ABDUL HUSEIN MOHAMMEDALLY MASTER Vs. UNION OF INDIA

JUDGEMENT

(1.) The petitioners are a partnership concern registered under the Partnership Act, 1932 and carry on business of buying and selling of non-ferrous metal.

(2.) On November 26, 1971, two import Licences were issued in favour of Simco Industries (India) for the import of stainless steel pipes and tubes under the provisions of the Import Policy for the year 1971-72. On February 16, 1972, Simco Industries issued a letter of authority in favour of the petitioners authorising them to import the goods specified in the licences. On January 28, 1972, one Ebrahim Enterprises having their offices at Hongkong offered to the petitioners a lot of brand new non-magnetic seamless stainless steel pipes and tubes of diameter 1/4" to 1" in 16/26 gauge, of all mixed lengths of 8 and more. By letter dated February 14, 1972, the petitioners offered to purchase 5 tonnes out of the lot. On February 16, 1972, Ebrahim Enterprises confirmed that the goods would be sold to the petitioners at the price of 550/- per ton. Accordingly, a contract was entered into between the petitioners and Ebrahim Enterprises on February 18, 1972. The goods arrived in Bombay Docks in early May 1972 and the petitioners lodged their bill of entry on May 12, 1972. The goods were not cleared by the Customs authorities after apprising the department called upon the petitioners to explain the use of the goods and the correspondence passed between the parties.

(3.) The respondents served a show cause notice on the petitioners on June 19, 1972 under Section 124 of the Customs Act, 1962. The show cause notice, inter alia, recites that the goods had been imported in contravention of the Import (Control) Order No. 17/55 and the petitioners have contravened the provisions of Section 111(d) of the Customs Act. The petitioners were called upon to show cause why penal action should not be taken under Section 112 of the Act and the goods should not be confiscated under Section 111 of the Act. The petitioners gave their reply on July 28, 1972, inter alia, claiming that the goods imported by them are new goods and they have not contravened any of the provisions of the Import (Control) Order. The respondent No. 2, after hearing the petitioners passed the order on October 3, 1972 confiscating the imported goods and allowing the option in lieu of such confiscation to pay a fine of Rs. 40,000/-. The appeal preferred by the petitioners before the Appellate Collector of Customs ended in dismissal by an order dated February 27, 1976 and the revision carried by the petitioners before the Government of India met with the same fate by an order dated September 5, 1977. These orders are under challenge in this petition filed under Article 226 of the Constitution of India.