TMI Blog2002 (3) TMI 70X X X X Extracts X X X X X X X X Extracts X X X X ..... the petitioner. No order authorising such search was served upon the petitioner. Such search was conducted for several hours. The petitioners were not aware the materials or documents they were carrying when they entered into office premises, what documents and materials they collected in the course of search, what materials and documents they took away with them and what materials and documents were planted by them at the said office premises. Since about 3 P.M. of 17th October, 2001 till the evening of 18th October, 2001 the entire office was under the control of the persons who had conducted such search. It was led by the respondent nos. 1 and 2. In course of such search they assaulted one purchase officer of the petitioner-company. They slapped him, pushed him and then in the evening of 18th October, 2001 took him with them to another office of the petitioner-company at 2/7, Sarat Bose Road, Calcutta-700 020 from where he was taken to the office of D.R.I, at Ho Chi Minh Sarani. Similar allegations are also made in respect of other employee or employees. The allegations are made that they have behaved in unruly manner and obtained tutored statements under the threat of further a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... age. Why so much of actions were necessary to be taken at a time? When only purported offence is export of goods without manufacturing in the own unit of the petitioner-company? 7.There is a galf difference between policy of 'import' and policy of 'export'. In 'import' goods are available in the country even after final importation. Therefore, if there is a reason to believe that goods are not properly imported, municipal laws of the country are available for its application unlike the exports. In exports, municipal laws of this country are applicable till the export is finally made i.e. through proper channel beyond the territorial sea water of the country. In turn, law of importing country will start operation so far as the exported goods are concerned. If we carefully look into the nomenclature we shall be able to find that there is a marked distinction between Sections 111 and 113 of the Customs Act made for the import and export respectively. Section 111 is made for confiscation of improperly imported goods and Section 113 is made for confiscation of goods attempted to be exported. First one regulates past events when last one regulates future events. Therefore, if one futur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Government of India controlled by the Ministry of Commerce. The authority under the scheme i.e. Director General, Foreign Trade (hereinafter called as DGFT) is the final adjudicating authority to determine any issue as regards licences. Dispute, if any, is quasi civil in nature. The customs authority deals with the 'smuggling' which is defined under Section 2(39) of the Customs Act. This Section has a flavour of criminal law. The dispute as regards 'value' of the product comes under Section 2(41) of the Customs Act. The value of a product cannot be equated with smuggling. The word 'smuggling' is related to the product not in respect of the value of the product. Value may follow from the smuggling but smuggling cannot follow from the value. Therefore, inflation of any amount, etc., is the domain of the DGFT. There is a thinner line in between these two subjects. If one thinks that search and seizure will be conducted in a factory or office of the company suspecting non-availability of desirable quantity of the goods at the relevant point of time which is a subject-matter of past final export, such action, under no stretch of imagination, can be said to be the reason to believe of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and 21 of the Constitution of India. 13.The authority concerned may feel that if the Court interferes even at the stage of enquiry and investigation they will not be in a position to investigate the matter properly. But Court cannot behave like a silent spectator in the given situation nor the ratio decidendi of the Bhajanlal's case reported in AIR 1992 S.C. 604 supports the same. In the instant case search and seizure were claimed to be made under Section 105 of the Customs Act and summons and investigation were claimed to be made under Section 108 of the Customs Act. A question was asked by the Court to the respondents as to whether both summons and investigation as well as search and seizure are simultaneous action or independent from other. It was answered that Section 108 is independent from Section 105 of the Act. It is further contended that even if the investigation seems to be bad the same cannot be stopped by the court of law otherwise the truth will never come forward. The authorities have proceeded on the basis of the information of an informer. Had the information not been there, there cannot be any question of enquiry or investigation. The investigation stage is no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al. I am sorry to say that Court under high prerogative writ of certiorari entitled to seek any document to see for its scrutiny to come to a definite conclusion. There is no wrong in it particularly when the final hearing of the matter is directed to be proceeded. The wrong in it, is non-production of such documents before the Court when called upon. In such circumstances Court may presume adversely against such authority. I have called upon the learned Counsel appearing for the authority to produce the same under sealed cover to know the exact nature and strength of the information but I find nobody was eager to produce the same from the date of adjournment of verdict till the date of delivery of the judgment inspite of giving assurance. It clinched the mind of the Court in drawing adverse inference against them apart from other illegality. The document being Annexure 'B' to the affidavit of Jitendra Kumar, dated 7th January, 2002 speaks about the information. There, I find the Additional Director General himself recorded all informations on 6th October, 2001 and a place for left hand thumb impression of the informer is there. The place of giving thumb impression is blank. Theref ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be established or there should be reason to believe that smuggling of goods is likely to be happened in the attempted export. Therefore, in a case of smuggling two things are required i.e. (a) goods; (b) confiscation. When there is no goods there cannot be any question of smuggling and when there is no smuggling there is no question of confiscation. Therefore, entire attempt of the authority is futile. Such futile attempt cannot be allowed to be regularised by the Court. Section 2(41) of the Customs Act, 1962 deals with 'value' in relation to any goods to be determined in accordance with the provisions of sub-section (1) of Section 14. Section 14 of the Customs Act, 1962 gives an impression as regards the valuation of the goods for the purpose of assessment to be made under the Customs Tariff Act, 1975 or any other law for the time being inforce. Chapter 5 of the Customs Act, deals with levy of, and exemptions from Customs duties, etc., which is totally different chapter from the smuggling, confiscation, search and seizure, etc., under the Act. Therefore, dispute if any, as regards valuation cannot be forceably made fit under Section 2(39) of the Customs Act. Provided for smugglin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... transition to a global oriented vibrant economy with a view to deriving maximum benefits for expanding global market opportunities. The Duty Exemption Scheme enables to import inputs required for export production. The Duty Remission Scheme enables post-export replenishment/ remission of duty of inputs used in the export product. There are two types of exporters. One is 'manufacturer exporter' and another is 'merchant exporter'. The objective of DEPB scheme is to neutralise the imposition of customs duty on the import contained the export product. The neutralisation shall be provided by granting of duty credit against the export product. The exporter may apply for credit as a specified percentage of Free on Board (hereinafter called as FOB) value of exports, made in freely convertable currency. The credit shall be available against such export products and at such rates as may be specified by the DGFT by way of public notice issued in this behalf for import of raw materials, components, parts packaging material, etc. The holder of DEPB shall have the option to pay additional customs duty, if any, in cash as well. The licence is followed for a period of 12 months from the date of is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cap fixed by the authority. 19.Therefore, taking into totality of the facts and circumstances of this case I am not impressed with the arguments put forward by the respondents. I have already held that after final export is over there is no scope of making any enquiry and investigation in respect of the goods already exported. See judgment reported in 2001 (133) E.L.T. 280 (Cal.) (Kanhaiya Exports v. Commissioner of Customs). I do not find any reason to deviate from my own reasoning. However, let me also discuss other judgments to come to a definite legal conclusion in respect of interference or non-interference of the Writ Court in the facts and circumstances of the case. The petitioner-company relied upon a Single Bench judgment of this Court which is supported by the Five Judges Bench judgment of the Supreme Court. Such judgment is reported in 1987 (27) E.L.T. 369 (Cal.) (Bishnu Krishna Shrestha v. Union of India and Ors.). There, the basic feature is difference between 'reason to believe' and 'reason to suspect'. A search and seizure cannot be made on the ground of reason to suspect to fish out the evidence. The authority concerned should be firm about the reason to believe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sdiction. 14/156/3 21.Learned Counsel appearing in support of the respondents while defending the matter relied upon a Five Judges' Bench judgment of the Supreme Court reported in 1983 (13) E.L.T. 1434 (S.C.) = AIR 1967 S.C. 1298 (R.S. Seth Gopikisan Agarwal v. R.N. Sen, Assistant Collector of Customs and Central Excise, Raipur Ors.) and contended that under Section 105 of the Act the customs authority either fix the search personally or through the authorities of the officer of the Customs to do so if he has reason to believe the facts therein. Under Section 165(1) of the Code of Criminal Procedure the reason for believing the facts is only to enable him to make a search urgently in a case where search warrants in the ordinary course cannot be obtained. It is, therefore, not possible to invoke the condition and apply it in a situation arising under Section 105 of the Act. It is not necessary in this case to particularise whether all the other clauses of that Section can be applied to a search under Section 105 of the Act. Therefore, according to him, when there is a reason to believe the matter is to be expedited as per the suitability of the authority concerned ignoring the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is parties were not in a position leave any inch of place to other. As a result whereof, both the contesting parties were allowed to cite two more judgments as per their desire. One is reported in 1997 (90) E.L.T. 241 (K.I. Pavunny v. Asstt. Collector (H.G.) C.Es. Collectorate, Cochin) and other is 2000 (120) E.L.T. 280 (S.C.) = 2000 (7) SCC 53 (Assistant Collector of Central Excise, Rajamundry v. Duncan Agro Industries Ltd. Ors.). However, in observing the cited portions I find that the Supreme Court is unanimous in one point that test of reasonableness as provided under section 24 of the Evidence Act has to be followed. According to me, reasonableness is variable state of affairs of the mind as per the circumstances. I am not for a moment want to say it is to be taken leisurely in a given situation. But is it the given situation where goods are allowed for final export, accepted by the importing country, DEPB issued, make a wishful thought that goods were not supposed to be manufactured in the factory in comparison to the export quantity as if merchants are not entitled for benefit, and not having so there is a cause of smuggling, hence confiscation and that too in a simultaneo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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