JADU NATH PAUL Vs. COLLECTOR OF CENTRAL EXCISE

JUDGEMENT

(1.) On 25th January,1974 the petitioner had filed an application with the Customs Authority for clearance of 566 bags of raw kapok imported from Bangla Desh. The petitioner declared that the said import was not liable to payment of import duty-both basic and auxiliary because the import of the said bags of kapok was made under "balanced trade and payment arrangement". The Customs Authority had allowed the petitioner to clear the said consignment without levying any import duty. On 1st March, 1978 the Assistant Collector of Customs, Calcutta, C-VIII(6) 1(a)/CAU/CUS/743749 stating that the petitioner had imported the aforesaid consignment of kapok from Banla Desh on 25th January, 1974 after the expiry of "the limited payment agreement" and at the relevant time "the balanced trade and payment agreement" had come into force which did not extend to cover import of kapok. The petitioner was allowed to clear the said consignment without payment of duty on the same. The petitioner was requested to make payment of duty amounting to Rs. 27905-02P. within a period of 15 days from the date of the receipt of the said letter of demand. Thereupon, the petitioner moved this Court and obtained the present Rule.

(2.) The petitioner has made three-fold submissions. In the first place, it has been contended that the said import of kapok from Bangla Desh made by the petitioner was exempt from payment of import duty. The respondents were bound by the doctrine of promissory estoppel inasmuch as the petitioner had acted upon representation made by the respondents that imports of kapok from Bangla Desh were exempt from payments of duty and, therefore, it would be inequitable to allow the respondents now to realise duty from the petitioners. Thirdly, the petitioner has submitted that the said demand dated 1st March, 1978 made by the Assistant Collector of Customs, Calcutta (Annexure 'B') was barred by limitation and also in breach of the provisions contained in Section 28(1) of the Customs Act, 1962.

(3.) The respondents in their affidavit-in-opposition affirmed by Samir Kumar Mitra, Assistant Collector of Customs, Calcutta, have set out in extenso the various provisions including notifications relating to duty payable in respect of kapok importation. Under Item No. 87 of the First Schedule (Import Tariff Schedule) to the Indian Tariff Act, 1934, Kapok was subjected to import duty at the rate set forth. By a Notification dated 19th September, 1956 and 27th July,1963 raw kapok imported from Pakistan was exempted form payment of customs duty. After the establishment of the Sovereign republic of Bangladesh, the trade between India and Bangladesh was governed by limited payment arrangement during period March 28, 1972 to September 27, 1973. The Government of India by a Notification dated 28th November,1972 had exempted kapok from payment of duty and a few other products when imported into India from Bangladesh. On January 10, 1972 the Central Government by an amendment notification had inserted in the said two notifications the words "in pursuance of the limited payments arrangement set forth in the schedule 'A' to the trade agreement between India and Bangladesh (Annexure 'D' to the affidavit-in-opposition). The Government of India by subsequent notification dated 11th May, 1973 had exempted kapok and several other goods from payment of auxiliary duty in view of the fact that those goods had been exempted from the payment of customs duty by a Notification dated November 28, 1973 (Annexure 'E' to the affidavit-in-opposition).