2011 (9) TMI 182 - AT - Customs

Application by the Association seeking to intervene in the Appeal filed by M/s.Agarwal Chemicals. - held that - Since the learned Counsel had made only legal submissions and had no submissions to make about facts of the case and the legal submissions in any case would be considered by us after hearing both sides, it was felt that there is no bar in allowing Miscellaneous Application since it would not have an impact on the ultimate decision that we may reach after hearing both sides. - Application allowed. Challenge to virus of notification - held that - even assuming that this Tribunal can consider the vires of the Notification and a challenge can be made, we are of the opinion that the Notification does not suffer from any of the defects which can be a ground for challenge to the Notification. Restriction on import of Boric Acid - All the consignments were not allowed to be cleared on the ground that Appellants were not eligible to import the same since Boric Acid for non-insecticidal use can be allowed only on the basis of an import permit issued by Central Insecticide Board and Registration Committee (CIB and RC) under Ministry of Agriculture. - the Appellant being a trading concern was required mandatorily to register themselves and produce import permit, and since they had not produced the same, the imported Boric Acid was confiscated and penalty was also imposed. - held that - confiscation of the goods can not be found fault with - however penalty reduced considering the value of goods involved.

Summary

Issues:
1. Intervention application by an association in an appeal.
2. Requirement of import permit for Boric Acid under the Insecticide Act, 1968.
3. Legality of the Notification issued under the Foreign Trade Development and Regulation Act (FTA) regarding Boric Acid import.
4. Authority of the Directorate General of Foreign Trade (D.G.F.T.) to issue the Notification.
5. Interpretation of the Notification's provisions in relation to the Insecticide Act, 1968.
6. Confiscation and penalty imposed on Boric Acid importers for not having the required import permit.

Analysis:
1. The Tribunal considered a Miscellaneous Application by an association seeking to intervene in an appeal. The association aimed to make legal submissions supporting the Notification requiring import permits for Boric Acid. Despite opposition, the Tribunal allowed the intervention as the legal points raised were relevant and would be considered during the decision-making process.

2. The Appellants argued that Boric Acid, exempt from the Insecticide Act, 1968, should not require an import permit under the Foreign Trade Development and Regulation Act (FTA). They contended that imposing conditions under the FTA on an item exempt under another enactment would defeat the main enactment's purpose. The Tribunal noted the exemption under the Insecticide Act and the necessity of import permits for items covered by it.

3. The Appellants challenged the legality of the Notification issued by D.G.F.T. under the FTA, arguing that it was ultra vires and contrary to the Insecticide Act, 1968. They relied on a Supreme Court decision but the Tribunal held that it couldn't question the vires of the Notification. The Tribunal found no merit in the argument that the Notification was contrary to the provisions of the Insecticide Act, emphasizing that both Acts were enacted by Parliament.

4. The Tribunal addressed the authority of D.G.F.T. to issue the Notification under the FTA. The Tribunal found that the Notification was issued within the powers vested in the Central Government and signed by D.G.F.T., dismissing the argument that an Additional Secretary couldn't issue such a Notification. The Tribunal stated that challenges to such Notifications should be made before the High Court or Supreme Court, not a Tribunal.

5. The Tribunal examined the provisions of the Notification in relation to the Insecticide Act, 1968. It clarified that the Notification did not restrict Boric Acid's exemption under the Act but imposed import restrictions under the FTA. The Tribunal emphasized that the FTA empowered D.G.F.T. to regulate imports and exports, and the conditions imposed were valid.

6. Regarding the confiscation and penalty imposed on Boric Acid importers for not having the required import permit, the Tribunal upheld the lower authority's decision due to the Appellants' failure to produce the permit. While reducing the penalty, the Tribunal emphasized the importance of compliance with import regulations and upheld the confiscation of the goods.