UNION INDUSTRIES Vs. UNION OF INDIA

JUDGEMENT

(1.) The petitioners are a firm carrying on business of importing diverse commodities. The petitioners hold letters of authority in respect of two R.E.P. licences issued to M/s. Industrial Cables (India) Ltd. and who are registered as export firm. The two licences were issued in connection with two registered contracts registered on July 25,1980 and October 27,1980. On April 1, 1980 the import policy for year 1980-81 was announced. The registered exporters in accordance with Clause 8 of Appendix 20 were entitled to claim the import replenishment as were permissible to registered exporters. The petitioners arranged for import of 1,000 M.T. of Animal Tallow and entered into contract with M/s. M.W. Harvey Ltd., a company at London on February 21, 1983. The imported items arrived at Bombay Port on April 27, 1983 and the petitioners filed four bills of entry for clearance of the goods for home consumption. The petitioners were called upon by show cause notice dated March 24,1983 to explain why the imported goods should not be confiscated on the ground that the import licence was not valid to cover the goods imported. The petitioners filed their reply on April 27,1983 and the Collector of Customs by order dated April 30,1983 confiscated the goods covered by each of the four bills of entry. The petitioners were given an option to pay a fine of Rs. 2,70,000/-in respect of each bill of entry in lieu of confiscation. The petitioners preferred an appeal in May 1983 but realising that the Appeal Bench was not available, preferred Writ Petition No. 1301 of 1983 under Article 226 of the Constitution in this Court. The petition was admitted and the petitioners were permitted to clear the goods on furnishing bank guarantee. The petitioners furnished the bank guarantee and cleared the goods.

(2.) The petitioners imported another quantity of 1,744.798 M.T. of Animal Tallow and seven bills of entry were presented for clearance of the goods. The petitioners requested the Collector of Customs to release the goods on their furnishing bank guarantee in view of the order passed in respect of the earlier consignment. On May 25, 1983 the Collector of Customs confiscated the goods but gave an option to the petitioners to pay fine aggregating to Rs. 24,25,000/- in lieu of confiscation. The petitioners then applied for amendment of this writ petition which was still pending and secured an order for clearance of the goods. The orders passed by the Collector of Customs dated April 30, 1983 and May 25, 1983 are under challenge in this petition filed under Article 226 of the Constitution. On Wednesday, March 9.1994;

(3.) Shri Nankani, learned Counsel appearing on behalf of the petitioners, submitted that the Assistant Collector had sought to draw a distinction between items permissible for import on R.E.P. licence as replenishment items in terms of the policy for registered exporters contained in Chapter 17 and Appendix 17 of the import policy April 1980 - March 1981 on one hand and the additional facility for import to export houses in terms of para 174(v) of Chapter 18. The learned Counsel urged that the Collector of Customs denied the benefits under Clause 8 of Appendix 20 to the petitioners on the strength of the distinction but the distinction is without any difference. It was urged that the Collector of Customs overruled the objective of the scheme for registered export houses and special facilities given to them and eligibility of import under the provisions of para 176 of 1980-81 policy. There is considerable merit in the contention urged by the learned Counsel but the order for confiscation passed by the Collector of Customs is not required to be disturbed for another reason. It is not in dispute that the item Animal Tallow was canalised with effect from June 5, 1981 and that factor is specifically referred to by the Collector of Customs in the impugned orders. It is equally not in dispute that the licences on the strength of which the import of Animal Tallow is sustained by the petitioners were issued on February 5, 1982 i.e. after the date of order of canalisation of the item. Shri Desai, learned Counsel appearing on behalf of the Department submitted that once the item was canalised, it was not open for the petitioners to import the item by reference to the licences granted. In our judgment, in view of the item being canalised with effect from June 5,1981, the short question which requires determination is whether the import by the petitioners without intervention of the canalising agency i.e. State Trading Corporation, was permissible.