METAL DISTRIBUTORS LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) These are two cross-appeals preferred against judgment dated July 6, 1983 delivered by Mr. Justice Bharucha in Writ Petition No. 622 of 1983 and both the appeals can be conveniently disposed of by common judgment.

(2.) The facts which gave rise to filing of the petition, are as follows : M/s. Metal Distributors Ltd., imported 764 metric tonnes of alloy steel scrap between October 15, 1979 and May 7, 1980. In respect of the import 26 bills of entries were presented to the Customs authorities seeking clearance for home consumption. In March and April 1980 the goods were initially inspected by the Customs authorities and reports of inspection were endorsed on the original bills of entries. Subsequently, the importer made representation to the Collector of Customs and thereafter between June 1981 to August 1981 the imported goods were reinspected in accordance with the directions of the Collector. According to the importer the goods were liable to be assessed under Tariff Item No. 73.03/05 and liable to basic customs duty at the rate of 30% ad valorem, auxiliary duty at the rate of 5% and additional duty at the rate of Rs. 225/- per metric tonne. The Customs authorities, however, assessed the goods under Tariff Item 73.15(1)(2) and 73.17/19(1) and the basic duty was determined at the rate of Rs. 325/- per metric tonne. According to the importer, the correct amount of duty was Rs. 25,49,834.60, while according to the Customs authorities duty payable was Rs. 1,29,037.77. As the importer was keen to seek clearance at an early date, the duty as demanded by the Customs authorities was paid under protest between June and August 1981. The Customs authorities also imposed a fine of Rs. 13,20,500/- for breach of the import regulations as it was the claim of the Customs authorities that what was imported was not scrap but alloy in various forms.

(3.) The importer filed 26 refund applications between November 21, 1981 and January 1982 claiming that the duty charged by the Customs authorities was without any authority of law and the importer was compelled to pay the duty under protest only to seek early clearance. The claim made by the importer was obviously correct and therefore the customs authorities between January 9, 1983 and February 17, 1983 refunded an amount of Rs. 77,52,145.72. As the Customs authorities failed to refund the balance amount, the importer instituted petition filed under Article 226 of the Constitution of India in this Court on March 1, 1983 and the relief sought was direction to the respondents to pay the balance sum of Rs. 26,35,853.84 and also an amount of Rs. 13,20,500/- paid in respect of fine illegally collected. The importer also sought payment of the amount along with interest at the rate of 18% per annum from the date of the payment till realisation. The petition was admitted on April 13, 1983 by Mr. Justice Bharucha by passing a speaking order. The learned Judge observed that the conduct of the respondents in not making refund is gross and there is no rational why for more than one year the refund was not granted. The learned Judge also found that though the importer sought an inspection of the endorsement made upon the duplicate bills after reinspection as per the order of the Collector, the respondents scrupulously avoided to give that inspection even after the date and time was fixed. The inspection of the record was not given on the spacious ground that the record was not traceable. The learned Judge felt that the respondents were trying to delay making payment on one pretext or other and thereupon directed the respondents to deposit in Court the aggregate amount of Rs. 39 lakhs towards credit of the petition.