SREENIVAS AND COMPANY AND ZUBAIDA LEATHER COMPANY AND ORS. Vs. UNION OF INDIA (UOI) REPRESENTED BY THE COLLECTOR OF CUSTOMS

JUDGEMENT

(1.) Three firms named Messrs. Srinivas and Company, M/s. Zubaida Leather Company and M/s. Farida Prima Tannery, who are doing the business of exporters in tanned sheep skin, have filed these petitions, each firm separately with regard to its own transactions. In respect of certain exports, the respective firms either directly or through its agent, filed the concerned shipping bill and other documents before the customs officials. The Assistant Collector of Customs, on an examination of the relevant documents, came to the conclusion that the goods were actually bought only by M/s. Bevingtons and Sons, London, and not by M/s. Zentral Kommerz, GmbH Berlin, as stated in the respective declarations and that the payment ought to be in sterling 'pounds' and not in terms of rupees as stated in the original G.R.I. form filed in the Customs House and that these statements were mis-declarations contravening the provisions of Section 12 (1) of the Foreign Exchange Regulation Act, 1947. Having come to these conclusions, he set out these reasons and issued show cause notices to the petitioners stating that the goods were liable for confiscation under Sections 112-D and 113 (1) of the Customs Act, 1962, and that the exporters were liable for penal action under Section 114 of the said Act. The exporters were required to show cause why action should not be accordingly taken. The exporters gave written explanations stating inter alia-that M/s. Bevingtons and Sons, London, were dealers having extensive business connection with traders all over Europe and were acting as agents for various purchasers, that the real purchaser was M/s. Zentral Kommerz, GmbH, Berlin, and that, therefore, there was no mis-declaration either with regard to the place of destination or with regard to the consignee or with regard to the mode of payment. The Collector of Customs gave a personal hearing to the exporters who were represented by their Counsel and appears to have reserved orders. At that stage, the petitioners came to this Court with petitions to quash the show cause notices. But in the meanwhile the Collector of Customs passed orders directing confiscation of the goods and imposing personal penalties. Subsequently, the exporters filed separate petitions to quash those orders. M/s. Srinivas and Company, have filed W.P. No. 3716 of 1970 to quash the show-cause notice and W.P. No. 4076 of 1970 to quash the order of confiscation and imposition of penalty. M/s. Zubaida Leather Company, who were concerned with three transactions, have filed petitions for similar reliefs. W.P. No. 3761 and W.P. No. 4348 of 1970 relate to one transaction. W.P. Nos. 3759 and 4349 of 1970 relate to another transaction. W.P. Nos. 3758 and 4351 of 1970 relate to a third transaction. M/s. Farida Prima Tannery are petitioners in W.P. Nos. 3760 and 4350 of 1970. Though appeals lie to the Central Board of Excise and Customs, New Delhi, against the impugned orders of the Collector, the petitioners have straightaway approached this Court contending inter alia that the action by the Collector is without jurisdiction and the order is void.

(2.) In these petitions the petitioners have put forward the same grounds as those which they put forward in their explanations given in answer to the show cause notices, in support of their contentions that the Collector has acted without jurisdiction and that the impugned notices and orders that followed those notices are invalid. In substance, their case is that M/s. Bevingtons and Sons, Limited, London, have acted as agents of M/s. Zentral Kommerz, Berlin, that as per the terms of the contract, the amount was to be paid by M/s. Zentral Kommerz, Berlin, that, therefore, the place of destination of the goods was mentioned, as G.D.R., and that the method of payment is Indian currency. It is therefore, contended by the petitioners that they are not guilty of any mis-declaration.

(3.) The contention urged on behalf of the respondents is that the real purchasers are M/s. Bevingtons and Sons Ltd., London and not M/s. Zentral Kommerz, Berlin, that the place of destination is, therefore, not G.D.R., and that the method of payment is not Indian currency but sterling. It is, therefore, contended by the respondents that the petitioners are guilty of having given untrue particulars with regard to the place of destination of the goods and the method of payment and that, therefore, they have violated Section 12 (1) of the Act.