TMI Blog1978 (12) TMI 55X X X X Extracts X X X X X X X X Extracts X X X X ..... the Company. In the said bill of entry the value of Jag Jyoti which was declared was rupees ten lakhs. The import duty prevalent on this date was 32%. On 21st July, 1965 there was an oral agreement between the Company and the petitioners for the sale of the said vessel for the amount of rupees twelve lakhs and on the very next day it appears that the petitioners paid 10% of this amount viz. Rs. 1,20,000/- as earnest money to the Company. On 2nd August, 1965 the Company wrote a letter to the Director General of Shipping requesting permission to sell the said vessel Jag Jyoti to the petitioners. A copy of the said letter is annexed as Exhibit 'A' to the petition. On 20th August, 1965 a notification was published increasing the import duty on ships and vessels to 45% instead of the existing 32%. On 21st August, 1965 an agreement in writing for the sale of Jag Jyoti was executed between the Company and the petitioners. A copy of the said agreement is annexed as Exhibit 'B' to the petition. The agreement recites most of the facts earlier mentioned and under clause 7 thereof the petitioners as the purchasers are responsible for the payment of all past and future customs and port dues and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d with by the Company and the proper rate applicable was that in force on 13th July, 1965. According to the petitioners, therefore, there was no legal basis for the substitution of a different date than the one which had been prescribed by law. It was also pointed out that the Assistant Collector of Customs who made the assessment of duty and allowed amendment of the bill of entry had come to certain conclusion and there was no warrant under the Customs Act for reconsideration of his decision by another officer of the same rank, as this would amount to a correction of the order of the previous officer by another, not of a higher rank, but one of equivalent rank only. 5. The Assistant Collector of Customs gave his decision on 16th March, 1966. Paragraph 1 of the said decision sets out the original demand, para 2 the contentions of the petitioners in reply thereto (though summarised in a somewhat haphazard and unsatisfactory manner) and para 3 contains the decision of the Assistant Collector of Customs. The decision is thoroughly unsatisfactory and may be regarded as totally useless. It does not show whether he had understood any contention of the petitioners or their explanation a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was on 7th September, 1965, and the rate of duty which they were liable to pay was the one prevailing on the date of the importation which was after this date. According to the Appellate Collector, by this date the rate of duty had been enhanced from originally 32% to 45%. It is important to note that in the appellate order it was not specifically held that the amendment of the bill of entry was improper. But, on the other hand, it appears to be the view of the Appellate Collector that the petitioners became liable to pay extra duty by reason of the amendment, and this is regarded as a consequence of the amendment. According to the Appellate Collector, there was no decision of the previous Assistant Collector to assess the duty at the lower rate and the assessment was a mistake which could be corrected subsequently by an officer of equal rank. 7. The petitioners carried the matter in revision before the Government of India, where the matter was considered by the Joint Secretary to the Government of India. One of the contentions urged on behalf of the petitioners was that as the amendment had been allowed to be carried out in the name of the importer in the original bill of entry, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or understood the petitioners' contentions. The petitioners have accordingly prayed that the orders be quashed and the amount of alleged short-levy paid under protest be refunded to the petitioners. It is in these circumstances that the statutory provisions will now be required to be considered and these are the relevant provisions of the Customs Act, 1962. 9. We have in the first place to consider the definitions of the terms "import" and "importer" to be found in Section 2(23) and 2(26) respectively of the said Act. It may be mentioned that under Section 2(22) 'goods' would include vessels and under Section 2(25) the definition of "imported goods" would include the said vessel which was brought into India from a place outside India for the purpose of being scrapped. The definitions of "import" and "importer" to be found in the two sub-sections of Section 2 may be fully set out. "2(25). "import", with its grammatical variations and cognate expressions, means bringing into India from a place outside India;" "2(26). "importer", in relation to any goods at any time between their importation and the time when they are cleared for home consumption, includes any owner or any pers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... : Provided that the Collector of Customs may in any special circumstances permit a bill of entry to be presented before the delivery of such manifest or report. (4) The importer while presenting a bill of entry shall at the foot thereof make and subscribe to a declaration as to the truth of the contents of such bill of entry and shall, in support of such declaration, produce to the proper officer the invoice, if any, relating to the imported goods. … … … … 13. We now have to turn to certain sections permitting amendment of customs documents. But before setting out Sections 149 and 154 which provide for amendment and correction respectively, brief reference may be made to sub-section (1) of Section 147 by which anything required to be done by the owner, importer or exporter of the goods under the Act may be done on his behalf by his agent. We then have Section 149 which reads as under : "149. Amendment of Documents. - Save as otherwise provided in Sections 30 and 41, the proper officer may in his discretion, authorise any document, after it has been presented in the custom house, to be amended : Provided that no amendment of a bill of ent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... petitioners were required to show cause in respect of the alleged short-levy was beyond the time prescribed by Section 28. I found no substance in the said plea as it appeared clear to me that in the circumstances of the case the show-cause memo was issued within the permitted period of six months, which, has to be considered to commence at the earliest from 7th September, 1965 when duty was assessed at the rate of 32 per cent to Rs. 3,75,537.40. It was also contended that the officer who issued the show-cause memo was not authorised to recover short-levy. The learned advocate for the petitioners, however, was not able to explain the basis of such contention, which was merely stated but not pressed. It was submitted that the impugned order of the Assistant Collector suffered from two defects: (1) that it was made in violation of the principles of natural justice and (2) that it was not a speaking order. As far as the latter connection is concerned, it will be required to be upheld. There is some force in the first grievance also. But it must be observed that the position would have been different if the petitioners had come to this Court straight from this order. The petitioners ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 130 (to give only an instance, which section gives to the Board the revisional powers to check the legality or propriety of all decisions of all officers of Customs), the bill of entry as amended was required to be considered and as long as there was a bill of entry as amended, in my opinion, it was not permissible for any authority, even though higher in status than the Assistant Collector, to consider the bill of entry as non est, improper, and to proceed to consider the goods as imported otherwise than after the presentation of a bill of entry. The process of reasoning to be found in paragraphs 10 and 11 of the order of the learned Joint Secretary is totally perverse. It is not open to the Union of India as long as the amended bill of entry stands to proceed, without rectifying the so-called error of the original Assistant Collector in permitting the amendment, on the footing that it did i.e. of ignoring the amended bill of entry and to consider the goods as having been imported without presentation of a proper bill of entry. By this manner, law and justice have been thrown to the winds and it is impossible to support the assessability of duty under Section 15(1)(c), which cours ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of entry into a new one presented on the date of the amendment. It was open to the officer concerned to have refused the application for substitution of the name of the petitioners for that of the Company. If he had done so, there were a number of options available to the petitioners. They could have asked the Company to clear the goods under the unamended bill of entry and then taken delivery of the vessel; they could have presented a fresh bill of entry, in which case they might be required to pay duty at the date on which the fresh bill of entry was presented; they could have appealed against the order of the Assistant Collector refusing to amend the company's bill of entry and sought appropriate orders from higher authorities. The petitioners were not called upon or required to exercise any of these options or to choose which course to follow. The original bill of entry which was presented in July, 1965 remained but the name of the importer was substituted. On that bill of entry the goods were allowed to be cleared. Even if the action of the Assistant Collector was, in the view of the Appellate Collector and the Board, erroneous, as long as that action (of allowing the amendmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pleadings and submitted that ordinarily all amendments would relate back to the date on which the original pleading was presented to the Court. It was pointed out that where a party was substituted or added, there was a special provision in the Limitation Act to counteract this ordinary result and that where there was no such provision the ordinary result must follow, which ordinary result may be summarised in this way that all amendments would relate back to the original date. 24. Mr. Nain also submitted that even under the agreement of sale it was open to the petitioners to have asked the Company to clear the vessel under the Company's bill of entry and they did not do so because the Assistant Collector permitted the petitioners to make clearance after substituting the name of the petitioners on the original bill of entry. Let us now examine that contention. It has been held and would appear to be the correct position in law that by the written agreement dated 21st August, 1965 the property had not passed to the petitioners and there was a mere equity in favour of the petitioners. It appears from the appellate order that the balance of the price was paid to the Company by the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2(26) and it was they who were required to make a declaration at the foot of the bill of entry, which was not made by them and, therefore, it could be contended that there was no bill of entry. Alternatively he submitted that since the name of the importer has been altered, the bill of entry as altered must be regarded as one having been presented on 7th September, 1965 and, if it be so regarded, then duty was required to be levied at the rate of 45% and the demand on the basis of short-levy was fully justified. Mr. Joshi forgets that the amendment had not been carried out by the petitioners simply but it had been sought for and had been allowed by the Assistant Collector presumably in the exercise of his discretion. If then there was any technical defect or incompleteness in the bill of entry which may be found out objectively, it must be presumed that the Assistant Collector had subjectively determined that the bill of entry after the amendment was in consonance with Section 46 and that it did not suffer from any obvious defect. But the short point then is : Are the 'petitioners to be made responsible for payment of difference in the duty by reason of any alleged error or errone ..... X X X X Extracts X X X X X X X X Extracts X X X X
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