UNION TRADING COMPANY Vs. UNION OF INDIA

JUDGEMENT

(1.) BY consent of both parties, the main writ petitions themselves have been taken up for final hearing, since the points involved in all the writ petitions are one and the same, they are disposed of by a common order. The petitioners in all the above writ petitions imported betel nuts of srilankan origin. They filed necessary bill of entries for home consumption and sought clearance of the goods under freely importable category claiming "the item not covered in Negative list of Import policy 1992-97'. The department refused to release the goods on the ground that betel nuts are in the nature of goods of agricultural origin and they are not dry fruits. The petitioner firm requested the Additional Commissioner of customs for adjudication of the case after affording personal hearing. The additional Commissioner of Customs after affording a personal hearing by his order dated 11-9-1995 hold that the betel nuts are other than dry fruits and are consumer goods requiring a valid import licence for clearance. Since the petitioner firm did not produce a licence, the Additional Commissioner of customs confiscated the goods under Section 111 (d) of the Customs Act, 1962 r/w. Section 3 (3) of the Foreign Trade (Development and Regulation) Act, 1992. The Additional Commissioner of Customs was however pleased to allow clearance of the goods under import on payment of redemption fine and also levied personal penalty on the petitioner firm under Section 112 (a) of the Customs act, 1962. The Additional Commissioner has also tried to distinguish the CEGAT decision in the decision in G. K. Enterprises v. Collector of Customs, Madras wherein it was held that aricanuts are dry fruits and can be allowed to be imported freely. Aggrieved by the order of the Additional Commissioner of Customs, the petitioners filed appeals before the Commissioner of Customs and Central Excise (Appeals), Trichirapalli. The appellate authority by his order dated 26-9-1995 and 28-9-1995 respectively ordered clearance of the goods on licence bond. The appellate authority in paragraph 4 of his order has observed as follows :" I have carefully gone through the records of the case. I find that in the case ofg. K. Enterprisesv. Collector of Customs, Madras, the question arose as to whether betelnuts are dry fruits or not. The CEGAT South regional Bench, after referring to the Import and Export Policy, various dictionary meanings for the word'betel nut'and the opinion of the commissioner of Horticulture and plantation crops, newspaper reports, like economic Times, and the Harmonised System of Commodity Classification and customs Tariff Act, came to the conclusion that aricanuts are dry fruits. Although the above decision was in the context of old Policy allowing import of dry fruits under Exim scrip, in the present policy, dry fruits are under O. G. L. and the entries are identical. Though a reference application has been filed, in the absence of any stay of CEGAT's decision, judicial discipline requires that the same be implemented by lower authorities. Further, the clarifications of DCFT and Ministry of Agriculture cannot also over-rule the decision of cegat, as held by the Supreme Court in the case ofbengal Iron corporationv. Commercial Tax Officer, reported in 1993 (63) ELT 13 (SC ). I also observe that in Madras Customs House, import of similar consignments is allowed under licence bond. In view of the above circumstances, I am unable to sustain the Additional Commissioner's orders that the goods are to be treated as falling under the negative list and accordingly set aside the same. However, considering the practice prevalent at the Madras Customs House, I order that the goods be allowed to be cleared on a licence bond so that if the final order of the High court on the reference application filed against CEGAT decision is in favour of the Department, suitable action can be taken against the importers in terms of the bond. The appeals are allowed thus in the above terms.

(2.) ACCORDING to the petitioners, they sent several letters for the release of the goods as per the order of Commissioner of customs and Central Excise (Appeals), on execution of a licence bond. However, the goods were not released. Inspite of repeated request made in person. The petitioners firm also issued lawyer's notice addressed to the Additional commissioner of Customs and Central Excise, Tuticorin requesting the third respondent for immediate release. There has been no reply to the letters sent by the petitioner's firm and by its lawyer. Therefore, the petitioners have filed the above writ petitions for a mandamus directing the respondents to release the betel nuts imported and covered by respective bill of entries.

(3.) ACCORDING to learned counsel for respondents the export import policy applicable to the case on hand is the policy of the year 1992-97 and the goods which were imported through Tuticorin port were declared as betel nut falling under Chapter Heading No. 8 with sub-heading No. 0802. 90. It is appropriate at this stage to refer to Chapter 8 which deals with edible fruit and nuts; peel of citrus, fruits or melons. Sub-heading 08. 02 deals with the following : "other nuts, fresh or dried, whether or not shelled or peeled : The Export-Import Policy for 1992-97, Part II Sl. No. 156 deals about Restricted items. These restricted items are consumer goods, which are not permitted to be imported freely except against a licence. Sl. No. 156-Restricted items. Aconsumergoods, Sl. No. 1isreproduced below : Sl. No. Description of items Nature of Restriction 1. All consumer goods, how-so-ever described, of industrial, agricultural, mineral or animal origin whether in SKD/ckd condition or ready to assemble sets or in finished form. Not permitted to be imported except against a licence or in accordance with a public notice issued in this behalf. ACCORDING to the learned counsel for respondents, the betel nuts are in the nature of consumer goods of agricultural origin and that being the clear picture emanating from the policy itself, there cannot be any deviation. The entry in the present policy is clear and unambiguous and therefore, the petitioners are not now entitled to the release of the goods. Learned counsel further submitted that in interpreting a particular entry, the opinion given by the regulating authority and the authority who is the expert to give such opinion, i. e. , the Ministry of Agriculture, is taken as guidelines alongwith the meaning given for such entry in Modern English dictionaries and the Encyclopedias to adjudicate the matter correctly. ACCORDING to him, the third respondent has considered extensively the meaning and definitions of 'betel nut''dried fruits'citing the paras from dictionaries and Mcgraw-Hill encyclopedia. Therefore, in the context of the Export-Import Policy 1992-97 the reasoning of the third respondent is valid and the Appellate Authority without considering the present policy allowed the appeals. It is also further stated that the department has filed appeals against the orders of the appellate authority and the limitation of three months to file appeal has not yet expired and that the department definitely feels that the earlier decision of CEGAT is not applicable to the import made under the present policy. It is also stated that the importers are one time importers and if the items are ordered to be released, it will be very difficult to take suitable action against the importers in the event of the department getting an order from the appellate authority in favour of the department. Hence, in the interest of justice and to safeguard the interest to department, the petitioners may be directed to deposit the redemption fine and penalty amounts. The petitioners must also be directed to pay interest at the rate of 15% per annum on the customs duty payable.