TMI Blog2018 (8) TMI 1349X X X X Extracts X X X X X X X X Extracts X X X X ..... power by an Act does not enable the Rule making authority to make a Rule that travels beyond the scope of the enabling Act. Petition allowed. - W.P.(C).No. 34268 of 2017 - - - Dated:- 6-6-2018 - MR. P.B. SURESH KUMAR J. PETITIONER: BY SENIOR ADVOCATE.SRI.JOSEPH KODIANTHARA ADV.SRI.GEORGE JOHNSON RESPONDENT(S): RESPONDENT R1 BY SRI.SREELAL N. WARRIER, SC SMT. A. SREEKALA, SC R2 BY SRI. N. NAGARESH, ASSISTANT SOLICITOR GENERAL R5 BY ADV. SRI. T. NAVEEN SC JUDGMENT Petitioner is a company engaged in the manufacture of Poly Vinyl Chloride. Ethylene Di-chloride ('EDC' for short) is a raw material for manufacturing Poly Vinyl Chloride. The petitioner is importing into India EDC for their manufacturing activity. EDC is a substance included as insecticide in the Schedule to the Insecticides Act, 1968 ('the Act' for short). Section 38 of the Act provides that nothing in the Act would apply to any substance included in the Schedule, if the same is intended for a purpose other than preventing, destroying, repelling or mitigating any insects, rodents, fungi, weeds and other forms of plant or animal life not useful to human beings. It is stated that a p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... petitioner seeks directions to the first respondent to permit them to clear consignments of EDC without insisting import permit from the statutory authorities under the Act. 3. A counter affidavit has been filed by the first respondent in the matter. It is reiterated by the first respondent in the counter affidavit that import permit in terms of the provisions of the Act is mandatory for importing EDC for non-insecticidal purposes. It is also stated by the first respondent in the counter affidavit that EDC comes within the purview of Manufacture, Storage and Import of Hazardous Chemicals Rules, 1989 and the petitioner, therefore, has to comply with the provisions of the said Rules also in the matter of importing EDC. 4. A statement has been filed by the Assistant Solicitor General of India on behalf of the Secretary of the Central Insecticides Board stating, among others, that in so far as EDC is a substance listed as insecticide in the Schedule to the Act, the provisions of the Act would apply to its import. 5. Heard the learned Senior Counsel for the petitioner, the learned Standing Counsel for the first respondent as also the learned Assistant Solicitor General of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lture and Co-operation. The learned Assistant Solicitor General of India has relied on the decision of this Court in Union of India and others v. Maliakkal Industrial Enterprises (ILR 2014 (3) KER 387) in support of the said contention. 8. The learned Standing Counsel for the first respondent reiterated the stand taken by the first respondent, in the counter affidavit filed in the matter. In addition, it was also pointed out by the learned Standing Counsel that Rule 45 of the Insecticides Rules, 1971 ('the Rules' for short) has now been substituted in terms of the Insecticides (Fourth Amendment) Rules, 2017 and as per the amended Rules, Cochin Port is excluded from the ports in India at which insecticides could be imported. According to the learned Standing Counsel, in the light of the said provision in the Rules, the petitioner, at any rate, cannot clear EDC through Cochin Port. 9. In reply to the submissions made by the learned Assistant Solicitor General of India as also the learned Standing Counsel for the first respondent, it was clarified by the learned Senior Counsel for the petitioner that the notification issued by the Central Government under the Foreign ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other forms of plant of animal life not useful to human beings. The fact that the petitioner is importing EDC for a non insecticidal purpose is not in dispute. Ext.P7 is a trade notice issued by the competent authority under the Customs Act. In terms of the said notice, import of insecticides for non-insecticidal purposes is permitted without insisting registration and import permit from the Central Insecticides Board and Registration Committee, on complying with the condition mentioned therein viz, that the importer shall produce a certificate from the concerned Excise Inspector within three months as to the utilization of the substance imported for their manufacturing activity. Ext.P9 is a circular issued by the Central Board of Excise and Customs. In Ext.P9 circular, after referring to Section 38 of the Act, the Central Board of Excise and Customs has clarified that clearance of insecticides for non-insecticidal purposes would not be subject to the requirement of registration and import permit of the Central Insecticides Board and Registration Committee. The relevant portion of Ext.P9 reads thus : 3. As may be seen, the aforementioned provisions of the said Section 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atio of the judgment of this Court further precludes the right of the Department to file an appeal against the correctness of the binding nature of the circulars. Therefore, it is clear that so far as the Department is concerned, whatever action it has to take, the same will have to be consistent with the circular which is in force at the relevant point of time. In the light of Section 38 of the Act as also Ext.P9 Circular issued by the Central Board of Excise and Customs, and the decisions of the Apex Court in Steel Authority of India (supra) and Paper Products Ltd. (supra), the stand of the first respondent that EDC imported by the petitioner can be cleared only if the petitioner produces import permit issued by the statutory authorities under the Act, cannot be accepted. This exactly is the view taken by the Division Bench of the Madras High Court in Synergies Castings Ltd (supra). Paragraph 3 of the said judgment reads thus: We have gone through the entire order passed by the Tribunal. In fact, having considered the submission made on behalf of the appellant that as regards Copper Sulphate and Nickel Chloride under import, there was no such requirement to obtain reg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Government hereby inserts the following Policy condition as Policy Condition no.3 under Chapter 38 of ITC(HS), 2012 - Schedule - 1 (Import Policy): 3. Under Section (9) of the Insecticides Act, 1968 all chemicals intended to be used as insecticides, rodenticides, fungicides, herbicides etc. [referred to as 'insecticides' under the Act] require mandatory registration for import. In cases, where the 'insecticide' is imported for non-insecticidal purpose, an import permit is necessary from the Registration Committee under the Department of Agriculture and Cooperation. The Registration Committee while granting registration or a permit for import of an insecticide spells out the conditions for import which inter alia, may include reference to the source of import. No 'insecticide' can be imported from a source other than that specified on the certificate of registration or the permit, as the case may be. In addition, the Registration Committee may issue regulatory guidelines from time to time with respect to safety, efficacy, quality etc. which warrant full compliance from importers. 2. Effect of this Notification: The policy provisions under the Inse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sub-heading Note 2 to this Chapter: Free Sub-heading note given in Chapter 38 of Schedule-1 of ITC clarifies that goods classified under sub-headings (52) and (59) under EXIM code 3808 cover only goods covered by heading 3808 containing the various substances mentioned therein including EDC. The said sub-heading note reads thus: 1. Sub-headings 3803 52 and 3808 59 cover only goods of heading 3808, containing one or more of the following substances: alachlor (ISO); binapacryl (ISO); camphechlor (ISO) (toxaphene); captafol (ISO); chlordane (ISO); chlordimeform (ISO); chlorobenzilate (ISO); DDT (ISO)(Clofenotane(INN), 1, 1, 1-trichloro2, 2-bis(p-chlorophenyl)ethane); dieldrin (ISO, INN); 4, 6-dinitro-ocresol (DNOC(ISO)) or its salts; dinoseb(ISO)(1, 2-dibromoethane); ethylene dischloride (ISO)(1, 2-dicholoroethane), fluoracetamide (ISO); heptachlor (ISO); hexachlorobenzene (ISO); 1, 2, 3, 4, 5, 6hexachlorocyclohexane (HCH(ISO), including Iindane (ISO, INN); mercury compounds; methamidophos (ISO); monocrotophos (ISO); oxirane (ethylene oxide); parathion (ISO); parathion-methyl (ISO) (methylparathion); penta- and octabromodiphenyl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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