TMI Blog1986 (11) TMI 233X X X X Extracts X X X X X X X X Extracts X X X X ..... Bros., Dubai dated 22-2-1984. Accordingly, they were granted Advance Licence No. 3025480 dated 14-5-1984 for 1,51,200 meters of 100% polyester fabrics width 60 for a value of Rs. 12,85,200/-. In terms of the aforesaid licence, the appellants imported the goods under four Bills of Entry. They complied with the requirement of the advance licence by executing the Bank Guarantee as per the endorsement of the licensing authority on Duty Exemption Entitlement Certificate issued in connection with the licence. Shri Krishnamurthi argued that it was a specific condition of the advance licence that the appellants would manufacture 10,000 doz. shirts and re-export the same within a period of six months from the date of clearance of the first consignment. Shri Krishnamurthi drew our attention to condition No. iv on the reverse of the licence. As per the licence, the goods were imported, but the Customs did not permit their clearance and issued a show cause notice dated 9-7-1985. In the aforesaid show cause notice the Assistant Collector of Customs stated that the goods had been examined and tested. The inspection of the cloth, denier and weight indicated that the cloth was suiting material ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing with the requirements of the licence, they could have informed the Import Control Authorities to take action against the licences in terms of clauses 8 9 of the Imports (Control) Order for preventing import of the goods or cancellation of the licence. In this behalf, Shri Krishnamurthi referred to the Bombay High Court decision in the case of Lokesh Chemicals Works reported in 1981 E.L.T. 235. He urged that the Customs could not now question the description of the goods imported under the licence. Section 111(d) was, therefore, not attracted Shri Krishnamurthi further contended that it was not a misnomer to call safari shirts as shirts. The samples of the cloth imported can be retained by the Customs authorities and the appellants were prepared to export the shirts through Bombay Custom House. As regards the other conditions imposed by the Addl. Collector for the clearance of the consignments, namely, permission to allow movement in Bond for carrying out manufacturing operation under Customs supervision, Shri Krishnamurthi submitted that the appellants had no means to provide a factory which could be bonded for the manufacture of shirts out of the imported material. In reply ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ods were, therefore, correctly liable to confiscation under the Customs read with the condition for the import of the goods. Under Section 125 of the Customs Act, the Addl. Collector could have levied fine in lieu of confiscation of the goods. But he took a lenient view and permitted clearance without any fine but under certain stipulations. In coming to the aforesaid decision, it was possible that the Addl. Collector was influenced by the decision of the Bombay High Court in another identical case of M/s Rene Diffusion Pvt. Ltd. decided under Writ Petition 994 of 1985 dated 20-5-1985. Shri Pal read out the Hon ble Bombay High Court s decision in this case which permitted M/s Rene Diffusion Pvt. Ltd. to carry out manufacturing operations as provided under Section 65 of the Customs Act for manufacture of goods and their re-export. Shri Pal further submitted that in both the cases, namely, the one under the consideration of the Bombay High Court and the present appeal, the imported goods were identical. It was, therefore, likely that in coming to the aforesaid conclusion, the Addl. Collector was influenced by the direction of the Bombay High Court. As regards the appellant s contenti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Collector was however satisfied by being shown a sample of the safari shirt that shirts can be stitched from this cloth. Hence he accepted the licence. The Addl. Collector has inter alia referred to the correspondence exchanged between him and the Export Commissioner. Shri Krishnamurthi has correctly made a grievance to the introduction of the extraneous grounds in the adjudication of the case by the Addl. Collector. The relevant observation of the Addl. Collector seems to suggest that there was no contract between the appellants and their foreign buyer namely M/s Hemchand Bros. as they could not produce such a contract before the Export Commissioner. On the other hand, they have now produced the contract with the foreign buyers. If, therefore, the Addl. Collector wanted to rely on certain evidence received from the Export Commissioner, he should have given an opportunity to the appellants to defend themselves against this evidence. This has not been done and therefore the Addl. Collector s order suffers from this infirmity. Apart from this the learned representative of the appellant has vehemently contended that the Addl. Collector has no jurisdiction to attach any conditions ..... X X X X Extracts X X X X X X X X Extracts X X X X
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