TMI Blog1994 (9) TMI 93X X X X Extracts X X X X X X X X Extracts X X X X ..... respondents, these being Union of India in the Ministry of Finance; Collector of Customs, New Delhi; Central Excise Gold (Control) Appellate Tribunal, New Delhi; and the Joint Chief Controller of Imports and Exports, Ludhiana. 2.In the Import and Export Policy for the period April 1988-March 1991, Chapter XIX related to "Duty Exemption Scheme". It is not necessary for us to refer to the scheme in detail except to note that an Indian exporter, who has firm order from a foreign buyer for export of particular goods (resultant products) to be manufactured by the exporter, is entitled to import certain raw materials for use in the manufacture of resultant products and that raw materials could be cleared for home consumption without payment of import duty. For this purpose, the importer is to apply for grant of licence which is called Advance Licence for import of the raw materials. The manufactured goods (resultant products) could be manufactured either after having imported the raw materials as per quantity and valuation in the Advance Licence within a stipulated period, or in the alternative, the exporter during the processing of his application for advance licence could procure t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m 65% polyester and rest viscose yarn (@ US $ 5.50/kg) from a foreign buyer based in Hongkong as per indent dated 2 March 1989. In the application for advance licence which was made in the proforma prescribed by the office of the Chief Controller of Imports and Exports all information was furnished by the petitioner and it was stated therein that the resultant product viz. 100 MTs of polyester fabrics would be with minimum 65% polyester yarn and rest viscose yarn, and on these premise the petitioner requested for grant of advance licence for the import of 1.10 lakh kgs (110 MTs) of filament yarn (man-made). The quantity of 110 MTs was applied for as per norms laid down against Item No. 9 under the heading of Textiles in Appendix 13-C above. 4.The petitioner was granted advance licence on 12 April 1989. He was to carry out the export obligations of 100 MTs of polyester fabric having minimum 65% polyester and rest viscose of the value of Rs. 81.85 lakhs (FOB). The petitioner was allowed import of 110 MTs of polyester filament yarn of the CIF value of Rs. 54,54,900/- This licence was split up into two on the request of the petitioner with details as under :- Date De ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the advance licence had been correctly issued to him and that this was for the import of filament yarn (man-made) against export of polyester fabrics having minimum 65% polyester and rest viscose yarn. The letter further said that as per the Import Export Policy 1988-91, Appendix 13-C at Serial No. 9, the party could import 100% man-made filament yarn (polyester) against the licence in question. This letter, it appears, did not satisfy the Customs Authority and the Additional Collector of Customs proceeded to adjudicate the matter. He observed that against the advance licence (split) dated 12 April, 1989 the petitioner had fulfilled the export obligations by exporting 12,297.5 kgs. of fabrics declaring them to contain minimum 65% polyester, having FOB value of Rs. 12,79,578/- under Shipping Bill dated 25 August, 1989. He said that the party had, thus, already cleared one import consignment of polyester filament yarn weighing 7,920 kgs, under Bill of Entry dated 8 September, 1989, and that other consignment of polyester filament yarn weighing 7,821 [kgs.] imported against the aforesaid advance licence was under clearance at ICD. The Additional Collector said that as per norms in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ioning the validity of the order of the Additional Collector of Customs, the Appellate Tribunal by order dated 21 March 1991 held that since the question of raising the export obligations would affect the validity of confiscation of the goods, payment of duty and imposition of penalty, an opportunity be given to the petitioner, in the interest of justice, to have the advance licence and DEEC Book amended. The Appellate Tribunal then adjourned the matter for three months. This led to filing of the present petition on or about 27 April 1991. Only the second respondent, the Collector of Customs, has filed his counter-affidavit opposing the petition. The fourth respondent, the Joint Chief Controller of Imports and Exports, has not come forward to contest the claim of the petitioner in the petition. Mr. Madan Lokur, Central Government Standing Counsel, submitted that the impugned order of the Additional Collector of Customs was a valid order under the provisions of the Customs Act, and the Notification No. 116/88-Cus., dated 30 March 1988 issued under sub-section (1) of Section 25 of that Act, and further that since the appeal of the petitioner before the Appellate Tribunal was alrea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce, and that once the export obligations having been met in terms of the advance licence which contained obligations and entitlements, the Import Trade Control Authority could not vary the conditions of the advance licence, or impose more obligations and reduce the entitlements, and that too without notice to the petitioner. Mr. Rawal said no extra burden could be placed on the petitioner to increase the export obligations without the petitioner being granted opportunity of being heard. It was submitted that the Customs Authority was bound to release the goods in terms of the licence so produced when the import was in terms of the import licence. 8.The Import Trade Control Authority and the Customs Authority operate in different fields, though their functions are complementary to each other. They do not function for cross purposes transgressing the jurisdiction of each other. They have to exercise their functions under different enactments : the Import Trade Control Authority under the provisions of the Imports and Exports (Control) Act, 1947 [since repealed by the Foreign Trade (Development and Regulation) Act, 1992], and the Imports (Control) Order and the Exports (Control) Ord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of its own to give such a direction to the petitioner. The function of the Appellate Tribunal was to see if the impugned order of the Additional Collector of Customs was valid or not under the provisions of the Customs Act and keeping in view the notification aforementioned issued under sub-section (1) of Section 25 of that Act. It could not be disputed that even as per the terms of the notification, the goods satisfied all the conditions as mentioned in the advance licence and that specified in Part `C' and Part `E' of the DEEC Book. The Customs Authority of its own could not impinge upon the jurisdiction of the Import Trade Control Authority, and thus proceed to adjudicate and hold the imports to be unauthorised and order confiscation of the goods so imported and impose a penalty on the petitioner. It is nobody's case that the advance licence had been issued on the basis of any misrepresentation or fraud committed by the petitioner or that there was any breach or contravention of the conditions subject to which the advance licence was issued. There was no action by the Import Trade Control Authority to invalidate the licence. The Import Trade Control Authority also did not con ..... X X X X Extracts X X X X X X X X Extracts X X X X
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