TMI Blog2003 (7) TMI 73X X X X Extracts X X X X X X X X Extracts X X X X ..... under Section 113(d) and penalty under Section 114 of Customs Act. The result of the above discussion is that import of the consignments in question being contrary to law, the goods were liable to confiscation under Section 111 of the Customs Act. The order of confiscation of goods passed by the Commissioner of Customs is held to be in accordance with law. We are unable to agree with the view taken by the Tribunal in permitting re-export of the goods. Further, the Tribunal in its impugned order has waived the penalties imposed by the Commissioner on respondents 3 to 7. This part of the order of the Tribunal is without any reasons.The appeals are thus allowed with costs. - 4151-4157 of 2001 - - - Dated:- 7-7-2003 - M.B. Shah and Arun Kumar, JJ. [Judgment per : Arun Kumar, J.]. - These appeals are directed against the order of the Customs Excise and Gold (Control) Appellate Tribunal (hereinafter referred to as the 'Tribunal') dated 20th November, 2000. By the impugned order the Tribunal allowed re-export of the three consignments of tussah silk and one consignment of silk fabric having a total value of Rs. 45,85,291/-. The Tribunal further set aside the penalties impose ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were recorded. Ultimately a demand-cum-show cause notice under Section 124 of the Customs Act, 1962 read with Section 28 of the said Act was issued on 14th May, 1999 to M/s. Olympia Exports, New Delhi, Shri Mahesh Chowhan and others. So far as the consignment, subject matter of the present appeals is concerned, the show cause notice called upon the noticees' to show cause why goods subject matter of the two consignments, should not be confiscated under Section 111(d) of the Customs Act, 1962 and why penalties should not be imposed. The importer did not respond to the show cause notice. Instead M/s. Grand Prime Limited respondent No. 1 addressed a communication dated 27th May, 1999 to the Commissioner of Customs stating that they had exported the goods subject matter of the two consignments, in the letter respondent No.1 stated that it had failed to locate that exporter. It was further stated that efforts were made to find an alternative purchaser for the goods which it had failed to arrange. Request was made to the Commissioner to grant permission to re-ship/re-export the goods comprising the said consignments. An advocate named Shri Om Prakash Chowdhary of Kolkata sent a Power-of- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al. 5.The learned Additional Solictor General - Mr. Mukul Rohtagi appearing for the appellant submitted that the Tribunal, clearly misunderstood the order passed by the Kolkata High Court in as much as it considered that it had to dispose of the appeal in terms of Dugar's case (supra). The High Court while disposing of the Writ Petition filed by respondent No.1 never directed the Tribunal to decide the case as per Dugar's case (supra). The operative part of the decision of the High Court has already been reproduced hereinbefore and in our view it cannot be inferred from the said decision that there is any direction to pass an order in terms of Dugar's case. The learned Additional Solicitor General then proceeded to distinguish the present case from Dugar's case. His basic contention is that the present is a case of fraud while in Dugar's case it was not so. Secondly, according to the learned Counsel there is no valid import of goods in the present case. Rather the import is contrary to law and Section 111(d) of the Customs Act, 1962 squarely applies. In this context, he further submitted that there is no provision for re-export of goods in the Customs Act and therefore there was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icence issued by the authorities. The licence against which the import took place in the present case was found to contain forgery. This rendered the licence invalid. As per conditions of licence the goods were meant for re-export and they could not be sold in India. The importer was found to have violated this condition of the licence in case of an earlier import. Fearing action in case of present import, the importer did not even come forward to clear the goods. No body presented a Bill of Entry or took any other step to clear the goods. Thus the import was clearly contrary to law being without a valid licence and in violation of condition/restrictions imposed under the licence. Section 3(1) of the Imports and Exports (Control) Act, 1947 empowers the Central Government to provide for prohibition, restricting or otherwise controlling import and export of specified goods. Such an import clearly attracts the provisions of Section 111 of the Customs Act and the appellant was within its right to confiscate the goods in question. 10.On the power of confiscation of goods imported contrary to any prohibition or restriction under Section 111(d), this court had occasion to observe in She ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the respondents, this court had permitted re-export of goods in special circumstances on equitable grounds. The goods in that case had been imported under a valid licence but had not been cleared from customs. This court was concerned with the question whether import of the goods was contrary to law and whether the goods were liable to confiscation under the Customs Act. After considering clauses (d) and (o) of Section 111 of the Customs Act, this court took the view that the said clauses were not attracted in the facts of the case and therefore the power to confiscate goods could not be exercised. It was in this background that the court also considered the question of passing of property in goods in favour of the importer and ultimately the foreign exporter was permitted to re-export the goods. 14.The points of distinction between the present case and Dugar's case (supra) are that the importer did not disappear in that case. Rather it appeared before the Customs Authorities and claimed the right to take delivery of goods. The importer in Dugar's case participated in adjudication proceedings before the Customs Authorities and during the course of the proceedings the exporter ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... v. the CEGAT, Bombay [1993 (suppl.) 1 SCC 169] that export of goods contrary to any prohibition imposed under the law for the time being in force will render the goods liable to confiscation. The same principle applies to illegal import. The Import-Export Policy, 1988-91 permitted issuance of Open General Licence for import of life saving goods. Life saving equipment was imported from Germany under the OGL after obtaining customs clearance without payment of customs duty. It was re-packed and sought to be exported to the USSR under a contract. It was held that object of permitting import of life saving goods being that the goods may be available for use in the country, re-export thereof was prohibited by necessary implication by or under the OGL. Such goods being prohibited within the meaning of Section 2(33), re-export thereof rendered them liable to confiscation under Section 113(d) and penalty under Section 114 of Customs Act. 18.The result of the above discussion is that import of the consignments in question being contrary to law, the goods were liable to confiscation under Section 111 of the Customs Act. The order of confiscation of goods passed by the Commissioner of Custo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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