¹or, where such owner is not known, the person from whose possession or custody such goods have been seized, an option to pay in lieu of confiscation such fine as the said officer thinks fit :

Provided that, without prejudice to the provisions of the proviso to sub-section (2) of section 115, such fine shall not exceed the market price of the goods confiscated, less in the case of imported goods the duty chargeable thereon.

²(2) Where any fine in lieu of confiscation of goods is imposed under sub-section (1), the owner of such goods or the person referred to in sub-section (1), shall, in addition, be liable to any duty and charges payable in respect of such goods.

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1. Ins. by Act 80 of 1985, sec. 9 (w.e.f. 27-12-1985).

2. Subs. by Act 80 of 1985, sec. 9, for sub-section (2) (w.e.f. 27-12-1985).

Section 126. On confiscation, property to vest in central government.

(1) When any goods are confiscated under this Act, such goods shall thereupon vest in the Central Government.

(2) The officer adjudging confiscation shall take and hold possession of the confiscated goods.

Section 127. Award of confiscation or penalty by customs officers not to interfere with other punishments.

The award of any confiscation or penalty under this Act by an officer of customs shall not prevent the infliction of any punishment to which the person affected thereby is liable under the provisions of Chapter XVI of this Act or under any other law.

Section 127A. Definition.

In this Chapter, unless the context otherwise requires, -

(a) “Bench” means a Bench of the Settlement Commission;

²[(b)   “case” means any proceeding under this Act or any other Act for the levy, assessment and collection of customs duty, pending before an adjudicating authority on the date on which an application under sub-section (1) of section 127B is made:

Provided that where any appeal or application for revision has been preferred after the expiry of the period specified for the filing of such appeal or application for revision under this Act and which has not been admitted, such appeal or revision shall not be deemed to be a proceeding pending within the meaning of this clause;

(c) “Chairman” means the Chairman of the Settlement Commission;

(d) “Commissioner (Investigation) “means an officer of the customs or a central Excise Officer appointed as such Commissioner to conduct inquiry or investigation for the purposes of this Chapter;

(e) “Member” means a Member of the Settlement Commission and includes the Chairman and the Vice-Chairman;

(f) “Settlement Commission” means the Customs and Central Excise Settlement Commission constituted under section 32 of the Central Excise Act, 1944 (1 of 1944); and

(g) “Vice-Chairman” means a Vice-Chairman of the Settlement Commission.

———-

1. Chapter XIVA (containing sections 127A to 127N) ins. by Act 21 of 1998, sec. 102 (w.e.f.1-8-1998).

2. Subs. by Act 22 of 2007, sec. 100, for clause (b) (w.e.f. 1-6-2007). Clause (b),

Section 127B. Application for settlement of cases.

¹[127B. Application for settlement of cases.—²[(1) Any importer, exporter or any other person (hereinafter referred to as the applicant in this Chapter) may, in respect of a case, relating to him make an application, before adjudication to the Settlement Commission to have the case settled, in such form and in such manner as may be specified by rules, and containing a full and true disclosure of his duty liability which has not been disclosed before the proper officer, the manner in which such liability has been incurred, the additional amount of customs duty accepted to be payable by him and such other particulars as may be specified by rules including the particulars of such dutiable goods in respect of which he admits short levy on account of misclassification, under-valuation or inapplicability of exemption notification but excluding the goods not included in the entry made under this Act and such application shall be disposed of in the manner hereinafter provided:

Provided that no such application shall be made unless,—

(a) the applicant has filed a bill of entry, or a shipping bill, in respect of import or export of such goods, as the case may be, and in relation to such bill of entry or shipping bill, a show cause notice has been issued to him by the proper officer;

(b) the additional amount of duty accepted by the applicant in his application exceeds three lakh rupees; and

(c) the applicant has paid the additional amount of customs duty accepted by him along with interest due under section 28AB:

Provided further that no application shall be entertained by the Settlement Commission under this sub-section in cases which are pending in the Appellate Tribunal or any court:

Provided also that no application under this sub-section shall be made in relation to goods to which section 123 applies or to goods in relation to which any offence under the Narcotic Drugs and Psychotropic Substances Act, 1985 (61 of 1985) has been committed:

Provided also that no application under this sub-section shall be made for the interpretation of the classification of the goods under the Customs Tariff Act, 1975 (51 of 1975).

(1A) Notwithstanding anything contained in sub-section (1), where an application was made under sub-section (1) before the 1st day of June, 2007 but an order under sub section (1) of section 127C has not been made before the said date, the applicant shall within a period of thirty days from the 1st day of June, 2007 pay the accepted duty liability failing which his application shall be liable to be rejected.]

(2) Where any dutiable goods, books of account, other documents or any sale proceeds of the goods have been seized under section 110, the applicant shall not be entitled to make an application under sub-section (1) before the expiry of one hundred and eighty days from the date of the seizure.

(3) Every application made under sub-section (1) shall be accompanied by such fees as may be specified by rules.

(4) An application made under sub-section (1) shall not be allowed to be withdrawn by the applicant.]

———-

1.Chapter XIVA (containing sections 127A to 127N) ins. by Act 21 of 1998, sec. 102 (w.e.f.1-8-1998).

2. Subs. by Act 22 of 2007, sec. 101, for sub-section (1) (w.e.f. 1-6-2007). Earlier sub-section (1) was amended by Act 10 of 2000, sec. 86 (w.e.f. 12-5-2000). Sub-section (1) before substitution by Act 22 of 2007, stood as under:

“(1) Any importer, exporter or any other person (hereinafter in this Chapter referred to as the applicant) may, at any stage of a case relating to him, make an application in such form and in such manner as may be specified by rules, and containing a full and true disclosure of his duty liability which has not been disclosed before the proper officer, the manner in which such liability has been incurred, the additional amount of customs duty accepted to be payable by him and such other particulars as may be specified by rules including the particulars of such dutiable goods in respect of which he admits short levy on account of misclassification or otherwise of goods, to the Settlement Commission to have the case settled and such application shall be disposed of in the manner hereinafter provided:

Provided that no such application shall be made unless—

(a) the applicant has filed a bill of entry, or a shipping bill, in respect of import or export of goods, as the case may be, and in relation to such bill of entry or shipping bill or a show cause notice has been issued to him by the proper officer;

(b) the additional amount of duty accepted by the applicant in his application exceeds two lakh rupees:

Provided further that no application shall be entertained by the Settlement Commission under this sub-section in cases which are pending in the Appellate Tribunal or any court:

Provided also that no application under this sub-section shall be made in relation to goods to which section 123 applies or to goods in relation to which any offence under the Narcotic Drugs and Psychotropic Substances Act, 1985 (61 of 1985), has been committed:

Provided also that no application under this sub-section shall be made for the interpretation of the classification of the goods under the Customs Tariff Act, 1975 (51 of 1975).”.

Section 127C. Procedure receipt of application under section 127b.

¹[²[127C. Procedure on receipt of an application under section 127B.—(1) On receipt of an application under section 127B, the Settlement Commission shall, within seven days from the date of receipt of the application, issue a notice to the applicant to explain in writing as to why the application made by him should be allowed to be proceeded with and after taking into consideration the explanation provided by the applicant, the Settlement Commission, shall, within a period of fourteen days from the date of the notice, by an order, allow the application to be proceeded with or reject the application, as the case may be, and the proceedings before the Settlement Commission shall abate on the date of rejection:

Provided that where no notice has been issued or no order has been passed within the aforesaid period by the Settlement Commission, the application shall be deemed to have been allowed to be proceeded with.

(2) A copy of every order under sub-section (1) shall be sent to the applicant and to the Commissioner of Customs having jurisdiction.

(3) Where an application is allowed or deemed to have been allowed to be proceeded with under sub-section (1), the Settlement Commission shall, within seven days from the date of order under sub-section (1), call for a report along with the relevant records from the Commissioner of Customs having jurisdiction and the Commissioner shall furnish the report within a period of thirty days of the receipt of communication from the Settlement Commission:

Provided that where the Commissioner does not furnish the report within the aforesaid period of thirty days, the Settlement Commission shall proceed further in the matter without the report of the Commissioner.

(4) Where a report of the Commissioner called for under sub-section (3) has been furnished within the period specified in that sub-section, the Settlement Commission may, after examination of such report, if it is of the opinion that any further enquiry or investigation in the matter is necessary direct, for reasons to be recorded in writing, the Commissioner (Investigation) within fifteen days of the receipt of the report, to make or cause to be made such further enquiry or investigation and furnish a report within a period of ninety days of the receipt of the communication from the Settlement Commission, on the matters covered by the application and any other matter relating to the case:

Provided that where the Commissioner (Investigation) does not furnish the report within the aforesaid period, the Settlement Commission shall proceed to pass an order under sub-section (5) without such report.

(5) After examination of the records and the report of the Commissioner of Customs received under sub-section (3), and the report, if any, of the Commissioner (Investigation) of the Settlement Commission under sub-section (4), and after giving an opportunity to the applicant and to the Commissioner of Customs having jurisdiction to be heard, either in person or through a representative duly authorised in this behalf, and after examining such further evidence as may be placed before it or obtained by it, the Settlement Commission may, in accordance with the provisions of this Act, pass such order as it thinks fit on the matters covered by the application and any other matter relating to the case not covered by the application, but referred to in the report of the Commissioner of Customs and Commissioner (Investigation) under sub-section (3) or sub-section (4).

(6) An order under sub-section (5) shall not be passed in respect of an application filed on or before the 31st day of May, 2007, later than the 29th February, 2008 and in respect of an application made on or after the 1st day of June, 2007, after nine months from the last day of the month in which the application was made, failing which the settlement proceedings shall abate, and the adjudicating authority before whom the proceeding at the time of making the application was pending, shall dispose of the case in accordance with the provisions of this Act as if no application under section 127B had been made.

(7) Subject to the provisions of section 32A of the Central Excise Act, 1944

(1 of 1944), the materials brought on record before the Settlement Commission shall be considered by the Members of the concerned Bench before passing any order under sub-section (5) and, in relation to the passing of such order, the provisions of section 32D of the Central Excise Act, 1944(1 of 1944) shall apply.

(8) The order passed under sub-section (5) shall provide for the terms of settlement including any demand by way of duty, penalty or interest, the manner in which any sums due under the settlement shall be paid and all other matters to make the settlement effective and in case of rejection contain the reasons therefor and it shall also provide that the settlement shall be void if it is subsequently found by the Settlement Commission that it has been obtained by fraud, or misrepresentation of facts:

Provided that the amount of settlement ordered by the Settlement Commission, shall not be less than the duty liability admitted by the applicant under section 127B.

(9) Where any duty, interest, fine and penalty payable in pursuance of an order under sub-section (5) is not paid by the applicant within thirty days of receipt of a copy of the order by him, the amount which remains unpaid, shall be recovered along with interest due thereon, as the sums due to the Central Government by the proper officer having jurisdiction over the applicant in accordance with the provisions of section 142.

(10) Where a settlement becomes void as provided under sub-section (8), the proceedings with respect to the matters covered by the settlement shall be deemed to have been revived from the stage at which the application was allowed to be proceeded with by the Settlement Commission and the proper officer having jurisdiction may, notwithstanding anything contained in any other provision of this Act, complete such proceedings at any time before the expiry of two years from the date of the receipt of communication that the settlement became void].]

———-

1.Chapter XIVA (containing sections 127A to 127N) ins. by Act 21 of 1998, sec. 102 (w.e.f.1-8-1998)./

2.Subs. by Act 22 of 2007, sec. 102, for section 127C (w.e.f. 1-6-2007). Section 127C, before substitution by Act 22 of 2007,

Section 127D. Power of settlement commission to order provisional attachment to protect revenue.

(1) Where, during the pendency of any proceeding before it, the Settlement Commission is of the opinion that for the purpose of protecting the interests of the revenue it is necessary so to do, it may, by order, attach provisionally any property belonging to the applicant in such manner as may be specified by rules.

(2) Every provisional attachment made by the Settlement Commission under sub-section (1) shall cease to have effect from the date the sums due to the Central Cover anent for which such attachment is made are discharged by the applicant and evidence to that effect is submitted to the Settlement Commission.

————

*  Chapter XIVA (containing sections 127A to 127N) ins. by  Act 21 of 1998, sec.  102 (w.e.f. 1-8-1998).

Section 127E. Power of settlement commission to reopen completed proceedings.

¹If the Settlement Commission is of the opinion (the reasons for such opinion to be recorded by it in writing) that, for the proper disposal of the case pending before it, it is necessary or expedient to reopen any proceeding connected with the case but which has been completed under this Act before application for settlement under section 127B was made, it may, with the concurrence of the applicant, reopen such proceeding and pass such order thereon as it thinks fit, as if the case in relation to which the application for settlement had been made by the applicant under that section covered such proceeding also:

Provided that no proceeding shall be reopened by the Settlement Commission under this section after the expiry of five years from the date of application under sub-section (1) of section 127B.

²[Provided further that no proceeding shall be reopened by the Settlement Commission under this section in a case where an application under section 127B is made on or after the 1st day of June, 2007.]]

———-

1.Chapter XIVA (containing sections 127A to 127N) ins. by Act 21 of 1998, sec. 102 (w.e.f.1-8-1998).

2.Ins. by Act 22 of 2007, sec. 103 (w.e.f. 1-6-2007).

Section 127F. Power and procedure of settlement commission.

¹[127F. Power and procedure of Settlement Commission.—(1) In addition to the powers conferred on the Settlement Commission under Chapter V of the Central Excise Act, 1944 (1 of 1944), it shall have all the powers which are vested in an officer of the customs under this Act or the rules made thereunder.

(2) Where an application made under section 127B has been allowed to be proceeded with under section 127C, the Settlement Commission shall, until an order is passed under sub-section ²[(5)] of section 127C, have, subject to the provisions of sub-section ³[(4)] of that section, exclusive jurisdiction to exercise the powers and perform the functions of any officer of customs or Central Excise Officer, as the case may be, under this Act or in the Central Excise Act, 1944 (1 of 1944), as the case may be, in relation to the case.

(3) In the absence of any express direction by the Settlement Commission to the contrary, nothing in this Chapter shall affect the operation of the provisions of this Act in so far as they relate to any matter other than those before the Settlement Commission.

(4) The Settlement Commission shall, subject to the provisions of Chapter V of the Central Excise Act, 1944 (1 of 1944) and this Chapter, have power to regulate its own procedure and the procedure of Benches thereof in all matters arising out of the exercise of its powers, or of the discharge of its functions, including the places at which the Benches shall hold their sittings.]

———

1.Chapter XIVA (containing sections 127A to 127N) ins. by Act 21 of 1998, sec. 102 (w.e.f.1-8-1998).

2. Subs. by Act 22 of 2007, sec. 104, for “(7)” (w.e.f. 1-6-2007).

3.Subs. by Act 22 of 2007, sec. 104, for “(6)” (w.e.f. 1-6-2007).

Section 127G. Inspection, etc., of reports.

No person shall be entitled to inspect, or obtain copies of, any report made by any officer of the Customs to the Settlement Commission; but the Settlement Commission may, in its discretion, furnish copies thereof to any such person on an application made to it in this behalf and on payment of such fee as may be specified by rules:

Provided that, for the purpose of enabling any person whose case is under consideration to rebut any evidence brought on record against him in any such report, the Settlement Commission shall, on an application made in this behalf, and on payment by such person of such fee as may be specified by rules, furnish him with a certified copy of any such report or part thereof relevant for the purpose.

————

*  Chapter XIVA (containing sections 127A to 127N) ins. by  Act 21 of 1998, sec.  102 (w.e.f. 1-8-1998).

Section 127H. Power Of Settlement Commission To Grant Immunity From Prosecution And Penalty.

¹[127H. Power of Settlement Commission to grant immunity from prosecution and penalty.—(1) The Settlement Commission may, if it is satisfied that any person who made the application for settlement under section 127B has co-operated with the Settlement Commission in the proceedings before it and has made a full and true disclosure of his duty liability, grant to such person, subject to such conditions as it may think fit to impose, immunity from prosecution for any offence under this Act ²[and also either wholly or in part from the imposition of any penalty and fine] under this Act, with respect to the case covered by the settlement:

Provided that no such immunity shall be granted by the Settlement Commission in cases where the proceedings for the prosecution for any such offence have been instituted before the date of receipt of the application under section 127B.

³[Explanation.—For the removal of doubts, it is hereby declared that the application filed before the Settlement Commission on or before the 31st day of May, 2007 shall be disposed of as if the amendment in this section had not come into force.]

(2) An immunity granted to a person under sub-section (1) shall stand withdrawn if such person fails to pay any sum specified in the order of the settlement passed under ⁴[sub-section (5) of section 127C within the time specified in such order], or fails to comply with any other condition subject to which the immunity was granted and thereupon the provisions of this Act shall apply as if such immunity had not been granted.

(3) An immunity granted to a person under sub-section (1) may, at any time, be withdrawn by the Settlement Commission, if it is satisfied that such person had, in the course of the settlement proceedings, concealed any particulars, material to the settlement or had given false evidence, and thereupon such person may be tried for the offence with respect to which the immunity was granted or for any other offence of which he appears to have been guilty in connection with the settlement and shall also become liable to the imposition of any penalty under this Act to which such person would have been liable, had no such immunity been granted.

———

1.Chapter XIVA (containing sections 127A to 127N) ins. by Act 21 of 1998, sec. 102 (w.e.f.1-8-1998).

2.Subs. by Act 22 of 2007, sec. 105(i)(a), for “or under the Indian Penal Code (45 of 1860) or under any other Central Act for the time being in force and also either wholly or in part from the imposition of any penalty, fine and interest” (w.e.f. 1-6-2007).

3.Ins. by Act 22 of 2007, sec. 105(i)(b) (w.e.f. 1-6-2007).

4.Subs. by Act 22 of 2007, sec. 105(ii), for “sub-section (7) of section 127C within the time specified in such order or within such further time as may be allowed by the Settlement Commission” (w.e.f. 1-6-2007).

Section 127-I. Power of settlement commission to send a case back to the proper officer.

(1) The Settlement Commission may if it is of opinion that any person who made an application for settlement under section 127B has not co-operated with the Settlement Commission in the proceedings before it, send the case back to the proper officer who shall thereupon dispose of the case in accordance with the provisions of this Act as if no application under section 127B had been made.

(2) For the purpose of sub-section (1), the proper officer shall be entitled to use all the materials and other information produced by the assessee before the Settlement Commission or the results of the inquiry held or evidence recorded by the Settlement Commission in the course of the proceedings before it as if such materials, information, inquiry and evidence had been produced before such proper officer or held or recorded by him in the course of the proceedings before him.

(3) For the purposes of the time limit under section 28 and for the purposes of interest under section 28AA, in a case referred to in sub-section (1), the period commencing on and from the date of the application to the Settlement Commission under section 127B and ending with the date of receipt by the officer of customs of the order of the Settlement Commission sending the case back to the officer of customs shall be excluded.

—————

*  Chapter XIVA (containing sections 127A to 127N) ins. by  Act 21 of 1998, sec.  102 (w.e.f. 1-8-1998).

Section 127J. Order of settlement to be conclusive.

Every order of settlement passed under sub-section (7) of section 127C shall be conclusive as to the matters stated therein and no matter covered by such order shall, save as otherwise provided in this Chapter, be reopened in any proceeding under this Act or under any other law for the time being in force.

Section 127K. Recovery of sums due under order of settlement.

¹[127K. Recovery of sums due under order of settlement.—Any sum specified in an order of settlement passed under sub-section ²[(5)] of section 127C may, subject to such conditions, if any, as may be specified therein, be recovered, and any penalty for default in making payment of such sum may be imposed and recovered as sums due to the Central Government in accordance with the provisions of section 142, by the proper officer having jurisdiction over the applicant.]

———-

1.Chapter XIVA (containing sections 127A to 127N) ins. by Act 21 of 1998, sec. 102 (w.e.f.1-8-1998).

2.Subs. by Act 22 of 2007, sec. 107, for “(7)” (w.e.f. 1-6-2007).

Section 127L. Bar on subsequent application for settlement in certain cases.

¹[127L. Bar on subsequent application for settlement in certain cases.—²[(1)] ³[Where, before the 1st day of June, 2007]—

(i) an order of settlement passed under sub-section (7) of section 127C provides for the imposition of a penalty on the applicant under section 127B for settlement, on the ground of concealment of particulars of his duty liability; or

(ii) after the passing of an order of settlement under said sub-section (7) in relation to a case, such person is convicted of any offence under this Act in relation to that case; or

(iii) the case of such person is sent back to the proper officer by the Settlement Commission under section 127-I,

then such person shall not be entitled to apply for settlement under section 127B in relation to any other matter.

⁴[(2) Where an applicant has made an application under sub-section (1) of section 127B, on or after the 1st day of June, 2007 and if such application has been allowed to be proceeded with under sub-section (1) of section 127C, such applicant shall not be entitled to apply for settlement under section 127B in relation to any other matter:

Provided that such applicant shall not be prevented from filing an application for settlement if the issue in the subsequent application is, but for the period of dispute and amount, identical to the issue in respect of which the earlier application is pending before the Settlement Commission.]]

———-

1.Chapter XIVA (containing sections 127A to 127N) ins. by Act 21 of 1998, sec. 102 (w.e.f.1-8-1998).

2. Section 127L renumbered as sub-section (1) thereof by Act 22 of 2007, sec. 108 (w.e.f. 11-5-2007).

3. Subs. by Act 22 of 2007, sec. 108(i) for “Where” (w.e.f. 11-5-2007).

4.Ins. by Act 22 of 2007, sec. 108(ii) (w.e.f. 1-6-2007).

Section 127M. Proceedings before settlement commission to be judicial proceedings.

Any proceedings under this Chapter before the Settlement Commission shall be deemed to be a judicial proceeding within the meaning of sections 193 and 228, and for the purposes of section 196, of the Indian Penal Code(45 of 1860).

—————

* Chapter XIVA (containing sections 127A to 127N) ins. by Act 21 of 1998, sec. 102 (w.e.f. 1-8-1998).

Section 127MA. Certain persons who have filed appeals to the appellate tribunal entitled to make applications to the settlement commission.

¹[127MA. Certain persons who have filed appeals to the Appellate Tribunal entitled to make applications to the Settlement Commission. — [ Repealed by the Finance Act, 2007 (22 of 2007), sec. 109 (w.e.f. 1-6-2007) ] .

———-

1. Section 127MA omitted by Act 22 of 2007, sec. 109 (w.e.f. 1-6-2007). Earlier section 127MA was inserted by Act 10 of 2000, section 87 (w.e.f. 12-5-2000) and was amended by Act 18 of 2005, section 68 (w.e.f. 13-5-2005). Section 127MA, before omission by Act 22 of 2007, stood as under:

“127MA. Certain persons who have filed appeals to the Appellate Tribunal entitled to make applications to the Settlement Commission. —(1) Notwithstanding anything contained in this Chapter, any person who has filed an appeal to the Appellate Tribunal under this Act, on or before the 29th day of February, 2000 and which is pending, shall, on withdrawal of such appeal from the Appellate Tribunal, be entitled to make an application to the Settlement Commission to have his case settled under this Chapter:

Provided that no such person shall be entitled to make an application under this section in a case where the Commissioner of Customs or any officer on his behalf has, on or before the date on which the Finance Act, 2000 receives the assent of the President, applied to the Appellate Tribunal for the determination of such points arising out of the decision or order specified by the Board in its order under sub-section (1) of section 129D or filed an appeal under sub-section (2) of section 129A, as the case may be.

(2) Any person referred to in sub-section (1) may make an application to the Appellate Tribunal for permission to withdraw the appeal.

(3) On receipt of an application under sub-section (2), the Appellate Tribunal shall grant permission to withdraw the appeal.

(4) Upon withdrawal of the appeal, the proceedings in appeal immediately before such withdrawal shall, for the purposes of this Chapter, be deemed to be a proceeding pending before a proper officer.

(5) An application to the Settlement Commission under this section shall be made within a period of thirty days from the date on which the order of the Appellate Tribunal permitting the withdrawal of the appeal is communicated to the person.

(6) An application made to the Settlement Commission under this section shall be deemed to be an application made under sub-section (1) of section 127B and the provisions of this Chapter, except sub-section (11) of section 127C, and sub-section (1) of section 127-I, shall apply accordingly.

(7) Where an application made to the Settlement Commission under this section is not entertained by the Settlement Commission, then, the appeal shall be deemed to have been revived before the Appellate Tribunal and the provisions contained in section 129A, section 129B and section 129C, shall, so far as may be, apply accordingly.

(8) The Settlement Commission may, if it is of opinion that any person who made an application under sub-section (5) has not co-operated with the proceedings before it, send the case back to the Appellate Tribunal and the provisions containing in section 129A, section 129B and section 129C shall, so far as may be, apply accordingly.”.

Section 127N. Applications of certain provisions of central excise act.

The provisions of Chapter V of the Central Excise Act, 1944 (1 of 1944) in so far as it is not inconsistent with the provisions of this Chapter shall apply in relation to proceedings before the Settlement Commission under this Chapter.

—————

*  Chapter XIVA (containing sections 127A to 127N) ins. by  Act 21 of 1998, sec.  102 (w.e.f. 1-8-1998).

Section 128. Appeals To Commissioner (Appeals).

¹[128. Appeals to ²[Commissioner (Appeals)]. —(1) Any person aggrieved by any decision or order passed under this Act by an officer of customs lower in rank than a ³[Commissioner of Customs] may appeal to the ²[Commissioner (Appeals)] 4[within sixty days] from the date of the communication to him of such decision or order:

⁵[Provided that the Commissioner (Appeals) may, if he is satisfied that the appellant was prevented by sufficient cause from presenting the appeal within the aforesaid period of sixty days, allow it to be presented within a further period of thirty days.]

⁶[(1A) The Commissioner (Appeals) may, if sufficient cause is shown, at any stage of hearing of an appeal, grant time, from time to time, to the parties or any of them and adjourn the hearing of the appeal for reasons to be recorded in writing:

Provided that no such adjournment shall be granted more than three times to a party during hearing of the appeal.]

(2) Every appeal under this section shall be in such form and shall be verified in such manner as may be specified by rules made in this behalf.]

———-

1. Chapter XV (containing sections 128, 128A, 129, 129A, 129B, 129C, 129D, 129E, 130, 130A, 130B, 130C, 130D, 130E, 130F, 131, 131A, 131B, 131C) subs. by Act 44 of 1980, sec. 50 and the Fifth Sch. Pt. 1, for Chapter XV (containing sections 128, 129, 130, and 131) (w.e.f. 11-10-1982).

2. Subs. by Act 22 of 1995, sec. 50, for “Collector (Appeals)” (w.e.f. 26-5-1995).

3. Subs. by Act 22 of 1995, sec. 50, for “Collector of Customs” (w.e.f. 26-5-1995).

4. Subs. by Act 14 of 2001, sec. 109, for “within three months” (w.e.f. 11-5-2001).

5. Subs. by Act 14 of 2001, sec. 109, for the proviso (w.e.f. 11-5-2001).

6.Ins. by Act 23 of 2004, sec. 68 (w.e.f. 10-9-2004).

Section 128A. Procedure in appeal.

¹[128A. Procedure in appeal. —(1) The ²[Commissioner (Appeals)] shall give an opportunity to the appellant to be heard if he so desires.

(2) The ²[Commissioner (Appeals)] may, at the hearing of an appeal, allow the appellant to go into any ground of appeal not specified in the grounds of appeal, if the ²[Commissioner (Appeals)] is satisfied that the omission of that ground from the grounds of appeal was not wilful or unreasonable.

(3) ³[The Commissioner (Appeals) shall, after making such further inquiry as may be necessary, pass such order, as he thinks just and proper, confirming, modifying or annulling the decision or order appealed against:]

Provided that an order enhancing any penalty or fine in lieu of confiscation or confiscating goods of the greater value or reducing the amount of refund shall not be passed unless the appellant has been given a reasonable opportunity of showing cause against the proposed order:

Provided further that where the ²[Commissioner (Appeals)] is of opinion that any duty has not been levied or has been short-levied or erroneously refunded, no order requiring the appellant to pay any duty not levied, short-levied or erroneously refunded shall be passed unless the appellant is given notice within the time-limit specified in section 28 to show cause against the proposed order.

(4) The order of the ³[Commissioner (Appeals)] disposing of the appeals shall be in writing and shall state the points for determination, the decision thereon and the reasons for the decision.

⁴[(4A) The Commissioner (Appeals) shall, where it is possible to do so, hear and decide every appeal within a period of six months from the date on which it is filed.]

(5) On the disposal of the appeal, the 3[Commissioner (Appeals)] shall communicate the order passed by him to the appellant, the adjudicating authority ⁵[, the Chief Commissioner of Customs and the Commissioner of Customs].

———

1. Chapter XV (containing sections 128, 128A, 129, 129A, 129B, 129C, 129D, 129E, 130, 130A, 130B, 130C, 130D, 130E, 130F, 131, 131A, 131B, 131C) subs. by Act 44 of 1980, sec. 50 and the Fifth Sch. Pt. 1, for Chapter XV (containing sections 128, 129, 130, and 131) (w.e.f. 11-10-1982).

2. Subs. by Act 22 of 1995, sec. 50, for “Collector (Appeals)” (w.e.f. 26-5-1995).

3. Subs. by Act 14 of 2001, sec. 110, for certain words (w.e.f. 11-5-2001).

4. Ins. by Act 14 of 2001, sec. 110 (w.e.f. 11-5-2001).

5. Subs. by Act 18 of 2005, sec. 69, for “and the Commissioner of Customs” (w.e.f. 13-5-2005)

Section 129. Appellate tribunal.

¹[129. Appellate Tribunal. —(1) The Central Government shall constitute an Appellate Tribunal to be called the ‘Customs, Excise and ²[Service Tax] Appellate Tribunal consisting of as many judicial and technical members as it thinks fit to exercise the powers and discharge the functions conferred on the Appellate Tribunal by this Act.

³[(2) A judicial member shall be a person who has for at least ten years held a judicial office in the territory of India or who has been a member of the ⁴[Indian Legal Service] and has held a post in Grade I of that service or any equivalent or higher post for at least three years, or who has been an advocate for at least ten years.

Explanations.— For the purposes of this sub-section,—

(i) in computing the period during which a person has held judicial office in the territory of India, there shall be included any period, after he has held any judicial office, during which the person has been an advocate or has held the office of a member of a tribunal or any post, under the Union or a State, requiring special knowledge of law;

(ii) in computing the period during which a person has been an advocate, there shall be included any period during which the person has held a judicial office, or the office of a member of a tribunal or any post, under the Union or a State, requiring special knowledge of law after he became an advocate.

(2A) A technical member shall be a person who has been a member of the Indian Customs and Central Excise Service, Group A, and has held the post of ⁵[Commissioner of Customs] or Central Excise or any equivalent or higher post for at least three years.]

⁶[(3) The Central Government shall appoint—

(a) a person who is or has been a Judge of a High Court; or

(b) one of the members of the Appellate Tribunal,

to be the President thereof.]

(4) The Central Government may appoint one or more members of the Appellate Tribunal to be the Vice-President, or as the case may be Vice-Presidents, thereof.

⁷[***]

(5) ⁸[ ⁹[A Vice-President]] shall exercise such of the powers and perform such of the functions of the President as may be delegated to him by the President by a general or special order in writing.

¹⁰[(6) On ceasing to hold office, the President, Vice-President or other Member shall not be entitled to appear, act or plead before the Appellate Tribunal.]

———-

1.Chapter XV (containing sections 128, 128A, 129, 129A, 129B, 129C, 129D, 129E, 130, 130A, 130B, 130C, 130D, 130E, 130F, 131, 131A, 131B, 131C) subs. by Act 44 of 1980, sec. 50 and the Fifth Sch. Pt. 1, for Chapter XV (containing sections 128, 129, 130, and 131) (w.e.f. 11-10-1982).

2. Subs. by Act 32 of 2003, sec. 119, for “Gold (Control)” (w.e.f. 14-5-2003).

3. Subs. by Act 21 of 1984, sec. 39, for sub-section (2) (w.e.f. 11-5-1984).

4. Subs. by Act 32 of 2003, sec. 119, for “Central Legal Service” (w.e.f. 14-5-2003).

5. Subs. by Act 22 of 1995, sec. 50, for “Collector of Customs” (w.e.f. 26-5-1995).

6. Subs. by Act 33 of 1996, sec. 65, for sub-section (3) (w.e.f. 28-9-1996).

7. Sub-section (4A) omitted by Act 32 of 2003, sec. 119 (w.e.f. 14-5-2003). Earlier sub-section (4A) was inserted by Act 21 of 1984, sec. 39 (w.e.f. 11-5-1984).

8. Subs. by Act 21 of 1984, sec. 39, for “The Vice-President” (w.e.f. 11-5-1984).

9. Subs. by Act 32 of 2003, sec. 119, for “The Senior Vice-President or a Vice-President” (w.e.f. 14-5-2003).

10.Ins. by Act 22 of 2007, sec. 110 (w.e.f. 11-5-2007).

Section 129A. Appeals to the appellate tribunal.

¹[129A. Appeals to the Appellate Tribunal. —(1) Any person aggrieved by any of the following orders may appeal to the Appellate Tribunal against such order—

(a) a decision or order passed by the ² [Commissioner of Customs] as an adjudicating authority;

(b) an order passed by the ³ [Commissioner (Appeals)] under section 128A;

(c) an order passed by the Board or the Appellate ² [Commissioner of Customs] under section 128, as it stood immediately before the appointed day;

(d) an order passed by the Board or the ² [Commissioner of Customs], either before or after the appointed day, under section 130, as it stood immediately before that day:

⁴ [Provided that no appeal shall lie to the Appellate Tribunal and the Appellate Tribunal shall not have jurisdiction to decide any appeal in respect of any order referred to in clause (b) if such order relates to,—

(a) any goods imported or exported as baggage;

(b) any goods loaded in a conveyance for importation into India, but which are not unloaded at their place of destination in India, or so much of the quantity of such goods as has not been unloaded at any such destination if goods unloaded at such destination are short of the quantity required to be unloaded at that destination;

(c) payment of drawback as provided in Chapter X, and the rules made thereunder:

Provided further that] the Appellate Tribunal may, in its discretion, refuse to admit an appeal in respect of an order referred to in clause (b) or clause (c) or clause (d) where—

(i) the value of the goods confiscated without option having been given to the owner of the goods to pay a fine in lieu of confiscation under section 125; or

(ii) in any disputed case, other than a case where the determination of any question having a relation to the rate of duty of customs or to the value of goods for purposes of assessment is in issue or is one of the points in issue, the difference in duty involved or the duty involved; or

(iii) the amount of fine or penalty determined by such order, does not exceed ⁵ [Fifty thousand rupees.]

⁶[(1A) Every appeal against any order of the nature referred to in the first proviso to sub-section (1), which is pending immediately before the commencement of section 40 of the Finance Act, 1984 before the Appellate Tribunal and any matter arising out of or connected with such appeal and which is so pending shall stand transferred on such commencement to the Central Government and the Central Government shall deal with such appeal or matter under section 129DD as if such appeal or matter were an application or a matter arising out of an application made to it under that section.]

⁷ [((1B) (i) The Board may, by notification in the Official Gazette, constitute such Committees as may be necessary for the purposes of this Act.

(ii) Every Committee constituted under clause (i) shall consist of two Chief Commissioners of Customs or two Commissioners of Customs, as the case may be.]

⁸ [(2) 9 [The Committee of Commissioners of Customs may, if it is] of opinion that an order passed by—

(a) the Appellate ⁸ [Commissioner of Customs] under section 128, as it stood immediately before the appointed day, or

(b) the ³[Commissioner (Appeals)] under section 128A, is not legal or proper, direct the proper officer to appeal 10 [on its behalf] to the Appellate Tribunal or, as the case may be, the Customs and Excise Revenues Appellate Tribunal established under section 3 of the Customs and Excise Revenues Appellate Tribunal Act, 1986, against such order.]

(3) Every appeal under this section shall be filed within three months from the date on which the order sought to be appealed against is communicated to the ³ [Commissioner of Customs], or as the case may be, the other party preferring the appeal.

(4) On receipt of notice that an appeal has been preferred under this section, the party against whom the appeal has been preferred may, notwithstanding that he may not have appealed against such order or any part thereof, file, within forty-five days of the receipt of the notice, a memorandum of cross-objections verified in such manner as may be specified by rules made in this behalf against any part of the order appealed against and such memorandum shall be disposed of by the Appellate Tribunal as if it were an appeal presented within the time specified in sub-section (3).

(5) The Appellate Tribunal may admit an appeal or permit the filing of a memorandum of cross-objections after expiry of the relevant period referred to in sub-section (3) or sub-section (4), if it is satisfied that there was sufficient cause for not presenting it within that period.

¹¹[(6) An appeal to the Appellate Tribunal shall be in such form and shall be verified in such manner as may be specified by rules made in this behalf and shall, irrespective of the date of demand of duty and interest or of levy of penalty in relation to which the appeal is made, be accompanied by a fee of,—

(a) where the amount of duty and interest demanded and penalty levied by any officer of customs in the case to which the appeal relates is five lakh rupees or less, one thousand rupees;

(b) where the amount of duty and interest demanded and penalty levied by any officer of customs in the case to which the appeal relates is more than five lakh rupees but not exceeding fifty lakh rupees, five thousand rupees;

(c) where the amount of duty and interest demanded and penalty levied by any officer of customs in the case to which the appeal relates is more than fifty lakh rupees, ten thousand rupees:

Provided that no such fee shall be payable in the case of an appeal referred to in sub-section (2) or a memorandum of cross-objections referred to in sub-section (4).

(7) Every application made before the Appellate Tribunal,—

(a) in an appeal for grant of stay or for rectification of mistake or for any other purpose; or

(b) for restoration of an appeal or an application,

shall be accompanied by a fee of five hundred rupees:

Provided that no such fee shall be payable in the case of an application filed by or on behalf of the Commissioner of Customs under this sub-section.]

———-

1. Chapter XV (containing sections 128, 128A, 129, 129A, 129B, 129C, 129D, 129E, 130, 130A, 130B, 130C, 130D, 130E, 130F, 131, 131A, 131B, 131C) subs. by Act 44 of 1980, sec. 50 and the Fifth Sch. Pt. 1, for Chapter XV (containing sections 128, 129, 130, and 131) (w.e.f. 11-10-1982).

2. Subs. by Act 22 of 1995, sec. 50, for “Collector of Customs” (w.e.f. 26-5-1995).

3. Subs. by Act 22 of 1995, sec. 50, for “Collector (Appeals)” (w.e.f. 26-5-1995).

4. Subs. by Act 21 of 1984, sec. 40, for “Provided that” (w.e.f. 11-5-1984).

5 Subs. by Act 38 of 1993, sec. 43, for “ten thousand rupees” (w.e.f. 13-5-1993).

6 1. Ins. by Act 21 of 1984, sec. 40 (w.e.f. 11-5-1984).

7. Ins. by Act 18 of 2005, sec. 70 (w.e.f. 13-5-2005).

8. Subs. by Act 62 of 1986, sec. 34, for sub-section (2).

9. Subs. by Act 18 of 2005, sec. 70, for “The Commissioner may, if he is” (w.e.f. 13-5-2005).

10. Subs. by Act 18 of 2005, sec. 70, for “on his behalf” (w.e.f. 13-5-2005).

11. Subs. by Act 23 of 2004, sec. 69, for sub-section (6) (w.e.f. 1-11-2004). Sub-section (6), before substitution, stood as under:

“(6) An appeal to the Appellate Tribunal shall be in such form and shall be verified in such manner as may be specified by rules made in this behalf and shall, in the case of an appeal made on or after the 1st day of June, 1993, irrespective of the date of demand of duty and interest or of levy of penalty in relation to which the appeal is made, be accompanied by a fee of,—

(a) where the amount of duty and interest demanded and penalty levied by any officer of customs in the case to which the appeal relates is one lakh rupees or less, two hundred rupees;

(b) where the amount of duty and interest demanded and penalty levied by any officer of customs in the case to which the appeal relates is more than one lakh rupees, one thousand rupees:

Provided that no such fee shall be payable in the case of an appeal referred to in sub-section (2) or a memorandum of cross objections referred to in sub-section (4).”.

Section 129B. Orders of appellate tribunal.

¹[129B. Orders of Appellate Tribunal. —(1) The Appellate Tribunal may, after giving the parties to the appeal, an opportunity of being heard, pass such orders thereon as it thinks fit, confirm­ing, modifying or annulling the decision or order appealed against or may refer the case back to the authority which passed such decision or order with such directions as the Appellate Tribunal may think fit, for a fresh adjudication or decision, as the case may be, after taking additional evidence, if necessary.

² [(1A) The Appellate Tribunal may, if sufficient cause is shown, at any stage of hearing of an appeal, grant time to the parties or any of them and adjourn the hearing of the appeal for reasons to be recorded in writing:

Provided that no such adjournment shall be granted more than three times to a party during hearing of the appeal.]

(2) The Appellate Tribunal may, at any time within ³ [six months] from the date of the order, with a view to rectifying any mistake apparent from the record, amend any order passed by it under sub-section (1) and shall make such amendments if the mistake is brought to its notice by the ⁴[Commissioner of Customs] or the other party to appeal:

Provided that an amendment which has the effect of enhancing the assessment or reducing a refund or otherwise increasing the liability of the other party shall not be made under this sub-section, unless the Appellate Tribunal has given notice to him of its intention to do so and has allowed him a reasonable opportunity of being heard.

⁵[(2A) The Appellate Tribunal shall, where it is possible to do so, hear and decide every appeal within a period of three years from the date on which such appeal is filed:

Provided that where an order of stay is made in any proceedings relating to an appeal filed under sub-section (1) of section 129A, the Appellate Tribunal shall dispose of the appeal within a period of one hundred and eighty days from the date of such order:

Provided further that if such appeal is not disposed of within the period specified in the first proviso, the stay order shall, on the expiry of that period, stand vacated.]

(3) The Appellate Tribunal shall send a copy of every order passed under this section to the 4 [Commissioner of Customs] and the other party to the appeal.

(4) Save as otherwise provided in section 130 or section 130E, orders passed by the Appellate Tribunal on appeal shall be final.]

———-

1. Chapter XV (containing sections 128, 128A, 129, 129A, 129B, 129C, 129D, 129E, 130, 130A, 130B, 130C, 130D, 130E, 130F, 131, 131A, 131B, 131C) subs. by Act 44 of 1980, sec. 50 and the Fifth Sch. Pt. 1, for Chapter XV (containing sections 128, 129, 130, and 131) (w.e.f. 11-10-1982).

2. Ins. by Act 23 of 2004, sec. 70 (w.e.f. 10-9-2004).

3.Subs. by Act 20 of 2002, sec. 127, for “four years” (w.e.f. 11-5-2002).

4. Subs. by Act 22 of 1995, sec. 50, for “Collector of Customs” (w.e.f. 26-5-1995).

5.Ins. by Act 20 of 2002, sec. 127 (w.e.f. 11-5-2002).

Section 129C. Procedure of appellate tribunal.

¹PROCEDURE OF APPELLATE TRIBUNAL. (1) The powers and functions of the Appellate Tribunal may be exercised and discharged by Benches constituted by the President from amongst the members thereof.

(2) Subject to the provisions contained in ²sub-section (4), a Bench shall consist of one judicial member and one technical member.

³[***]

(4) The President or any other member of the Appellate Tribunal authorised in this behalf by the President may, sitting singly, dispose of any case which has been allotted to the Bench of which he is a member where -

(a) the value of the goods confiscated without option having been given to the owner of the goods to pay a fine in lieu of confiscation under section 125; or

(b) in any disputed case, other than a case where the determination of any question having a relation to the rate of duty of customs or to the value of goods for purposes of assessment is in issue or is one of the points in issue, the difference in duty involved or the duty involved; or

(c) the amount of fine or penalty involved, does not exceed ⁴ten lakhs rupees.

⁵(5) If the members of a Bench differ in opinion on any point, the point shall be decided according to the opinion of the majority, if there is a majority; but if the members are equally divided, they shall state the point or points on which they differ and make a reference to the President who shall either hear the point or points himself or refer the case for hearing on such point or points by one or more of the other members of the Appellate Tribunal and such point or points shall be decided according to the opinion of the majority of these members of the Appellate Tribunal who have heard the case, including those who first heard it.

(6) Subject to the provisions of this Act, the Appellate Tribunal shall have power to regulate its own procedure and the procedure of the Benches thereof in all matters arising out of the exercise of its powers or of the discharge of its functions, including the places at which the Benches shall hold their sittings.

(7) The Appellate Tribunal shall, for the purposes of discharging its functions, have the same powers as are vested in a court under the Code of Civil Procedure, 1908 (5 of 1908), when trying a suit in respect of the following matters, namely :-

(a) discovery and inspection;

(b) enforcing the attendance of any person and examining him on oath;

(c) compelling the production of books of account and other documents; and

(d) issuing commissions.

(8) Any proceeding before the Appellate Tribunal shall be deemed to be a judicial proceeding within the meaning of sections 193 and 228 and for the purpose of section 196 of the Indian Penal Code (45 of 1860), and the Appellate Tribunal shall be deemed to be a Civil Court for all the purposes of section 195 and Chapter XXVI of the Code of Criminal Procedure, 1973 (2 of 1974).

———-

1.Chapter XV (containing sections 128, 128A, 129, 129A, 129B, 129C, 129D, 129E, 130, 130A, 130B, 130C, 130D, 130E, 130F, 131, 131A, 131B, 131C) subs. by Act 44 of 1980, sec. 50 and the Fifth Sch. Pt. 1, for Chapter XV (containing sections 128, 129, 130, and 131) (w.e.f. 11-10-1982).

2. Subs. by Act 22 of 1995, sec. 65, for “sub-sections (3) and (4)” (w.e.f. 26-5-1995).

3. Sub-section (3) omitted by Act 22 of 1995, sec. 65 (w.e.f. 26-5-1995).

4. Subs. by Act 33 of 1996, sec. 66, for “one lakh rupees” (w.e.f. 28-9-1996).

5. Subs. by Act 12 of 1990, sec. 62, for sub-section (5) (w.e.f. 31-5-1990).

Section 129D. Power of committee of chief commissioners of customs or commissioner of customs to pass certain orders.

129D. Power of ¹[Committee of Chief Commissioners of Customs] or ²[Commissioner of Customs] to pass certain orders.—(1) The ¹[Committee of Chief Commissioners of Customs] may, of its own motion, call for and examine the record of any proceeding in which a ²[Commissioner of Customs] as an adjudicating authority has passed any decision or order under this Act for the purpose of satisfying itself as to the legality or propriety of any such decision or order and may, by order, direct such ³[Commissioner] ⁴[or any other Commissioner] to apply to the Appellate Tribunal ⁵[ or, as the case may be, the Customs and Excise Revenues Appellate Tribunal established under section 3 of the Customs and Excise Revenues Appellate Tribunal Act, 1986] for the determination of such points arising out of the decision or order as may be specified by the ¹[Committee of Chief Commissioners of Customs] in its order.

(2) The ²[Commissioner of Customs] may of his own motion, call for and examine the record of any proceeding in which an adjudicating authority subordinate to him has passed any decision or order under this Act for the purpose of satisfying himself as to the legality or propriety of any such decision or order and may, by order, direct ⁶[such authority or any officer of customs subordinate to him] to apply to the ⁷[Commissioner (Appeals)] for the determination of such points arising out of the decision or order as may be specified by the ²[Commissioner of Customs] in his order.

⁸[(3) The Committee of Chief Commissioners of Customs or the Commissioner of Customs, as the case may be, shall make order under sub-section (1) or sub-section (2) within a period of three months from the date of communication of the decision or order of the adjudicating authority.]

(4) Where in pursuance of an order under sub-section (1) or sub-section (2), the adjudicating or any officer of customs authorised in this behalf by the ³[Commissioner of Customs] makes an application to the Appellate Tribunal ⁵[or, as the case may be, the Customs and Excise Revenues Appellate Tribunal established under section 3 of the Customs and Excise Revenues Appellate Tribunal Act, 1986] or the ⁷[Commissioner (Appeals)] within a period of ⁹[one month] from the date of communication of the order under sub-section (1) or sub-section (2) to the adjudicating authority, such application shall be heard by the Appellate Tribunal 5[or, as the case may be, the Customs and Excise Revenues Appellate Tribunal established under section 3 of the Customs and Excise Revenues Appellate Tribunal Act, 1986] or the ⁷[Commissioner (Appeals)] as the case may be, as if such applications were an appeal made against the decision or order of the adjudicating authority and the provisions of this Act regarding appeals, including the provisions of sub-section (4) of section 129A ⁵[or, as the case may be, the provisions of the Customs and Excise Revenues Appellate Act, 1986] shall, so far as may be, apply to such application.

¹⁰[(5) The provisions of this section shall not apply to any decision or order in which the determination of any question having a relation to the rate of the duty or to the value of goods for the purposes of assessment of any duty is in issue or is one of the points in issue.

1. —For the purposes of this sub-section, the determination of a rate of duty in relation to any goods or valuation of any goods for the purposes of assessment of duty includes the determination of a question—

(a) relating to the rate of duty for the time being in force, whether under the Customs Tariff Act, 1975 (51 of 1975) or under any other Central Act providing for the levy and collection of any duty of customs, in relation to any goods on or after the 28th day of February, 1986; or

(b) relating to the value of goods for the purposes of assessment of any(b) relating to the value of goods for the purposes of assessment of any duty in cases where the assessment is made on or after the 28th day of February, 1986; or

(c) whether any goods fall under particular heading or sub-heading of the First Schedule or the Second Schedule to the Customs Tariff Act, 1975 (51 of 1975) or that any goods are or not covered by a particular notification or order issued by the Central Government granting total or partial exemption from duty; or

(d) whether the values of any goods for the purposes of assessment of duty shall be enhanced or reduced by the addition or reduction of the amounts in respect of such matters as are specifically provided in this Act.]

———-

1. Subs. by Act 18 of 2005, sec. 71, for “Board” (w.e.f. 13-5-2005).

2. Subs. by Act 22 of 1995, sec. 50, for “Collector of Customs” (w.e.f. 26-5-1995).

3. Subs. by Act 22 of 1995, sec. 50, for “Collector” (w.e.f. 26-5-1995).

4. Ins. by Act 14 of 2001, sec. 111 (w.e.f. 11-5-2001).

5. Ins. by Act 62 of 1986, sec. 34.

6. Subs. by Act 29 of 2006, sec. 29, for “such authority” (w.e.f. 13-7-2006)

7. Subs. by Act 22 of 1995, sec. 50, for “Collector (Appeals)” (w.e.f. 26-5-1995).

8. Subs. by Act 22 of 2007, sec. 111(i), for sub-section (3) (w.e.f. 11-5-2007). Earlier sub-section (3) was substituted by Act 20 of 2002, sec. 128 (w.e.f. 11-5-2002) and was amended by Act 18 of 2005, sec. 71 (w.e.f. 13-5-2005). Sub-section (3), before substitution by Act 22 of 2007, stood as under: “(3) The Committee of Chief Commissioners of Customs or the Commissioner of Customs, as the case may be, shall, where it is possible to do so, make order under sub-section (1) or sub-section (2), within a period of six months, but not beyond a period of one year, from the date of the decision or order of the adjudicating authority.”.

9. Subs. by Act 22 of 2007, sec. 111(ii), for “three months” (w.e.f. 11-5-2007).

10. Ins. by Act 29 of 1988, sec. 4 (w.e.f. 1-7-1988).

Section 129DA. Powers of revision of board or commissioner of customs in certain cases.

¹ POWERS OF REVISION OF BOARD OR COMMISSIONER OF CUSTOMS IN CERTAIN CASES. -(1) The Board may, of its own motion or on the application of any aggrieved person or otherwise, call for and examine the record of any proceedin

g in which a ²Commissioner of Customs has passed any decision or order [not being a decision or order passed under sub-section

(2) of this section] of the nature referred to in sub-section (5) of section 129D for the purpose of satisfying itself as to the correctness, legality or propriety of such decision or order and may pass such order thereon as it thinks fit.

(2) The ²Commissioner of Customs may, of his own motion or on the application of any aggrieved person or otherwise, call for and examine the record of any proceeding in which an adjudicating authority subordinate to him has passed any decision or order of the nature referred to in sub-section (5) of section 129D for the purpose of satisfying himself as to the correctness, legality or propriety of such decision or order and may pass such order thereon as he thinks fit.

(3) (a) No decision or order under this section shall be made so as to prejudicially affect any person unless such person is given a reasonable opportunity of making representation and if, he so desires, of being heard in his defence.

(b) Where the Board or, as the case may be, the ²Commissioner of Customs is of the opinion that any duty has not been levied or has been short-levied or short-paid or erroneously refunded, no order requiring the affected person to pay any duty not levied or paid, short-levied or short-paid or erroneously refunded shall be passed under this section unless such person is given notice within the time limit specified in section 28 to show cause against the proposed order.

(4) No proceedings shall be initiated under sub-section (1) or sub-section (2) in respect of any decision or order after the expiry of a period of six months from the date of communication of such decision or order :

Provided that in respect of any decision or order passed before the commencement of the Customs and Central Excises Laws (Amendment) Act, 1988, the provisions of this sub-section shall have effect as if for the words “six months”, the words “one year” were substituted.

(5) Any person aggrieved by any decision or order passed under sub-section (1) or sub-section (2) may appeal to the Customs and Excise Revenues Appellate Tribunal established under section 3 of the Customs and Excise Revenues Appellate Tribunal Act, 1986 (62 of 1986), against such decision or order

—————

1. Ins. by Act 29 of 1988, sec. 5 (w.e.f. 1-7-1988).

2. Subs. by Act 22 of 1995, sec. 50, for “Collector of Customs” (w.e.f. 26-5-1995).

*. Ed. Date of commencement of the Customs and Central Excise Laws (Amendment) Act, 1988 is 1st July, 1988.

Section 129DD. Revision by central government.

¹(1) The Central Government may, on the application of any person aggrieved by any order passed under section 128A, where the order is of the nature referred to in the first proviso to sub-section (1) of section 129A, annul or modify such order.

Provided that the Central Government may in its discretion, refuse to admit an application in respect of an order where the amount of duty or fine or penalty, determined by such order does not exceed five thousand rupees.

Explanation : For the purposes of this sub-section, “order passed under section 128A” includes an order passed under that section before the commencement of section 40 of the Finance Act, 1984, against which an appeal has not been preferred before such commencement and could have been, if the said section had not come into force, preferred after such commencement, to the Appellate Tribunal.

²(1A) The Commissioner of Customs may, if he is of the opinion that an order passed by the Commissioner (Appeals) under section 128A is not legal or proper, direct the proper officer to make an application on his behalf to the Central Government for revision of such order.

(2) An application under sub-section (1) shall be made within three months from the date of the communication to the applicant of the order against which the application is being made :

Provided that the Central Government may, if it is satisfied that the applicant was prevented by sufficient cause from presenting the application within the aforesaid period of three months, allow it to be presented within a further period of three months.

³(3) An application under sub-section (1) shall be in such form and shall be verified in such manner as may be specified by rules made in this behalf and shall be accompanied by a fee of,- (a) two hundred rupees, where the amount of duty and interest demanded, fine or penalty levied by an officer of customs in the case to which the application relates is one lakh rupees or less;

(b) one thousand rupees, where the amount of duty and interest demanded, fine or penalty levied by an officer of customs in the case to which the application relates is more than one lakh rupees:

Provided that no such fee shall be payable in the case of an application referred to in sub-section(1A).

(4) The Central Government may, of its own motion, annul or modify any order referred to in sub-section (1).

(5) No order enhancing any penalty or fine in lieu of confiscation or confiscating goods of greater value shall be passed under this section, -

(a) in any case in which an order passed under section 128A has enhanced any penalty or fine in lieu of confiscation or has confiscated goods of greater value, and

(b) in any other case, unless the person affected by the proposed, order has been given notice to show cause against it within one year from the date of the order sought to be annulled or modified.

(6) Where the Central Government is of opinion that any duty of customs has not been levied or has been short-levied, no order levying or enhancing the duty shall be made under this section unless the person affected by the proposed order is given notice to show cause against it within the time limit specified in section 28.

—————

1. Ins. by Act 21 of 1984, sec. 43 (w.e.f. 11-5-1984).

2. Ins. by Act 27 of 1999, sec. 110 (w.e.f. 11-5-1999).

*. Ed. Date of commencement of section 40 of the Finance Act, 1984 is 11th May, 1984

3. Subs. by Act 27 of 1999, sec. 110, for sub-section (3) (w.e.f. 11-5-1999).

Section 129E. Deposit, pending appeal, of duty and interest demanded or penalty levied.

¹[129E. Deposit, pending appeal, of ²[duty and interest], demanded or penalty levied. —Where in any appeal under this Chapter, the decision or order appealed against relates to any 2 [duty and interest] demanded in respect of goods which are not under the control of the customs authorities or any penalty levied under this Act, the person desirous of appealing against such decision or order shall, pending the appeal deposit with the proper officer ²[duty and interest] demanded or penalty levied:

Provided that where in any particular case, the ³[Commissioner (Appeals)] or the Appellate Tribunal is of the opinion that the deposit of ² [duty and interest] demanded or penalty levied would cause undue hardship to such person, the ³ [Commissioner (Appeals)] or, as the case may be, the Appellate Tribunal may dispense with such deposit subject to such conditions as he or it may deem fit to impose so as to safeguard the interests of revenue:

⁴[Provided further that where an application is filed before the Commissioner (Appeals) for dispensing with the deposit of duty and interest demanded or penalty levied under the first proviso, the Commissioner (Appeals) shall, where it is possible to do so, decide such application within thirty days from the date of its filing.] ]

———-

1.Chapter XV (containing sections 128, 128A, 129, 129A, 129B, 129C, 129D, 129E, 130, 130A, 130B, 130C, 130D, 130E, 130F, 131, 131A, 131B, 131C) subs. by Act 44 of 1980, sec. 50 and the Fifth Sch. Pt. 1, for Chapter XV (containing sections 128, 129, 130, and 131) (w.e.f. 11-10-1982) .

2.Subs by Act 55 of 1991, sec 10 , for “duty” (w. e. f 23.12. 1991 ).

3. Subs. by Act 22 of 1995, sec. 50, for “Collector of Customs” (w.e.f. 26-5-1995).

4. Ins by Act 14 of 2001, sec. 112 ( w. e. f. 11. 5. 2001).

130. Appeal to High Court.

¹[ ² [130. Appeal to High Court. —[ Rep. by the National Tax Tribunal Act, 2005 (49 of 2005), sec. 30 and Sch., Pt. VI-7 (w.e.f. 28-12-2005). ]] ]

———-

1.Chapter XV (containing sections 128, 128A, 129, 129A, 129B, 129C, 129D, 129E, 130, 130A, 130B, 130C, 130D, 130E, 130F, 131, 131A, 131B, 131C) subs. by Act 44 of 1980, sec. 50 and the Fifth Sch. Pt. 1, for Chapter XV (containing sections 128, 129, 130, and 131) (w.e.f. 11-10-1982) .

2. Section 130, before repeal, stood as under:

“ 130. Appeal to High Court .—(1) An appeal shall lie to the High Court from every order passed in appeal by the Appellate Tribunal on or after the 1st day of July, 2003 (not being an order relating, among other things, to the determination of any question having a relation to the rate of duty of customs or to the value of goods for purposes of assessment), if the High Court is satisfied that the case involves a substantial question of law.

(2) Commissioner of Customs or the other party aggrieved by any order passed by the Appellate Tribunal may file an appeal to the High Court and such appeal under this sub-section shall be—

(a) filed within one hundred and eighty days from the date on which the order appealed against is received by the commissioner of Customs or the other party;

(b) accompanied by a fee of two hundred rupees where such appeal is filed by the other party;

(c) in the form of a memorandum of appeal precisely stating therein the substantial question of law involved.

(3) Where the High Court is satisfied that a substantial question of law is involved in any case, it shall formulate that question.

(4) The appeal shall be heard only on the question so formulated, and the respondents shall, at the hearing of the appeal, be allowed to argue that the case does not involve such question:

Provided that nothing in this sub-section shall be deemed to take away or abridge the power of the Court to hear, for reasons to be recorded, the appeal on any other substantial question of law not formulated by it, if it is satisfied that the case involves such question.

(5) The High Court shall decide the question of law so formulated and deliver such judgment thereon containing the grounds on which such decision is founded and may award such cost as it deems fit.

(6) The High Court may determine any issue which—

(a) has not been determined by the Appellate Tribunal; or

(b) has been wrongly determined by the Appellate Tribunal, by reason of a decision on such question of law as is referred to in sub-section (1).

(7) When an appeal has been filed before the High Court, it shall be heard by a bench of not less than two Judges of the High Court, and shall be decided in accordance with the opinion of such Judges or of the majority, if any, of such Judges.

(8) Where there is no such majority, the Judges shall state the point of law upon which they differ and the case shall, then, be heard upon that point only by one or more of the other Judges of the High Court and such point shall be decided according to the opinion of the majority of the Judges who have heard the case including those who first heard it.

(9) Save as otherwise provided in this Act, the provisions of the Code of Civil Procedure, 1908 (5 of 1908), relating to appeals to the High Court shall, as far as may be, apply in the case of appeals under this section.”.

Section 130A. Application to high court.

¹[² [130A. Application to High Court. —[ Rep. by the National Tax Tribunal Act, 2005 (49 of 2005), sec. 30 and Sch., Pt. VI-7 (w.e.f. 28-12-2005) .]]]

———-

1.Chapter XV (containing sections 128, 128A, 129, 129A, 129B, 129C, 129D, 129E, 130, 130A, 130B, 130C, 130D, 130E, 130F, 131, 131A, 131B, 131C) subs. by Act 44 of 1980, sec. 50 and the Fifth Sch. Pt. 1, for Chapter XV (containing sections 128, 129, 130, and 131) (w.e.f. 11-10-1982) .

2. Section 130A, before repeal, stood as under:

“ 130A. Application to High Court. —(1) The Commissioner of Customs or the other party may, within one hundred and eighty days of the date upon which he is served with notice of an order under section 129B passed before the 1st day of July, 2003 (not being an order relating, among other things, to the determination of any question having a relation to the rate of duty of customs or to the value of goods for purposes of assessment), by application in the prescribed form, accompanied, where the application is made by the other party, by a fee of two hundred rupees, apply to the High Court to direct the Appellate Tribunal to refer to the High Court any question of law arising from such order of the Tribunal.

(2) The Commissioner of Customs or the other party applying to the High Court under sub-section (1) shall clearly state the question of law which he seeks to be referred to the High Court and shall also specify the paragraph in the order of the Appellate Tribunal relevant to the question sought to be referred.

(3) On receipt of notice that an application has been made under sub-section (1), the person against whom such application has been made, may, notwithstanding that he may not have filed such application, file, within forty-five days of the receipt of the notice, a memorandum of cross objections verified in the prescribed manner against any part of the order in relation to which an application for reference has been made and such memorandum shall be disposed of by the High Court as if it were an application presented within the time specified in sub-section (1).

(4) If, on an application made under sub-section (1), the High Court directs the Appellate Tribunal to refer the question of law raised in the application, the Appellate Tribunal shall, within one hundred and twenty days of the receipt of such direction, draw up a statement of the case and refer it to the High Court.”.

Section 130B. Power of high court or supreme court to require statement to be amended.

¹[²[130B. Power of High Court or Supreme Court to require statement to be amended. —[ Rep. by the National Tax Tribunal Act, 2005 (49 of 2005), sec. 30 and Sch., Pt. VI-7 (w.e.f. 28-12-2005) .]]]

———-

1.Chapter XV (containing sections 128, 128A, 129, 129A, 129B, 129C, 129D, 129E, 130, 130A, 130B, 130C, 130D, 130E, 130F, 131, 131A, 131B, 131C) subs. by Act 44 of 1980, sec. 50 and the Fifth Sch. Pt. 1, for Chapter XV (containing sections 128, 129, 130, and 131) (w.e.f. 11-10-1982)

2. Section 130B, before repeal, stood as stood:

“ 130B. Power of High Court or Supreme Court to require statement to be amended. —If the High Court or the Supreme Court is not satisfied that the statements in a case referred to it are sufficient to enable it to determine the questions raised thereby, the Court may refer the case to the Appellate Tribunal for the purpose of making such additions thereto or alterations therein as it may direct in that behalf.”.

Section 130C. Case before high court to be heard by not less than two judges.

¹[² [130C. Case before High Court to be heard by not less than two judges. —[ Rep. by the National Tax Tribunal Act, 2005 (49 of 2005), sec. 30 and Sch., Pt. VI-7 (w.e.f. 28-12-2005) .]]]

———-

1.Chapter XV (containing sections 128, 128A, 129, 129A, 129B, 129C, 129D, 129E, 130, 130A, 130B, 130C, 130D, 130E, 130F, 131, 131A, 131B, 131C) subs. by Act 44 of 1980, sec. 50 and the Fifth Sch. Pt. 1, for Chapter XV (containing sections 128, 129, 130, and 131) (w.e.f. 11-10-1982) .

2. Section 130C, before repeal, stood as stood:

“ 130C. Case before High Court to be heard by not less than two judges. —(1) When any case has been referred to the High Court under section 130, or section 130A it shall be heard by a bench of not less than two judges of the High Court and shall be decided in accordance with the opinion of such judges or of the majority, if any of such judges.

(2) Where there is no such majority, the judges shall state the point of law upon which they differ and the case shall then be heard upon that point only one or more of the other judges of the High Court, and such point shall be decided according to the opinion of the majority of the judges who have heard the case including those who first heard it.”.

Section 130D. Decision Of High Court Or Supreme Court On The Case Stated.

¹[²[130D. Decision of High Court or Supreme Court on the case stated. —[ Rep. by the National Tax Tribunal Act, 2005 (49 of 2005), sec. 30 and Sch., Pt. VI-7 (w.e.f. 28-12-2005) .]]]

———-

1.Chapter XV (containing sections 128, 128A, 129, 129A, 129B, 129C, 129D, 129E, 130, 130A, 130B, 130C, 130D, 130E, 130F, 131, 131A, 131B, 131C) subs. by Act 44 of 1980, sec. 50 and the Fifth Sch. Pt. 1, for Chapter XV (containing sections 128, 129, 130, and 131) (w.e.f. 11-10-1982) .

2. Section 130D, before repeal, stood as stood:

“ 130D. Decision of High Court or Supreme Court on the case stated. —(1) The High Court or the Supreme Court hearing any such case shall decide the questions of the law raised therein, and shall deliver its judgment thereon containing the grounds on which such decision is founded and a copy of the judgment shall be sent under the seal of the Court and the signature of the registrar to the Appellate Tribunal which shall pass such orders as are necessary to dispose of the case in conformity with such judgment.

(1A) Where the High Court delivers a judgment in an appeal filed before it under section 130, effect shall be given to the order passed on the appeal by the proper officer on the basis of a certified copy of the judgment.

(2) The costs of any reference to the High Court or an appeal to the High Court or the Supreme Court, as the case may be, which shall not include the fee for making the reference shall be in the discretion of the Court.”.

Section 130E. Appeal to supreme court.

An appeal shall lie to the Supreme Court from -

² [(a) any judgment of the High Court delivered—

(i) in an appeal made under section 130; or

(ii) on a reference made under section 130 by the Appellate Tribunal before the 1st day of July, 2003;

(iii) on a reference made under section 130A,

in any case which, on its own motion or on an oral application made by or on behalf of the party aggrieved, immediately after the passing of the judgment, the High Court certifies to be a fit one for appeal to the Supreme Court; or]

(b) any order passed ³[before the establishment of the National Tax Tribunal] by the Appellate Tribunal relating, among other things, to the determination of any question having a relation to the rate of duty of customs or to the value of goods for purposes of assessment.]

———-

1.Chapter XV (containing sections 128, 128A, 129, 129A, 129B, 129C, 129D, 129E, 130, 130A, 130B, 130C, 130D, 130E, 130F, 131, 131A, 131B, 131C) subs. by Act 44 of 1980, sec. 50 and the Fifth Sch. Pt. 1, for Chapter XV (containing sections 128, 129, 130, and 131) (w.e.f. 11-10-1982) .

2. Subs. by Act 32 of 2003, sec. 123, for clause (a) (w.e.f. 14-5-2003).

3.Ins. by Act 49 of 2005, sec. 30 and Sch., Pt. VI-8.

Section 130F. Hearing before supreme court.

¹ 130F. HEARING BEFORE SUPREME COURT.(1) The provisions of the Code of Civil Procedure, 1908 (5 of 1908), relating to appeals to the Supreme Court shall, so far as may be, apply in the case of appeals under section 130E as they apply in the case of appeals from decrees of a High Court :

Provided that nothing in this sub-section shall be deemed to affect the provisions of sub-section (1) of section 130D or section 131.

(2) The costs of the appeal shall be in the discretion of the Supreme Court.

(3) Where the judgment of the High Court is varied or reversed in the appeal, effect shall be given to the order of the Supreme Court in the manner provided in section 130D in the case of a judgment of the High Court.

———-

1.Chapter XV (containing sections 128, 128A, 129, 129A, 129B, 129C, 129D, 129E, 130, 130A, 130B, 130C, 130D, 130E, 130F, 131, 131A, 131B, 131C) subs. by Act 44 of 1980, sec. 50 and the Fifth Sch. Pt. 1, for Chapter XV (containing sections 128, 129, 130, and 131) (w.e.f. 11-10-1982) .

Section 131. Sums due to be paid notwithstanding reference, etc.

¹[131. Sums due to be paid notwithstanding reference, etc . —Notwithstanding that a reference has been made to the High Court or the Supreme Court or an appeal has been preferred to the Supreme Court ² [under this Act before the commencement of the National Tax Tribunal Act, 2005], sums due to the Government as a result of an order passed under sub-section (1) of section 129B shall be payable in accordance with the order so passed.]

———-

1.Chapter XV (containing sections 128, 128A, 129, 129A, 129B, 129C, 129D, 129E, 130, 130A, 130B, 130C, 130D, 130E, 130F, 131, 131A, 131B, 131C) subs. by Act 44 of 1980, sec. 50 and the Fifth Sch. Pt. 1, for Chapter XV (containing sections 128, 129, 130, and 131) (w.e.f. 11-10-1982) .

2. Ins. by Act 49 of 2005, sec. 30 and Sch., Pt. VI-9.

Section 131A. Exclusion of time taken for copy.

In computing the period of limitation specified for an appeal or application under this Chapter, the day on which the order complained of was served, and if the party preferring the appeal or making the application was not furnished with a copy of the order when the notice of the order was served upon him, the time requisite for obtaining a copy of such order shall be excluded.

———-

1.Chapter XV (containing sections 128, 128A, 129, 129A, 129B, 129C, 129D, 129E, 130, 130A, 130B, 130C, 130D, 130E, 130F, 131, 131A, 131B, 131C) subs. by Act 44 of 1980, sec. 50 and the Fifth Sch. Pt. 1, for Chapter XV (containing sections 128, 129, 130, and 131) (w.e.f. 11-10-1982) .

Section 131B. Transfer of certain pending proceedings and transitional provisions.

¹(1) Every appeal which is pending immediately before the appointed day before the Board under section 128, as it stood immediately before that day, and any matter arising out of or connected with such appeal and which is so pending shall stand transferred on that day to the Appellate Tribunal and the Appellate Tribunal may proceed with such appeal or matter from the stage at which it was on that day :

Provided that the appellant may demand that before proceeding further with that appeal or matter, he may be re-heard.

(2) Every proceeding which is pending immediately before the appointed day before the Central Government under section 131, as it stood immediately before that day, and any matter arising out of or connected with such proceeding and which is so pending shall stand transferred on that day to the Appellate Tribunal and the Appellate Tribunal may proceed with such proceeding or matter from the stage at which it was on that day as if such proceeding or matter were an appeal filed before it :

Provided that if any such proceeding or matter relates to an order where -

(a) the value of the goods confiscated without option having been given to the owner of the goods to pay a fine in lieu of confiscation under section 125; or

(b) in any disputed case, other than a case where the determination of any question having a relation to the rate of duty of customs or to the value of goods for purposes of assessment is in issue or is one of the points in issue, the difference in duty involved or the duty involved; or

(c) the amount of fine or penalty determined by such order, does not exceed ten thousand rupees, such proceeding or matter shall continue to be dealt with by the Central Government as if the said section 131 had not been substituted :

Provided further that the applicant or the other party may make a demand to the Appellate Tribunal that before proceeding further with that proceeding or matter, he may be re-heard.

(3) Every proceeding which is pending immediately before the appointed day before the Board or the ²Commissioner of Customs under section 130, as it stood immediately before that day, and any matter arising out of or connected with such proceeding and which is so pending shall continue to be dealt with by the Board or the Commissioner of Customs, as the case may be, as if the said section had not been substituted.

(4) Any person who immediately before the appointed day was authorised to appear in any appeal or proceeding transferred under sub-section (1) or sub-section (2) shall, notwithstanding anything contained in section 146A, have the right to appear before the Appellate Tribunal in relation to such appeal or proceeding.

———-

1.Chapter XV (containing sections 128, 128A, 129, 129A, 129B, 129C, 129D, 129E, 130, 130A, 130B, 130C, 130D, 130E, 130F, 131, 131A, 131B, 131C) subs. by Act 44 of 1980, sec. 50 and the Fifth Sch. Pt. 1, for Chapter XV (containing sections 128, 129, 130, and 131) (w.e.f. 11-10-1982) .

2. Subs. by Act 22 of 1995, sec. 50, for “Collector of Customs” (w.e.f. 26-5-1995).

Section 131C. Definitions.

¹[131C. Definitions. —In this Chapter—

(a) “appointed day” means the date of coming into force of the amendments to this Act specified in part 1 of the Fifth Schedule to the Finance (No. 2) Act, 1980 (44 of 1980);

²[***]

(c) “President” means the President of the Appellate Tribunal.]

———-

1.Chapter XV (containing sections 128, 128A, 129, 129A, 129B, 129C, 129D, 129E, 130, 130A, 130B, 130C, 130D, 130E, 130F, 131, 131A, 131B, 131C) subs. by Act 44 of 1980, sec. 50 and the Fifth Sch. Pt. 1, for Chapter XV (containing sections 128, 129, 130, and 131) (w.e.f. 11-10-1982).

2. Clause (b) omitted by Act 49 of 2005, sec. 30 and Sch., Pt. VI-10 (w.e.f. 28-12-2005). Clause (b), before omission, stood as under:

‘(b) “High Court” means—

(i) in relation to any State, the High Court for that State;

(ii) in relation to the Union territories to which jurisdiction of the High Court of a State has been extended by law, that High Court;

(iii) in relation to the Union territory of Dadra and Nagar Haveli and Goa, Daman and Diu, the High Court at Bombay;

(iv) in relation to any other Union territories, the highest court of civil appeal for that territory other than the Supreme Court of India;’.

Section 132. False declaration, false documents, etc.

Whoever makes, signs or uses, or causes to be made, signed or used, any declaration, statement or document in the transaction of any business relating to the customs knowing or having reason to believe that such declaration, statement or document is false in any material particular, shall be punishable with imprisonment for a term which may extend to ¹[two years], or with fine, or with both.

—————

1.  Subs. by Act 29 of 2006, sec. 30, for “six months” (w.e.f. 13-7-2006).

Section 133. Obstruction of officer of customs.

If any person intentionally obstructs any officer of customs in the exercise of any powers conferred under this Act, such person shall be punishable with imprisonment for a term which may extend to six months, or with fine, or with both.

—————

1.  Subs. by Act 29 of 2006, sec. 31, for “six months” (w.e.f. 13-7-2006).

Section 134. Refusal to be x-rayed.

If any person -

(a) resists or refuses to allow a radiologist to screen or to take X-ray picture of his body in accordance with an order made by a Magistrate under section 103, or

(b) resists or refuses to allow suitable action being taken on the advice and under the supervision of a registered medical practitioner for bringing out goods liable to confiscation secreted inside his body, as provided in section 103,

he shall be punishable with imprisonment for a term which may extend to six months, or with fine, or with both.

Section 135. Evasion of duty or prohibitions.

¹(1) Without prejudice to any action that may be taken under this Act, if any person -

(a) is in relation to any goods in any way knowingly concerned in any fraudulent evasion or attempt at evasion of any duty chargeable thereon or of any prohibition for the time being imposed under this Act or any other law for the time being in force with respect to such goods, or

(b) acquires possession of or is in any way concerned in carrying, removing, depositing, harboring, keeping, concealing, selling or purchasing or in any other manner dealing with any goods which he knows or has reason to believe are liable to confiscation under section 111, he shall be punishable, – (i) in the case of an offence relating to any of the goods to which section 123 applies and the market price whereof exceeds one lakh of rupees, with imprisonment for a term which may extend to seven years and with fine :

Provided that in the absence of special and adequate reasons to the contrary to be recorded in the judgment of the court, such imprisonment shall not be for less than three years;

(ii) in any other case, with imprisonment for a term which may extend to three years, or with fine, or with both.

²(2) If any person convicted of an offence under this section or under sub-section (1) of section 136 is again convicted of an offence under this section, then, he shall be punishable for the second and for every subsequent offence with imprisonment for a term which may extend to seven years and with fine :

Provided that in the absence of special and adequate reasons to the contrary to be recorded in the judgment of the court such imprisonment shall not be for less than ³one year.

(3) For the purposes of sub-sections (1) and (2), the following shall not be considered as special and adequate reasons for awarding a sentence of imprisonment for a term of less than one year, namely :- (i) the fact that the accused has been convicted for the first time for an offence under this Act;

(ii) the fact that in any proceeding under this Act, other than a prosecution, the accused has been ordered to pay a penalty or the goods which are the subject matter of such proceedings have been ordered to be confiscated or any other action has been taken against him for the same act which constitutes the offence;

(iii) the fact that the accused was not the principal offender and was acting merely as a carrier of goods or otherwise was a secondary party to the commission of the offence;

(iv) the age of the accused.

—————

1.  Subs. by Act 22 of 2007, for sub-section (1). Earlier section 135 was renumbered as sub-section thereof by Act 36 of 1973, sec. 5 (w.e.f. 1-9-1973) and was amended by Act 25 of 1978, sec. 16 (w.e.f. 1-7-1978) by Act 40 of 1989, sec. 3 (w.e.f. 26-10-1989) and by Act 32 of 2003, sec. 124 (w.e.f. 14-5-2003). Sub-section (1), before substitution by Act 22 of 2007, stood as under:

“(1) Without prejudice to any action that may be taken under this Act, if any person—

(a) is in relation to any goods in any way knowingly concerned in misdeclaration of value or in any fraudulent evasion or attempt at evasion of any duty chargeable thereon or of any prohibition for the time being imposed under this Act or any other law for the time being in force with respect to such goods, or

(b)  acquires possession of or is in any way concerned in carrying, removing, depositing, harbouring, keeping, concealing, selling or purchasing or in any other manner dealing with any goods which he knows or has reason to believe are liable to confiscation under section 111 or section 113, as the case may be, or,

(c)  attempts to export any goods which he knows or has reason to believe are liable to confiscation under section 113, shall be punishable,—

(i) in the case of an offence relating to any of the goods to which section 123 applies and the market price whereof exceeds one lakh of rupees, with imprisonment for a term which may extend to seven years and with fine:

Provided that in the absence of special and adequate reasons to the contrary to be recorded in the judgment of the court, such imprisonment shall not be for less than three years;

(ii) in any other case with imprisonment for a term which may extend to three years, or with fine, or with both.”.

2.  Ins. by Act 36 of 1973, sec. 5 (w.e.f. 1-9-1973).

3.  Subs. by Act 25 of 1978, sec. 16, for “six months” (w.e.f. 1-7-1978).

Section 135A. Preparation.

If a person makes preparation to export any goods in contravention of the provisions of this Act, and from the circumstances of the case it may be reasonably inferred that if not prevented by circumstances independent of his will, he is determined to carry out his intention to commit the offence, he shall be punishable with imprisonment for a term which may extend to three years, or with fine, or with both.

———

1.  Ins. by Act 36 of 1973, sec. 6 (w.e.f. 1-9-1973).

Section 135B. Power of court to publish name, place of business, etc., of persons convicted under the act.

(1) Where any person is convicted under this Act for contravention of any of the provisions, thereof, it shall be competent for the court convicting the person to cause the name and place of business or residence of such person, nature of the contravention, the fact that the person has been so convicted and such other particulars as the court may consider to be appropriate in the circumstances of the case, to be published at the expense of such person in such newspapers or in such manner as the court may direct.

(2) No publication under subsection (1) shall be made until the period for preferring an appeal against the orders of the court has expired without any appeal having been preferred, or such an appeal, having been preferred, has been disposed of.

(3) The expenses of any publication under sub-section (1) shall be recoverable from the convicted person as if it were a fine imposed by the court.

—————

1.  Ins. by Act 36 of 1973, sec. 6 (w.e.f. 1-9-1973).

Section 136. Offences by officers of customs.

(1) If any officer of customs enters into or acquiesces in any agreement to do, abstains from doing, permits, conceals or ¹connives at any act or thing whereby any duty of customs leviable on any goods, or any prohibition for the time being in force under this Act or any other law for the time being in force with respect to any goods is or may be evaded, he shall be punishable with imprisonment for a term which may extend to ²three years, or with fine, or with both.

(2) If any officer of customs, -

(a) requires any person to be searched for goods liable to confiscation or any document relating thereto, without having reason to believe that he has such goods or document secreted about his person; or

(b) arrests any person without having reason to believe that he has been guilty of an offence punishable under section 135; or

(c) searches or authorises any other officer of customs to search any place without having reason to believe that any goods, documents or things of the nature referred to in section 105 are secreted in that place, he shall be punishable with imprisonment for a term which may extend to six months, or with fine which may extend to one thousand rupees, or with both.

(3) If any officer of customs, except in the discharge in good faith of his duty as such officer or in compliance with any requisition made under any law for the time being in force, discloses any particulars learnt by him in his official capacity in respect of any goods, he shall be punishable with imprisonment for a term which may extend to six months, or with fine which may extend to one thousand rupees, or with both.

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1.  Subs. by Act 32 of 2003, sec. 125, for “connives at any act or thing whereby” (w.e.f. 14-5-2003).

2.  Subs. by Act 36 of 1973, sec. 7, for “two years” (w.e.f. 1-9-1973).

Section 137. Cognizance Of Offences.

(1) No court shall take cognizance of any offence under section 132, section 133, section 134 or ¹section 135, except with the previous sanction of the ²Commissioner of Customs.

(2) No court shall take cognizance of any offence under section 136, -

(a) where the offence is alleged to have been committed by an officer of customs not lower in rack than ³Assistant Commissioner of Customs, except with the previous sanction of the Central Government;

(b) where the offence is alleged to have been committed by an officer of customs lower in rank than ³Assistant Commissioner of Customs, except with the previous sanction of the ²Commissioner of Customs.

⁴[(3) Any offence under this Chapter may, either before or after the institution of prosecution, be compounded by the Chief Commissioner of Customs on payment, by the person accused of the offence to the Central Government, of such compounding amount as may be specified by rules.]

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1.  Subs. by Act 29 of 2006, sec. 32, for “section 135″ (w.e.f. 13-7-2006).

2.  Subs. by Act 22 of 1995, sec. 50, for “Collector of Customs” (w.e.f. 26-5-1995).

3.  Subs. by Act 22 of 1995, sec. 50, for “Assistant Collector of Customs” (w.e.f. 26-5-1995) and again subs. by Act 27 of 1999, sec. 100, for “Assistant Commissioner of Customs” (w.e.f. 11-5-1999).

4.  Ins. by Act 23 of 2004, sec. 71 (w.e.f. 10-9-2004).

Section 138. Offences to be tried summarily.

Notwithstanding anything contained in the Code of Criminal Procedure, 1898 (5 of 1898)¹ an offence under this Chapter other than an offence punishable ²[under clause (i) of sub-section (1) of section 135 or under sub-section (2) of that section] may be tried summarily by a magistrate..

—————

1.  See now the Code of Criminal Procedure, 1973 (2 of 1974).

2.  Subs. by Act 36 of 1973, sec. 8, for “under clause (i) of section 135″ (w.e.f. 1-9-1973).

Section 138A. Presumption of culpable mental state.

¹ (1) In any prosecution for an offence under this Act which requires a culpable mental state on the part of the accused, the court shall presume the existence of such mental state but it shall be a defence for the accused to prove the fact that he had no such mental state with respect to the act charged as an offence in that prosecution.

Explanation : In this section, “culpable mental state” includes intention, motive, knowledge of a fact and belief in, or reason to believe, a fact.

(2) For the purposes of this section, a fact is said to be proved only when the court believes it to exist beyond reasonable doubt and not merely when its existence is established by a preponderance of probability.

————

1. Ins. by Act 36 of 1973, sec. 9 (w.e.f. 1-9-1973).

Section 138B. Relevancy of statements under certain circumstances.

(1) A statement made and signed by a person before any gazetted officer of customs during the course of any inquiry or proceeding under this Act shall be relevant, for the purpose of proving, in any prosecution for an offence under this Act, the truth of the facts which it contains, -

(a) when the person who made the statement is dead or cannot be found, or is incapable of giving evidence, or is kept out of the way by the adverse party, or whose presence cannot be obtained without an amount of delay or expense which, under the circumstances of the case, the court considers unreasonable; or

(b) when the person who made the statement is examined as a witness in the case before the court and the court is of opinion that, having regard to the circumstances of the case, the statement should be admitted in evidence in the interests of justice.

(2) The provisions of sub-section (1) shall, so far as may be, apply in relation to any proceeding under this Act, other than a proceeding before a court, as they apply in relation to a proceeding before a court.

1.  Ins. by Act 36 of 1973, sec. 9 (w.e.f. 1-9-1973).

Section 138C. Admissibility of micro films, facsimile copies of documents and computer print outs as documents and as evidence.

¹138C. ADMISSIBILITY OF MICRO FILMS, FACSIMILE COPIES OF DOCUMENTS AND COMPUTER PRINT OUTS AS DOCUMENTS AND AS EVIDENCE. -(1) Notwithstanding anything contained in any other law for the time being in force, -

(a) a micro film of a document or the reproduction of the image or images embodied in such micro film (whether enlarged or not); or

(b) a facsimile copy of a document; or

(c) a statement contained in a document and included in a printed material produced by a computer (hereinafter referred to as a “computer print out”), if the conditions mentioned in sub-section (2) and the other provisions contained in this section are satisfied in relation to the statement and the computer in question, shall be deemed to be also a document for the purposes of this Act and the rules made there under and shall be admissible in any proceedings there under, without further proof or production of the original, as evidence of any contents of the original or of any fact stated therein of which direct evidence would be admissible.

(2) The conditions referred to in sub-section (1) in respect of a computer print out shall be the following, namely :-

(a) the computer print out containing the statement was produced by the computer during the period over which the computer was used regularly to store or process information for the purposes of any activities regularly carried on over that period by the person having lawful control over the use of the computer;

(b) during the said period, there was regularly supplied to the computer in the ordinary course of the said activities, information of the kind contained in the statement or of the kind from which the information so contained is derived;

(c) throughout the material part of the said period, the computer was operating properly or, if not, then any respect in which it was not operating properly or was out of operation during that part of that period was not such as to affect the production of the document or the accuracy of the contents; and

(d) the information contained in the statement reproduces or is derived from information supplied to the computer in the ordinary course of the said activities.

(3) Where over any period, the function of storing or processing information for the purposes of any activities regularly carried on over that period as mentioned in clause (a) of sub-section (2) was regularly performed by computers, whether -

(a) by a combination of computers operating over that period; or

(b) by different computers operating in succession over that period; or

(c) by different combinations of computers operating in succession over

that period; or

(d) in any other manner involving the successive operation over that period, in whatever order, of one or more computers and one or more combinations of computers, all the computers used for that purpose during that period shall be treated for the purposes of this section as constituting a single computer; and references in this section to a computer shall be construed accordingly.

(4) In any proceedings under this Act and the rules made there under where it is desired to give a statement in evidence by virtue of this section, a certificate doing any of the following things, that is to say, -

(a) identifying the document containing the statement and describing the manner in which it was produced;

(b) giving such particulars of any device involved in the production of that document as may be appropriate for the purpose of showing that the document was produced by a computer;

(c) dealing with any of the matters to which the conditions mentioned in sub-section (2) relate, and purporting to be signed by a person occupying a responsible official position in relation to the operation of the relevant device or the management of the relevant activities (whichever is appropriate) shall be evidence of any matter stated in the certificate; and for the purposes of this sub-section it shall be sufficient for a matter to be stated to the best of the knowledge and belief of the person stating it.

(5) For the purposes of this section, -

(a) information shall be taken to be supplied to a computer if it is supplied thereto in any appropriate form and whether it is so supplied directly or (with or without human intervention) by means of any appropriate equipment;

(b) whether in the course of activities carried on by any official, information is supplied with a view to its being stored or processed for the purposes of those activities by a computer operated otherwise than in the course of those activities, that information, if duly supplied to that computer, shall be taken to be supplied to it in the course of those activities;

(c) a document shall be taken to have been produced by a computer whether it was produced by it directly or (with or without human intervention) by means of any appropriate equipment.

Explanation : For the purposes of this section, – (a) “computer” means any device that receives, stores and processes data, applying stipulated processes to the information and supplying results of these processes; and

(b) any reference to information being derived from other information shall be a reference to its being derived therefrom by calculation, comparison or any other process.

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1.  Ins. by Act 29 of 1988, sec. 6 (w.e.f. 1-7-1988).

Section 139. Presumption as to documents in certain cases.

¹139. PRESUMPTION AS TO DOCUMENTS IN CERTAIN CASES. – Where any document -

(i) is produced by any person or has been seized from the custody or control of any person, in either case, under this Act or under any other law, or

(ii) has been received from any place outside India in the course of investigation of any offence alleged to have been committed by any person under this Act, and such document is tendered by the prosecution in evidence against him or against him and any other person who is tried jointly with him, the court Shall -

(a) presume, unless the contrary is proved, that the signature and every other part of such document which purports to be in the handwriting of any particular person or which the court may reasonably assume to have been signed by, or to be in the handwriting of, any particular person, is in that person’s handwriting, and in the case of a document executed or attested, that it was executed or attested by the person by whom it purports to have been so executed or attested;

(b) admit the document in evidence, notwithstanding that it is not duly stamped, if such document is otherwise admissible in evidence;

(c) in a case falling under clause (i) also presume, unless the contrary is proved, the truth of the contents of such document.

²Explanation : For the purposes of this section, “document” includes inventories, photographs and lists certified by a Magistrate under sub-section (1C) of section 110

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1.  Subs. by Act 36 of 1973, sec. 10, for section 139 (w.e.f. 1-9-1973).

2.  Ins. by Act 80 of 1985, sec. 11 (w.e.f. 27-12-1985).

Section 140. Offences by companies.

(1) If the person committing an offence under this Chapter is a company, every person who, at the time the offence was committed was in charge of, and was responsible to, the company for the conduct of business of the company, as well as the company, shall be deemed to be guilty of the offence 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 such punishment provided in this Chapter if he proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent the commission of such offence.

(2) Notwithstanding anything contained in sub-section (1), where an offence under this Chapter has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to any negligence on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.

Explanation : For the purposes of this section, -

(a) “company” means a body corporate and includes a firm or other association of individuals; and

(b) “director”, in relation to a firm, means a partner in the firm.

Section 140A. Application of section 562 of the code of criminal procedure, 1898, and of the probation of offenders act, 1958.

(1) Nothing contained in section 562 of the ²Code of Criminal Procedure, 1898 (5 of 1898), 260 or in the Probation of Offenders Act, 1958 (20 of 1958), shall apply to a person convicted of an offence under this Act unless that person is under eighteen years of age.

(2) The provisions of sub-section (1) shall have effect notwithstanding anything contained in sub-section (3) of section 135.

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1.  Ins. by Act 36 of 1973, sec. 11 (w.e.f. 1-9-1973).

2.  See now section 360 of the Code of Criminal Procedure, 1973 (2 of 1974).

Section 141. Conveyances and goods in a customs area subject to control of officers of customs.

All conveyances and goods in a customs area shall, for the purpose of enforcing the provisions of this Act, be subject to the control of officers of customs.

Section 142. Recovery of sums due to government.

(1) ¹[Where any sum payable by any person] under this Act ²[including the amount required to be paid to the credit of the Central Government under section 28B] is not paid,—

(a) the proper officer may deduct or may require any other officer of customs to deduct the amount so payable from any money owing to such person which may be under the control of the proper officer or such other officer of customs; or

(b) the ³Assistant Commissioner of Customs may recover or may require any other officer of customs to recover the amount so payable by detaining and selling any goods belonging to such person which are under the control of the Assistant Commissioner of Customs or such other officer of customs; or

⁵(c) if the amount cannot be recovered from such person in the manner provided in clause (a) or clause (b) -

(i) the ⁴Assistant Commissioner of Customs may prepare a certificate signed by him specifying the amount due from such person and send it to the Collector of the district in which such person owns any Property or resides or carries on his business and the said Collector on receipt of such certificate shall proceed to recover from such person the amount specified there under as if it were an arrear of land revenue; or

(ii) the proper officer may, on an authorisation by a Commissioner of Customs and in accordance with the rules made in this behalf, distain any movable or immovable property belonging to or under the control of such person, and detain the same until the amount payable is paid; and in case, any part of the said amount payable or of the cost of the distress or keeping of the property, remains unpaid for a period of thirty days next after any such distress, may cause the said property to be sold and with the proceeds of such sale, may satisfy the amount payable and the costs including cost of sale remaining unpaid and shall render the surplus, if any, to such person.

⁶[Provided that where the person (hereinafter referred to as predecessor), by whom any sum payable under this Act including the amount required to be paid to the credit of the Central Government under section 28B is not paid, transfers or otherwise disposes of his business or trade in whole or in part, or effects any change in the ownership thereof, in consequence of which he is succeeded in such business or trade by any other person, all goods, materials, preparations, plants, machineries, vessels, utensils, implements and articles in the custody or possession of the person so succeeding may also be attached and sold by the proper officer, after obtaining written approval from the Commissioner of Customs, for the purposes of recovering the amount so payable by such predecessor at the time of such transfer or otherwise disposal or change.]

(2) Where the terms of any bond or other instrument executed under this Act or any rules or regulations made there under provide that any amount due under such instrument may be recovered in the manner laid down in sub-section (1), the amount may, without prejudice to any other mode of recovery, be recovered in accordance with the provisions of that sub-section.

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1.  Subs. by Act 22 of 1995, sec. 66, for certain words (w.e.f. 26-5-1995).

2.  Ins. by Act 10 of 2000, sec. 88 (w.e.f. 12-5-2000).

3.  Subs. by Act 27 of 1999, sec. 100, for “Assistant Commissioner of Customs” (w.e.f. 11-5-1999). Earlier the words “Assistant Commissioner of Customs” were substituted by Act 22 of 1995, sec. 50, for the words “Assistant Collector of Customs” (w.e.f. 26-5-1995).

4.  Subs. by Act 27 of 1999, sec. 100, for “Assistant Commissioner of Customs” (w.e.f.11-5-1999). Earlier the words “Assistant Commissioner of Customs” were substituted by Act 22 of 1995, sec. 50, for the words “Assistant Collector of Customs” (w.e.f. 26-5-1995).

5.  Subs. by Act 22 of 1995, sec. 66, for clause (c) (w.e.f. 26-5-1995).

6.  Ins. by Act 23 of 2004, sec. 72 (w.e.f. 10-9-2004).

Section 143. Power to allow import or export on execution of bonds in certain cases.

(1) Where this Act or any other law requires anything to be done before a person can import or export any goods or clear any goods from the control of officers of customs and the ¹[Assistant Commissioner of Customs or Deputy Commissioner of Customs] is satisfied that having regard to the circumstances of the case, such thing cannot be done before such import, export or clearance without detriment to that person, the ¹[Assistant Commissioner of Customs or Deputy Commissioner of Customs], may, notwithstanding anything contained in this Act or such other law, grant leave for such import, export or clearance on the person executing a bond in such amount, with such surety or security and subject to such conditions as the ¹[Assistant Commissioner of Customs or Deputy Commissioner of Customs] approves, for the doing of that thing within such time after the import, export or clearance as may be specified in the bond.

(2) If the thing is done within the time specified in the bond, the ¹[Assistant Commissioner of Customs or Deputy Commissioner of Customs] shall cancel the bond as discharged in full and shall, on demand, deliver it, so cancelled, to the person who has executed or who is entitled to receive it; and in such a case that person shall not be liable to any penalty provided in this Act or, as the case may be, in such other law for the contravention of the provisions thereof relating to the doing of that thing.

(3) If the thing is not done within the time specified in the bond, the ¹[Assistant Commissioner of Customs or Deputy Commissioner of Customs] shall, without prejudice to any other action that may be taken under this Act or any other law for the time being in force, be entitled to proceed upon the bond in accordance with law.

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1. Subs. by Act 27 of 1999, sec. 100, for “Assistant Commissioner of Customs” (w.e.f. 11-5-1999). Earlier the words “Assistant Commissioner of Customs” were substituted by Act 22 of 1995, sec. 50, for the words “Assistant Collector of Customs” (w.e.f. 26-5-1995).

Section 143A. Duty deferment.

¹[143A. Duty deferment.—(1) When any material is imported under an import licence belonging to the category of Advance Licence granted under the ²Imports and Exports (Control) Act, 1947 (18 of 1947), subject to an obligation to export the goods as are specified in the said Licence within the period specified therein, the 3[Assistant Commissioner of Customs or Deputy Commissioner of Customs] may, notwithstanding anything contained in this Act, permit clearance of such material without payment of duty leviable thereon.

(2) The permission for clearance without payment of duty under sub-section (1) shall be subject to the following conditions, that is to say—

(a) the duty payable on the material imported shall be adjusted against the drawback of the duty payable under this Act under any other law for the time being in force on the export of goods specified in the said Advance Licence; and

(b) where the duty is not so adjusted either for the reason that the goods are not exported within the period specified in the said Advance Licence, or within such extended period not exceeding six months as the ³[Assistant Commissioner of Customs or Deputy Commissioner of Customs] may, on sufficient cause being shown, allow, or for any other sufficient reason, the importer shall, notwithstanding anything contained in section 28, be liable to pay the amount of duty not so adjusted together with simple interest thereon at the rate of twelve per cent. per annum from the date the said permission for clearance is given to the date of payment.

(3) While permitting clearance under sub-section (1), the ³[Assistant Commissioner of Customs or Deputy Commissioner of Customs] may require the importer to execute a bond with such surety or security as he thinks fit for complying with the conditions specified in sub-section (2)].

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1. Ins. by Act 25 of 1978, sec. 17 (w.e.f. 1-7-1987).

2. See now the Foreign Trade Development and Regulation Act, 1992 (22 of 1992).

3. Subs. by Act 27 of 1999, sec. 100, for “Assistant Commissioner of Customs” (w.e.f. 11-5-1999). Earlier the words “Assistant Commissioner of Customs” were substituted by Act 22 of 1995, sec. 50, for the words “Assistant Collector of Customs” (w.e.f. 26-5-1995).

Section 144. Power to take samples.

(1) The proper officer may, on the entry or clearance of any goods or at any time while such goods are being passed through the customs area, take samples of such goods in the presence of the owner thereof, for examination or testing, or for ascertaining the value thereof, or for any other purposes of this Act.

(2) After the purpose for which a sample was taken is carried out, such sample shall, if practicable, be restored to the owner, but if the owner fails to take delivery of the sample within three months of the date on which the sample was taken, it may be disposed of in such manner as the ¹Commissioner of Customs may direct.

(3) No duty shall be chargeable on any sample of goods taken under this section which is consumed or destroyed during the course of any test or examination thereof, if such duty amounts to five rupees or more.

————

1.  Subs. by Act 22 of 1995, sec. 50, for “Collector of Customs” (w.e.f 26-5-1995).

Section 145. Owner, etc., to perform operations incidental to compliance with customs law.

All operations necessary for making any goods available for examination by the proper officer or for facilitating such examination shall be performed by, or at the expense of, the owner, importer or exporter of the goods, as the case may be.

Section 146. Custom house agents to be licensed.

(1) No person shall carry on business as an agent relating to the entry or departure of a conveyance or the import or export of goods at any customs-station unless such person holds a licence granted in this behalf in accordance with the regulations.

(2) The Board may make regulations for the purpose of carrying out the provisions of this section and, in particular, such regulations may provide for -

(a) the authority by which a licence may be granted under this section and the period of validity of any such licence;

(b) the form of the licence and the fees payable therefore;

(c) the qualifications of persons who may apply for a licence and the

qualifications of persons to be employed by a licensee to assist him in his work as an agent;

(d) the restrictions and conditions (including the furnishing of security by the licensee) subject to which a licence may be granted;

(e) the circumstances in which a licence may be suspended or revoked; and

(f) the appeals, if any, against an order of suspension or revocation of a licence, and the period within which such appeals shall be filed.

Section 146A. Appearance by authorised representative.

¹146A. APPEARANCE BY AUTHORISED REPRESENTATIVE. (1) Any person who is entitled or required to appear before an officer of customs or the Appellate Tribunal in connection with any proceedings under this Act, otherwise than when required under section 108 to attend personally for examination on oath or affirmation, may, subject to the other provisions of this section, appear by an authorised representative.

(2) For the purposes of this section, “authorised representative” means a person authorised by the person referred to in sub-section (1) to appear on his behalf, being -

(a) his relative or regular employee; or

(b) a custom house agent licensed under section 146; or

(c) any legal practitioner who is entitled to practice in any civil court in India; or

(d) any person who has acquired such qualifications as the Central Government may specify by rules made in this behalf.

(3) Notwithstanding anything contained in this section, no person who was a member of the Indian Customs and Central Excise Service – Group A and has retired or resigned from such Service after having served for not less than three years in any capacity in that Service shall be entitled to appear as an authorised representative in any proceedings before an officer of customs for a period of two years from the date of his retirement or resignation, as the case may be.

(4) No person, -

(a) who has been dismissed or removed from Government service; or

(b) who is convicted of an offence connected with any proceeding under this Act, the Central Excises and Salt Act, 1944 (1 of 1944), or the ³Gold

(Control) Act, 1968 (45 of 1968); or

(c) who has become an insolvent, shall be qualified to represent any person under sub-section (1), for all times in the case of a person referred to in clause (a), and for such time as the ⁴[Commissioner of Customs] or the competent authority under the ²Central Excises and Salt Act, 1944, or the ²Gold (Control) Act, 1968,, as the case may be, may, by order, determine in the case of a person referred to in clause (b), and for the period during which the insolvency continues in the case of a person referred to in clause (c).

(5) If any person, -

(a) who is a legal practitioner, is found guilty of misconduct in his professional capacity by any authority entitled to institute proceedings against him, an order passed by that authority shall have effect in relation to his right to appear before an officer of customs or the Appellate Tribunal as it has in relation to his right to practise as a legal practitioner;

(b) who is not a legal practitioner, is found guilty of misconduct in connection with any proceedings under this Act by such authority as may be specified by rules made in this behalf, that authority may direct that he shall thenceforth be disqualified to represent any person under sub-section (1).

(6) Any order or direction under clause (b) of sub-section (4) or clause (b) of sub-section (5) shall be subject to the following conditions, namely :-

(a) no such order or direction shall be made in respect of any person unless he has been given a reasonable opportunity of being heard;

(b) any person against whom any such order or direction is made may, within one month of the making of the order or direction, appeal to the Board to have the order or direction cancelled; and

(c) no such order or direction shall take effect until the expiration of one month from the making thereof, or, where an appeal has been preferred, until the disposal of the appeal.

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1.  Ins. by Act 44 of 1980, sec. 50 and Fifth Sch., Pt. 1 (w.e.f. 11-10-1982).

2.  See now the Central Excise Act, 1944 (1 of 1944).

3.  This Act has been repealed by Act 18 of 1990, sec. 2 (w.e.f. 6-6-1990).

4.  Subs. by Act 22 of 1995, sec. 50, for “Collector of Customs” (w.e.f 26-5-1995).

Section 147. Liability of principal and agent.

(1) Where this Act requires anything to be done by the owner, importer or exporter of any goods, it may be done on his behalf by his agent.

(2) Any such thing done by an agent of the owner, importer or exporter of any goods shall, unless the contrary is proved, be deemed to have been done with the knowledge and consent of such owner, importer or exporter, so that in any proceedings under this Act, the owner, importer or exporter of the goods shall also be liable as if the thing had been done by himself.

(3) When any person is expressly or impliedly authorised by the owner, importer or exporter of any goods to be his agent in respect of such goods for all or any of the purposes of this Act, such person shall, without prejudice to the liability of the owner, importer or exporter, be deemed to be the owner, importer or exporter of such goods for such purposes :

Provided that where any duty is not levied or is short-levied or erroneously refunded on account of any reason other than any willful act, negligence or default of the agent, such duty shall not be recovered from the agent unless in the opinion of ¹Assistant Commissioner of Customs the same cannot be recovered from the owner, importer or exporter.

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1.  Subs. by Act 27 of 1999, sec. 100, for “Assistant Commissioner of Customs” (w.e.f. 11-5-1999). Earlier the words “Assistant Commissioner of Customs” were substituted by Act 22 of 1995, sec. 50, for the words “Assistant Collector of Customs” (w.e.f. 26-5-1995).

Section 148. Liability of agent appointed by the person in charge of a conveyance.

(1) Where this Act requires anything to be done by the person in charge of a conveyance, it may be done on his behalf by his agent.

(2) An agent appointed by the person in charge of a conveyance and any person who represents himself to any officer of customs as an agent of any such person in charge, and is accepted as such by that officer, shall be liable for the fulfillment in respect of the matter in question of all obligations imposed on such person in charge by or under this Act or any law for the time being in force, and to penalties and confiscations which may be incurred in respect of that matter.

Section 149. Amendment of documents.

Save as otherwise provided in sections 30 and 41, the proper officer may, in his discretion, authorise any document, after it has been presented in the custom house to be amended :

Provided that no amendment of a bill of entry or a shipping bill or bill of export shall be so authorised to be amended after the imported goods have been cleared for home consumption or deposited in a warehouse, or the export goods have been exported, except on the basis of documentary evidence which was in existence at the time the goods were cleared, deposited or exported, as the case may be.

Section 150. Procedure for sale of goods and application of sale proceeds.

(1) Where any goods not being confiscated goods are to be sold under any provisions of this Act, they shall, after notice to the owner thereof, be sold by public auction or by tender or with the consent of the owner in any other manner.

(2) The proceeds of any such sale shall be applied -

(a) firstly to the payment of the expenses of the sale,

(b) next to the payment of the freight and other charges, if any, payable in respect of the goods sold, to the carrier, if notice of such charges has been given to the person having custody of the goods,

(c) next to the payment of the duty, if any, on the goods sold,

(d) next to the payment of the charges in respect of the goods sold due to the person having the custody of the goods,

(e) next to the payment of any amount due from the owner of the goods to the Central Government under the provisions of this Act or any other law relating to customs, and the balance, if any, shall be paid to the owner of the goods.

Section 151. Certain officers required to assist officers of customs.

The following officers are hereby empowered and required to assist officers of customs in the execution of this Act, namely :- (a) officers of the Central Excise Department;

(b) officers of the Navy;

(c) officers of Police;

(d) officers of the Central or State Governments employed at any port or airport;

(e) such other officers of the Central or State Governments or a local authority as are specified by the Central Government in this behalf by notification in Official Gazette.

Section 151A. Instructions to officers of customs.

¹ 151A. INSTRUCTIONS TO OFFICERS OF CUSTOMS.The Board may, if it considers it necessary or expedient so to do for the purpose of uniformity in the classification of goods or with respect to the levy of duty thereon, issue such orders, instructions and directions to officers of customs as it may deem fit and such officers of customs and all other persons employed in the execution of this Act shall observe and follow such orders, instructions and directions of the Board :

Provided that no such orders, instructions or directions shall be issued -

(a) so as to require any such officer of customs to make a particular assessment or to dispose of a particular case in a particular manner; or

(b) so as to interfere with the discretion of the Commissioner of Custom (Appeals) in the exercise of his appellate functions.

—————

1.  Ins. by Act 80 of 1985, sec. 12 (w.e.f. 27-12-1985).

Section 152. Delegation of powers.

The Central Government may, by notification in the Official Gazette, direct that subject to such conditions, if any, as may be specified in the notification -

(a) any power exercisable by the Board under this Act shall be exercisable also by ¹[a ²[Chief Commissioner of Customs] or a ³[Commissioner of Customs]] empowered in this behalf by the Central Government;

(b) any power exercisable by a ³[Commissioner of Customs] under this Act may be exercisable also by a ⁴[Joint Commissioner of Customs] or an ⁵[Assistant Commissioner of Customs or Deputy Commissioner of Customs] empowered in this behalf by the Central Government;

(c) any power exercisable by a ⁴[Joint Commissioner of Customs] under this Act may be exercisable also by an ¹⁵[Assistant Commissioner of Customs or Deputy Commissioner of Customs] empowered in this behalf by the Central Government;

(d) any power exercisable by an 6[Assistant Commissioner of Customs or Deputy Commissioner of Customs] under this Act may be exercisable also by a gazetted officer of customs empowered in this behalf by the Board.

—————

1. The words “a Principal Collector of Customs or a Collector of Customs” ins. by Act 29 of 1988, sec. 7, for “a Collector of Customs” (w.e.f. 1-7-1988).

2. Subs. by Act 22 of 1995, sec. 50, for “Principal Collector of Customs” (w.e.f. 26-5-1995).

3. Subs. by Act 22 of 1995, sec. 50, for “Collector of Customs” (w.e.f. 26-5-1995).

4. Subs. by Act 27 of 1999, sec. 100, for “Deputy Commissioner of Customs” (w.e.f. 11-5-1999). Earlier the words “Deputy Commissioner of Customs” were substituted by Act 22 of 1995, sec. 50, for the words “Deputy Collector of Customs” (w.e.f. 26-5-1995).

5. Subs. by Act 27 of 1999, sec. 100, for “Assistant Commissioner of Customs” (w.e.f. 11-5-1999). Earlier the words “Assistant Commissioner of Customs” were substituted by Act 22 of 1995, sec. 50, for the words “Assistant Collector of Customs” (w.e.f. 26-5-1995).

6. Subs. by Act 27 of 1999, sec. 100, for “Assistant Commissioner of Customs” (w.e.f. 11-5-1999). Earlier the words “Assistant Commissioner of Customs” were substituted by Act 22 of 1995, sec. 50, for the words “Assistant Collector of Customs” (w.e.f. 26-5-1995).

Section 153. Service of order, decision, etc.

Any order or decision passed or any summons or notice issued under this Act, shall be served -

(a) by tendering the order, decision, summons or notice or sending it by registered post to the person for whom it is intended or to his agent; or

(b) if the order, decision, summons or notice cannot be served in the manner provided in clause (a), by affixing it on the notice board of the customs house.

Section 154. Correction of clerical errors, etc.

Clerical or arithmetical mistakes in any decision or order passed by the Central Government, the Board or any officer of customs under this Act, or errors arising therein from any accidental slip or omission may, at any time, be corrected by the Central Government, the Board or such officer of customs or the successor in office of such officer, as the case may be.

Section 154A. Rounding off of duty, etc. -

The amount of duty, interest, penalty, fine or any other sum payable, and the amount of refund, drawback or any other sum due, under the provisions of this Act shall be rounded off to the nearest rupee and, for this purpose, where such amount contains a part of a rupee consisting of paise then, if such part is fifty paise or more, it shall be increased to one rupee and if such part is less than fifty paise it shall be ignored.

Section 154B. Publication of information respecting persons in certain cases.

¹[154B. Publication of information respecting persons in certain cases.—(1) If the Central Government is of opinion that it is necessary or expedient in the public interest to publish the names of any person and any other particulars relating to any proceedings or prosecutions under this Act in respect of such person, it may cause to be published such names and particulars in such manner as it thinks fit.

(2) No publication under this section shall be made in relation to any penalty imposed under this Act until the time for presenting an appeal to the Commissioner (Appeals) under section 128 or the Appellate Tribunal under section 129A, as the case may be, has expired without an appeal having been presented or the appeal, if presented, has been disposed of.

Explanation.—In the case of a firm, company or other association of persons, the names of the partners of the firm, directors, managing agents, secretaries and treasurers or managers of the company, or the members of the association, as the case may be, may also be published if, in the opinion of the Central Government, circumstances of the case justify it.]

—————

1. Subs. by Act 2 of 2006, sec. 33 (w.e.f. 13-7-2006).

Section 155. Protection of action taken under the act.

(1) No suit, prosecution or other legal proceedings shall lie against the Central Government or any officer of the Government or a local authority for anything which is done, or intended to be done in good faith, in pursuance of this Act or the rules or regulations.

(2) No proceeding other than a suit shall be commenced against the Central Government or any officer of the Government or a local authority for anything purporting to be done in pursuance of this Act without giving the Central Government or such officer a month’s previous notice in writing of the intended proceeding and of the cause thereof, or after the expiration of three months from the accrual of such cause.

Section 156. General power to make rules.

(1) Without prejudice to any power to make rules contained elsewhere in this Act, the Central Government may make rules consistent with this Act generally to carry out the purposes of this Act.

(2) In particular and without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters, namely :-

¹[(a) the manner of determining the transaction value of the imported goods and export goods under sub-section (1) of section 14;]

(b) the conditions subject to which accessories of and spare parts and maintenance and repairing implements for, any article shall be chargeable at the same rate of duty as that article;

²[***]

(d) the detention and confiscation of goods the importation of which is prohibited and the conditions, if any, to be fulfilled before such detention and confiscation and the information, notices and security to be given and the evidence requisite for the purposes of such detention or confiscation and the mode of verification of such evidence;

(e) the reimbursement by an informant to any public officer of all expenses and damages incurred in respect of any detention of any goods made on his information and of any proceedings consequent on such detention;

(f) the information required in respect of any goods mentioned in a shipping bill or bill of export which are not exported or which are exported and are afterwards re-landed;

³[(g) the publication, subject to such conditions as may be specified therein, of names and other particulars of persons who have been found guilty of contravention of any of the provisions of this Act or the rules.]

⁴[(h) the amount to be paid for compounding under sub-section (3) of section 137.]

———-

1. Subs. by Act 22 of 2007, sec. 113, for clause (a). Earlier clause (a) was substituted by Act 27 of 1988, sec. 3 (w.e.f. 16-8-1988). Clause (a), before substitution by Act 22 of 2007, stood as under:

“(a) the manner of determining the price of imported goods under sub-section (1A) of section 14;”.

2. Clause (c) omitted by Act 26 of 1988, sec. 80 (w.e.f. 13-5-1988).

3. Added by Act 36 of 1973, sec. 12 (w.e.f. 1-9-1973).

4. Ins. by Act 23 of 2004, sec. 73 (w.e.f. 10-9-2004).

Section 157. General power to make regulations.

(1) Without prejudice to any power to make regulations contained elsewhere in this Act, the Board may make regulations consistent with this Act and the rules, generally to carry out the purposes of this Act.

(2) In particular and without prejudice to the generality of the foregoing power, such regulations may provide for all or any of the following matters, namely :-

(a) the form of a bill of entry, shipping bill, bill of export, import manifest, import report, export manifest, export report, ¹bill of transshipment, declaration for transshipment boat note and bill of coastal goods;

²[(aa)  the ³[form and manner] in which an application for refund shall be made under section 27;]

(b) the conditions subject to which the transshipment of all or any goods under sub-section (3) of section 54, the transportation of all or any goods under section 56 and the removal of warehoused goods from one warehouse to another under section 67, may be allowed without payment of duty;

(c) the conditions subject to which any manufacturing process or other operations may be carried on in a warehouse under section 65.

—————

1.  Subs. by Act 27 of 1999, sec. 115, for “bill of transshipment” (w.e.f. 11-5-1999)

2.  Ins. by Act 40 of 1991, sec. 14 (w.e.f. 20-9-1991).

3.  Subs. by Act 22 of 1995, sec. 67, for “form” (w.e.f. 26-5-1995).

Section 158. Provisions with respect to rules and regulations.

(1) All rules and regulations made under this Act shall be published in the Official Gazette.

(2) Any rule or regulation which the Central Government or the Board is empowered to make under this Act may provide -

(i) for the levy of fees in respect of applications, amendment of documents, furnishing of duplicates of documents, issue of certificates, and supply of statistics, and for rendering of any services by officers of customs under this Act;

(ii) that any person who contravenes any provision of a rule or regulation or abets such contravention or any person who fails to comply with any provision of a rule or regulation with which it was his duty to comply, shall be liable, -

(a) in the case of contravention or failure to comply with a rule, to a penalty which may extend to five hundred rupees;

(b) in the case of contravention or failure to comply with a regulation, to a penalty which may extend to two hundred rupees.

Section 159. Rules, certain notifications and orders to be laid before parliament.

¹Every rule or regulation made under this Act, every notification issued under sections 11, 11B, 11H, 11-I, 11K, 11N, 14,25, 28A, 43, 66, 69, 70, 74,75, 76, 98, 98A, 101 and 123 and every order made under sub-section (2) of section 25, other than an order relating to goods of strategic, secret, individual or personal nature, shall be laid, as soon as may be after it is made or issued, before each House of Parliament, while it is in session, for a total period of thirty days which may be comprised in one session, or in two or more successive sessions, and if, before the expiry of the session immediately following the session or the successive sessions aforesaid, both Houses agree in making any modification in the rule or regulation or notification or order, or both Houses agree that the rule or regulation should not be made or notification or order should not be issued or made, the rule or regulation or notification or order shall thereafter have effect only in such modified form or be of no effect, as the case may be; so, however, that any such modification or annulment shall be without prejudice to the validity of anything previously done under that rule or regulation or notification or order.

—————

1.  Subs. by Act 22 of 1995, sec. 68, for section 159 (w.e.f. 26-5-1995).

Section 160. Repeal and savings.

(1) The enactments specified in the Schedule are hereby repealed to the extent mentioned in the fourth column thereof.

(2) In the Indian Tariff Act, 1934 (32 of 1934) -

(a) for section 2, the following section shall be substituted, namely :- “2. Duties specified in the Schedules to be levied. The rates at which duties of customs shall be levied under the Customs Act, 1962, are specified in the First and Second Schedules.”;

(b) sections 5 and 6 shall stand repealed.

(3) Notwithstanding the repeal of any enactment by this section, – (a) any notification, rule, regulation, order or notice issued or any appointment or declaration made or any licence, permission or exemption granted for any assessment made, confiscation adjudged or any duty levied or any penalty or fine imposed or any forfeiture, cancellation or discharge of any bond ordered or any other thing done or any other action taken under any repealed enactment shall, so far as it is not inconsistent with the provisions of this Act, be deemed to have been done or taken under the corresponding provision of this Act;

(b) any document referring to any enactment hereby repealed shall be construed as referring to this Act or to the corresponding provision of this Act.

(4) This Act shall apply to all goods which are subject to the control of customs at the commencement of this Act notwithstanding that the goods were imported before such commencement.

(5) Where the period prescribed for any application, appeal, revision or other proceeding under any repealed enactment had expired on or before the commencement of this Act, nothing in this Act shall be construed as enabling any such application, appeal or revision to be made or a proceeding to be instituted under this Act by reason only of the fact that a longer period therefor is prescribed or provision is made for extension of

time in suitable cases by the appropriate authority.

(6) The provisions of section 65 shall apply to goods warehoused before the commencement of this Act if the operations permissible under that section were carried on after such commencement.

(7) Any duty or penalty payable under any repealed enactment may be recovered in a manner provided under this Act but without prejudice to any action already taken for the recovery of such duty or penalty under the repealed enactment.

(8) The mention of particular matters in sub-sections (4), (5), (6) and (7) shall not be held to prejudice or affect the general application of section 6 of the General Clauses Act, 1897 (10 of 1897), with regard to the effect of repeals.

(9) Nothing in this Act shall affect any law for the time being in force relating to the constitution and powers of any Port authority in a major port as defined in the Indian Ports Act, 1908 (15 of 1908).

Section 161. Removal of difficulties.

If any difficulty arises in giving effect to the provisions of this Act, particularly in relation to the transition from the enactments repealed by this Act to the provisions of this Act, the Central Government may, by general or special order, do anything not inconsistent with such provisions which appears to be ] necessary or expedient for the purpose of removing the difficulty.

Schedule. -

(See Section 160)

Repeals

Gift Tax Act

November 30, 2014

Section 1. SHORT TITLE, EXTENT AND COMMENCEMENT.

(1) This Act may be called the Gift-tax Act, 1958.

(2) 1 It extends to the whole of India except the State of Jammu and Kashmir.

(3) It shall be deemed to have come into force on the 1st day of April, 1958.

Section 2. DEFINITIONS.

In this Act, unless the context otherwise requires,—

¹[***]

²[(ii) “Appellate Tribunal” means the Appellate Tribunal constituted under section 252 of the Income-tax Act;]

²[(iii) “assessee” means a person by whom gift-tax or any other sum of money is payable under this Act, and includes—

(a) every person in respect of whom any proceeding under this Act has been taken for the determination of gift-tax payable by him or by any other person or the amount of refund due to him or such other person;

(b) every person who is deemed to be an assessee under this Act;

(c) every person who is deemed to be an assessee in default under this Act;]

³[(iiia) “Assessing Officer” means the Assistant Commissioner or the Income-tax Officer who is vested with the relevant jurisdiction by virtue of directions or orders issued under sub-section (1) or sub-section (2) of section 120 or any other provision of the Income-tax Act which apply for the purposes of gift-tax under section 7 of this Act, and also the Deputy Commissioner who is directed under clause (b) of sub-section (4) of the said section 120 to exercise or perform all or any of the powers and functions conferred on or assigned to the Assessing Officer under that Act;]

²[(iv) “assessment” includes re-assessment;

(iva) “ assessment year” means the period of twelve months commencing on the 1st day of April, every year;]

(v) “Board” means the ⁴[Central Board of Direct Taxes constituted under the Central Boards of Revenue Act, 1963 (54 of 1963))];

⁵[(va) “charitable purpose” includes relief of the poor, education, medical relief, and the advancement of any other object of general public utility ⁶[***];]

⁷[***]

⁸[***]

⁹[(vii) the experessions “company”, “Indian company” and “company in which the public are substantially interested” shall have the meanings respectively assigned to them under section 2 of the Income-tax Act;]

¹⁰[***]

(viii) “donee” means any person who acquires any property under a gift, and, where a gift is made to a trustee for the benefit of another person, includes both the trustee and the beneficiary;

(ix) “donor” means any person who makes a gift;

(x) “executor” means an executor or adiminstrator of the estate of a deceased person;

¹¹[(xi) the expressions “firm”, “partner” and “partnership” shall have the meanings respectively assigned to them under section 2 of the Income-tax Act;]

(xii) “gift” means the transfer by one person to another of any existing movable or immovable property made voluntarily and without consideration in money or money’s worth, and ¹²[includes the transfer or conversion of any property referred to in section 4, deemed to be a gift under that section];

¹³[Explanation.—A transfer of any building or part thereof referred to in clause (iii), clause (iiia) or clause (iiib) of section 27 of the Income-tax Act, by the person who is deemed under the said clause to be the owner thereof made voluntarily and without consideration in money or money’s worth, shall be deemed to be a gift made by such person;]

¹⁴[***]

¹⁵[(xiv) “Income-tax Act” means the Income-tax Act, 1961 (43 of 1961);]

¹⁶[***]

¹⁷[(xvib) “legal representative” has the meaning assigned to it in clause (11) of section 2 of the Code of Civil Procedure, 1908 (5 of 1908);]

¹⁸[***]

(xviii) “person” includes a Hindu undivided family or a company or an association or a body of individuals or persons, whether incorporated or not;

(xix) “prescribed” means prescribed by rules made under this Act;

(xx) “previous year”, in relation to any assessment year—

(a) in the case of an assessee ¹⁹[having no source of income, profits or gains or] having a source of income, profits or gains in respect of which there is no previous year under the Income-tax Act, means the twelve months ending on the 31st day of March immediately preceding the assessment year;

²⁰[***]

(c) in the case of any other assessee, means the previous year as defined in ²¹[section 3] of the Income-tax Act if an assessment were to be made under that Act for that year:

²²[Provided that where a person who has not been assessed under this Act for any assessment year makes a gift on a date which does not fall within a previous year as defined in sub-clause (a) ²³[***] or sub-clause (c), the previous year shall be the twelve months ending on the 31st day of March immediately preceding the assessment;

²⁴[***]]

(xxi) “principal officer”, used with reference to a company or any association of persons, means—

(a) the secretary and treasurer, manager, managing agent, managing director or agent of the company or association; or

(b) any person connected with the management of the affairs of the company or association upon whom the ²⁵[Assesssing Officer] has served a notice of his intention of treating him as the principal officer thereof;

(xxii) “property” includes any interest in property, movable or immovable;

(xxiii) “taxable gifts” means gifts chargeable to gift-tax under this Act;

²⁶[(xxiiia) territories to which this Act extends shall be deemed to include the Union territories of Dadra and Nagar Haveli, Goa, Daman and Diu, and Pondicherry—

(a) as respects any period for the purposes of section 5; and

(b) as respects any period included in the previous year, for the purposes of making any assessment for the assessment year commencing on the 1st day of April, 1963, or for any subsequent year;]

(xxiv) “transfer of property” means any disposition, conveyance, assignment, settlement, delivery, payment or other alienation of property and, without limiting the generality of the foregoing, includes—

(a) the creation of a trust in property;

(b) the grant or creation of any lease, mortgage, charge, easement, licence, power, partnership or interest in property;

(c) the exercise of a power of appointment ²⁷[(whether general, special or subject to any restrictions as to the persons in whose favour the appointment may be made)] of property vested in any person; not the owner of the property, to determine its disposition in favour of any person other than the donee of the power; and

(d) any transaction entered into by any person with intent thereby to diminish directly or indirectly the value of his own property and to increase the value of the property of any other person;

²⁸[(xxv) the expressions “Chief Commissioner”, “Director-General”, “Commissioner”, “Commissioner (Appeals)”, “Director”, ²⁹[“Additional Director of Income-tax”, “Additional Commissioner of Income-tax”, “Additional Commissioner of Income-tax (Appeals)”, “Deputy Director”,] “Deputy Commissioner”, “Deputy Commissioner (Appeals)”, “Assistant Commsissioner”, “Income-tax Officer”, “Tax Recovery Officer” and “Inspector of Income-tax” shall have the meanings respectively assigned to them under section 2 of the Income-tax Act.]

—————

1. Clause (i) omitted by Act 4 of 1988, sec. 162(a) as amanded by Act 26 of 1988, sec. 88 (j) (i) (w.e.f. 1-4-1988).

2. Subs. by Act 53 of 1962, sec. 2(a) (w.e.f. 1-4-1963).

3. Ins. by Act 4 of 1988, Sec. 162 (b) as amended by Act 26 of 1988, sec. 88(j)(i) (w.e.f. 1-4-1988).

4. Subs. by Act 54 of 1963, sec. 5, for “Central Board of Revenue constituted under the Central Board of Revenue Act, 1924 (4 of 1924)” (w.e.f. 1-4-1963).

5. Ins. by Act 53 of 1962, sec. 2(b) (w.e.f. 1-4-1963).

6. The words “not involving the carrying on of any activity for profit” omitted by Act 67 of 1984, sec. 71(w.e.f. 1-4-1984).

7. Clause (vi) omitted by Act 4 of 1988, sec. 162 (c)(i) as amended by Act 26 of 1988, sec. 88 (j) (iii) (w.e.f. 1-4-1988).

8. Clause (via) omitted by Act 4 of 1988, sec. 162 (c) (i) as amended by Act 26 of 1988, sec. 88 (j) (iii) (w.e.f. 1-4-1988). Earlier clause (via) was ins. by Act 29 of 1977, sec. 39 and Sch. V (w.e.f. 10-7-1978).

9. Subs. by Act 4 of 1988, sec. 162 (d) (w.e.f. 1-4-1989).

10. Clause (viia) omitted by Act 4 of 1988 sec. 162 (c)(i) as amended by Act 26 of 1988, sec. 88(j) (iii) (w.e.f. 1-4-1988). Earlier clause (viia) was ins. by Act 53 of 1962, sec. 2 (c) (w.e.f. 1-4-1963).

11. Subs. by Act 4 of 1988, sec. 162 (e) (w.e.f. 1-4-1989).

12. Subs. by Act 32 of 1971, sec. 37 (a), for “includes the transfer of any property deemed to be a gift under section 4 (w.e.f. 1-4-1972).

13. Ins. by Act 11 of 1987, sec. 90 (w.e.f. 1-4-1988).

14. Clause (xiii) omitted by Act 4 of 1988, sec. 162 (c) (i) as amended by Act, 26 of 1988, sec. 88(j) (iii) (w.e.f. 1-4-1988).

15. Subs. by Act 53 of 1962, sec. 2(d) (w.e.f 1-4-1963).

16. Clauses (xv), (xvi) and (xvia) omitted by Act 4 of 1988, sec. 162 (c) (i) as amended by Act 26 of 1988, sec. 88(j) (iii) (w.e.f 1-4-1988). Earlier clause (xvia) was ins. by Act 53 of 1962, sec. 2 (e) (w.e.f. 1-4-1963).

17. Ins. by Act 53 of 1962, sec. 2(e).

18. Clause (xvii) Omitted by Act 4 of 1988, sec. 162 (c) (ii) as amended by Act 26 of 1988, sec. 88(j) (iii) (w.e.f. 1-4-1989)

19. Ins. by Act 12 of 1959, sec. 27 (i) (w.e.f. 1-4-1959).

20. Sub-clause (b) omitted by Act 4 of 1988, sec. 162(f) (i) (w.e.f. 1-4-1989).

21. Subs. by Act 53 of 1962, sec. 2(f) (ii), for “Clause (ii) of section 2” (w.e.f. 1-4-1963).

22. Two provisons were ins. by Act 12 of 1959, sec. 27(ii) (w.e.f. 1-4-1959).

23. The words “or sub-clause (b)” omitted by Act 4 of 1988, sec. 162 (f) (ii) (w.e.f. 1-4-1989).

24. Second Proviso omitted by Act 4 of 1988, sec. 162(f) (iii) (w.e.f. 1-4-1989).

25. Subs by Act 4 of 1988, sec. 161, for “Gift-tax Officer” (w.e.f. 1-4-1988).

26. Ins. by Taxation Laws (Extension to Union Territories) Regulation, 1963 (w.e.f. 1-4-1963).

27. Ins. by Act 44 of 1980, sec. 42(a) (w.e.f. 1-4-1980).

28. Ins. by Act 4 of 1988, sec. 162 (g) as amended by Act 26 of 1988, sec. 88(j)(iv) (w.e.f. 1-4-1988).

29. Ins. by Act 32 of 1994, sec. 54 (w.e.f. 1-6-1994).

Section 3. CHARGE OF GIFT-TAX.

¹[(1)] Subject to the other provisions contained in this Act, there shall be charged for every ²[assessment year] commencing on and from the 1st day of April, 1958, 3[but before the 1st day of April, 1987,] a tax (hereinafter referred to as gift-tax) in respect of the gifts, if any, made by a person during the previous year (other than gifts made before the 1st day of April, 1957) at the rate or rates specified in 4[Schedule I].

²[(2) ⁶[Subject to the other provisions (including provisions for the levy of additional gift-tax) contained in this Act], there shall be charged for every assessment year commencing on and from the 1st day of April, 1987, gift-tax in respect of the gifts, if any, made by a person during the previous year, at the rate of thirty per cent. on the value of all taxable gifts.]

\⁷[(3) Notwithstanding anything contained in sub-section (2), the provisions of this Act shall cease to apply and shall have no effect whatsoever in respect of any gift made on or after the 1st day of October, 1998.]

—————

1. Section 3 re-numbered as sub-section (1) thereof by Act 23 of 1986, sec. 41 (w.e.f. 1-4-1987).

2. Subs. by Act 53 of 1962, sec. 3, for “financial year” (w.e.f. 1-4-1963).

3. Ins. by Act 23 of 1986, sec. 41 (a) (w.e.f. 1-4-1987).

4. Subs. by Act 3 of 1989, sec. 79, for “Schedule” (w.e.f. 1-4-1989).

5. Ins by Act 23 of 1986, sec. 41 (b) (w.e.f. 1-4-1987).

6. Subs. by Act 4 of 1988, sec. 163, for “Subject to the other

provisions contained in this Act”, (w.e.f. 1-4-1989).

7. Ins. by Act 21 of 1998, sec. 75 (w.e.f. 1-10-1998).

Section 4. GIFTS TO INCLUDE CERTAIN TRANSFERS.

¹(1) For the purposes of this Act, -

(a) where property is transferred otherwise than for adequate consideration, the amount by which the ²value of the property as on the date of the transfer and determined in the manner laid down in Schedule II exceeds the value of the consideration shall be deemed to be a gift made by the transferor :

³Provided that nothing contained in this clause shall apply in any case where the property is transferred to the Government or where the value of the consideration for the transfer is determined or approved by the Central Government or the Reserve Bank of India;

(b) where property is transferred for a consideration which, having regard to the circumstances of the case, has not passed or is not intended to pass either in full or in part from the transferee to the transferor, the amount of the consideration which has not passed or is not intended to pass shall be deemed to be a gift made by the transferor;

(c) 38 where there is a release, discharge, surrender, forfeiture or abandonment of any debt, contract or other actionable claim or of any interest in property by any person, the value of the release, discharge, surrender, forfeiture or abandonment to the extent to which it has not been found to the satisfaction of the ⁴Assessing Officer to have been bona fide, shall be deemed to be a gift made by the person, responsible for the release, discharge, surrender, forfeiture or abandonment;

(d) where a person absolutely entitled to property causes or has caused the same to be vested in whatever manner in himself and any other person jointly without adequate consideration and such other person makes an appropriation from or out of the said property, the amount of the appropriation used for the benefit of the person making the appropriation or for the benefit of any other person shall be deemed to be a gift made in his favour by the person who causes or has caused the property to be so vested;

⁵(e) where a person who has an interest in property as a tenant for a term or for life or a remainderman surrenders or relinquishes his interest in the property or otherwise allows his interest to be terminated without consideration or for a consideration which is not adequate, the value of the interest so surrendered, relinquished or allowed to be terminated or, as the case may be, the amount by which such value exceeds the consideration received, shall be deemed to be a gift made by such person.

⁶(2) where in the case of an individual being a member of a Hindu undivided family, any property having been the separate property of the individual has been converted by the individual into property belonging to the family through the act of impressing such separate property with the character of property belonging to the family or throwing it into the common stock of the family (such property being hereafter in this sub-section referred to as the converted property), then, notwithstanding anything contained in any other provision of this Act or any other law for the time being in force, for the purpose of computation of the taxable gifts made by the individual, the individual shall be deemed to have made a gift of so much of the converted property as the members of the Hindu undivided family other than such individual would be entitled to, if a partition of the converted property had taken place immediately after such conversion.

—————

1. Section 4 re-numbered as sub-section (1) thereof by Act 32 of 1971, sec. 37 (b) (w.e.f. 1-4-1972).

2. Subs. by Act 49 of 1991, sec. 84, for “market value of the property at the date of the transfer”. (w.e.f. 1-4-1992).

3. Ins. by Act 25 of 1975, sec. 29 (w.r.e.f. 1-4-1974).

4. Subs. by Act 4 of 1988, sec. 161, for “Gift-tax Officer” (w.e.f. 1-4-1988).

5. Ins. by Act 44 of 1980, sec. 42 (b) (w.e.f. 1-4-1980).

6. Ins. by Act 32 of 1971, sec. 37 (b) (w.e.f. 1-4-1972).

Section 5. EXEMPTION IN RESPECT OF CERTAIN GIFTS.

(1) Gift-tax shall not be charged under this Act in respect of gifts made by any person-

(i) of immovable property situate outside the territories to which this Act extends;

(ii) of movable property situate outside the said territories unless the person -

(a) being an individual, is a citizen of India and is ordinarily resident in the said territories; or

(b) not being an individual, is resident in the said territories, during the previous year in which the gift is made;

¹[(iia) being an individual who is not resident in India, to any person resident in India, of foreign currency or other foreign exchange [as defined, respectively, in clause (c) and clause (d) of section 2 of the Foreign Exchange Regulation Act, 1947 (7 of 1947)] remitted from a country outside India in accordance with the provisions of the said Act, and any rules made thereunder, during the period commencing on the 26th day of October, 1965, and ending on the 28th day of February, 1966 or such later date as the Central Government may, by notification in Official Gazette, specify in this behalf.

Explanation.—For the purposes of this clause, the expression “resident in India” shall have the meaning assigned to it in the Income-tax Act;]

²[(iib) being a person resident outside India, out of the moneys standing to his credit in a Non-resident (External) Account in any bank in India in accordance with the provisions of the Foreign Exchange Regulation Act, 1973 (46 of 1973), and any rules made thereunder.

Explanation—For the purposes of this clause, “person resident outside India” has the meaning assinged to it in clause (q) of section 2 of the Foreign Exchange Regulation Act, 1973 (46 of 1973);

(iic) being a citizen of India, or a person of Indian origin, who is not resident in India, to any relative of such person in India, of convertible foreign exchange remitted from a country outside India in accordance with the provisisons of the Foreign Exchange Regulation Act, 1973 (46 of 1973), and any rules made thereunder.

Explanation.—For the purposes of this clause and clause (iid),—

(a) a person shall be deemed to be of Indian origin if he or either of his parents or any of his grand-parents was born in undivided India;

(b) “convertible foreign exchange” means foreign exchange which is for the time being treated by the Reserve Bank of India as convertible foreign exchange for the purposes of the Foreign Exchange Regulation Act, 1973 (46 of 1973), and any rules made thereunder;

(c) “relative” has the meaning assigned to it in clause (41) of section 2 of the Income-tax Act;

(d) “resident in India” shall have the meaning assigned to it in the Income-tax Act;

(iid) being a citizen of India or a person of Indian origin, who is not resident in India, to any relative of such person in India of property in the form of ³[any foreign exchange asset as defined in clause (b) of section 115C of the Income-tax Act];]

4[(iie) being an individual who is a non-resident Indian, once out of the moneys standing to his credit in an account opened and operated in accordance with the Non-resident (Non-repatriable) Rupee Deposit Scheme, 1992.

1. —For the purposes of this clause, “non-resident Indian” shall have the meaning assigned to it in clause (e) of section 115C of the Income-tax Act;]

(iii) of property in the form of savings certificates issued by the Central Government, which that Government, by notification in the Official Gazette, exempts from gift-tax;

⁵[***]

⁶[(iiib) of property in the form of Special Bearer Bonds, 1991;]

⁷[(iiic) ⁸[being an individual or a Hindu undivided family, of property in the form of such Capital Investment Bonds] as the Central Government may, by notification in the Official Gazette, specify in this behalf subject to a maximum of rupees ten lakhs in value in the aggregate in one or more previous years:

Provided that the exemption conferred by this clause shall be available only to a person who has initially subscribed to the said Bonds;]

⁹[(iiid) being an individual or a Hindu undivided family, of property in the form of such Relief Bonds, as the Central Government may, by notification in the Official Gazette, specify in this behalf subject to a maximum of rupees five lakhs in value in the aggregate in one or more previous years:

Provided that the exemption conferred by this clause shall be available only to a person who has initially subscribed to the said Bonds;]

¹⁰[(iiie) being an individual who is a non-resident Indian, ¹¹[of property in the form of the bonds specified under sub-clause (iid) of clause (15) of section 10 of the Income-tax Act:

Provided that] where an individual, who is a non-resident Indian in any previous year in which the bonds are acquired, becomes a resident in India in any subsequent year, the provisions of this clause shall apply in respect of the gifts of property referred to in this clause in such subsequent year or any year thereafter.

Explanation.—For the purposes of this clause, the expressions—

¹²[***]

(b) “non-resident Indian” shall have the meaning assigned to it clause (e) of section 115C of the Income-tax Act;]

(iv) to the Government or any local authority ¹³[or any authority referred to in clause (20A) of section 10 of the Income-tax Act];

(v) to any institution or fund established ¹⁴[or deemed to be established] for a charitable purpose to which the provisions of ¹⁵[section 80G] of the Income-tax Act apply;

¹⁶[(va) (i) to such temple, mosque, gurdwara, church or other place as has been notified by the Central Government for the purposes of ¹⁷[clause (b) of sub-section (2) of section 80G of the Income-tax Act]; or

(ii) by way of settlement on trust, of property the income from which, according to the deed of settlement, is to be used exclusively in connection with the temple, mosque, gurdwara, church or other place specified therein and notified as aforesaid;]

¹⁸[***]

(vii) to any relative dependent upon him for support and maintenance, on the occasion of the marriage of the relative, subject to a maximum of rupees 19[one hundred thousand] in value in respect of the marriage of each such relative;

²⁰[***]

(x) under a will;

(xi) in contemplation of death;

(xii) for the education of his children, to the extent to which the gifts are proved to the satisfaction of the ²¹[Assessing Officer] as being reasonable having regard to the circumstances of the case;

(xiii) being an employer, to any employee by way of bonus, gratuity or pension or to the dependents of a deceased employee, to the extent to which the payment of such bonus, gratuity or pension is proved to the satisfaction of the ²⁷[Assessing Officer] as being reasonable having regard to the circumstances of the case and is made solely in recognition of the services rendered by the employee;

²¹[***]

(xv) to any person in charge of any such Bhoodan or Sampattidan movement as the Central Government may, by notification in the Official Gazette, specify;

²³[***]

²⁴[(1A) Any reference in clause (v) ²⁵[***] of sub-section (1) to charitable purpose in relation to a gift made on or after the 1st day of April, 1964, shall be construed as not including a purpose the whole or substantially the whole of which is of a religious nature.]

(2) Without prejudice to the provisions contained in sub-section (1), gift-tax shall not be charged under this Act in respect of gifts made by any person during the previous year, subject to a maximum of rupees ²⁶[thirty thousand] in value.

²⁷[***]

Explanation.—For the purposes of this section,—

(a) an individual shall be deemed to be ordinarily resident in the territories to which this Act extends during the previous year in which the gift is made if during that year he is regarded as a resident but not as not ordinarily resident 28[within the meaning of section 6 of the Income-tax Act, subject to the modification that references in that section to India shall be construed as references to the territories to which this Act extends];

(b) a Hindu undivided family firm or other association of persons shall be deemed to be resident in the territories to which this Act extends during any previous year unless, during that year, the control and management of its affairs was situated wholly outside the said territories;

(c) a company shall be deemed to be resident in the territories to which this Act extends during the previous year, if—

(i) it is a company formed and registered under the Companies Act, 1956 (1 of 1956), or is an existing company within the meaning of that Act; or

(ii) during that year, the control and management of that company was situated wholly in the said territories;

(d) “gifts made in contemplation of death” has the same meaning as in section 191 of the Indian Succession Act, 1925 (39 of 1925).

—————

1. Ins. by Act 13 of 1966, sec. 41 (a)(i) (w.e.f. 1-4-1966).

2. Ins. by Act 14 of 1982, sec. 38 (a) (w.e.f. 1-4-1983).

3. Subs. by Act 11 of 1983, sec. 42 (a) (w.e.f. 1-4-1984).

4. Ins. by Act 38 of 1993, sec. 41 (a)(i) (w.e.f. 1-4-1993).

5. Clause (iiia) omitted by Act 23 of 1986, sec. 42 (a) (w.e.f. 1-4-1987). Earlier clause (iiia) was ins. by Act 41 of 1975, sec. 7 (w.e.f. 4-12-1965).

6. Ins. by Act 7 of 1981, sec. 7 (w.e.f. 12-1-1981).

7. Ins. by Act 14 of 1982, sec. 38(b) (w.e.f 1-4-1983).

8. Subs. by Act 11 of 1983, sec. 42(b), for “of property in the form of such Capital Investment Bonds”, (w.e.f. 1-4-1983).

9. Ins. by Act 26 of 1988, sec. 67 (w.e.f. 1-4-1988).

10. Ins. by Act 3 of 1989, sec. 80 (w.e.f. 1-4-1989).

11. Subs. by Act 49 of 1991, sec. 85 (a) (w.e.f. 1-4-1991).

12. Clause (a) omitted by Act 49 of 1991, sec. 85(b) (w.e.f. 1-4-1991).

13. Ins. by Act 66 of 1976, sec. 28 (w.e.f. 1-4-1977).

14. Ins. by Act 21 of 1973, sec. 21(w.e.f. 1-4-1974).

15. Subs. by Act 32 of 1971, sec. 37 (c)(i) for “section 88”(w.r.e.f. 1-4-1968).

16. Ins. by Act 10 of 1965, sec. 71 (i) (w.e.f. 1-4-1965).

17. Subs. by Act 32 of 1971, sec. 37 (c) (ii), for “sub-section (6) of section 88 of the Income-tax Act” (w.r.e.f. 1-4-1968).

18. Clause (vi) omitted by Act 23 of 1986, sec. 42 (a) (w.e.f. 1-4-1987).

19. Subs. by Act 32 of 1994, sec. 55, for “thirty thousand” (w.e.f. 1-4-1995). Earlier the words “thirty thousand” were subs. by Act 38 of 1993, sec. 41(a) (ii), for “ten thousand” (w.e.f. 1-4-1994).

20. Clauses (viii) and (ix) omitted by Act 23 of 1986, sec. 42 (a) (w.e.f. 1-4-1987).

21. Subs. by Act 4 of 1988, sec. 161, for “Gift-tax Officer” (w.e.f. 1-4-1988)

22. Clause (xiv) omitted by Act 23 of 1986, sec. 42 (a) (w.e.f 1-4-1987).

23. Clause (xvi) omitted by Act 23 of 1986, sec. 42 (a) (w.e.f. 1-4-1987). Earlier clause (xvi) was omitted by Act 54 of 1972, sec. 6 (w.e.f. 1-4-1973) and was ins. by Act 67 of 1984, sec. 72 (w.e.f. 1-4-1985).

24. Ins. by Act 15 of 1965, sec. 21 (i) (w.e.f. 1-4-1964).

25. The words “or clause (vi)” omitted by Act 23 of 1986, sec. 42 (b) (w.e.f. 1-4-1987).

26. Subs. by Act 38 of 1993, sec. 41(b), for “twenty thousand” (w.e.f. 1-4-1994). Earlier the words “twenty thousand” were subs. by Act 23 of 1986, sec. 42(c), for “five thousand” (w.e.f. 1-4-1987) and the words “five thousand” were subs. by Act 19 of 1970, sec. 27(a), for “ten thousand” (w.e.f. 1-4-1971), and still earlier the words “ten thousand” were subs. by Act 13 of 1966, sec. 41(a) (ii) (w.e.f. 1-4-1966). Prior to this the words “five thousand” were subs. by Act 5 of 1964, sec. 52 (a) (ii), for “ten thousand”(w.e.f. 1-4-1964).

27. Sub-section (3) omitted by Act 23 of 1986, sec. 42 (d) (w.e.f. 1-4-1987).

28. Subs. by Act 53 of 1962, sec. 4 (ii), for “in the taxable territories within the meaning of the Income-tax Act” (w.e.f. 1-4-1963).

Section 6. VALUE OF GIFTS, HOW DETERMINED.

¹[6. Value of gifts, how determined.— (1) Subject to the provisions of sub-section (2), the value of any property, other than cash, transferred by way of gift shall, for the purpose of this Act, be its value as on the date on which the gift was made and shall be determined in the manner laid down in Schedule II.

(2) Where a person makes a gift which is not revocable for a specified period, the value of the property gifted shall be the capitalised value of the income from such property during the period for which the gift is not revocable.

—————

1.  Subs. by Act 3 of 1989, sec. 81 (w.e.f. 1-4-1989).

Section 6A.

¹[***]

—————

1. Section 6A omitted by Act 23 of 1986, sec. 43 (w.e.f. 1-4-1987). Earlier Section 6A was ins. by Act 5 of 1964, sec. 52(b) (w.e.f. 1-4-1964) and was omitted by Act 13 of 1966, sec. 41 (b) (w.e.f. 1-4-1966) and was again ins. by Act 41 of 1975, sec. 106 (w.e.f. 1-4-1976).

Section 7. GIFT-TAX AUTHORITIES AND THEIR JURISDICTION.

¹[7. Gift-tax authorities and their jurisdiction.—The income-tax authorities specified in section 116 the Income-tax Act shall be the gift-tax authorities for the purposes of this Act and every such authority shall exercise the powers and perform the functions of a gift-tax authority under this Act in respect of any person within his jurisdiction, and for this purpose his jurisdiction under this Act shall be the same as he has under the Income-tax Act by virtue of orders or directions issued under section 120 of that Act (including orders or directions assigning concurrent jurisdiction) or under any other provision of that Act.

Explanation : For the purposes of this section, the gift-tax authority having jurisdiction in relation to a person who has no income assessable to income-tax under the Income-tax Act shall be the gift-tax authority having jurisdiction in respect of the area in which that person resides.

—————

1.  Subs. by Act 4 of 1988, sec. 164 (w.e.f.1-4-1988).

Section 7A.

[OMITTED BY THE DIRECT TAX LAWS (AMENDMENT) ACT, 1987, W.E.F. 1-4-1988]

¹[***]

—————

1.  Section 7A omitted by Act 4 of 1988, sec. 165 (w.e.f. 1-4-1988). Earlier section 7A was ins. by Act 53 of 1962, sec. 5 (w.e.f. 1-4-1963) and was subs. by Act 20 of 1967, sec. 35 (b) (w.e.f. 1-4-1967) and again subs. by Act 67 of 1984), sec. 78 (w.e.f. 1-10-1984).

Section 7AA.

[OMITTED BY THE DIRECT TAX LAWS (AMENDMENT) ACT, 1987, W.E.F. 1-4-1988]

¹[***]

—————

1.  Section 7AA omitted by Act 4 of 1988, sec. 165 (w.e.f. 1-4-1988). Earlier section 7AA was ins. by Act 41 of 1975, sec. 108 (w.e.f. 1-10-1975) and was subs. by Act 29 of 1977), sec. 39 and Sch. V, Pt. III (w.e.f. 10-7-1978).

Section 7B.

[OMITTED BY THE DIRECT TAX LAWS (AMENDMENT) ACT, 1987, W.E.F. 1-4-1988]

¹[***]

—————

1.  Section 7B omitted by Act 4 of 1988, sec. 165 (w.e.f. 1-4-1988). Earlier section 7B was subs. along with section 7A by Act 20 of 1967. sec. 35 (b) (w.e.f. 1-4-1967).

Section 8. CONTROL OF GIFT-TAX AUTHORITIES.

¹[8. Control of gift-tax authorities. Section 118 of the Income-tax Act and any notification issued thereunder shall apply in relation to the control of gift-tax authorities as they apply in relation to the control of the corresponding income-tax authorities, except to the extent to which the Board may, by notification in the Official Gazette, otherwise direct in respect of any gift-tax authority.

—————

1.  Subs. by Act 4 of 1988, sec. 164 (w.e.f. 1-4-1988).

Section 8A.

[OMITTED BY THE DIRECT TAX LAWS (AMENDMENT) ACT, 1987, W.E.F. 1-4-1988]

¹[***]

—————

Section 9. INSTRUCTIONS TO SUBORDINATE AUTHORITIES.

¹[9. Instructions to subordinate authorities. —(1) The Board may, from time to time, issue such orders, instructions and directions to other gift-tax authorities as it may deem fit for the proper administration of this Act, and such authorities and all other persons employed in the execution of this Act shall observe and follow such orders, instructions and directions of the Board :

Provided that no such orders, instructions or directions shall be issued -

(a) so as to require any gift-tax authority to make a particular assessment or to dispose of a particular case in a particular manner; or

(b) so as to interfere with the discretion of the Deputy Commissioner (Appeals) or Commissioner (Appeals) in the exercise of his appellate functions.

(2) Without prejudice to the generality of the foregoing power, -

(a) the Board may, if it considers it necessary or expedient so to do, for the purpose of proper and efficient management of the work of assessment and collection of revenue, issue, from time to time (whether by way of relaxation of any of provisions of sections ²13, 14, 15, 16B, 17 and 34 or otherwise), general or special orders in respect of any class of cases, setting forth directions or instructions (not being prejudicial to assessees) as to the guidelines, principles or procedures to be followed by the gift-tax authorities in the work relating to assessment or collection of revenue or the initiation of proceedings for the imposition of penalties and any such order may, if the Board is of opinion that it is necessary in the public interest so to do, be published and circulated in the prescribed manner for general information;

(b) the Board may, if it considers it desirable or expedient so to do for avoiding genuine hardship in any case or class of cases, by general or special order, authorise any gift-tax authority, not being a Deputy Commissioner (Appeals) or Commissioner (Appeals) to admit an application or claim for any exemption, deduction, refund or any other relief under this Act after the expiry of the period specified by or under this Act for making such application or claim and deal with the same on merits in accordance with law.

—————

1.  Subs. by Act 4 of 1988, sec. 164 (w.e.f. 1-4-1988).

2.  Subs. by Act 12 of 1990, sec. 59, for “15, 16” (w.e.f. 1-4-1990).

Section 9A.

[OMITTED BY THE DIRECT TAX LAWS (AMENDMENT) ACT, 1987, W.E.F. 1-4-1988]

¹[***]

—————

1.  Section 9A omitted by Act 4 of 1988, sec. 165 (w.e.f. 1-4-1988). Earlier section 9A was ins. by Act 53 of 1962, sec.6 (w.e.f. 1-4-1963).

Section 10. JURISDICTION OF ASSESSING OFFICERS AND POWER TO TRANSFER CASES.

¹[10. Jurisdiction of Assessing Officers and power to transfer cases.—(1) The provisions of sections 124 and 127 of the Income-tax Act shall, so far as may be, apply for the purposes of this Act as they apply for the purposes of the Income-tax Act, subject to the modifications specified in sub-section (2).

(2) The modifications referred to in sub-section (1) shall be the following namely :-

(a) in section 124 of the Income-tax Act, – (i) in sub-section (3), references to the provisions of the Income-tax Act shall be construed as references to the corresponding provisions of the Gift-tax Act; (ii) sub-section(5) shall be omitted;

(b) in section 127 of the Income-tax Act, in the Explanation below sub-section ²[(4)], references to proceedings under the Income-tax Act shall be construed as including references to proceedings under the Gift-tax Act.]

—————

1. Subs. by Act 4 of 1988, sec. 164 (w.e.f. 1-4-1988).

2. Subs. by Act 3 of 1989, sec. 82, for “(5)” (w.r.e.f. 1-4-1988).

Section 11.

[OMITTED BY THE DIRECT TAX LAWS (AMENDMENT) ACT, 1987, W.E.F. 1-4-1988]

¹[***]

—————

1. Section 11 omitted by Act 4 of 1988, sec. 165 (w.e.f. 1-4-1988). Earlier section 11 was subs. by Act 53 of 1962, sec. 7 (w.e.f. 1-4-1963) and was again subs. by Act 20 of 1967, sec. 35 (c) (w.e.f. 1-4-1967).

Section 11A.

[OMITTED BY THE DIRECT TAX LAWS (AMENDMENT) ACT, 1987, W.E.F. 1-4-1988]

¹[***]

—————

1.  Section 11A omitted by Act 4 of 1988,sec. 165 (w.e.f. 1-4-1988). Earlier section 11A was ins. by Act 19 of 1970, sec. 27 (b) after renumbering the then section 11A as section 11AA (w.e.f. 1-4-1970)and the original section 11A was ins. by Act 20 of 1967, sec. 35 (f) (w.e.f.1-4-1967).

Section 11AA.

[OMITTED BY THE DIRECT TAX LAWS (AMENDMENT) ACT, 1987, W.E.F. 1-4-1988]

¹[***]

—————

1.  Section 11AA omitted by Act 4 of 1988, sec. 165 (w.e.f. 1-4-1988). Earlier section 11AA was ins. as section 11A by Act 20 of 1967, sec. 35 (f) (w.e.f. 1-4-1967) and the original section 11A was re-numbered as section 11AA by Act 19 of 1970, sec. 27 (b) (w.e.f. 1-4-1970).

Section 11B.

[OMITTED BY THE DIRECT TAX LAWS (AMENDMENT) ACT, 1987, W.E.F. 1-4-1988]

¹[***]

—————

1.  Section 11B omitted by Act 4 of 1988, sec. 165 (w.e.f. 1-4-1988). Earlier section 11A was subs. along with section 11 by Act 53 of 1962, sec. 7 (w.e.f. 1-4-1963), and section 11A was renumbered as section 11B by Act 20 of 1967, sec. 35 (7) (w.e.f. 1-4-1967).

Section 12.

[OMITTED BY THE DIRECT TAX LAWS (AMENDMENT) ACT, 1987, W.E.F. 1-4-1988]

¹[***]

—————

1.  Section 12 omitted by Act 4 of 1988, sec. 165 (w.e.f. 1-4-1988).

Section 13. RETURN OF GIFTS.

¹(1) Every person who during a previous year has made any taxable gifts, or is assessable in respect of the taxable gifts made by any other person under this Act, which, in either case, exceeded the maximum amount not chargeable to gift-tax, shall, on or before the 30th day of June of the corresponding assessment year, furnish a return of such gifts in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed.

(2) Notwithstanding anything contained in any other provision of this Act, a return which shows the amount of taxable gifts below the maximum amount which is not chargeable to tax shall be deemed never to have been furnished :

Provided that this sub-section shall not apply to a return furnished in response to notice under section 16.

²[***]

—————

1.  Subs. by Act 4 of 1988, sec. 166(a) (w.e.f.1-4-1989).

2.  Sub-section (3) omitted by Act 4 of 1988, sec. 166(b) (w.e.f. 1-4-1989).

Section 14. RETURN AFTER DUE DATE AND AMENDMENT OF RETURN.

¹ RETURN AFTER DUE DATE AND AMENDMENT OF RETURN. – If any person has not furnished a return within the time allowed under sub-section (1) of section 13 or by a notice issued under clause (i) of sub-section (4) of section 15, or having furnished a return discovers any omission or wrong statement therein, he may furnish a return or a revised return, as the case may be, at any time before the expiry of one year from the end of the relevant assessment year or before the completion of the assessment, whichever is earlier :

Provided that -

(a) where such return or revised return relates to the assessment year commencing on the 1st day of April, 1987, or any earlier assessment year, it may be furnished at any time up to and inclusive of the 31st day of March, 1990 or before the completion of the assessment, whichever is earlier;

(b) where such return or revised return relates to the assessment year commencing on the 1st day of April, 1988, it may be furnished at any time up to and inclusive of the 31st day of March, 1991 or before the completion of the assessment, whichever is earlier.

—————

1.  Subs. by Act 4 of 1988, sec. 167 (w.e.f. 1-4-1989).

Section 14A. RETURN BY WHOM TO BE SIGNED.

¹ RETURN BY WHOM TO BE SIGNED. The return made under section 13 or section 14 shall be signed and verified -

² (a) in the case of an individual, – (i) by the individual himself;

(ii) where he is absent from India, by the individual or by some person duly authorised by him in this behalf;

(iii) where he is mentally incapacitated from attending to his affairs, by his guardian or any other person competent to act on his behalf; and

(iv) where, for any other reason, it is not possible for the individual to sign the return, by any person duly authorised by him in this behalf :

Provided that in a case referred to in sub-clause (ii) or sub-clause (iv), the person signing the return holds a valid power of attorney from the individual to do so, which shall be attached to the return;

(b) in the case of a Hindu undivided family, by the Karta, and, where the Karta is absent from India or is mentally incapacitated from attending to his affairs, by any other adult member of such family;

(c) in the case of a company, by the managing director thereof or where for any unavoidable reason such managing director is not able to sign and verify the return, or where there is no managing director, by any director thereof :

Provided that where the company is not resident in India, the return may be signed and verified by a person who holds a valid power of attorney from such company to do so, which shall be attached to the return :

Provided further that, -

(a) where the company is being wound up, whether under the orders of the Court or otherwise, or where any person has been appointed as the receiver of any assets of the company, the return shall be signed and verified by the liquidator referred to in sub-section (1) of section 178 of the Income-tax Act;

(b) where the management of the company has been taken over by the Central Government or any State Government under any law, the return of the company shall be signed and verified by the principal officer thereof.

(d) in the case of a firm, by the managing partner thereof or where for any unavoidable reason such managing partner is not able to sign and verify the return, or where there is no managing partner as such, by any partner thereof, not being a minor;

(e) in the case of any other association, by any member of the association or the principal officer thereof; and

(f) in the case of any other person, by that person or by some person

competent to act on his behalf.

————

1.  Ins. by Act 53 of 1962, sec. 11 (w.e.f. 1-4-1963).

2.  Subs. by Act 4 of 1988, sec. 168 (i) (w.e.f.1-4-1989).

3.  Clauses (c) and (d) subs. by Act 41 of 1975, sec. (111) (w.e.f. 1-4-1976).

4.  Two provisions by Act 4 of 1988, sec. 168 (ii) (w.e.f. 1-4-1989).

Section 14B. SELF-ASSESSMENT.

¹SELF-ASSESSMENT. (1) Where any tax is payable on the basis of any return furnished under section 13 or under section 14 or in response to a notice under clause (i) of sub-section (4) of section 15 or under section 16, after taking into account the amount of tax, if any, already paid under any provision of this Act, the assessee shall be liable to pay such tax, together with interest payable under any provision of this Act for any delay in furnishing the return, before furnishing the return and the return shall be accompanied by proof of payment of such tax and interest.

Explanation : Where the amount paid by the assessee under this sub-section falls short of the aggregate of the tax and interest as aforesaid, the amount so paid shall first be adjusted towards the interest payable as aforesaid and the balance, if any, shall be adjusted towards the tax payable.

(2) After the regular assessment under section 15 has been made, any amount paid under sub-section (1) shall be deemed to have been paid towards such regular assessment.

(3) If any assessee fails to pay the whole or any part of such tax or interest or both in accordance with the provisions of sub-section (1), he shall, without prejudice to any other consequences which he may incur, be deemed to be an assessee in default in respect of the tax or interest or both remaining unpaid and all the provisions of this Act shall apply accordingly.

(4) The provisions of this section shall apply in respect of assessment for the assessment year commencing on the 1st day of April, 1989 and subsequent assessment years.

²[(4)The provisions of this section shall apply in respect of assessment for the assessment year commencing on the 1st day of April, 1989, and subsequent assessment years.]

—————

1.  Ins. by Act 4 of 1988, sec. 169 (w.e.f. 1-4-1989).

2.  Ins. by Act 36 of 1989, sec. 31 (w.e.f. 1-4-1989).

Section 15. ASSESSMENT.

¹[15. Assessment.—(1) (a) Where a return has been made under section 13 or section 14 or in response to a notice under clause (i) of sub-section (4),—

(i) if any tax or interest is found due on the basis of such return after adjustment of any amount paid by way of tax or interest, an intimation shall be sent to the assessee specifying the sum so payable, and such intimation shall be deemed to be a notice issued under section 31 and all the provisions of this Act shall apply accordingly; and

(ii) if any refund is due on the basis of such return, it shall be granted to the assessee;

Provided that in computing the tax or interest payable by, or refundable to the assessee, the following adjustments shall be made in the taxable gifts declared in the return, namely:—

i) any arithmetical errors in the return, accounts or documents accompanying it shall be rectified;

(ii) any exemption or deduction, which on the basis of the information available in such return, accounts or documents, is prima facie admissible but which is not claimed or made in the return, shall be allowed;

(iii) any exemption or deduction claimed or made in the return, which, on the basis of the information available in such return, accounts or documents, is prima facie inadmissible, shall be disallowed:

²[Provided further that where adjustments are made under the first proviso, an intimation shall be sent to the assessee, notwithstanding that no tax or interest is found due from him after making the said adjustments:]

³[4[Provided also] that an intimation for any tax or interest due under this clause shall not be sent after the expiry of two years from the end of the assessment year in which the gifts were first assessable.]

(b) Where, as a result of an order made under 5[sub-section (3) or sub-section (5) of this section or section 16 or section 22 or section 23 or section 24 or section 26 or section 28 or section 34 relating to any earlier assessment year and passed subsequent to the filing of the return referred to in clause (a) there is any variation in the exemption or deduction claimed or made in the return, and as a result of which,—

(i) if any tax or interest is found due, an intimation shall be sent to the assessee specifying the sum so payable, and such intimation shall be deemed to be a notice of demand issued under section 31 and all the provisions of this Act shall apply accordingly; and

(ii) if any refund is due, it shall be granted to the assessee:

Provided that an intimation for any tax or interest due under this clause shall not be sent after the expiry of four years from the end of the financial year in which any such order was passed.

⁶[(1A) (a) Where in the case of any person, the taxable gift, as a result of the adjustments made under 7[the first proviso] to clause (a) of sub-section (1), exceeds the taxable gift declared in the return by any amount, the Assessing Officer shall,—

(i) further increase the amount of tax payable under sub-section (1) by an additional gift-tax calculated at the rate of twenty per cent. of the tax payable on such excess amount and specify the additional gift-tax in the intimation to be sent under sub-clause (i) of clause (a) of sub-section (1);

(ii) where any refund is due under sub-section (1), reduce the amount of such refund by an amount equivalent to the additional gift-tax calculated under sub-clause (i).

(b) Where as a result of an order under section 22 or section 23 or section 24 or section 26 or section 28 or section 34, the amount on which additional gift-tax is payable under clause (a) has been increased or reduced, as the case may be, the additional gift-tax shall be increased or reduced accordingly, and,—

(i) in a case where the additional gift-tax is increased, the Assessing Officer shall serve on the assessee a notice of demand under section 31;

(ii) in a case where the additional gift-tax is reduced, the excess amount paid, if any, shall be refunded.

Explanation.—For the purposes of this sub-section, “tax payable on such excess amount” means the difference between the tax on the taxable gift and the tax that would have been chargeable had such taxable gift been reduced by the amount of adjustments.]

⁸[(1B) Where an assessee furnishes a revised return under section 14 after the issue of an intimation, or the grant of refund, if any, under sub-section (1) of this section, the provisions of sub-sections (1) and (1A) of this section shall apply in relation to such revised return and—

(i) the intimation already sent for any gift-tax, additional gift-tax or interest shall be amended on the basis of the said revised return and where any amount payable by way of gift-tax, additional gift-tax or interest specified in the said intimation has already been paid by the assessee then, if any such amendment has the effect of—

(a) enhancing the amount already paid, the intimation amended under this clause shall be sent to the assessee specifying the excess amount payable by him and such intimation shall be deemed to be a notice of demand issued under section 31 and all the provisions of this Act, shall apply accordingly;

(b) reducing the amount already paid, the excess amount paid shall be refunded to the assessee;

(ii) the amount of the refund already granted shall be enhanced or reduced on the basis of the said revised return and where the amount of refund already granted is—

(a) enhanced, only the excess amount of refund due to the assessee shall be paid to him;

(b) reduced, the excess amount so refunded shall be deemed to be the tax payable by the assessee and an intimation shall be sent to the assessee specifying the amount so payable, and such intimation shall be deemed to be a notice of demand issued under section 31 and all the provisions of this Act shall apply accordingly:

Provided that an assessee, who has furnished a revised return under section 14 after the service upon him of the intimation under sub-section (1) of this section, shall be liable to pay additional gift-tax in relation to the adjustments made under the first proviso to clause (a) of sub-section (1) and specified in the said intimation, whether or not he has made the said adjustments in the revised return.]

(2) ⁹[Where a return has been made under section 13 or section 14 or in response to a notice under clause (i) of sub-section (4) of this section, the Assessing Officer shall, if he] considers it necessary or expedient to ensure that the assessee has not omitted to disclose any taxable gift or has not understated the amount or value of any such gift or has not under-paid the tax in any manner 10[serve on the assessee] a notice requiring him, on a date to be specified therein, either to attend at the office of the Assessing Officer or to produce, or cause to be produced there, any evidence on which the assessee may rely in support of the return:

¹¹[Provided that no notice under this sub-section shall be served on the assessee after the expiry of twelve months from the end of the month in which the return is furnished.]

(3) On the date specified in the notice issued under sub-section (2) or, as soon afterwards as may be, after hearing such evidence as the assessee may produce and such other evidence as the Assessing Officer may require on specified points, and after taking into account all relevant material which he has gathered, the Assessing Officer shall, by order in writing, assess the value of taxable gifts made by the assessee and determine the sum payable by him on the basis of such assessment.

(4) For the purposes of making an assessment under this Act, the Assessing Officer may serve, on any person who has made a return under section 13 or section 14 or in whose case the time allowed under sub-section (1) of section 13 for furnishing the return has expired, a notice requiring him, on a date to be specified therein,—

(i) where such person has not made a return ¹²[within the time allowed under sub-section (1) of section 13], to furnish a return of the taxable gifts made by him or of the taxable gifts made by any other person in respect of which he is assessable under this Act during the previous year, in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed, or

(ii) to produce or cause to be produced such accounts, records or other documents as the Assessing Officer may require.

(5) If any person—

(a) fails to make the return required under sub-section (1) of section 13 and has not made a return or a revised return under section 14, or

(b) fails to comply with all the terms of a notice issued under sub-section (2) or sub-section (4), the Assessing Officer, after taking into account all relevant material which he has gathered, shall, after giving such person an opportunity of being heard, estimate the vlaue of taxable gifts to the best of his judgment and determine the sum payble by such person on the basis of such assessment:

Provided that such opportunity shall be given by the Assessing Officer by serving a notice calling upon the person to show cause, on a date and time to be specified in the notice, why the assessment should not be completed to the best of his judgment:

Provided further that it shall not be necessary to give such opportunity in a case where a notice under sub-section (4) has been issued prior to the making of the assessment under this sub-section.

(6) Notwithstanding anything contained in section 6, for the purpose of making an assessment under this Act, 13[where under the provisions of section 6 read with Schedule II, the fair market value of any property transferred by way of gift is to be taken into account in such assessment,] the Assessing Officer may refer the valuation of such property to the Valuation Officer,—

(a) in a case where the value of the property as returned is in accordance with the estimate made by a registered valuer, if the Assessing Officer is of opinion that the value so returned is less than its fair market value;

(b) in any other case, if the Assessing Officer is of opinion—

(i) that the fair market value of the property exceeds the value of the property as returned by more than such percentage of the value of the property as returned or by more than such amount as may be prescribed in this behalf; or

(ii) that having regard to the nature of the property and other relevant circumstances, it is necessary so to do,and where any such reference is made, the provisions of sub-sections (2), (3), (4), (5) and (6) of section 16A, clauses (ha) and (i) of sub-section (1) and sub-sections (3A) and (4) of section 23, sub-section (5) of section 24, section 34AA, section 35 and section 37 of the Wealth-tax Act, 1957 (27 of 1957), shall, with the necessary modifications, apply in relation to such reference as they apply in relation to a reference made by the Assessing Officer under sub-section (1) of section 16A of that Act.

Explanation.—In this sub-section, “Valuation Officer” has the same meaning as in clause (r) of section 2 of the Wealth-tax Act, 1957 (27 of 1957)].

¹⁴[(7) Where a regular assessment under sub-section (3) or sub-section (5) is made,—

(a) any tax or interest paid by the assessee under sub-section (1) shall be deemed to have been paid towards such regular assessments;

(b) in no refund is due on regular assessment or the amount refunded under sub-section (1) exceeds the amount refundable on regular assessment, the whole or the excess amount so refunded shall be deemed to be tax payable by the assessee and the provisions of this Act shall apply accordingly.

(8) The provisions of this section, except those of sub-section (6), as they stood immediately before their amendment by the Direct Tax Laws (Amendment) Act, 1987 (4 of 1988), shall apply to and in relation to any assessment for the assessment year commencing on the 1st day of April, 1988, or any earlier assessment year and references in this section to the other provisions of this Act shall be construed as references to those provisions as for the time being in force and applicable to the relevant assessment year.]

¹⁵[Explanation.—An intimation sent to the assessee under sub-section (1) or sub-section (IB) shall be deemed to be an order for the purposes of sub-section (1) of section 24.]

—————

1. Subs. by Act 4 of 1988, sec. 170 (w.e.f. 1-4-1989).

2. Ins. by Act 36 of 1989, sec. 32 (a)(i)(1) (w.e.f. 1-4-1989).

3. Ins. by Act 3 of 1989, sec. 83 (a) (w.e.f. 1-4-1989).

4. Subs. by Act 36 of 1989, for “Provided further” (w.e.f. 1-4-1989).

5. Ins. by Act 36 of 1989, sec. 32 (a)(ii)(w.e.f. 1-4-1989).

6. Ins. by Act 3 of 1989, sec. 83 (b) (w.e.f. 1-4-1989).

7. Subs. by Act 36 of 1989, sec. 32 (b) for “ the proviso” (w.e.f. 1-4-1989).

8. Ins. by Act 12 of 1990, sec. 60(a) (w.r.e.f. 1-4-1989).

9. Subs. by Act 36 of 1989, sec. 32 (c)(i), for “In a case referred to in sub-section (1) if the Assessing Officer” (w.e.f. 1-4-1989).

10. Subs. by Act 36 of 1989, sec. 32 (c) (ii), for “he shall serve on the assessee” (w.e.f. 1-4-1989).

11. Subs. by Act 49 of 1991, sec. 86 (a) (w.e.f. 1-10-1991).

12. Subs. by Act 12 of 1990, sec. 60 (b), for “before the end of the relevant assessment year”(w.e.f. 1-4-1990).

13. Ins. by Act 3 of 1989, sec. 83 (c) (w.e.f. 1-4-1989).

14. Sub-sections (7) and (8) ins. by Act 36 of 1989, sec. 32 (d) (w.e.f. 1-4-1989).

15. Ins. by Act 49 of 1991, sec. 86 (b) (w.e.f. 1-10-1991).

Section 16. GIFT ESCAPING ASSESSMENT.

¹(1) If the Assessing Officer ²has, reasons to believe] that the taxable gifts in respect of which any person is assessable under this Act (whether made by him or by any other person) have escaped assessment for any assessment year (whether by reason of under-assessment or assessment at too low a rate or otherwise), he may, subject to the other provisions of this section and section 16A, serve on such person a notice requiring him to furnish within such period, ³[***], as may be specified in the notice, a return in the prescribed form and verfied in the prescribed manner, setting forth the taxable gifts made by him or by such other person during the previous year mentioned in the notice, in respect of which he is assessable, along with such other particulars as may be required by the notice, and may proceed to assess or reassess such gifts and also any other taxable gifts in respect of which such person is assessable, which have escaped assessment and which come to his notice subsequently in the course of the proceedings under this section for the assessment year concerned (hereafter in this section referred to as the relevant assessment year); and the provisions of this Act shall, so far as may be apply as if the return were a return required under section 13:

Provided that where an assessment under sub-section (3) of section 15 or this section has been made for the relevant assessment year, no action shall be taken under this section after the expiry of four years from the end of the relevant assessment year, unless any taxable gift chargeable to tax has escaped assessment for such assessment year by reason of the failure on the part of the assessee to make a return under section 13 or section 14 or in response to a notice issued under sub-section (4) of section 15 or this section or to disclose fully and truly all material facts necessary for his assessment for that assessment year :

⁴Provided further that the Assessing Officer shall, before issuing any notice under this sub-section, record his reasons for doing so.

Explanation : Production before the Assessing Officer of account books or other evidence from which material evidence could with due diligence have been discovered by the Assessing Officer will not necessarily amount to disclosure within the meaning of the foregoing proviso.

(1A) No notice under sub-section (1) shall be issued for the relevant assessment year, – (a) in a case where an assessment under sub-section (3) of section 15 or sub-section (1) of this section has been made for such assessment year, -

(i) if four years have elapsed from the end of the relevant assessment year, unless the case falls under sub-clause (ii) or sub-clause (iii);

(ii) if four years, but not more than seven years, have elapsed from the end of the relevant assessment year, unless the value of taxable gifts chargeable to tax which have escaped assessment amounts to or is likely to amount to rupees fifty thousand or more for that year;

(iii) if seven years, but not more than ten years, have elapsed from the end of the relevant assessment year, unless the value of taxable gifts chargeable to tax which have escaped assessment amounts to or is likely to amount to rupees one lakh or more for that year;

(b) in any other case, – (i) if four years have elapsed from the end of the relevant assessment year, unless the case falls under sub-clause (ii) or sub-clause (iii);

(ii) if four years, but not more than seven years, have elapsed from the end of the relevant assessment year, unless the value of taxable gifts chargeable to tax which have escaped assessment amounts to or is likely to amount to rupees twenty-five thousand or more for that year;

(iii) if seven years, but not more than ten years, have elapsed from the end of the relevant assessment year, unless the value of taxable gifts chargeable to tax which have escaped assessment amounts to or is likely to amount to rupees fifty thousand or more for that year.

Explanation : For the purposes of sub-section (1) and sub-section (1A), the following shall also be deemed to be cases where taxable gifts chargeable to tax have escaped assessment, namely :-

(a) where no return of taxable gifts has been furnished by the assessee although the taxable gifts made by him or the taxable gifts made by any other person in respect of which he is assessable under this Act during the previous year exceeded the maximum amount which is not chargeable to gift-tax;

(b) where a return of taxable gifts has been furnished by the assessee but no assessment has been made and it is noticed by the Assessing Officer that the assessee has understated the amount or value of the taxable gifts or has claimed excessive exemption or deduction in the return.

(1B)(a) In a case where an assessment under sub-section (3) of section 15 or sub-section (1) of this section has been made for the relevant assessment year, no notice shall be issued under sub-section (1) ⁵by an Assessing Officer who is below the rank of Assistant Commissioner or Deputy Commissioner, unless the Deputy Commissioner is satisfied, on the reasons recorded by such Assessing Officer, that it is a fit case for the issue of such notice :

Provided that, after the expiry of four years from the end of the relevant assessment year, no such notice shall be issued unless the Chief Commissioner or Commissioner is satisfied, on the reasons recorded by the Assessing Officer aforesaid, that it is a fit case for the issue of such notice.

(b) In a case, other than a case falling under clause (a), no notice shall be

issued under sub-section (1) by an Assessing Officer, who is below the rank of Deputy Commissioner, after the expiry of four years from the end of the relevant assessment year, unless the Deputy Commissioner is satisfied, on the reasons recorded by such Assessing Officer, that it is a fit case for the issue of such notice.

(2) Nothing contained in this section limiting the time within which any proceedings for assessment or reassessment may be commenced shall apply to an assessment or reassessment to be made on the assessee or any person in consequence of or to give effect to any finding or direction contained in an order under section 22, section 23, section 24, section 26 or section 28, ⁶or by a court in any proceedings under any other law.

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1.  Sub-sections (1), (lA) and (1B) subs. by Act 4 of 1988, sec. 171 (a), for sub-section (1) (w.e.f. 1-4-1989).

2.  Subs. by Act 3 of 1989, sec. 84 (a), for “for, reasons to be recorded by him in writing, is of the opinion”.

3.  The words “not being less than thirty days”, omited by the Finance Act, 2003, sec. 101 (w.r.e.f. 1-4-1989).

4.  Ins. by Act 3 of 1989, sec. 84 (b) (w.e.f. 1-4-1989).

5.  Subs. by Act 12 of 1990, sec. 61 (w.e.f. 1-4-1990)

6.  Ins. by Act 4 of 1988, sec. 171(b) (w.e.f. 1-4-1989).

Section 16A. TIME LIMIT FOR COMPLETION OF ASSESSMENT AND REASSESSMENT.

¹[16A. Time-limit for completion of assessment and reassessment.—²[(1) No order of assessment shall be made under section 15 at any time after the expiry of ³[two years] from the end of the assessment year in which the gifts were first assessable:

⁴[Provided that,—

(a) where the gifts were first assessable in the assessment year commencing on the 1st day of April, 1987, or any ealier assessment year, such assessment may be made on or before the 31st day of March, 1991;

(b) where the gifts were first assessable in the assessment year commencing on the 1st day of April, 1988, such assessment may be made on or before the 31st day of March, 1992].

(2) No order of assessment or reassessment shall be made under section 16 after the expiry of two years from the end of the financial year in which the notice under sub-section (1) of that section was served:

Provided that,—

(i) where the notice under clause (a) of sub-section (1) of section 16 was served during the financial year commencing on the 1st day of April, 1985, or the 1st day of April, 1986 such assessment or reassessment may be completed on or before the 31st day of March,1990;

(ii) where the notice under clause (b) of sub-section (1) of section 16 relates to the assessment for the assessment year commencing on the 1st day of April, 1985, or the 1st day of April, 1986, such assessment or reassessment may be completed on or before the 31st day of March, 1990 or the expiry of two years from the end of the financial year in which such notice was served, whichever is later.

Explanation.—References to section 16 in the proviso shall be construed as references to that section as it stood before its amendment by the Direct Tax Laws (Amendment) Act, 1987 (4 of 1988).]

(3) Notwithstanding anything contained in sub-sections (1) and (2), an order of fresh assessment in pursuance of an order passed on or after the 1st day of April, 1975, under section 22, section 23 or section 24, setting aside or cancelling an assessment, may be made at any time before the expiry of ⁵[two years] from the end of the financial year in which the order under section 22 or section 23 is received by the ⁶[Chief Commissioner or Commissioner] or, as the case may be, the order under section 24 is passed by the Commissioner:

⁷[Provided that where the order setting aside or cancelling the assessment was passed during the financial year commencing on the 1st day of April, 1985 or the 1st day of April, 1986, the order of fresh assessment may be made on or before the 31st day of March, 1990.]

(4) The provisions of sub-sections (1) and (2) shall not apply to the assessment or reassessment made on the assessee in consequence of, or to give effect to, any finding or direction contained in an order under section 22, section 23, section 24, section 26, or section 28 or in an order of any Court in a proceeding otherwise than by way of appeal or reference under this Act and such assessment or reassessment may, subject to the provisions of sub-section (3), be completed at any time.

Explanation 1.—In computing the period of limitation for the purposes of this section—

(i) the time taken in reopening the whole or any part of the proceeding or in giving an opportunity to the assessee to be reheard under the proviso to section 38, or

(ii) the period during which the assessment proceeding is stayed by an order or injunction of any Court,shall be excluded:

⁸[Provided that where immediately after the exclusion of the aforesaid time or period, the period of limitation referred to in sub-sections (1), (2) and (3) available to the Assessing Officer for making an order of assessment or reassessment, as the case may be, is less than sixty days, such remaining period shall be extended to sixty days and the aforesaid period of limitation shall be deemed to be extended accordingly.]

Explanation 2.—Where, by an order referred to in sub-section (4), any gift is excluded from the taxable gifts for an assessment year in respect of an assessee, then, an assessment of such gift for another assessment year shall, for the purposes of sub-section (2) of section 16 and this section, be deemed to be one made in consequence of, or to give effect to, any finding or direction contained in the said order.]

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1. Ins. by Act 41 of 1975, sec. 112 (w.e.f. 1-10-1975).

2. Subs. by Act 4 of 1988, sec. 172 (a) (w.e.f. 1-4-1989).

3. Subs. by Act 13 of 1989, sec. 31(a), for “one year” (w.e.f. 1-4-1989).

4. Subs. by Act 13 of 1989, sec. 31(b) (w.e.f. 1-4-1989).

5. Subs. by Act 4 of 1988, sec. 172 (b) (i), for “four years” (w.e.f. 1-4-1989).

6. Subs. by Act 4 of 1988, sec. 161, for “Commissioner” (w.e.f. 1-4-1988).

7. Ins. by Act 4 of 1988, sec. 172 (b) (ii) (w.e.f. 1-4-1989).

8. Ins. by Act 49 of 1991, sec. 87 (w.e.f. 27-9-1991).

Section 16B. INTEREST FOR DEFAULTS IN FURNISHING RETURN OF GIFTS.

¹[16B. Interest for defaults in furnishing return of gifts.—(1) Where a return of gifts for any assessment year under sub-section (1) of section 13 or section 14, or in response to a notice under clause (i) of sub-section (4) of section 15, is furnished after the 30th day of June of such year, or is not furnished, the assessee shall be liable to pay simple interest at the rate of two per cent. for every month or part of a month comprised in the period commencing on the 1st day of July of the assessment year, and,—

(a) where the return is furnished after the 30th day of June ending on the date of furnishing of the return; or

(b) where no return has been furnished, ending on the date of completion of the assessment under sub-section (5) of section 15, on the amount of tax payable on the taxable gifts as determined 2[under sub-section (1) of section 15 or] on regular assessment.

³[Explanation 1.—In this sub-section, “tax payable on the taxable gifts as determined under sub-section (1) of section 15” shall not include the additional gift-tax, if any payable under section 15.]

Explanation 2.—Where in relation to an assessment year the assessment is made for the first time under section 16, the assessment so made shall be regarded as a regular assessment for the purposes of this section.

⁴[Explanation 3.—In this sub-section, “tax payable on the taxable gifts as determined under sub-section (1) of section 15 or on regular assessment” shall, for the purposes of computing the interest payable under section 14B, be deemed to be tax payable on the taxable gifts as declared in the return.]

(2) The interest payable under sub-section (1) shall be reduced by the interest, if any, paid under section 14B towards the interest chargeable under this section.

(3) Where return of gifts for any assessment year, required by a notice under sub-section (1) of section 16 issued 5[after the determination of taxable gifts under sub-section (1) of section 15 or] after the completion of an assessment under sub-section (3) or sub-section (5) of section 15 or section 16, is furnished after the expiry of the time allowed under such notice, or is not furnished, the assessee shall be liable to pay simple interest at the rate of two per cent. for every month or part of a month comprised in the period commencing on the day immediately following the expiry of the time allowed as aforesaid, and,—

(a) where the return is furnished after the expiry of the time aforesaid, ending on the date of furnishing the return; or

(b) where no return has been furnished, ending on the date of completion of the reassessment under section 16,

on the amount by which the tax on the taxable gifts determined on the basis of such reassessment exceeds the tax on the taxable gifts as determined ⁶[under sub-section (1) of section 15 or] on the basis of the earlier assessment aforesaid.

⁷[***]

(4) where, as a result of an order under section 22 or section 23 or section 24 or section 26 or section 28 or section 34, the amount of tax on which interest was payable under this section has been increased or reduced, as the case may be, the interest shall be increased or reduced accordingly, and,—

(i) in a case where the interest is increased, the Assessing Officer shall serve on the assessee a notice of demand in the prescribed form specifying the sum payable, and such notice of demand shall be deemed to be a notice under section 31 and the provisions of this Act shall apply accordingly, and

(ii) in a case where the interest is reduced, the excess interest paid, if any, shall be refunded.

(5) The provisions of this section shall apply in respect of assessments for the assessment year commencing on the 1st day of April, 1989, and subsequent assessment years.]

—————

1. Ins. by Act 4 of 1988, sec. 173 (w.e.f. 1-4-1989).

2. Ins. by Act 3 of 1989, sec. 85 (a) (i) (w.e.f. 1-4-1989).

3. Subs. by Act 3 of 1989, sec. 85 (a) (ii) (w.e.f. 1-4-1989).

4. Ins. by Act 3 of 1989, sec. 85(a)(iii) (w.e.f. 1-4-1989).

5. Ins. by Act 3 of 1989, sec. 85 (b) (i) (w.e.f. 1-4-1989.)

6. Ins. by Act 3 of 1989, sec. 85(b) (ii) (w.e.f. 1-4-1989).

7. Explanation omitted by Act 3 of 1989, sec. 85 (b) (iii) (w.e.f. 1-4-1989).

Section 17. PENALTY FOR FAILURE TO FURNISH RETURNS, TO COMPLY WITH NOTICES AND CONCEALMENT OF GIFTS, ETC.

¹[17. Penalty for failure to furnish returns, to comply with notices and concealment of gifts, etc.—(1) If the ²[Assessing Officer], ³[Deputy Commissioner (Appeals)], ⁴[Commissioner(Appeals)], ⁵[Chief Commissioner or Commissioner] or Appellate Tribunal, in the course of any proceedings under this Act, is satisfied that any person—

⁶[***]

(b) has ⁷[***] failed to comply with a notice under sub-section (2) or sub-section (4) of section 15; or

(c) has concealed the particulars of any gift or deliberately furnished inaccurate particulars thereof,he or it may, by order in writing, direct that such person shall pay by way of penalty—

⁸[***]

⁹[(ii) in the cases referred to in clause (b), in addition to the amount of gift-tax payable by him, a sum which shall not be less than one thousand rupees but which may extend to twenty-five thousand rupees, for each such failure;]

(iii) in the cases referred to in clause (c), in addition to any gift-tax payable by him, a sum which shall not be less than twenty per cent. but which shall not exceed one and half times the amount of the tax, if any, which would have been avoided if the return made by such person had been accepted as correct:

¹⁰[Provided that in cases referred to in clause (b), no penalty shall be imposable if the person proves that there was a reasonable cause for the failure referred to in that clause.]

¹¹[Explanation.—Where any adjustment is made in the taxable gifts declared in the return under the proviso to clause (a) of sub-section (1) of section 15 and additional gift-tax charged under that section, the provisions of this sub-section shall not apply in relation to the adjustments so made.]

(2) No order imposing a penalty under sub-section (1) shall be made unless the assessee has been heard or has been given a reasonable opportunity of being heard.

¹²[(3) No order imposing a penalty under sub-section (1) shall be made,—

(i) by the Income-tax Officer, where the penalty exceeds ten thousand rupees;

(ii) by the Assistant Commissioner, where the penalty exceeds twenty thousand rupees,except with the prior approval of the Deputy Commissioner,]

(4) ¹³[A Deputy Commissioner (Appeals)] ¹⁴[a Commissioner (Appeals)], a ¹⁵[Chief Commissioner or Commissioner] or the Appellate Tribunal] on making an order under this section imposing a penalty, shall forthwith send a copy of the same to the ¹⁶[Assessing Officer].

¹⁷[(5) No order imposing a penalty under this section shall be passed—

(i) in a case where the assessment to which the proceedings for imposition of penalty relate is the subject-matter of an appeal to the Deputy Commissioner (Appeals) or Commissioner (Appeals) under section 22 or an appeal to the Appellate Tribunal under sub-section (2) of section 23, after the expiry of the financial year in which the proceedings, in the course of which action for the imposition of penalty has been initiated, are completed, or six months from the end of the month in which the order of the Deputy Commissioner (Appeals) or the Commissioner (Appeals) or, as the case may be, the Appellate Tribunal is received by the Chief Commissioner or Commissioner, whichever is later;

(ii) in a case where the relevant assessment is the subject-matter of revision under sub-section (2) of section 24, after the expiry of six months from the end of the month in which such order of revision is passed;

(iii) in any other case, after the expiry of the financial year in which the proceedings, in the course of which action for the imposition of penalty has been initiated, are completed or six months from the end of the month in which action for imposition of penalty is initiated, whichever period expires later.

1. —In computing the period of limitation for the purposes of this section,—

(i) the time taken in giving an opportunity to the assessee to be reheard under the proviso to section 38; and

(ii) any period during which a proceeding under this section for the levy of penalty is stayed by an order or injunction of any court, shall be excluded.

(6) The provisions of this section as they stood immediately before their amendment by the Direct Tax Laws (Amendment) Act, 1989, shall apply to and in relation to any assessment for the assessment year commencing on the 1st day of April, 1988, or any earlier assessment year and references in this section to the other provisions of this Act shall be construed as references to those provisions as for the time being in force and applicable to the relevant assessment year.]—————

1. Subs. by Act 53 of 1962, sec. 14 (w.e.f. 1-4-1963).

2. Subs. by Act 4 of 1988, sec. 161, for “Gift-tax Officer” (w.e.f. 1-4-1988).

3. Subs. by Act 4 of 1988, sec. 161, for “Appellate Assistant Commissioner” (w.e.f. 1-4-1988).

4. Ins. by Act 29 of 1977, sec. 39 and Sch. v (w.e.f. 10-7-1978).

5. Subs. by Act 4 of 1988, sec. 161, for “Commissioner” (w.e.f. 1-4-1988).

6. Clause (a) omitted by Act 3 of 1989, sec. 86 (a) (i) (w.e.f. 1-4-1989).

7. The words “without reasonable cause” omitted by Act 46 of 1986, sec. 40 (i) (w.e.f. 10-9-1986).

8. Clause (i) omitted by Act 3 of 1989, sec. 86 (a) (ii) (w.e.f. 1-4-1989).

9. Subs. by Act 3 of 1989, sec. 86 (a) (iii) (w.e.f. 1-4-1989).

10. Subs. by Act 3 of 1989, sec 86 (a)(iv) (w.e.f. 1-4-1989). Earlier it was ins. by Act 46 of 1986, sec. 40 (ii) (w.e.f. 10-9-1986)

11. Ins. by Act 3 of 1989, sec. 86 (a) (v) (w.e.f. 1-4-1989).

12. Subs. by Act 3 of 1989, sec. 86 (b) (w.e.f. 1-4-1989).

13. Subs. by Act 4 of 1988, sec. 161 for “An Appellate Assistant Commissioner” (w.e.f. 1-4-1988).

14. Ins. by Act 29 of 1977, sec. 39 and Sch. V (w.e.f. 10-7-1978).

15. Subs. by Act 4 of 1988, sec. 161, for “Commissioner” (w.e.f. 1-4-1988).

16. Subs. by Act 4 of 1988, sec. 161, for “Gift-tax Officer” (w.e.f. 1-4-1988).

17. Ins. by Act 3 of 1989, sec. 86(c) (w.e.f. 1-4-1989).

Section 17A. PENALTY FOR FAILURE TO ANSWER QUESTIONS, SIGN STATEMENTS, FURNISH INFORMATION, ALLOW INSPECTION, ETC.

¹ [17A. Penalty for failure to answer questions, sign statements, furnish information, allow inspection, etc.—(1) If a person, -

(a) being legally bound to state the truth of any matter touching the subject of his assessment, refuses to answer any question put to him by a gift-tax authority in the exercise of his powers under this Act; or

(b) refuses to sign any statement made by him in the course of any proceedings under this Act, which a gift-tax authority may legally require him to sign; or

(c) to whom a summons is issued under sub-section (1) of section 36, either to attend to give evidence or produce books of account or other documents at a certain place and time, omits to attend or produce the books of account or documents at the place and time, he shall pay, by way of penalty, a sum which shall not be less than five hundred rupees but which may extend to ten thousand rupees for each such default or failure :

Provided that no penalty shall be imposable under clause (c) if the person proves that there was reasonable cause for the said failure.

(2) If a person fails to furnish in due time any statement or information which such person is bound to furnish to the Assessing Officer under section 37, he shall pay, by way of penalty, a sum which shall not be less than one hundred rupees but which may extend to two hundred rupees for every day during which the failure continues :

Provided that no penalty shall be imposable under this sub-section if the person proves that there was a reasonable cause for the said failure.

(3) Any penalty imposable under sub-section (1) or sub-section (2) shall be imposed, -

(a) in a case where the contravention, failure or default in respect of which such penalty is imposable occurs in the course of any proceeding before a gift-tax authority not lower in rank than a Joint Director or a Joint Commissioner, by such gift-tax authority;

(b) in any other case, by the Joint Director or the Joint Commissioner.

(4) No order under this section shall be passed by any gift-tax authority referred to in sub-section (3) unless the person on whom penalty is proposed to be imposed has been heard or has been given a reasonable opportunity of being heard in the matter by such authority.

Explanation : In this section “gift-tax authority” includes a Director General, Director, Joint Director, Assistant Director or Valuation Officer while exercising the powers vested in a court under the Code of Civil Procedure, 1908 (5 of 1908), when trying a suit in respect of the matters specified in sub-section (1) of section 36.

————

1.  Section 17A Subs. by Act 3 of 1989, sec. 87 (w.e.f. 1-4-1989). Earlier it was ins. by Act 41 of 1975, sec. 114 (w.e.f. 1-4-1976) and was subs. by Act 4 of 1988, sec. 174 (w.e.f. 1-4-1989).

Section 18. REBATE ON ADVANCE PAYMENTS.

¹ [18. Rebate on advance payments.—It a person making a taxable gift pays into the treasury within fifteen days of his making the gift any part of the amount of tax due on the gift calculated at the rates specified in the Schedule ²[or at the rate specified in sub-section (2) of section 3], he shall, at the time of assessment under section 15, be given credit—

(i) for the amount so paid; and

(ii) for a sum equal to one-ninth of the amount so paid, so however, that such sum shall in no case exceed one-tenth of the tax due on the gift.

Explanation.—If a person makes more than one taxable gift in the course of a previous year, the amount of tax due on any one of such gifts shall be the difference between the total amount of tax due on the aggregate value of all the taxable gifts so far made, including the taxable gift in respect of which tax has to be paid, calculated at the rates specified in the schedule or, as the case may be, ³[at the rate specified in sub-section (2) or section 3], and the total amount of tax on the aggregate value of all the gifts made during that year, excluding the taxable gift in respect of which tax has to be paid, calculated at the rates specified in the Schedule or, as the case may be, ⁴[at the rate specified in sub-section (2) of section 3].]

—————

1. Section 18 subs. by Act 41 of 1975, sec. 15 (w.e.f. 1-4-1976). Earlier it was subs. by Act 13 of 1960, sec. 17 (w.e.f. 1-4-1960).

2. Subs. by Act 23 of 1986, sec. 44(a) for “or, in a case where the provisions of section 6A are applicable to a gift, in the manner specified in that section” (w.e.f. 1-4-1987).

3. Subs. by Act 23 of 1986, sec. 44(b) for “in the manner specified in section 6A” (w.e.f. 1-4-1987).

4. Subs. by Act 23 of 1986, sec. 44(b) for “in the manner specified in section 6A” (w.e.f. 1-4-1987).

Section 18A. CREDIT FOR STAMP DUTY PAID ON INSTRUMENT OF GIFT.

¹[18A. Credit for stamp duty paid on instrument of gift.—Where any stamp duty has been paid under any law relating to stamp duty in force in any State on an instrument of gift of property, the assessee shall be entitled to a deduction from the gift-tax payable by him of an amount equal to the stamp duty so paid or one-half of the gift-tax payable, before making the deduction under this section, whichever is less.

————

1.  Section 18A subs. by Act 14 of 1982, sec. 39 (w.e.f. 1-4-1983). Earlier it was ins. by Act 10 of 1965, sec. 71 (ii) (w.e.f. 1-4-1965).

Section 18B.

¹ [***]

—————

1.  Chapter IVA containing section 18B omitted by Act 3 of 1989, sec. 95 (P) (w.e.f. 1-4-1989). Earlier it was ins. by Act 4 of 1988, sec. 175 (w.e.f. 1-4-1989).

Section 19. TAX OF DECEASED PERSON PAYABLE BY LEGAL REPRESENTATIVE.

(1) Where a person dies, his executor, administrator or other legal representative shall be liable to pay out of estate of the deceased person, to the extent to which the estate is capable of meeting the charge, the gift-tax determined as payable by such person, or any sum which would have been payable by him under this Act, if he had not died.

(2) Where a person dies without having furnished a return under section 13, or after having furnished a return which the ¹Assessing Officer has reason to believe to be incorrect or incomplete, the Assessing Officer may make an assessment of the value of the taxable gifts made by such person and determine the gift-tax payable by him, and for this purpose may, by the issue of the appropriate notice which would have had to be served upon the deceased person if he had survived, require from the executor, administrator, or other legal representative of the deceased person any accounts, documents or other evidence which might, under the provisions of section 15, have been required from the deceased person.

(3) The provisions of sections 13, 14 and 16 shall apply to an executor, administrator or other legal representative as they apply to any person referred to in ²those sections.

—————

1.  Subs. by Act 4 of 1988, sec. 161, for “Gift-tax Officer” (w.e.f. 1-4-1988).

2.  Subs. by Act 58 of 1960, sec. 3 and Sch. II, for “that section” (w.e.f. 26-12-1960).

Section 19A. ASSESSMENT OF PERSONS LEAVING INDIA.

¹[19A. Assessment of persons leaving India.—(1) Notwithstanding anything contained in section 3, when it appears to the ²[Assessing Officer] that any individual may leave India during the current assessment year or shortly after its expiry and that he has no present intention of returning to India, the gifts made by such individual during the period from the expiry of the previous year for that assessment year up to the probable date of his departure from India, shall be chargeable to gift-tax in that assessment year.

(2) The taxable gifts made in each completed previous year or part of any previous year included in such period shall be chargeable to gift-tax at the rate or rates specified in the Schedule ³[or, as the case may be, at the rate specified in sub-section (2) of section 3], and separate assessments shall be made in respect of each such completed previous year or part of any previous year.

(3) The ²[Assessing Officer] may estimate the value of the gifts made by such individual during such period or any part thereof, where it cannot be readily determined in the manner provided in this Act.

(4) For the purpose of making an assessment under sub-section (1), the ¹[Assessing Officer] may serve a notice upon such individual requiring him to furnish, within such time, not being less than seven days, as may be specified in the notice, a return in the same form and verified in the same manner as ⁴[a return under sub-section (1) of section 13], giving particulars of the gifts made by him during each completed previous year comprised in the period referred to in sub-section (1) and during any part of the previous year comprised in that period; and the provisions of this Act shall, so far as may be, and subject to the provisions of this section, apply ⁵[as if the notice were a notice issued under clause (i) of sub-section (4) of section 15].

(5) The gift-tax chargeable under this section shall be in addition to the tax, if any, chargeable under any other provision of this Act.

(6) Where the provisions of sub-section (1) are applicable, any notice issued by the ⁶[Assessing Officer] under ⁷[clause (i) of sub-section (4) of section 15] or under section 16 in respect of any gift-tax chargeable under any other provisions of this Act may, notwithstanding anything contained in ⁷[clause (i) of sub-section (4) of section 15] or section 16, as the case may be, required the furnishing of the return by such individual within such period, not being less than seven days, as the ⁶[Assessing Officer] may think proper.]

—————

1. Ins by Act 53 of 1962, sec. 15 (w.e.f. 1-4-1963).

2. Subs. by Act 4 of 1988, sec. 161, for “Gift-tax Officer” (w.e.f. 1-4-1988).

3. Ins. by Act 23 of 1986, sec. 45 (w.e.f. 1-4-1987).

4. Subs. by Act 4 of 1988, sec. 186(1)(a)(i), for “a return under sub-section (2) of section 13”(w.e.f. 1-4-1989).

5. Subs. by Act 4 of 1988, sec. 186 (1)(a)(ii), for “as if the notice were a notice issued under sub-section (2) of section 13” (w.e.f. 1-4-1989).

6. Subs. by Act 4 of 1988, sec. 161, for “Gift-tax Officer” (w.e.f. 1-4-1988).

7. Subs. by Act 4 of 1988, sec. 186 (1)(b), for “sub-section (2) of Section 13” (w.e.f. 1-4-1988).

Section 20. ASSESSMENT AFTER PARTITION OF A HINDU UNDIVIDED FAMILY.

(1) Where, at the time of making an assessment, it is brought to the notice of the ¹Assessing Officer that a partition has taken place among the members of a Hindu undivided family, and the ¹Assessing Officer, after enquiry, is satisfied that the joint family property has been partitioned among the various members or groups of members in definite portions, he shall record an order to that effect and he shall make assessments ²on the value of the taxable gifts made by the family as such as if no partition had taken place and each member or group of members shall be liable jointly and severally for the tax assessed on the value of the taxable gifts made by the joint family as such.

(2) Where the ¹[Assessing Officer] is not so satisfied, he may, by order, declare that such family shall be deemed for the purposes of this Act to continue to be a Hindu undivided family.

—————

1.  Subs. by Act 4 of 1988, sec. 161, for “Gift-tax Officer” (w.e.f. 1-4-1988).

2.  Subs. by Act 58 of 1960, sec. 3 and Sch. II, for “on the amount of taxable gifts” (w.e.f. 26-12-1960).

Section 21. LIABILITY IN CASE OF DISCONTINUED FIRM OR ASSOCIATION OF PERSONS.

(1) Where a firm or association of persons liable to pay gift-tax has been discontinued or dissolved the Assessing Officer shall determine the gift-tax payable by the firm or association of persons as such as if no such discontinuance or dissolution had taken place.

(2) If the ¹[Assessing Officer], the ²[Deputy Commissioner (Appeals)] ³[the Commissioner (Appeals)] or the Appellate Tribunal in the course of any proceedings under this Act in respect of any such firm or other association of persons as is referred to in sub-section (1) is satisfied that the firm or association is guilty of any of the acts specified in clause (a) or clause (b) or clause (c) of sub-section (1) of section 17, he or it may impose or direct the imposition of a penalty in accordance with the provisions of that section.

(3) Every person who was at the time of such discontinuance or dissolution a partner of the firm or a member of the association, as the case may be, shall be jointly and severally liable for the amount of tax or penalty payable, and all the provisions of Chapter VII, so far as may be, shall apply to any such assessment or imposition of penalty.

—————

1. Subs. by Act 4 of 1988, sec. 161, for “Gift-tax Officer” (w.e.f. 1-4-1988).

2. Subs. by Act 4 of 1988, sec. 161, for “Appellate Assistant Commissioner” (w.e.f. 1-4-1988).

3. Ins. by Act 29 of 1977, sec. 39 and Sch. V, Pt. III (w.e.f. 10-7-1978).

Section 21A. ASSESSMENT OF DONEE WHEN DONOR CANNOT BE FOUND.

¹[21A. Assessment of donee when the donor connot be found.—(1) Where an ²Assessing Officer after using all due and reasonable diligence cannot find the donor who had made any taxable gifts, for the purpose of service of notice under sub-section (2) of section 13, or under section 16, the Assessing Officer may make an assessment of the value of all such taxable gifts made by him and determine the gift-tax payable by him and for this purpose may, by the issue of the appropriate notice which would have had to be served upon the donor, require from the donee or donees any accounts, documents or other evidence which might, under the provisions of section 15, have been required from the donor.

(2) Where any assessment in respect of the taxable gifts made by the donor has been made under sub-section (1), every donee shall be liable for the gift-tax so assessed :

Provided that where the donees are more than one, they shall be jointly and severally liable for the amount of the gift-tax so assessed :

Provided further that the amount of the gift-tax which may be recovered from each donee shall not exceed the value of the gift made to him as on the date of the gift.

(3) The provisions of sections 13, 14 and 16 shall apply to a donee as they apply to any person referred to in those sections.

—————

1.  Ins. by Act 53 of 1962, sec. 16 (w.e.f. 1-4-1963).

2.  Subs. by Act 4 of 1988, sec. 161, for “Appellate Assistant Commissioner” (w.e.f. 1-4-1988).

Section 22. APPEAL TO THE DEPUTY COMMISSIONER (APPEALS) FROM ORDERS OF ASSESSING OFFICER.

22. Appeal to the ¹[Deputy Commissioner (Appeals)] from orders of ²[Assessing Officer].—(1) ³[Subject to the provisions of sub-section (1A), any person],—

(a) objecting to the value of ⁴[***] taxable gifts determined under this Act; or

(b) objecting to the amount of gift-tax determined as payable by him under this Act; or

(c) denying his liability to be assessed under this Act; or

⁵[(d) objecting to any penalty imposed by the Assessing Officer under section 17 ⁶[***];]; or

(e) objecting to any order of the ⁷[Assessing Officer] under sub-section (2) of section 20;or

(f) objecting to any penalty imposed by the ⁸[Assessing Officer] under ⁹[sub-section (1) of section 221] of the Income-tax Act] as applied under section 33 for the purposes of gifts-tax; ¹⁰[or]

¹¹[(g) objecting to an order of the ⁸[Assessing Officer] under section 34 having the effect of enhancing the assessment or reducing a refund or an order refusing to allow the claim made by the assessee under that section; or

(h) ¹²[***]] may appeal to the ¹³[Deputy Commissioner (Appeals)] against the assessment or order, as the case may be, in the prescribed form and verified in the prescribed manner:

Provided that no appeal shall lie under clause (f) unless the tax has been paid before the appeal is filed.

¹⁴[(1A) Notwithstanding anything contained in sub-section (1), any person—

(a) objecting to the value of taxable gifts determined under this Act or objecting to the amount of gift-tax determined as payable by him or denying his liability to be assessed under this Act where the value of taxable gifts determined on assessment exceeds two lakh rupees; or

¹⁵[(b) objecting to any assessment or order referred to in clauses (a) to (g) (both inclusive) of sub-section (1), where such assessment or order has been made by the Deputy Commissioner in exercise of the powers or functions conferred on or assigned to him under section 7 or section 10; or

¹⁶[(c) objecting to any penalty imposed under sub-section (1) of section 17 with the previous approval of the Deputy Commissioner as specified in sub-section (3) of that section;]

(d) objecting to any penalty imposed by the Deputy Director or the Deputy Commissioner under section 17A;]

(e) objecting to any order made by ¹⁷[an Assessing Officer] in the case of such persons or classes of persons as the Board may, having regard to the nature of the cases, the complexities involved and other relevant considerations, direct, may appeal to the Commissioner (Appeals) against the assessment or order, as the case may be, in the prescribed form and verified in the prescribed manner:

Provided that no appeal shall lie under clause (b) of this sub-section against any order referred to in clause (f) of sub-section (1) unless the tax has been paid before the appeal is filed.]

¹⁸[(1B) Notwithstanding anything contained in sub-section (1), the Board or the Director-General or the Chief Commissioner or the Commissioner, if so authorised by the Board, may, by order in writing, transfer any appeal which is pending before a Deputy Commissioner (Appeals) and any matter arising out of or connected with such appeal and which is so pending, to the Commissioner (Appeals), if the Board or, as the case may be, the Director-General, the Chief Commissioner or the Commissioner (at the request of the appellant or otherwise) is satisfied that it is necessary or expedient so to do having regard to the nature of the case, the complexities involved and other relevant considerations and the Commissioner (Appeals) may proceed with such appeal or matter from the stage at which it was before it was so transferred:

Provided that the appellant may demand that before proceeding further with the appeal or matter, the previous proceeding or any part thereof be reopened or that he be reheard.]

(2) An appeal shall be presented within thirty days of the receipt of the notice of demand relating to the assessment or penalty objecting to, or the date on which any order objected to, is communicated to him, but the ¹⁹[Deputy Commissioner (Appeals)] 20[or, as the case may be, the Commissioner (Appeals)] may admit an appeal after the expiration of the period aforesaid if he is satisfied that the appellant had sufficient cause for not presenting the appeal within that period.

(3) The ¹⁹[Deputy Commissioner (Appeals)] ²⁰[or, as the case may be, the Commissioner (Appeals)] shall fix a day and place for the hearing of the appeal and may from time to time adjourn the hearing.

(4) The ²¹[Deputy Commissioner (Appeals)] ²⁰[or, as the case may be, the Commissioner (Appeals)] may,—

(a) at the hearing of an appeal, allow an appellant to go into any ground of appeal, not specified in the grounds of appeal;

(b) before disposing of an appeal, make such further inquiry as he thinks fit or cause further inquiry to be made by the ²¹[Assessing Officer].

(5) In disposing of an appeal, the ¹⁹[Deputy Commissioner (Appeals)] ²⁰[or, as the case may be, the Commissioner (Appeals)] may pass such order as he thinks fit which may include or order enhancing the amount of gift-tax determined or penalty imposed:

Provided that no order enchaning the amount of gift-tax determined or penalty imposed shall be made unless the person affected thereby has been given a reasonable opportunity of showing cause against such enhancement.

²²[(5A) In disposing of an appeal, the ²³[Deputy Commissioner (Appeals)] ²³[or, as the case may be, the Commissioner (Appeals)] may consider and decide any matter arising out of the proceedings in which the order appealed against was passed, notwithstanding that such matter was not raised before the ²²[Deputy Commissioner (Appeals)] 23[or, as the case may be, the Commissioner (Appeals)] by the appellant.

(5B) The order of the ²³[Deputy Commissioner (Appeals)] ²⁴[or, as the case may be, the Commissioner (Appeals)] disposing of the appeal shall be in writing and shall state the points for determination, the decision thereon and the reasons for the decision.]

(6) A copy of every order passed by the ²³[Deputy Commissioner (Appeals)] ²⁴[or, as the case may be, the Commissioner (Appeals)] under this section shall be forwarded to the appellant and the ²⁵[Chief Commissioner or Commissioner].

—————

1. Subs. by Act 4 of 1988, sec. 161, for “Gifts-tax Officer” (w.e.f. 1-4-1988).

2. Subs. by Act 4 of 1988, sec. 161, for “Appellate Assistant Commissioner” (w.e.f. 1-4-1988).

3. Subs. by Act 29 of 1977, sec. 39 and Sch. V, Pt. III, for “any person” (w.e.f. 10-7-1978).

4. The word “his” omitted by Act 53 of 1962, sec. 17(i)(a) (w.e.f. 1-4-1963).

5. Subs. by Act 4 of 1988, sec. 176 (a)(i) (w.e.f. 1-4-1989).

6. Certain words omitted by Act 3 of 1989, sec. 88(i) (w.e.f. 1-4-1989).

7. Subs. by Act 4 of 1988, sec. 161, for “Gift-tax Officer” (w.e.f. 1-4-1988).

8. Subs. by Act 4 of 1988, sec. 161, for “Gift-tax Officer” (w.e.f. 1-4-1988).

9. Subs. by Act 53 of 1962, sec. 17 (i)(b)(1), for “Sub-section (1) of section 46 of the Income-tax Act” (w.e.f. 1-4-1963).

10. Ins. by Act 53 of 1962, sec. 17(i) (b)(2)(w.e.f. 1-4-1963).

11. Clauses (g) and (h) ins. by Act 53 of 1962, sec. 17(i) (c) (w.e.f. 1-4-1963).

12. Clause (h) omitted by Act 4 of 1988, sec. 176 (a) (ii) (w.e.f. 1-4-1989).

13. Subs. by Act 4 of 1988, sec. 161, for “Appellate Assistant Commissioner” (w.e.f. 1-4-1988).

14. Sub-sections (1A), (1B) and (1C) by Act 29 of 1977, sec. 39 and Sch. V, Pt. III (w.e.f. 10-7-1978).

15. Clauses (b), (c) and (d) subs. by Act 4 of 1988, sec. 176(b) (w.e.f. 1-4-1989).

16. Clause (c) Subs. by Act 3 of 1989, sec. 88 (ii) (w.e.f. 1-4-1989).

17. Subs. by Act 4 of 1988, sec. 161, for “a Gift-tax Officer” (1-4-1988).

18. Subs. by Act 4 of 1988, sec. 176 (c), for sub-sections (1B) and (1C) (w.e.f. 1-4-1989).

19. Subs. by Act 4 of 1988, sec. 161 for “Appellate Assistant Commissioner” (w.e.f. 1-4-1988).

20. Ins. by Act 29 of 1977, sec. 39 and Sch. V, Pt. III (w.e.f. 10-7-1978).

21. Subs. by Act 4 of 1988, sec. 161 for “Gift-tax Officer” (w.e.f. 1-4-1988).

22. Ins. by Act 53 of 1962, sec. 17(ii) (w.e.f. 1-4-1963).

23. Subs. by Act 4 of 1986 sec. 161, for, “Appellate Assistant Commissioner” (w.e.f. 1-4-1988).

24. Ins. by Act 29 of 1977, sec. 39 and Sch. V, Pt. IV (w.e.f. 10-7-1978).

25. Subs. by Act 4 of 1988, sec. 161, for “Commissioner” (w.e.f. 1-4-1988).

Section 23. APPEAL TO THE APPELLATE TRIBUNAL.

¹[(1) An assessee, objecting to an order passed by the ²[Deputy Commissioner (Appeals)] ³[or the Commissioner (Appeals)] ⁴[under section 17 or section 17A] of section 22 ⁵[***] or sub-section (2) of section 36 ⁶[***] may appeal to the Appellate Tribunal within sixty days of the date on which the order is communicated to him.]

(2) The Commissioner may, if he is not satisfied as to the correctness of any order passed by ⁷[a Deputy Commissioner (Appeals)] ³[or a Commissioner (Appeals) under section 22 direct the ⁸[Assessing Officer] to appeal to the Appellate Tribunal against such order, and such appeal may be made at any time before the expiry of sixty days of the date on which the order is communicated to the Commissioner.

⁹[(2A) The ⁸[Assessing Officer] or the assessee, as the case may be, on receipt of the notice that an appeal against the order of the ¹⁰[Deputy Commissioner (Appeals)] ³[or the Commissioner (Appeals)] has been preferred under sub-section (1) or sub-section (2) by the other party, may, notwithstanding that he may not have appealed against such order or any part thereof, within thirty days of the receipt of the notice, file a memorandum of cross-objections, verified in the prescribed manner against any part of the order of the ¹¹[Deputy Commissioner (Appeals)] ¹²[or the Commissioner (Appeals)] and such memorandum shall be disposed of by the Appellate Tribunal as if it were an appeal presented within the time specified in sub-section (1) or sub-section (2).]

¹³[(3) The Appellate Tribunal may admit an appeal or permit the filing of a memorandum of cross-objections after the expiry of the relevant period referred to in sub-section (1) or sub-section (2) or sub-section (2A), if it is satisfied that there was sufficient cause for not presenting it within that period.]

(4) An appeal to the Appellate Tribunal shall be in the prescribed form and shall be verified in the prescribed manner and shall, except in the case of an appeal referred to in sub-section (2), be accompanied by ¹⁴[a fee of ¹⁵[two hundred rupees]].

(5) The Appellate Tribunal may, after giving the parties to the appeal an opportunity of being heard, pass such orders thereon as it thinks fit, and any such orders may include an order enhancing the amount of gift-tax determined or penalty imposed:

Provided that no order enhancing the amount of gift-tax determined or penalty imposed shall be made unless the person affected thereby has been given a reasonable opportunity of showing cause against such enhancement.

¹⁶[***]

(9) A copy of every order passed by the Appellate Tribunal under this section shall be forwarded to the assessee and the Commissioner.

(10) Save as provided in section 26, any order passed by the Appellate Tribunal on appeal shall be final.

(11) The provisions of 17[sub-sections (1), (4) and (5) of section 255 of the Income-tax Act] shall apply to the Appellate Tribunal in the discharge of its functions under this Act as they apply to it in the discharge of its functions under the Income-tax Act.

—————

1. Subs. by Act 53 of 1962, sec. 18(i) (w.e.f. 1-4-1962).

2. Ins. by Act 53 of 1962, sec. 17(ii) (w.e.f. 1-4-1963).

3. Ins. by Act 29 of 1977, sec. 39 and Sch. V, Pt. III (w.e.f 10-7-1978).

4. Subs. by Act 41 of 1975, sec. 116(i), for “under section 17” (w.e.f. 1-4-1976).

5. The words “or section 22A” omitted by Act 3 of 1989, sec. 95 (u) (w.e.f. 1-4-1989). Earlier they were ins. by Act 4 of 1988, sec. 186(2) (w.e.f. 1-4-1989).

6. The words “or to an order passed by the Inspecing Assistant Commissioner under section 17A”, omitted by Act 29 of 1977, sec. 39 and Sch. V, Pt. III (w.e.f. 10-7-1978).

7. Subs. by Act 4 of 1988. sec. 161, for” an Appellate Assistant Commissioner” (w.e.f. 1-4-1988).

8. Subs. by Act 4 of 1988, sec. 161, for “Gift-Tax Officer” (w.e.f. 14-1988).

9. Ins. by Act 53 of 1962, sec. 18 (ii) (w.e.f. 1-4-1963).

10. Subs. by Act 4 of 1986 sec. 161, for, “Appellate Assistant Commissioner” (w.e.f. 1-4-1988).

11. Subs. by Act 4 of 1988. sec. 161, for “Appellate Assistant Commissioner” (w.e.f. 1-4-1988).

12. Ins. by Act 29 of 1977, 539 and Sch. V, Pt. III (w.e.f. 10-7-1978).

13. Subs. by Act 53 of 1962, sec. 18(iii) (w.e.f. 1-4-1963).

14. The words ”a fee of one hundred and twenty-five rupees” subs. by Act 42 of 1970, sec. 67 for “a fee of rupees one hundred” (w.e.f. 1-4-1971).

15. Subs. by Act 16 of 1981, sec. 32, for “one hundred and twenty-five rupees” (w.e.f 1-6-1981).

16. Sub-sections (6), (7) and (8) omitted by Act 45 of 1972, sec. 22, (w.e.f 1-1-1973).

17. Subs. by Act 53 of 1962, sec. 18(iv), for “sub-sections (5), (7) and (8) of section 5A of the Income-tax Act” (w.e.f. 1-4-1963).

Section 24. POWERS OF COMMISSIONER TO REVISE ORDERS OF SUBORDINATE AUTHORITIES.

(1) The Commissioner may, either on his own motion or on application made by an assessee in this behalf, call for the record of any proceeding under this Act in which an order has been passed by any authority subordinate to him, and may make such inquiry or cause such inquiry to be made, and, subject to the provisions of this Act, pass such order thereon not being an order prejudicial to the assessee, as the Commissioner thinks fit:

Provided that the Commissioner shall not revise any order under this sub-section in any case—

(a) where an appeal against the order lies to the ¹[Deputy Commissioner (Appeals)] ²[or to the Commissioner (Appeals)] or to the Appellate Tribu nal and the time within which such appeal can be made has not expired or, ³[in the case, of an appeal to the Commissoner (Appeals) or to the Appellate Tribunal], the assessee has not waived his right of appeal;

(b) where the order is pending in appeal before the ¹[Deputy Commissioner (Appeals) or has been the subject of an appeal 2[to the Commissioner (Appeals) or] to the Appellate Tribunal;

(c) where the application is made by the assessee for such revision unless—

(i) the application is accompanied by a fee of rupees twenty-five; and

(ii) the application is made within one year from the date of the order sought to be revised or within such further period as the Commissioner may think fit to allow on being satisfied that the assessee was prevented by sufficient cause from making the application within that period; and

(d) where the order is sought to be revised by the Commissioner of his own motion, if such order is made more than one year previously.

Explanation.—For the purposes of this sub-section,—

(a) the ¹[Deputy Commissioner (Appeals)] shall be deemed to be an authority subordinate to the Commissioner, and

(b) an order by the Commissioner declining to interfere shall be deemed not to be an order prejudicial to the assessee.

(2) Without prejudice to the provisions contained in sub-section (1), the Commissioner may call for and examine the record of any proceeding under this Act, and, if he considers that any order passed therein by 4[an Assessing Officer] is erroneous in so far as it is prejudicial to the interests of revenue, he may, after giving the assessee an opportunity of being heard, and after making or causing to be made such inquiry as he deems necessary, pass such order thereon as the circumstances of the case justify, including an order enhancing or modifying the assessment or cancelling it and directing a fresh assessment.

⁵[Explanation.—For the removal of doubts, it is hereby declared that, for the purposes of this sub-section,—

(a) an order passed 6[on or before or after the 1st day of June,1988,] by the Assessing Officer shall include an order passed by the Deputy Commissioner in exercise of the powers or in performance of the functions of an Assessing Officer conferred on or assigned to him under orders or directions issued by the Board or by the Chief Commissioner or Director-General or Commissioner authorised by the Board in this behalf under section 120 of the Income-tax Act read with section 7 of this Act;

(b) “record”⁷[shall include and shall be deemed always to have included] all records relating to any proceeding under this Act available at the time of examination by the Commissioner;

(c) where any order referred to in this sub-section and passed by the Assessing Officer had been the subject-matter of any appeal ⁸[filed on or before or after the 1st day of June,1988], the powers of the Commissioner under this sub-section shall extend 8[and shall be deemed always to have extended] to such matters as had not been considered and decided in such appeal.]

(3) No order shall be made under sub-section (2) after the expiry of two years ⁹[from the end of the financial year in which the order sought to be revised was passed].

¹⁰[Explanation.—In computing the period of limitation for purposes of this sub-section, the time taken in giving an opportunity to the assessee to be reheard under the proviso to section 38 and any period during which any proceeding under this section is stayed by an order or injunction of any Court shall be excluded.]

—————

1. Subs. by Act 4 of 1988, sec. 161, for “Appellate Assistant Commissioner” (w.e.f. 1-4-1988).

2. Ins. by Act 29 of 1977, sec. 39 and Sch. V, Pt. III (w.e.f. 10-7-1978).

3. Subs. by Act 29 of 1977, sec. 39 and Sch. V, Pt. III for “in the case of the Appellate Tribunal” (w.e.f. 10-7-1978).

4. Subs. by Act 4 of 1988, sec. 161, for “Gift-tax Officer”. (w.e.f. 1-4-1988).

5. Subs. by Act 26 of 1988, sec. 68 (w.e.f. 1-6-1988). Earlier it was ins. by Act 67 of 1984, sec. 74, (a) (w.e.f. 1-10-1984).

6. Ins. by Act 13 of 1989, sec. 32(i) (w.r.e.f. 1-6-1988).

7. Subs. by Act 13 of 1989, sec. 32 (ii), for “includes” (w.r.e.f. 1-6-1988).

8. Ins. by Act 13 of 1989, sec. 32 (iii) (w.r.e.f. 1-6-1988).

9. Subs. by Act 67 of 1984, sec. 74(b), for “from the date of the order sought to be revised” (w.e.f. 1-10-1984).

10. Ins. by Act 53 of 1962, sec. 19 (w.e.f. 1-4-1963).

Section 25. APPEAL TO THE APPELLATE TRIBUNAL FROM ORDERS OF ENHANCEMENT BY CHIEF COMMISSIONER OR COMMISSIONER.

25. Appeal to the Appellate Tribunal from orders of enhancement by ¹[Chief Commissioner or Commissioner]—²[(1) An assessee objecting to an order passed by the ¹[Chief Commissioner or Commissioner] ³[under section 17 or section 17A] or to an order of enhancement passed by him under section 24 ⁴[or an order passed by the Director-General or Director under section 17A] may appeal to the Appellate Tribunal within sixty days of the date on which the order is communicated to him.]

(2) An appeal to the Appellate Tribunal under sub-section (1) shall be in the prescribed form and shall be verified in the prescribed manner and shall be accompanied by ⁵[a fee of ⁶[two hundred rupees]].

(3) The provisions of ⁷[sub-sections (3),(5),(9) and (10) of section 23 shall apply in relation to any appeal under this section as they apply in relation to any appeal under that section.

—————

1. Subs. by Act 4 of 1988, sec. 161, for “Commissioner” (w.e.f. 1-4-1988).

2. Subs. by Act 53 of 1962, sec. 20 (w.e.f. 1-4-1963)

3. Subs. by Act 41 of 1975, sec. 117, for “under section 17” (w.e.f. 1-4-1976).

4. Ins. by Act 3 of 1989, sec. 89 (w.e.f. 1-4-1989).

5. The words “a fee of one hundred and twenty-five rupees” subs. by Act 42 of 1970, sec. 68, for “a fee of rupees one hundred” (w.e.f. (1-4-1971).

6. Subs. by Act 16 of 1981, sec. 33, for “one hundered and twenty-five rupees” (w.e.f. 1-6-1981).

7. Subs. by Act 45 of 1972, sec. 23 for “sub-sections (3) and (5) to 10” (w.e.f. 1-1-1973).

Section 26. REFERENCE TO HIGH COURT.

¹[(1) The assessee or the ²[Chief Commissioner or Commissioner] may, within sixty days of the date upon which he is served with notice of an order under section 23 or section 25 ³[or clause (e) of sub-section (1) of section 34], by application in the prescribed form, accompanied, where the application is made by the assessee, by ⁴[a fee of 5[two hundred rupees]], require the Appellate Tribunal to refer to the High Court any question of law arising out of such order and, subject to the other provisions contained in this section, the Appellate Tribunal shall, within one hundred and twenty days of the receipt of such application, draw up a statement of the case and refer it to the High Court.

(2) The Appellate Tribunal may, if it is satisfied that the applicant was prevented by sufficient cause from presenting the application within the period specified in sub-section (1), allow it to be presented within a further period not exceeding thirty days.]

(3) If, on an application made under sub-section (1), the Appellate Tribunal,—

(a) refuses to state a case on the ground that no question of law arises, or

(b) rejects it on the ground that it is time-barred,

the applicant may, within ninety days from the date on which he is served with a notice of refusal or rejection, as the case may be, apply to the High Court, and the High Court may, if it is not satisfied with the correctness of the decision of the Appellate Tribunal, require the Appellate Tribunal to state the case to the High Court, and on receipt of such requisition the Appellate Tribunal shall state the case:

Provided that, if in any case where the Appellate Tribunal has been required by an assessee to state a case the Appellate Tribunal refuses to do so on the ground that no question of law arises, the assessee may, within thirty days from the date on which he receives notice of refusal to state the case, withdraw his application, and if he does so, the fee paid by him under sub-section (1) shall be refunded to him.

⁶[(3A) If, on an application made under this section, the Appellate Tribunal is of the opinion that on account of a conflict in the decisions of High Courts in respect of any particular question of law, it is expedient that a reference should be made direct to the Supreme Court, the Appellate Tribunal may draw up a statement of the case and refer it through its President direct to the Supreme Court.]

(4) The statement to the High Court ⁷[or the Supreme court] shall set forth the facts, the determination of the Appellate Tribunal and the question of law which arises out of this case.

(5) If the High Court ⁸[or the Supreme Court] is not satisfied that the case as stated is sufficient to enable it to determine the question of law raised thereby, it may require the Appellate Tribunal to make such modification therein as it may direct.

(6) The High Court ⁸[or the Supreme Court], upon hearing any such case, shall decide the question of law raised therein, and in doing so, may, if it thinks fit, alter the form of the question of law and shall deliver judgment thereon containing the grounds on which such decision is founded and shall send a copy of the judgment under the seal of the Court and the signature of the Registrar to the Appellate Tribunal and the Appellate Tribunal shall pass such orders as are necessary to dispose of the case conformably to such judgment.

⁹[(7) The costs of any reference to the High Court or the Supreme Court which shall not include the fee for making the reference shall be in the discretion of the Court.]

—————

1. Subs. by Act 53 of 1962, sec. 21(i) (w.e.f. 1-4-1963).

2. Subs. by Act 4 of 1988, sec. 161, for “Commissioner” (w.e.f. 1-4-1988).

3. Ins. by Act 49 of 1991, sec. 88 (w.e.f. 27-9-1991).

4. The words “a fee of one hundred and twenty-five rupees” subs. by Act 42 of 1970, sec. 69, for” a fee of one hundred rupees” (w.e.f. 1-4-1971).

5. Subs. by Act 16 of 1981, sec. 34 for “one hundred and twenty-five rupees”(w.e.f. 1-6-1981).

6. Ins. by Act 53 of 1962, sec. 21 (ii). (w.e.f. 1-4-1963).

7. Ins. by Act 53 of 1962, sec. 21 (iii) (w.e.f. 1-4-1963).

8. Ins. by Act 53 of 1962, sec. 21 (iii) (w.e.f. 1-4-1963).

9. Subs. by Act 53 of 1962, sec. 27 (iv) (w.e.f. 1-4-1963).

Section 27. HEARING BY HIGH COURT.

When a case has been stated to the High Court under section 26, it shall be heard by a Bench of not less than two Judges of the High Court and shall be decided in accordance with the opinion of such Judges or of the majority of such judges, if any :

Provided that where there is no such majority, the Judges shall state the point of law upon which they differ and the case shall then be heard upon that point only by one or more of the Judges of the High Court, and such point shall be decided according to the opinion of the majority of the Judges who have heard the case, including those who first heard it.

Section 28. APPEAL TO THE SUPREME COURT.

(1) An appeal shall lie to the Supreme Court from any judgment of the High Court delivered on a case stated under section 26 in any case which the High Court certifies as a fit case for appeal to the Supreme Court.

(2) Where the judgment of the High Court is varied or reversed on appeal under this section, effect shall be given to the order of the Supreme Court in the manner provided in sub-section (6) of section 26.

(3) The High Court may, on application made to it for the execution of any order of the Supreme Court in respect of any costs awarded by it, transmit the order for execution to any court subordinate to the High Court.

Section 28A. TAX TO BE PAID NOTWITHSTANDING REFERENCE, ETC.

¹ Notwithstanding that a reference has been made to the High Court or the Supreme Court, or an appeal has been preferred to the Supreme Court, tax shall be payable in accordance with the assessment made in the case.

—————

1.  Ins. by Act 53 of 1962, sec. 22 (w.e.f. 1-4-1963).

Section 28B. DEFINITION OF HIGH COURT.

In this Chapter, “High Court” means -

(i) in relation to any State, the High Court of that State;

¹[(ii) in relation to the Union territory of Delhi, the High Court of Delhi;

²[(iia) [***]]

³[(iii) in relation to the Union Territories of Arunachal Pradesh *and Mizoram, the Gauhati High Court (the High Court of Assam, Nagaland, Meghalaya, Manipur and Tripura);]

(iv) in relation to the Union territory of Andaman and Nicobar Islands, the High Court at Calcutta;

(v) in relation to the Union territory of ⁴[Lakshadweep], the High Court of Kerala;

⁵[(va) in relation to the Union territory of Chandigarh, the High Court of Punjab and Haryana;]

⁶[(vi) in relation to the Union territories of Dadra and Nagar Haveli and Goa**, Daman and Diu, the High Court at Bombay;

(vii) in relation to the Union territory of Pondicherry, the High Court at Madras.]]

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Section 29. GIFT-TAX BY WHOM PAYABLE.

¹[29. Gift-tax by whom payable.—Subject to the provisions of this Act, gift-tax shall be payable by the donor but when in the opinion of the ²[Assessing Officer] the tax cannot be recovered from the donor, it may be recovered from the donee:

Provided that where the donees are more than one, they shall be jointly and severally liable for the amount of tax determined to be payable by the donor :

Provided further that the amount of tax which may be recovered from each donee shall not exceed the value of the gift made to him as on the date of the gift.

———

1.  Subs. by Act, 53 of 1962, sec. 23 (w.e.f. 1-4-1963).

2.  Subs. by Act 4 of 1988, sec. 161, for “Gift-tax Officer” (w.e.f. 1-4-1988).

Section 30. GIFT-TAX TO BE CHARGED ON PROPERTY GIFTED.

Gift-tax payable in respect of any gift comprising immovable property shall be a first charge on that property but any such charge shall not affect the title of a bona fide purchaser for valuable consideration without notice of the charge.

Section 31. NOTICE OF DEMAND.

¹[31. Notice of demand.—When any tax, interest, penalty, fine or any other sum is payable in consequence of any order passed under this Act, the ²[Assessing Officer] shall serve upon the assessee a notice of demand in the prescribed form specifying the sum so payable.]

—————

1. Subs. by Act 53 of 1962, sec. 24 (w.e.f. 1-4-1963).

2. Subs. by Act 4 of 1988, sec. 161, for “Gift-tax Officer” (w.e.f. 1-4-1988).

Section 32. RECOVERY OF TAX AND PENALTIES.

(1) Any amount specified as payable in a notice of demand under section 31 shall be paid within thirty days of the service of the notice at the place and to the person mentioned in the notice :

Provided that, where the Assessing Officer has any reason to believe that it will be detrimental to revenue if the full period of thirty days aforesaid is allowed, he may, with the previous approval of the Joint Commissioner direct that the sum specified in the notice of demand shall be paid within such period being a period less than the period of thirty days aforesaid, as may be specified by him in the notice of demand.

(2) If the amount specified in any notice of demand under section 31 is not paid within the period limited under sub-section (1), the assessee shall be liable to pay simple interest at one and one-half per cent, for every month or part of a month comprised in the period commencing from the day immediately following the end of the period mentioned in sub-section (1) and ending with the day on which the amount is paid ;

Provided that where as a result of an order under section 22, or section 23, or section 24, or section 25, or section 26 or section 28, or section 34, the amount on which interest was payable under this section had been reduced, the interest shall be reduced accordingly and the excess interest paid, if any, shall be refunded.

Provided further that in respect of any period commencing on or before the 31st day of March, 1989 and ending after that date, such interest shall, in respect of so much of such period as falls after that date, be calculated at the rate of one and one-half per cent for every month or part of a month.

(3) Without prejudice to the provisions contained in sub-section (2), on an

application made by the assessee before the expiry of the due date under sub-section (1), the Assessing Officer may extend the time for payment or allow payment by installments subject to such conditions as he may think fit to impose in the circumstances of the case.

(4) If the amount is not paid within the time limited under sub-section (1) or extended under sub-section (3), as the case may be, at the place and to the person mentioned in the said notice, the assessee shall be deemed to be in default.

(5) If, in a case where payment by installments is allowed under sub-section (3), the assessee commits default in paying any one of the installments within the time fixed under that sub-section, the assessee shall be deemed to be in default as to the whole of the amount then outstanding, and the other installment or installments shall be deemed to have been due on the same date as the installment actually in default.

(6) Where the assessee has presented an appeal under section 22, the Assessing Officer may in his discretion and subject to such conditions as he may think fit to impose in the circumstances of the case, treat the assessee as not being in default in respect of the amount in dispute in the appeal, even though the time for payment has expired as long as such appeal remains undisposed of.

Section 33. MODE OF RECOVERY.

¹The provisions contained in ²sections 221 to 227, 228A, 229, 231 and 232 of the Income-tax Act and the Second and Third Schedules to that Act and any rules made thereunder shall, so far as may be, apply as if the said provisions were provisions of this Act and referred to gift-tax and sums imposed by way of penalty, fine and interest under this Act instead of to income-tax and sums imposed by way of penalty fine and interest under that Act ³and to the corresponding gift-tax authorities instead of to the income-tax authorities specified therein.

Explanation I : Any reference to sub-section (2) or sub-section (6) of section 220 of the Income-tax Act in the said provisions of that Act or the rules made thereunder shall be construed as references to sub-sections (2) and (6) respectively of section 32 of this Act.

⁴Explanation II : The Chief Commissioner or Commissioner and the Tax Recovery Officer referred to in the Income-tax Act shall be deemed to be the corresponding gift-tax authorities for the purpose of recovery of gift-tax and sums imposed by way of penalty, fine and interest under this Act.

—————

1.  Subs. by Act 53 of 1962, sec. 24 (w.e.f. 1-4-1963).

2.  Subs. by Act 16 of 1972, sec. 53, for “sections 221 to 227” (w.e.f. 1-4-1972).

3.  Subs. by Act 4 of 1988, sec. 179(a), for certain words (w.e.f. 1-4-1989).

4.  Subs. by Act 4 of 1988, sec. 179 (b) (w.e.f. 1-4-1989).

Section 33A. REFUNDS.

(1) Where, as a result of any order passed in appeal or other proceeding under this Act, refund of any amount becomes due to the assessee, the ¹[Assessing Officer] shall, except as otherwise provided in this Act, refund the amount to the assessee without his having to make claim in that behalf:

²[Provided that where, by the order aforesaid.—

(a) an assessment is set aside or cancelled and an order of fresh assessment is directed to be made, the refund, if any, shall become due only on the making of such fresh assessment;

(b)the assessment is annulled, the refund shall become due only of the amount, if any, of the tax paid in excess of the tax chargeable on the ³[taxable gifts] returned by the assessee.]

⁴(2) Where refund of any amount becomes due to the assessee as a result of an order under this Act or under the provisions of sub-section (1) of section 15 after a return has been made under section 13 or section 14 or in response to a notice under clause (i) of sub-section (4) of section 15 and the Assessing Officer is of the opinion, having regard to the fact that,—

(i) a notice has been issued, or is likely to be issued, under sub-section (2) of section 15 in respect of the said return; or

(ii) the order is the subject-matter of an appeal or further proceeding; or

(iii) any other proceeding under this Act is pending; that the grant of the refund is likely to adversely affect the revenue, the Assessing Officer may, with the previous approval of the Chief Commissioner or Commissoner, withhold the refund till such time as the Chief Commissioner or Commissioner may determine.]

(3) Where a refund is due to the assessee in pursuance of an order referred to in sub-section (1) and the ¹[Assessing Officer] does not grant the refund within a period of six months from the date of such order, the Central Government shall pay to the assessee simple interest at ⁵[fifteen per cent.] per annum on the amount of refund due from the date immediately following the expiry of the period of six months aforesaid to the date on which the refund is granted.

⁶[(3A) Where the whole or any part of the refund referred to in sub-section (3) is due to an assessee as a result of any amount having been paid by him after the 31st day of March, 1975, in pursuance of any order of assessment or penalty and such amount or any part thereof having been found in appeal or other proceeding under this Act to be in excess of the amount which such assessee is liable to pay as tax or penalty, as the case may be, under this Act, the Central Government shall pay to such assessee simple interest at the rate specified in sub-section (3) on the amount so found to be in excess from the date on which such amount was paid to the date on which the refund is granted:

Provided that, where the amount so found to be in excess was paid in instalments, such interest shall be payable on the amount of each such instalments or any part of such instalment, which was in excess, from the date on which such instalment was paid to the date on which the refund is granted:

Provided further that no interest under this sub-section shall be payable for a period of one month from the date of the passing of the order in appeal or other proceeding:

Provided also that, where interest is payable to an assessee under this sub-section, no interest under sub-section (3) shall be payable to him in respect of the amount so found to be in excess.]

(4) Where a refund is withheld under the provisions of sub-section (2), the Central Government shall pay interest at the aforesaid rate on the amount of refund ultimately determined to be due as a result of the appeal or further proceedings for a period commencing after the expiry of six months from the date of the order referred to in that sub-section to the date the refund is granted.

⁷[(4A) The provisions of sub-sections (3), (3A) and (4) shall not apply in respect of any assessment for the assessment year commencing on the 1st day of April, 1989, or any subsequent assessment year.

(4B) (a) ⁸[Where refund of any amount becomes due to the assessee under this Act,] he shall, subject to the provisions of this sub-section, be entitled to receive, in addition to the said amount, simple interest thereon calculated at the rate of one ⁹[***] per cent. for every month or part of a month comprised in the period or periods from the date or, as the case may be, dates of payment of the tax or penalty to the date on which the refund is granted .

Explanation.—For the purposes of this clause, “date of payment of the tax or penalty” means the date on and from which the amount of tax or penalty specified in the notice of demand issued under section 31 is paid in excess of such demand.

(b) If the proceedings resulting in the refund are delayed for reasons attributable to the assessee, whether wholly or in part, period of the delay so attribuatable to him shall be excluded from the period for which interest is payable, and where any question arises as to the period to be excluded, it shall be decided by the Chief Commissioner or Commissioner whose decision thereon shall be final.

(c) Where as a result of an order under ¹⁰[sub-section (3) or sub-section (5) of section 15 or] section 16 or section 22 or section 23 or section 24 or section 26 or section 28 or section 34 the amount on which the interest was payable under clause (a) has been increased or reduced, as the case may be, interest shall be increased or reduced accordingly, and, in a case where the interest is reduced, the Assessing Officer shall serve on the assessee a notice of demand in the prescribed form specifying the amount of the excess interest paid and requiring him to pay such amount; and such notice of demand shall be deemed to be a notice under section 31 and the provisions of this Act shall apply accordingly.

(d) The provisions of this sub-section shall apply in respect of assessments for the assessment year commencing on the 1st day of April, 1989, and subsequent assessment years.]

(5) Where under any of the provisions of this Act, a refund is found to be due to any person, the ¹¹[Assessing Officer], ¹²[Deputy Commissioner (Appeals)], ¹³[Commissioner (Appeals)] or ¹⁴[Chief Commissioner or Commissioner], as the case may be, may, in lieu of payment of the refund, set off the amount to be refunded or any part of that amount, against the sum, if any, remaining payable under this Act by the person to whom the refund is due, after giving an intimation in writing to such person of the action proposed to be taken under this section.]

—————

1. Subs. by Act 4 of 1988, sec. 161, for “Gift-tax Officer” (w.e.f. 1-4-1988).

2. Ins. by Act 4 of 1988, sec. 180(i) (w.e.f. 1-4-1989).

3. Subs. by Act 3 of 1989, sec. 90(a), for “total income” (w.e.f. 1-4-1989).

4. Subs. by Act 36 of 1989, sec. 33 (w.e.f. 1-4-1989).

5. Subs. by Act 67 of 1984 sec. 75, for “twelve per cent.” (w.e.f. 1-10-1984). Earlier the words “twelve per cent.” were subs. by Act 16 of 1972, sec. 52, for “nine per cent.” (w.e.f. 1-4-1972). Prior to that the words “nine per cent.” were subs. by Act 27 of 1967 sec. 3, for “six per cent.” (w.e.f. 1-10-1967). Still earlier, the words “six per cent.” were subs. by Act 15 of 1965, sec. 21 (ii), for “four per cent.” (w.e.f. 1-4-1965).

6. Ins. by Act 41 of 1975, sec. 118 (w.e.f. 1-10-1975).

7. Ins. by Act 4 of 1988, sec. 180 (ii) (w.e.f. 1-4-1989).

8. Subs. by Act 3 of 1989, sec. 9(b) (i) for “where, in pursuance of any order passed under this Act, the refund of any amount becomes due to the assessee”. (w.e.f. 1-4-1989).

9. The words “and a half” omitted by Act 49 of 1991, sec. 89 (w.e.f. 1-10-1991).

10. Ins. by Act 3 of 1989, sec. 90 (b) (ii) (w.e.f. 1-4-1989).

11. Subs. by Act 4 of 1988, sec. 161, for “Gift-tax Officer” (w.e.f. 1-4-1988).

12. Subs. by Act 4 of 1988, sec. 161, for “Appellate Assistant Commissioner” (w.e.f. 1-4-1988).

13. Ins. by Act 29 of 1977, sec. 39 and Sch. V, Pt. III (w.e.f. 10-7-1978).

14. Subs. by Act 4 of 1988, sec. 161, for “Commissioner” (w.e.f. 1-4-1988).

Section 34. RECTIFICATION OF MISTAKES.

¹[34. Rectification of mistakes.—(1) With a view to rectifying any mistake apparent from the record—

(a) The ²[Assessing Officer] may amend any order of assessment or of refund or any other order passed by him;

³[(aa) a gift-tax authority may amend any intimation sent by it under sub-section (1) of section 15 or enhance or reduce the amount of refund granted by it under that sub-section;]

⁴[(b) the Deputy Director or Deputy Commissioner or Director or Commissioner or Deputy Commissioner (Appeals) or Commissioner (Appeals) may amend any order passed by him under section 17A;

(c) the Deputy Commissioner (Appeals) or Commissioner (Appeals) may amend any order passed by him under Section 22 ⁵[***];

(d) the Commissioner may amend any order passed by him under section 24;

(e) the Appellate Tribunal may amend any order passed by it under section 23 or section 25.]

(2) Subject to the other provisions of this section, the authority concerned—

(a) may make an amendment under sub-section (1) of its own motion; and

(b) shall make such amendment for rectifying any such mistake which has been brought to its notice by the assessee, and where the authority concerned is the ⁶[Deputy Commissioner (Appeals)] ⁷[or the Commissioner (Appeals)] or the Appellate Tribunal by the ⁸[Assessing Officer] also.

(3) An amendment, which has the effect of enhancing an assessment or reducing a refund or otherwise increasing the liability of the assessee, shall not be made under this section unless the authority concerned has given notice to the assessee of its intention so to do and has allowed the assessee a reasonable opportunity of being heard.

(4) Where an amendment is made under this section, an order shall be passed in writing by the gift-tax authority concerned.

(5) Subject to the provisions of sub-section (2) of ⁹[section 33A], where any such amendment has the effect of reducing the assessment, the ⁸[Assessing Officer] shall make any refund which may be due to such assessee.

(6) Where any such amendment has the effect of enhancing the assessment or reducing a refund already made, the ⁸[Assessing Officer] shall serve on the assessee a notice of demand in the prescribed form specifying the sum payable, and such notice of demand shall be deemed to be issued under section 31 and the provisions of this Act shall apply accordingly.

(7) No amendment under this section shall be made after the expiry of four years ¹⁰[from the end of the financial year in which the order sought to be amended was passed].]

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1. Subs. by Act 53 of 1962, sec. 26 (w.e.f. 1-4-1963).

2. Subs. by Act 4 of 1988, sec. 161, for “Gift-tax Officer” (w.e.f. 1-4-1988).

3. Ins. by Act 4 of 1988, sec. 181 (w.e.f. 1-4-1989).

4. Subs. by Act 4 of 1988, sec. 186 (3) (w.e.f. 1-4-1989).

5. The words “or section 22A” omitted by Act 3 of 1989, sec. 91 (w.e.f. 1-4-1989).

6. Subs. by Act 4 of 1988, sec. 161, for “Appellate Assistant Commissioner” (w.e.f. 1-4-1988).

7. Ins. by Act 29 of 1977, sec. 39 and Sch. V, Pt. III (w.e.f. 10-7-1978).

8. Subs. by Act 4 of 1988, sec. 161, for “Gift-tax Officer” (w.e.f. 1-4-1988).

9. Subs. by Act 5 of 1964, sec. 52 (c), for “section 33” (w.e.f. 1-4-1963).

10. Subs. by Act 67 of 1984, sec. 76, for “from the date of the order sought to be amended” (w.e.f. 1-10-1984).

Section 35. PROSECUTION.

(1) If any person fails without reasonable cause, -

(a) to furnish in time any return of gifts under this Act;

(b) to produce, cause to be produced, on or before the date mentioned in any notice under ¹[***] sub-section (4) of section 15, such accounts, records and documents as are referred to in the notice;

²[***]

he shall, on conviction before a magistrate, be punishable with fine which may extend to rupees ten for every day during which the default continues.

(2) If a person makes a statement in a verification in any return of gifts furnished under this Act or in a verification mentioned in section 22, 23 or 25 which is false, and which he either knows or believes to be false, or does not believe to be true, he shall, on conviction before a magistrate, be punishable with simple imprisonment which may extend to one year, or with fine which may extend to rupees one thousand, or with both.

³[(2A) If a person abets or induces in any manner another person to make and deliver an account, statement or declaration relating to any gifts chargeable to tax which is false and which he either knows to be false or does not believe to be true, he shall, on conviction before a magistrate, be punishable with simple imprisonment which may extend to six months or with fine which may extend to one thousand rupees or with both.]

⁴[(3) A person shall not be proceeded against for an offence under this Act except with the previous sanction of the Commissioner or Commissioner (Appeals):

Provided that the Chief Commissioner or, as the case may be, Director General may issue such instructions or directions to the aforesaid gift-tax authorites as he may deem fit for institution of proceedings under this sub-section.

(4) Any such offence may, either before or after the institution of proceedings, be compounded by the Chief Commissioner or Director-General.]

⁵[⁶[Explanation 1].—For the purposes of this section, “Magistrate” means a Presidency magistrate or a Magistrate of the first class.]

⁷[Explanation 2.—For the removal of doubts, it is hereby declared that the powers of the Board to issue orders, instructions or directions under this Act shall include and shall be deemed always to have included the power to issue instructions or directions (including instructions or directions to obtain the previous approval of the Board) to other gift-tax authorities for the proper composition of offences under this section.]

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1. The words “sub-section (2) or” omitted by Act 41 of 1975, sec. 119(i) (w.e.f. 1-4-1976).

2. Clause (c) omitted by Act 41 of 1975, sec. 119(ii) (w.e.f. 11-4-1976).

3. Ins. by Act 53 of 1962, sec. 27 (ii) (w.e.f. 1-4-1963).

4. Subs. by Act 49 of 1991, sec. 90(a) (w.e.f. 1-10-1991).

5. Subs. by Act 53 of 1962, sec. 27(ii) (w.e.f. 1-4-1963).

6. Explanation re-numbered as explanation 1 by Act 49 of 1991, sec. 90(b) (w.r.e.f. 1-4-1963).

7. Ins. by Act 49 of 1991, sec. 90(b) (w.r.e.f. 1-4-1958).

Section 35A. OFFENCES BY COMPANIES.

¹[35A. Offences by companies.—(1) Where an offence under this Act has been committed by a company, every person who, at the time the offence was committed, was in charge of and was responsible to, the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence 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 any punishment if he proves that the offence was committed without his knowledge or that he had exercised all due diligence to prevent the commission of such offence.

(2) Notwithstanding anything contained in sub-section (1), where an offence under this Act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to any neglect on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.

Explanation : For the purposes of this section, – (a) “company” means a body corporate, and includes – (i) a firm, and

(ii) an association of persons or a body of individuals, whether incorporated or not; and

(b) “director”, in relation to -

(i) a firm, means a partner in the firm,

(ii) an association of persons or a body of individuals, means any member controlling the affairs thereof.

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1.  Ins. by Act 41 of 1975, sec. 120 (w.e.f. 1-10-1975).

Section 35B. OFFENCES BY HINDU UNDIVIDED FAMILIES.

(1) Where an offence under this Act has been committed by a Hindu undivided family, the Karta thereof shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly:

Provided that nothing contained in this sub-section shall render the Karta liable to any punishment if he proves that the offence was committed without his knowledge or that he had exercised all due diligence to prevent the commission of such offence.

(2) Notwithstanding anything contained in sub-section (1), where an offence under this Act has been committed by a Hindu undivided family and it is proved that the offence has been committed with the consent or connivance of, or is attributable to any neglect on the part of, any member of the Hindu undivided family, such member shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly.

Section 35C. SECTION 360 OF THE CODE OF CRIMINAL PROCEDURE, 1973 AND THE PROBATION OF OFFENDERS ACT, 1958, NOT TO APPLY.

Nothing contained in section 360 of the Code of Criminal Procedure, 1973 (2 of 1974), or in the Probation of Offenders Act, 1958 (20 of 1958), shall apply to a person convicted of an offence under this Act unless that person is under eighteen years of age.

Section 35D. PRESUMPTION AS TO CULPABLE MENTAL STATE.

¹[35D. Presumption as to culpable mental state.—(1) In any prosecution for any offence under this Act which requires a culpable mental state on the part of the accused, the court shall presume the existence of such mental state but it shall be a defence for the accused to prove the fact that he had no such mental state with respect to the act charged as an offence in that prosecution.

Explanation : In this sub-section “culpable mental state” includes intention, motive or knowledge of a fact, or belief in, or reason to believe, a fact.

(2) For the purposes of this section, a fact is said to be proved only when the court believes it to exist beyond reasonable doubt and not merely when its existence is established by a preponderance of probability.

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1.  Ins. by Act 46 of 1986, sec. 41 (w.e.f. 10-9-1986).

Section 35E. PROOF OF ENTRIES IN RECORDS OR DOCUMENTS.

¹[35E. Proof of entries in records or documents.—Entries in the records or other documents in the custody of a gift-tax authority shall be admitted in evidence in any proceedings for the prosecution of any person for an offence under this Act, and all such entries may be proved either by the production of the records or other documents in the custody of the gift-tax authority containing such entries, or by the production of a copy of the entries certified by the gift-tax authority having custody of the records or other documents under its signature and stating that it is a true copy of the original entries and that such original entries are contained in the records or other documents in its custody.

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1.  Ins. by Act 3 of 1989, sec. 92 (w.e.f. 1-4-1989).

Section 36. POWER REGARDING DISCOVERY, PRODUCTION OF EVIDENCE, ETC.

¹[36. Power regarding discovery, production of evidence, etc.—(1) The ²[Assessing Officer], the ³[Deputy Commissioner (Appeals)], 4[the Commissioner (Appeals),] the ⁵[Chief Commissioner or Commissioner] and the Appellate Tribunal shall, for the purposes of this Act, have the same powers as are vested in a Court under the Code of Civil Procedure 1908 (5 of 1908), when trying a suit in respect of the following matters, namely:—

(a) discovery and inspection;

(b) enforcing the attendance of any person, including any officer of a banking company and examinaing him on oath;

(c) compelling the production of books of account and other documents; and

(d) issuing commissions.

⁶[(1A) If the Director-General or Director or Deputy Director or Assistant Director has reason to suspect that any gifts chargeable to tax under this Act have been concealed, or are likely to be concealed, by any person or class of persons within his jurisdiction, then for the purposes of making any inquiry or investigation relating thereto, it shall be competent for him to exercise the powers conferred under sub-section (1) on the gifts-tax authorities referred to in that sub-section, notwithstanding that no proceedings with respect to such person or class of persons are pending before him or any other gift-tax authority.]

⁷[***]

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1. Subs. by Act 53 of 1962, sec. 28 (w.e.f. 1-4-1963).

2. Subs. by Act 4 of 1988, sec. 161, for “Gift-tax Officer” (w.e.f. 1-4-1988).

3. Subs. by Act 4 of 1988, sec. 161, for “Appellate Assistant Commissioner” (w.e.f. 1-4-1988).

4. Ins. by Act 29 of 1977, sec. 39 and Schedule V, Pt. III (w.e.f. 10-7-1978).

5. Subs. by Act 4 of 1988, sec. 161, for “Commissioner” (w.e.f. 1-4-1988).

6. Ins. by Act 26 of 1988, sec. 70 (w.e.f. 1-6-1988).

7. Sub-section (2) omitted by Act 4 of 1988, sec. 182(b) (w.e.f. 1-4-1989).

Section 37. POWER TO CALL FOR INFORMATION.

¹[Where, for the purposes of this Act, it appears necessary for any gift-tax authority to obtain any statement or information from any person or banking company,] ²[such gift-tax authority] may serve a notice requiring such person, on or before a date to be therein specified, to furnish such statement or information on the points specified in the notice, and that person shall, notwithstanding anything in any law to the contrary, be bound to furnish such statement or information to such gift-tax authority

Provided that no legal practitioner shall be bound to furnish any statement or information under this section based on any professional communication made to him otherwise than as permitted by section 126 of the Indian Evidence Act, 1872 (1 of 1872).

—————

1.  Subs. by Act 4 of 1988, sec. 183 (a), for certain words (w.e.f. 1-4-1989).

2.  Subs. by Act 4 of 1988, sec. 183 (b), for “the Gift-tax Officer” (w.e.f. 1-4-1989).

Section 38. EFFECT OF TRANSFER OF AUTHORITIES ON PENDING PROCEEDINGS.

Whenever in respect of any proceeding under this Act, any gift-tax authority ceases to exercise jurisdiction and is succeeded by another who has and exercises such jurisdiction, the authority so succeeding may continue the proceeding from the stage at which the proceeding was left by his predecessor :

¹[Provided that the assessee concerned may demand that before the proceeding is so continued the previous proceeding or any part thereof be reopened or that before any order of assessment is passed against him, he be reheard.]

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Section 39. COMPUTATION OF PERIOD OF LIMITATION.

¹ COMPUTATION OF PERIOD OF LIMITATION. In computing the period of limitation prescribed for an appeal or an application under this Act, the day on which the order complained of was served and if the assessee was not furnished with a copy of the order when the notice of the order was served upon him, the time requisite for obtaining a copy of such order shall be excluded.

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Section 40. SERVICE OF NOTICE.

(1) A notice or a requisition under this Act may be served on the person therein named either by post or as if it were a summons issued by a court under the Code of Civil Procedure, 1908 (5 of 1908).

(2) Any such notice or requisition may, in the case of a firm or a Hindu undivided family, be addressed to any member of the firm or to the manager or any adult male member of the family, and in the case of a company or association of persons be addressed to the principal officer thereof.

¹[(3) After a finding of total partition has been recorded by the ²[Assessing Officer] under section 20 in respect of any Hindu family, notices under this Act in respect of the gifts made by the family shall be served on the person who was the last manager of the Hindu family, or if such person is dead, then on all surviving adults who were members of the Hindu family immediately before the partition.