S.G. INTERNATIONAL (P) LTD. Vs. CC

JUDGEMENT

(1.) M /s. S.G. International (P) Ltd. have filed the present appeal as the Commissioner of Customs (Preventive) has rejected their request for provisional release of the goods under the impugned Order.

(2.) SHRI Sudhir Kumar Mehta, learned Advocate, submitted that the Appellants, an Export Oriented Unit at Special Economic Zone, Falta, manufacture and export leather goods and leather items of various kinds; that they also procure goods from the Domestic Tariff Area and export the same; that on 15.1.2003 their representative Shri N.K. Maitra received a phone call from Mr. Farid Jamal of M/s. S.N.M. Clearing Agency who informed that two containers belonging to the Appellants have been seized at the Customs Port; that as they had not authorized M/s. S.N.M. Clearing Agency for export nor had filed any Shipping Bill they were astonished to receive the information; that during the course of search of residential and official premises they came to know that search was effected in respect of goods seized at the port in respect of shipping bills and invoices which allegedly were filed in their name; that they, therefore, under their letter dated 17.11.2003 informed the Commissioner and other authorities concerned about the unlawful removal of goods from their warehouse; that from the records of Customs they came to know that 154 packets of leather wallets and 751 packets of leather industrial hand gloves belonging to them were seized at the port and amongst other extraneous materials which did not belong to them; that had they procured these goods for export to their foreign buyers who started pressing hard to effect the shipment under threat for filing suit for damages, that they made a request to the Commissioner of Customs for releasing the goods on provisional basis; that as the Revenue did not consider their request they moved the High Court of Calcutta which directed the Commissioner to consider the application immediately; that the Commissioner under the impugned Order has rejected their request for provisional release of the goods. The learned Advocate, further, submitted that the impugned goods had been removed from their premises without any authorization from them; that they had not authorized any Customs House Agent for exporting the impugned goods; that the letter of authorization is dated 4.4.2004 which cannot be in any circumstances treated as an authorization to execute an export job on November 14th or 15th, 2003; that the letter dated 4.4.2003 itself relates to the documents executed which means documents executed prior to 4.4.2003; that under the Customs House Agent Regulation, the CHA is required to obtain an authorization for effecting any export which is lacking in the present matter, that out of the 13 shipping bills 10 shipping bills have not been signed by the Appellants; that one shipping bill is bearing stamp without any signature and in remaining two shipping bills though the signatures are there but they are not of the Appellants. He, further, contended that seizure of the export goods under Section 10 of the Customs means goods which are to be taken outside India to a place outside India and exporter in relation to any goods at any time between their entry for export and the time and their exporter includes any owner or any person holding himself out to be exporter; that they are not the exporter and never held to be exporters as they had not filed any shipping bills and there is no entry for export by them within the meaning of Section 50 of the Customs Act which requires that an exporter of any goods shall make entry thereof to the proper officer by a shipping bill in the prescribed form; that it is also required that the exporter while presenting a shipping bill or bill of export, shall at the foot thereof make and subscribe to a declaration as to the truth of its contents; that from the shipping bills it is very clear that shipping bill was not filed by them which is required to be filed under Section 50 of the Customs Act; that the Customs Act becomes applicable after the goods are entered for export; that if shipping bill is not filed within the meaning of Section 50 of the Customs Act it cannot be stated that goods are for export and accordingly provisions under Section 113 of the Customs Act do not apply and as such there could not be any seizure; that thus the entire proceedings of seizure is without authority of law, without jurisdiction. The learned Advocate also referred to the Shipping Bill and Bill of Export (Form) Regulation, 1991; that under these regulations shipping bill is required to be presented by the exporter; that none of the 13 shipping bills in question, it appears, were presented by exporter; that on the contrary, shipping bills were presented by a clearing agent which is not permissible under law; that the processing of the shipping bill by the Customs Authorities itself shows that the first stage of proceedings for export was illegal and goods should have not been allowed to be entered into Port without lawful documents of Shipping Bills. Finally he submitted that the impugned goods should not have been seized; that assuming the goods could have been seized, in terms of paragraph 4.2a of the Exim Policy the seizure is required to be lifted within a period of 7 days; that their goods have unnecessarily been seized to prevent them from exporting the same; that it is nothing but a calculated device of the trade competitors to grab the overseas market by preventing them from exporting the goods.

(3.) COUNTERING the arguments Shri Kumar Santosh, learned SDR, alongwith Shri U. Raja Ram, learned DR, submitted that the present matter is not a normal case of mis -declaration; that in the present matter calculated moves have been taken by the Appellants to fulfil their export obligation; that instead of manufacturing the goods for export they had procured the goods from Domestic Tariff Area and the suppliers of these goods would claim the benefit of Deemed Export from the Ministry of Commerce; that the matter is still under investigation by the Department and the release of the goods at this stage may hamper the investigation; that the statement of the officers of the appellants who are involved in sending the goods under seizure fraudulently outside India cannot be recorded as those officers are absconding; that if the goods are released to the Appellants they will never produce these officers which will hamper the investigation being conducted by the Department; that the Department had already issued show cause notice in compliance with the provisions of the Proviso to Sub -section (2) of Section 110 of the Customs Act for extending the time limit for issuing the show cause notice; that it has been held by the Supreme Court in the case of UOI v. Polar Marbles Agglomerates Ltd., 1997 (96) ELT 21 (SC) that the High Court cannot interfere in a writ petition at the stage of the show cause notice to take over fact finding investigation. In reply the learned Advocate submitted that the department can continue with their investigation and proceeds with the matter in accordance with the law; that they are only requesting for release of the goods with the intention of fulfilling their export obligations.