TMI Blog1996 (11) TMI 67X X X X Extracts X X X X X X X X Extracts X X X X ..... pellants' licences and, in that sense, a breach of the terms of the said Exemption Notification is also a breach of the terms of the license, entitling the licensing authority to investigate. But the breach is not only of the terms of the license; it is also a breach of the condition in the Exemption Notification upon which the appellants obtained exemption from payment of Customs duty and, therefore, the terms of Section 111(o) enable the Customs authorities to investigate. Appeal dismissed. - 1152 of 1992 - - - Dated:- 19-11-1996 - S.P. Bharucha and K.S. Paripoornan, JJ. [Judgment per : Bharucha, J.]. - The principal judgment was delivered by a Division Bench of the High Court of Karnataka in the case of M/s. Kamath Packagin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in respect of alleged violations of the terms of the appellants' advance licences which incorporated the terms of the said Exemption Notification. Only the licensing authority had the jurisdiction to investigate the alleged violations. The Duty Exemption Scheme under which the licences had been issued was a code by itself and excluded any investigation by the Customs authorities. The bond that had been furnished by the appellants pursuant to the licences also provided for action by the licensing authority. 5.Our attention was drawn by learned Counsel for the appellant in support of his aforestated submissions to the Import and Export Policy, 1988-91, wherein Chapter XIX dealt with the Duty Exemption Scheme. Paragraph 231 stated that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of domestic sale of exempt material and the jurisdiction of the Customs authorities to do so was ousted. 6.Learned Counsel placed reliance upon a communication to all Collectors of Central Excise issued by the Central Board of Excise Customs on 13th May, 1969, on the subject of whether, in the event of the contravention of a post-importation condition of an import licence, it was open to the Customs authorities [to] confiscate imported goods under Section 111(o) of the Customs Act. The said communication stated that before Section 111(o) could be attracted there had "to be an exemption, subject to a condition, from a prohibition. Where a valid licence has been issued, it is not a case of an exemption from the prohibition. Therefore, i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provisions of the Import and Export Policy or the Hand Book of Procedure issued by the Ministry of Commerce, Government of India, anything that even remotely suggests that the aforesaid power of the Customs authorities had been taken away or abridged or that an investigation into such alleged breach could be conducted only by the licensing authority. That the licensing authority is empowered [to] conduct such an investigation does not by itself preclude the Customs authorities from doing so. 11.The communication of the Central Board of Excise and Customs, dated 13th May, 1969 refers to the breach of the condition of a license and suggests that it may not be possible to take action under Section 111(o) in respect thereof. It is true that ..... X X X X Extracts X X X X X X X X Extracts X X X X
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