GENESIS INTERNATIONAL Vs. COMMISSIONER OF CUSTOMS

JUDGEMENT

(1.) By this application the petitioners have substantially challenged the enquiry in relation to the drawback received and/or receivable by the petitioner No. 1 for supplies made at Special Economic Zone under summons being Annexure P-3 to the petition and also proceeding thereunder, and further search and seizure. The petitioner No. 1 claims to be one of the partners thereof. It is stated in the petition, the first petitioner has been carrying on business of manufacturing leather goods meant for marketing and selling in indigenous market as well as for supply to the exporters, who are also carrying on business within Special Economic Zone. The petitioners are not the exporters, but by virtue of their supplies of the finished leather goods to the exporters within the Special Economic Zone, they are entitled to get the facility of duty draw-back, treating their sale as aforesaid to be deemed export. Such duty draw-back facility is allowable under the provisions of Foreign Trade (Development and Regulation) Act. The petitioners of course have received, and may be receiving in future draw-backs in connection with supply of their goods to the aforesaid exporters. Therefore, according to the petitioners they are answerable and/or liable under the provisions of the Foreign Trade (Development and Regulation) Act. They cannot be subjected to under any search, seizure under the provisions of the Customs Act 1962, which is applicable in case of physical export of the goods, nor the deemed export. Physical export taken place known as transporting and/or carrying the goods after sale are transported or carried beyond the Indian Territorial sea water. This kind of activities are never undertaken by the petitioners, as such, any proceeding under the Customs Act cannot be initiated against the petitioner. Moreover, the amended provisions of the Customs Act being Chapter X(A) dealing with special provisions relating to export in the Special Economic Zone has not been enforced by the proper notification. Initially the aforesaid Chapter was sought to be enforced in July 2003, thereafter it has been deferred till January 2004.

(2.) The petitioners have supplied its product, to one M/s. S.G. International Pvt. Ltd. and they are not aware as to whether S.G. International Pvt. Ltd. have made any export or not.

(3.) Mr. P.K. Mullick, learned Senior Counsel appearing in support of the application contends that search and seizure under the provisions of Customs Act of the writ petitioner are wholly unauthorised and illegal. The search and seizure might have been undertaken had the amended provisions of the aforesaid Chapter XA of the Customs Act been enforced by a notification. Besides, the petitioners are treated to be deemed exporters under the different Act and the officers appointed under the said Act are controlled by the Ministry of Commerce and they can make an enquiry into the draw-back duty payable to the petitioners under the aforesaid Act. The officials of the Customs authority have no jurisdiction to do so, as such, he submits, that the summons, search and seizure and enquiry into the draw-back received or receivable by the petitioners from its suppliers at Special Economic Zone under the provisions of the aforesaid Act shall be stayed.