1986 (2) TMI 65 - HC - Customs

Summary

Issues:
1. Interpretation of Import of Export Policy for the period April-March, 1983 regarding the import of raw materials for manufacturing drugs.
2. Confiscation of goods imported by the petitioner under Section 124 of the Customs Act.
3. Appeal against the order of confiscation before the Customs, Excise and Gold (Control) Appellate Tribunal.
4. Writ petition seeking clearance of remaining consignments and challenging the Tribunal's order.
5. Examination of the correctness of the Tribunal's order and the Import Policy provisions.
6. Amendment of the petition to challenge the Tribunal's order after a delay.

Analysis:
1. The petitioner, a company manufacturing fine chemicals, imported raw material called "tetracycline urea complex" for manufacturing tetracycline hydrochloride, claiming it as a drug intermediate, not a drug itself. The Import Policy specified canalised items under Appendix 9, including tetracycline base/HCL. Paragraph 218(4) clarified that active ingredients or commonly known substances were covered, along with their salts and esters.
2. The Assistant Collector issued show cause notices under Section 124 of the Customs Act, alleging contravention of the Import Trade Control Order. One consignment was confiscated, with an option to pay a fine. The petitioner's appeal before the Tribunal was dismissed.
3. The petitioner filed a writ petition challenging the remaining consignments' clearance, highlighting past clearances of similar material. The Tribunal's finding that the imported item was not canalised under Appendix 9 was crucial.
4. The Tribunal's order was extensively analyzed, noting discrepancies in the interpretation of the Import Policy. The Tribunal's conclusion that the imported item was impermissible under "OGL" was disputed, emphasizing the substance's nature as an intermediate.
5. The judgment critiqued the Tribunal's findings, emphasizing the lack of clarity and the subsequent amendment in the Import Policy. The petitioner's delayed challenge to the Tribunal's order was allowed due to the unjust deprivation of clearing the remaining consignments.
6. The court ruled in favor of the petitioner, directing the clearance of the consignments and rejecting the argument of delay in challenging the Tribunal's order. The judgment made the rule absolute without costs, considering the circumstances of the case.