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Issues Involved:
1. Applicability of customs duty rate based on the date of entry of goods into Indian territorial waters versus the date of clearance from the bonded warehouse. 2. Application of the doctrine of promissory estoppel to customs notifications. 3. Validity of the impugned notification based on its publication date. 4. Retrospective effect of the impugned notification. Issue-wise Detailed Analysis: 1. Applicability of Customs Duty Rate: The primary contention from the petitioners was that the customs duty rate applicable should be the one in force at the time the goods entered Indian territorial waters, which was governed by the notification dated January 1, 1981. The petitioners argued that since the goods entered Indian waters on January 5, 1981, they should benefit from the exemption provided by the January 1, 1981 notification, notwithstanding the subsequent notification dated March 30, 1981, which rescinded the earlier exemption and imposed a higher duty. The Court disagreed, referencing its own decisions and those of other High Courts, stating that goods retain their character as imported goods until they are cleared for home consumption. The Court held that the rate of duty applicable is the one in force at the date of clearance from the bonded warehouse, as per Section 15(1)(b) of the Customs Act. Therefore, the petitioners were liable to pay the enhanced duty as per the March 30, 1981 notification. 2. Doctrine of Promissory Estoppel: The petitioners invoked the doctrine of promissory estoppel, arguing that the government should be estopped from rescinding the January 1, 1981 notification before its declared expiry on March 31, 1981, as they had relied on this notification for their import decisions. The Court rejected this argument, emphasizing that Section 25 of the Customs Act grants the Central Government the power to issue, modify, or rescind exemption notifications in public interest. The Court cited previous decisions indicating that the power to issue notifications includes the power to issue time-bound notifications and to withdraw or modify them if public interest so demands. The Court also noted that promissory estoppel does not apply to legislative actions, such as the issuance of notifications under Section 25. 3. Validity of Notification Based on Publication Date: The petitioners contended that the notification dated March 30, 1981, could not be considered effective on the same date as it was not available to the public immediately. They cited decisions from the Allahabad High Court, which held that a notification becomes effective only when the official gazette is made available to the public. The Court preferred the view of the Gujarat High Court, which stated that the publication in the official gazette is sufficient for the notification to become operative. The Court reasoned that requiring the notification to be available to the public to be effective could frustrate the purpose of issuing such notifications in public interest. 4. Retrospective Effect of the Notification: The petitioners argued that the March 30, 1981 notification was bad in law as it was issued with retrospective effect. The Court found no merit in this argument, clarifying that the notification was effective from its date of issue and not retrospectively from an earlier date. The Court reiterated that the Central Government has the authority to issue such notifications in public interest. Conclusion: The Court dismissed all contentions raised by the petitioners. It upheld the validity of the March 30, 1981 notification, stating that the petitioners were liable to pay customs duty at the enhanced rates prescribed therein. The Rule issued upon the respondents was discharged, and the interim order was vacated, allowing the respondents to realize the balance of customs duty from the petitioners by encashment of the bank guarantee or other legal methods. No order was made for costs.
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