TMI Blog2007 (10) TMI 504X X X X Extracts X X X X X X X X Extracts X X X X ..... Imprest Licence. Likewise, the direction to pay to the Customs Authorities duty to the proportionate quantity of exempt material with interest, affirmed by the impugned order, and the forfeiture order dated 21-11-1994 as upheld in the impugned order cannot be sustained. They are accordingly set aside. - 2751 of 1997 - - - Dated:- 5-10-2007 - S. Ravindra Bhat, J. REPRESENTED BY : S/Shri J.S. Arora with Sanjay Kumar, Advocates, for the Petitioner. Ms. Monika Garg and Munish Malhotra, Advocates, for the Respondent. [Judgment]. The petitioner seeks a direction for quashing the order of the Joint Director General, of Foreign Trade, dated 24-1-1997, (hereafter the impugned order ) in appeal, issued under the Foreign Trade and Development Act, 1992 (hereafter the Act ). 2. Two purchase orders were placed on the petitioner on 20th September 1984, and 11th March 1985, by the National Dairy Development Board, ( NDDB ) under a World Bank project. The NDDB is a Government of India Enterprise. According to the purchase orders, the petitioner had to fabricate and supply 21 barrels for broad guage Rail Milk Tankers. The first purchase order was for supply of 11 barrels a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on Quantity CIF Value S.S. Sheets/Coils AISI 304 3.14 M.M. 22,500 Kgs. 7,87,500 S.S. Plates AISI 304 5.00 M.M. 6,142.26 Kgs. 3,19,397 S.S. Sheets/Coils AISI 304 2.00 M.M. 1,125.00 Kgs. 29,767.26 Kgs. 39,375 11,46,272. 5. The petitioner imported stainless steel sheets and plates of the CIF value of Rs. 10,51,021/- as under : S.S. Sheets 3.15 mm 22,000 Kgs. S.S. Sheets 2.00 mm 1,700 Kgs. Plates 5.00 mm 7,000 Kgs. 30,700 Kgs. 6. As the quantity of imports exceeded the quantity sanctioned under the amended import license, by 1,432.74 Kgs., the petitioner paid Customs duty in the amount of Rs. 1,02,109/- on such excess quantity imported. With the payment of the Customs duty on the excess quantity of steel imported, the CIF Value stood reduced to Rs. 10,01,962/-. 7. The petitioner supplied to the NDDB 9 Stainless Steel Barrels, and the proportionate FOB value of the export made by it, was in the sum of Rs.25,01,687/- on the CIF value of import in the sum of Rs.10,01,962/-. In this view of the matter, the pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e from this office, have accepted the receipt of the same and have expressed regrets for non submission of the same duly completed. The reason attributed for non-submission is that the same might have been misplaced in their office. Suggestion has also been made to decide this case in their favour without any insistance on the production of DEEC (export). (b) In respect of non-receipt of payment against supplies made under invoice No. 1001. It has been mentioned by M/s. Mohan Machines Ltd., that the same has been adjusted against some earlier dues payable by them to the project authority and have also made a suggestion for verification of the correct facts by this office directly from the project authority. (c) In respect of some supplies allegedly made to the project authority after the expiry of export obligation period M/s. Mohan Machines Ltd., have sought a time from this office to enable them to make a request for extension in the obligation period to the Hqrs. office of CCI and E (now DGFT). Accepting their default M/s. Mohan Machines Ltd., have also suggested that the same should be treated as a default of a technical nature and the action initiated b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es Ltd., only to give proof of receipt of payment and this office has no reason to intervene anywhere on their behalf. The acceptable supplies under deemed export are those which are financed through World Bank funds and a legitimate proof is essential to establish the fact that supplies have been made and the payment has been received in a legitimate manner. In absence of the proper certification no such supplies can be accepted towards the discharge of obligation. Therefore, I am also not at all convinced with the suggestion made by M/s. Mohan Machines Ltd., that this office should cross check the facts from the project authority. Hence, all such supplies which are not paid for cannot qualify towards the discharge of export obligation. Further, all those supplies made after the due date of obligation cannot be accepted unless proper extension is obtained from the office of DGFT, New Delhi. (iv) M/s. Mohan Machines Ltd., vide letter dated 24-12-96 has sought sufficient time from this office for making representation to CCI and E (now DGFT) for getting extension in the export obligation period to cover the supplies made after the due date of obligation. For this purpose no per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the impugned orders to say that the first consignment of import was cleared on 25-9-1990. It was urged that in the written submissions furnished to the Joint Director General, the date of receipt of first consignment was discussed as 25-10-1990; therefore, the export obligation period started 30 days from that day i.e 25-11-1990. The nine month period ended on 25-8-1991. This was sought to be substantiated by copies of the Bill of Entry for Home consumption, enclosed alongwith the written submissions before the .Joint Director General. 12. Learned counsel urged that the Petitioner had filed copies of Invoice Nos. 3016, 3024, 1003 and 1004 relating to supply of five Stainless Steel Barrels and four Invoice Nos. 1001, 2003, 2006 and 3005 relating to supply of four Stainless Steel Barrels. It was urged that the impugned order failed to note that the Petitioner had annexed relevant documents issued by the NDBB confirming supplies had been made against the invoices. Therefore, the Respondent fell into error in finding that there was no certification by the NDBB that supplies were made. 13. Learned counsel urged that the finding that in the absence of DEEC (Export) Book, the supplies ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AIL:32416 dated 11-3-85 for supply of 10 nos. Rail Milk Barrels. 3. The Purchase Order No: PUR:15.7:OF; RAIL:32416 dt. 11-3-1985 for supply of 10 barrels under the World Bank Project for Rail Milk Barrels was cancelled by the answering respondent as the petitioner showed his inability to comply the said Purchase Order. 4. That as per Purchase Order No: PUR:15.7:OF:RAIL:16653 dt. 20-9-1984 under World Bank Project for Rail Milk Barrels, the petitioner supplied two barrels, manufactured from local stainless steel material and the balance 9(Nine) barrels manufactured from imported stainless steel material under Special Imprest License obtained by the petitioner. 16. From the above discussion, the principal question to be decided is whether the impugned order upholding the forfeiture and the imposition of sanctions on the Petitioner for its not fulfilling export obligations in terms of the Special Imprest License, is valid and legal. 17. The Petitioner entered into an agreement for import and manufacture of 21 Stainless Steel Barrels for their use in transportation of milk by rail to the NDBB. Under the prevalent Import Export policy, the Controller of Imports and Exports issu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... int Director General of Foreign Trade, a letter dated 26th April 1996, wherein, for reasons stated in the said letter, the petitioner explained that DEEC Book for export was already on the record of the original file of the office of Joint Chief Controller of Imports and Exports (CLA). Whilst annexing with the said letter, a statement of the imports and exports giving the full details certified by a Chartered Accountant, the petitioner further explained that part H , in terms of Appendix XX of Hand Book 1992-97 (Volume-1) was in fact the statement of import and export duly certified by a Chartered Accountant, and annexed with the said letter. A true copy of the said letter of the petitioner dated 26th April 1996, with the duly certified statement of imports and exports attached thereto, are enclosed herewith collectively as Annexure-10. A true copy of the receipt dated 26th April 1996, obtained by the petitioner in confirmation of the said letter dated 26th April 1996, having been filed hid (sic) the counter, in the office of the Joint Director General of Foreign Trade, is enclosed herewith as Annexure-11. 20. Having complied with the direction issued to the petitioner by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s particularly influenced by the fact that the DEEC Export Book duly completed had not been furnished. 23. From the above discussion it is evident that the Petitioner had produced sufficient materials in the form of originals of Bill of Entry, Invoices, Payment advise and Certificates of Project Authority, to substantiate its claim that the deemed export obligation had in fact been fulfilled. It is a matter of record that import and such obligations were satisfied so far as supply of stainless steel drums were concerned. These facts have been completely ignored in the impugned order. Besides the most crucial fact i.e. that the contract had been performed and all 9 Stainless Steel Barrels supplied to NDBB and even payment released to it upon satisfaction by the customer (i.e. NDBB) clinches the issue. The Project Authority in unequivocal terms has deposed before the Court that the quantities contracted for were supplied to it and the Petitioner was paid for doing this. 24. In view of the above discussion I am of the opinion that the impugned order is in error of law in holding that the Petitioner was not entitled to claim the benefits of the duty exemption under the Special Impr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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