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TMI Blog2006 (11) TMI 223X X X X Extracts X X X X X X X X Extracts X X X X ..... sp; Whether the Applicant Bank has locus standi to prefer an appeal before the Appellate Tribunal in view of the condition provided in the Hand Book of Import-Export and Procedure of Government of India, 1985-88, that the exchange bank of authorised dealer whom the letter of credit is opened is considered as a joint holder of license to the extent of goods covered by the credit before the Appellate Tribunal ? 2.1 The detailed facts that are relevant for the disposal of this appeal are : 249.4 Metric Tonnes of what was declared as "Stainless Steel Defective Circles" were imported from Korea in May - June 1982 in the name of M/s. Indian Steel Corporation (hereinafter referred to as 'the Corporation') claiming that the same were covered by ten import licenses issued during the period 1981-82. The declared value of the goods was Rs.18,19,102/-. The import licenses relied on by the importer are : 1. P/L/2899510/31-3-1981 2. P/L/2902451/1-1-1982 3. P/L/2902519/14-1-1982 4. P/L/2902163/28 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e both the writ petitions were dismissed by the Delhi High Court, the proprietor, A. Kumar, preferred Civil Appeal Nos.1693 and 1694 of 1982 before the Apex Court. 2.5 In the meanwhile, the proprietor of the Corporation, A. Kumar, also approached the Apex Court in Writ Petition (C) No. 8168 of 1982 for a declaration that the "scale of rates" prescribed by the Madras Port Trust are unconstitutional and to restrain the Port Trust from collecting the charges in accordance with the said scale of rates and also for issuance of detention certificate. After the receipt of the show cause notice dated 15-10-1982 issued under Section 124 of the Act, he filed another Writ Petition (C) No. 2 of 1983 invoking Article 32 of the Constitution of India questioning the validity of the show cause notice. 2.6 All the above mentioned writ petitions, viz., Writ Petition (C) No. 8168 of 1982 and Writ Petition (C) No. 2 of 1983 as well as the Civil Appeals Nos.1693 and 1694 of 1984 were heard together by the Apex Court and were disposed of by a common order dated 11-10-1996. 2.7 The Apex Court while disposing of the above writ petitions and the civil appeals, observed that the department had a huge cla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o do with the said import at all. According to the said statement of A. Kumar, everything was done by Vinod Kumar Didwania and Deen Dayal Didwania using his name. 2.9.2 In the second statement dated 2-12-1983 recorded by the Income-tax authorities, the said Kumar denied being the proprietor of the said concern and disowned any connection with the import of the said goods and further stated that he had no claim to the said goods. 2.9.3 In the third statement, which is an affidavit dated 24-2-1984, the same stand denying his connection with the Corporation as well as the import of the goods in question and added that, whatever the affidavits he had signed and filed in the impugned proceedings therein were made at the instance of his employers, Didwanias. 2.10 In the light of the averments stated in the above statements, the Department came up with a petition in CM.P.No. 27299 of 1983 in Special Leave Petition (C) No. 8780 of 1982, which was subsequently re-numbered as Civil Appeal No.1693 of 1984 for prosecuting the members of Didwania group together with certain officials of Lakhsmi Vilas Bank for various offences under the Indian Penal Code. 2.11 On the other hand, the appellan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ake necessary disciplinary proceedings against them. The Apex Court, accordingly disposed of the above writ petitions and the civil appeals by order dated 11-10-1996, as referred to above. 3.1 Pursuant to the above order of the Apex Court dated 11-10-1996, the department proceeded with the final adjudication proceedings and issued notice to the Corporation as well as to its proprietor, viz., A. Kumar, requiring the said Kumar to appear for personal hearing on 27-2-1998. But on that date, the appellant herein representing through its Manager and the consultant sought a hearing as an intervenor. The notice issued to the Corporation and its proprietor, was returned undelivered and the appellant was permitted to be heard as an intervenor on 27-2-1998. After the full-fledged adjudication, the Commissioner passed an order dated 6-3-1998 confirming the demand of Customs duty to the tune of Rs. l,38,72,807/- on the imported goods and also imposed a redemption fine of equal amount in lieu of confiscation of the goods, apart from a penalty imposed to the tune of Rs.25 lakhs and Rs.25,000/- on A. Kumar and the corporation respectively under Section 112 of the Act. 3.2 Aggrieved by the said ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; (emphasis supplied) 4.4 The learned Senior Counsel also placed reliance on a decision of the Supreme Court reported in 1997 (91) E.L.T. 502 (S.C.) (Northern Plastics Ltd. v. Hindustan Photo Films Mfg. Co. Ltd.) and a decision of this court in M/s. Indian Overseas Bank v. Collector of Customs [2000 (123) E.L.T. 359 (Mad.) = 1984 TAX L.R. 2427] to buttress his submissions. 5.1 Per contra, Mr. V.T. Gopalan, learned Additional Solicitor General appearing on behalf of the Department, submits that the claim of the appellant Bank already got concluded before the Apex Court in the common order dated 11-10-1996 while disposing of the writ petitions and the civil appeals, referred to above. 5.2 The learned Additional Solicitor General invited our attention to the finding rendered by the Apex Court on the claim of the appellant Bank that the bank had already filed a suit against the Corporation and its proprietor and the appellant Bank has to work out its right only in that suit. Therefore, the appellant has no locus standi to be heard in the confiscation proceedings initiated under Section 124 of the Act, much less, to agitate against the order passed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l shall lie to the Appellate Tribunal and the Appellate Tribunal shall not have jurisdiction to decide any appeal in respect of any order referred to in clause (b) if such order relates to, - (a) any goods imported or exported as baggage; (b) any goods loaded in a conveyance for importation into India, but which are not unloaded at their place of destination in India, or so much of the quantity of such goods as has not been unloaded at any such destination if goods unloaded at such destination are short of the quantity required to be unloaded at that destination; (c) payment of drawback as provided in Chapter X, and the Rules made thereunder: Provided further that the Appellate Tribunal may, in its discretion, refuse to admit an appeal in respect of an order referred to in clause (b) or clause (c) or clause (d) where - (i) the value of the goods confiscated without option having been given to the owner of the goods to pay a fine in lieu of confiscation under Section 125; or (ii) &nb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0.3 In a decision of the Constitution Bench (seven judges) of the Apex Court rendered in Council of Maharashtra v. M.V. Dabholkar - (1975) 2 SCC 702 : AIR 1975 SC 2092, A.N. Ray, C.J. on behalf of H.R. Khanna, K.K. Mathew, A.C. Gupta and S. Murtaza Fazal Ali, held as follows :- "The words "person aggrieved" are found in several statutes. The meaning of the words "person aggrieved" will have to be ascertained with reference to the purpose and the provisions of the statute. Sometimes, it is said that the words "person aggrieved" correspond to the requirement of locus standi which arises in relation to judicial remedies. Where a right of appeal to courts against an administrative of judicial decision is created by a statute, the right is invariably confined to a person aggrieved or a person who claims to be aggrieved. The meaning of the words "a person aggrieved" may vary according to the context of the statute. One of the meanings is that a person will be held to be aggrieved by a decision if that decision is materially adverse to him. Normally, one is required to establish that one has been denied or deprived of something to which one is legally entitled in order to make one "a per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , came up for consideration before the Apex Court in Northern Plastics Ltd. v. Hindustan Photo Films Mfg. Co. Ltd. [1997 (91) E.L.T. 502]. The Apex Court in the said judgment held that the appeal as provided under Sections 128 and 129A of the Act is a creature of statute. The right to appeal has to be exercised only by persons permitted by the statute to prefer an appeal subject to the conditions regarding the filing of such an appeal. Therefore, the wider concept of locus standi for filing a writ petition both under Articles 32 and 226 of the Constitution of India, is not importable for deciding the right of appeal under the statutory provisions, viz., Sections 128, 129A and 130E of the Act. It is further held that the expression "person aggrieved" employed in Section 129A of the Act, even though has got a wider connotation than the expression "party aggrieved", the expression "person aggrieved" has to be construed only in the context of the statutory scheme, viz., the scheme of the Customs Act, particularly in the context of Section 129A of the Act, wherein the right of appeal is confined to the parties to the proceedings before the adjudicating authority and that a third party c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9D(1) and not otherwise. It is easy to visualise that even a third party may get legitimately aggrieved by the order of the Collector of Customs being the adjudicating authority if it is contended by such a third party that the goods imported really belonged to it and not to the purported imported or that he had financed the same and, therefore, in substance he was interested in the goods and consequently the release order in favour of the purported imported was prone to create a legal injury to such a third party which is not actually arraigned as a party before the adjudicating authority and was not heard by it. Under such circumstances, such a third party might perhaps be treated to be legally aggrieved by the order of the Collector of Customs as an adjudicating authority and may legitimately prefer an appeal to the CEGAT as a 'person aggrieved'. That is the reason why the Legislature in its wisdom has used the phrase 'any person aggrieved' by the order of the Collector of Customs as adjudicating authority in Section 129A(1). But in order to earn a locus standi as 'person aggrieved' other than the aggrieved party before the Collector of Customs as an adjudicating authority it mu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... invalid but also conceded to be a bogus and illegal event according to the import statutes, even though he has got the business interest in the matter, which itself cannot be a consideration to treat the appellant bank as the person aggrieved, more particularly, when the Apex Court in the detailed order dated 11-10-1996 did not satisfy with the records produced by the bank with regard to the circumstances under which the letters of credit were issued in favour of the importer, Kumar, who himself disowned his claim over the goods imported, and left the matter for the Reserve Bank of India to look into the same and to take necessary action in the matter. 10.9 Taking into consideration the object of Sections 124 and 129A of the Act, merely because the appellant Bank happened to be the financier to the Corporation, whose proprietor himself has denied his right on the imported goods, it cannot claim to be the person aggrieved against the order of confiscation passed by the Commissioner of Customs for filing an appeal under Section 129A of the Act, because they do not have any legal grievance against the confiscation proceedings even though they may have a lawful claim against the impor ..... 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