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Issues Involved:
1. Applicability of additional duty rates based on the date of entry of goods into territorial waters vs. the date of presentation of Bills of Entry. 2. Doctrine of promissory estoppel against the issuance of the impugned notification. 3. Validity of the retrospective introduction of the impugned notification. Issue-wise Detailed Analysis: 1. Applicability of Additional Duty Rates: The primary contention by the petitioners was that the additional duty should be charged at the rate of Rs. 1.32 per kg based on the notifications dated January 5, 1979, as the ships carrying the consignments entered Indian territorial waters before December 31, 1979. However, the respondents argued that the rate of duty should be determined as per Section 15 of the Customs Act, 1962, which specifies that the rate of duty applicable is the one in force on the date the Bills of Entry are presented. The court noted that there are divergent views from various High Courts on this issue. The Bombay High Court held that the taxable event occurs when goods enter territorial waters, while the Delhi High Court and Kerala High Court maintained that the rate of duty should be determined based on the date specified in Section 15. The court sided with the latter view, stating that goods retain their character as imported goods until cleared for home consumption and the applicable rate of duty is the one in force on the date of presentation of the Bills of Entry. Therefore, the enhanced rate of Rs. 2.37 per kg was applicable. 2. Doctrine of Promissory Estoppel: The petitioners argued that the respondents were estopped from changing the rate of additional duty before December 31, 1979, based on the earlier notifications. However, the respondents contended that there can be no promissory estoppel against the exercise of legislative power. The court referred to the Supreme Court's decisions in M.P. Sugar Mills v. State of Uttar Pradesh and Union of India v. Godfrey Phillips India Ltd., which held that there can be no promissory estoppel against the exercise of legislative functions. The court agreed with the respondents, stating that the power to grant, modify, or withdraw an exemption under Section 25(1) of the Customs Act is a legislative function. Therefore, the plea of promissory estoppel could not be sustained. 3. Validity of Retrospective Introduction: The petitioners contended that the impugned notification could not be retrospectively issued before the expiry of the period specified in the earlier notification. The court clarified that the notification dated December 30, 1979, was not given retrospective effect but was prospective from December 30, 1979, onwards. Therefore, this contention of the petitioners was also rejected. Conclusion: The court concluded that the enhanced rate of additional duty at Rs. 2.37 per kg was applicable as the Bills of Entry were presented in January 1980, after the notification dated December 30, 1979, came into force. The plea of promissory estoppel was not applicable as the notification was a piece of subordinate legislation. The notification was not retrospective but prospective from its date of issue. Consequently, the writ petitions were dismissed, and the respondents were allowed to realize the additional duty from the petitioners at the enhanced rate.
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