JAYANTILAL K KATAKIA Vs. P GOVINDAN NAIR

JUDGEMENT

(1.) These six appeals by special leave arise out of two orders dated February 25, 1970 and March 18, 1970 passed by the Central Government in revision under Section 131 of the Customs Act, 1962 (hereinafter referred to as the Act). By order made on February 25, 1970 the Central Government disposed of three revision applications preferred against three orders passed by the Central Board of Excise and Customs, New Delhi (hereinafter referred to as the Board) on June 1, July 19, and August 12, 1968 in appeal from certain orders of the Collectors of Customs at Calcutta and Bombay. Civil Appeals Nos. 1141-1143 of 1970 arise out of the Government of Indian's decision dated February 25, 1970. Civil Appeals Nos. 1256-1258 of 1970 are from the Government of India's order dated March 18, 1970 disposing of three revision cases which arose out of three appeals decided by the Board on November 11, 1968, February 13, and Match 13, 1969 preferred against certain orders passed by the Collector of Customs, Bombay. In each of the cases giving rise to the appeals before us the Collector of Customs had made an order under Section 111 (d) of the Act which provides for confiscation of improperly imported goods; in some cases a personal penalty was imposed in addition, in several other cases the Collector had passed an order of fine in lieu of confiscation. The Board made an order in all these cases allowing the goods to be redeemed on payment of fine in lieu of confiscation. The Board also remitted the personal penalties imposed by the Collector.

(2.) The facts found by the Customs authorities on the evidence in the cases covered by Government of India's order dated February 25, 1970 are these. Under the Cotton Textiles Export Incentive Scheme exporters of cotton fabric and yarn were entitled to get import licences for the import of any or all of the following four items:

(3.) We see no reason for not accepting as correct the facts as found by the customs authorities. On these facts the Collectors of Customs held that as the entire gamut of functions of the importers had been performed by Madhusudan Gordhandas, they were really the importers of the goods in question and that it could not be said that they were acting as the authorised representatives of the licensee mills because both the contracts for sale and the authorisations of the Textile Commissioner referred only to non-viscose staple fibre whereas the goods imported were synthetic yarn. The device of having the shipping documents in the name of the licensee mills, it was held, was adopted to suppress the name of the real importers. On appeal the Board also found that the agreements of sale specifically referred only to non-viscose staple fibre and not to all the four varieties. The Board further observed that even if the licensee mills had agreed to the sale of all the four varieties, it was clear from the evidence that the licences were actually transferred by the licensee mills to Madhusudan Gordhandas who dealt with them in the manner they liked. The Board held that having obtained the margin of profit on their licences, the licensee, mills had lost all interest either in the licences or in the goods to be imported against their licences, that it was only because the licensee mills had relinquished control on the licences that Madhusudan Gordhandas could get the licences amended without consulting them. The Board also had no doubt that Madhusudan Gordhandas were the real importers and owners of the goods. The Government of India in revision took the same view on the nature of the transactions. They overruled the contention raised on be, half of Madhusudan Gordhandas that it was only the import quota that was transferred and not the licences. The Board also held that the permission granted by the Textile Commissioner could not confer any protection or immunity from the operation of law and found that the documents Madhusudan Gordhandas eventually obtained from the Textile Commissioner were only usual authorisations for sale of the goods, obviously after import.