GURUDEV PHOTO COLOUR Vs. UNION OF INDIA

JUDGEMENT

(1.) HE petitioners imported one automatic film developing and processing machine with micro processor based system. It filed the bill of entry covering the said machine and sought clearance of the same under OGL Appendix 2, Item 9 (24) of the Import Export Policy AM 83-84. It was contended by the petitioners that it was assessable at concessional rate of duty under chapter Heading 84. 66 of the Customs Tariff Act, 1975. As the customs authorities were of the opinion that the said machine was not covered under OGL as claimed by the petitioners and needed a specific licence for import, petitioners were asked to explain as to how they were claiming clearance of the goods under OGL. In reply, the petitioners by their letter dated 6-7-1984 explained that on enquiries being made from Government agencies/importers, they were given to understand that the import of Automatic Film Developing and Processing Machine with Micro System was covered under OGL vide Item 9 (24) of Appendix 2 of Import and Export Policy AM 83-84. In support of their contention they produced a letter issued by the Collector of Imports and Exports, Srinagar which states that items covered by Appendix 2, item 9 of the Import Export Policy AM 83-84 are covered by OGL. The petitioners also produced a letter from the Director of Industries to the same effect. In the said letter it was stated by the Director of Industries that the machinery was required by the petitioners for initial setting up of their industry. The Assistant Collector of Customs was also requested to consider the case of the petitioner for concessional rate of duty as per the rules in vogue.

(2.) IT may be pertinent to mention that there is no controversy in this case about the fact that the machinery imported by the petitioners was for use in photo film laboratory and not "cinematographic film laboratory". The Additional Collector of Customs, Bombay considered the reply filed by the petitioners and on interpretation of Item 9 (24) of Appendix 2 of the Import Export Policy held that the machine imported by the petitioners not being a cinematographic film laboratory equipment, did not fall within items permitted to be imported under OGL. He, therefore, confiscated the goods under section 111 (d) of the Customs Act, 1962 read with section 3 of the Imports and Exports (Control) Act, 1947. Option was, however, given to the petitioners to pay in lieu of confiscation, a fine of Rs. 1,50,000/- and clear the goods. It was also held that the petitioners were not eligible to assessment of the said machine at concessional rate of duty under paragraph 177 (1) of the Hand Book of Import and Export Procedure AM 84-85. The petitioners have challenged the above actions of the respondents by this writ petition.

(3.) LEARNED Counsel for the petitioners Dr. Kantawala submits that the machine imported by the petitioners falls under Appendix 2, item 9 (24) of the Import Policy AM 83-84 (corresponding to Item 9 (23) of Appendix I, Part B of Import Export Policy AM 84-85 ). The second submission of the counsel is that even if it does not fall under the said item, on payment of fine in lieu of confiscation the import gets authorised and the goods imported by the petitioners become eligible to concessional rate of duty available to importers of machinery under OGL.