1987 (8) TMI 94 - HC - Customs

Summary

Issues Involved:
1. Mis-description under Section 111(m) of the Customs Act, 1962.
2. Validity of import under the given licences.
3. Jurisdiction of the Bombay High Court to entertain the petition.

Detailed Analysis:

1. Mis-description under Section 111(m) of the Customs Act, 1962
The petitioners were initially charged with mis-description of the imported goods (MHP) under Section 111(m) of the Customs Act, 1962. The third respondent claimed that the MHP was actually silicon oil, which was restricted to 10% of the face value of the licences. The revision order, however, clarified that the goods had been correctly described in the bill of entry by their chemical name. Therefore, the petitioners were not guilty of mis-description under Section 111(m).

2. Validity of import under the given licences
The core issue was whether the import was without a valid licence. The respondents argued that the import policy for 1976-77 restricted the import to 10% of the face value of the licence. The petitioners contended that the import policy did not have the force of law and could not bind citizens unless it was notified under Section 3 of the Imports and Exports (Control) Act, 1947.

The judgment referred to several precedents:
- Andhra Industrial Works v. Chief Controller, Imports (A.I.R. 1974 S.C. 1539): The import policy does not have statutory force.
- J.C.C. of Imports & Exports v. Aminchand (A.I.R. 1966 S.C. 478): Prohibition of import cannot be recognized unless published in the official gazette.
- B.C. & Co. v. Union of India (A.I.R. 1973 S.C. 106): Policy cannot bind citizens unless it acquires the force of law.
- Lokesh Chemical Works v. M.S. Mehta (1981 E.L.T. 235): Once a licence is issued, import cannot be prevented except by cancellation under the Import & Exports (Control) Act, 1947.

The court concluded that the authorities based their decision on the import policy rather than any statutory order. Therefore, the order of confiscation under Section 111(d) of the Customs Act, 1962, was set aside.

3. Jurisdiction of the Bombay High Court to entertain the petition
The respondents contested the jurisdiction, arguing that the import and subsequent actions occurred in Cochin. The petitioners contended that they had their registered office in Bombay, received show cause notices in Bombay, and were affected in Bombay.

The court referred to:
- Damomal v. Union of India (A.I.R. 1967 Bombay 355): The effect of an order on a petitioner residing within the jurisdiction can establish jurisdiction.
- Prem Cables Pvt. Ltd. (1981 E.L.T. 440): Even if actions occur outside the jurisdiction, receiving orders/notices within the jurisdiction can confer jurisdiction.
- State of Rajasthan v. Swaika Properties (1985) 3 S.C.C. 217: Distinguished on the basis that the service of notice was not an integral part of the cause of action in that case.

The court held that the service of notices and orders in Bombay was an integral part of the cause of action, thereby conferring jurisdiction to the Bombay High Court.

Conclusion:
The court made the rule absolute in terms of prayers (a) and (b), ordering the refund of amounts within eight weeks. No order as to costs was made.