1961 (1) TMI 1 - HC - Customs

Issues Involved:
1. Jurisdiction of the Court under Article 226 of the Constitution.
2. Entitlement to refund of customs duty paid for short-landed goods.
3. Validity of the Customs Authorities' rejection of the refund claim.
4. Availability of alternative remedies.

Detailed Analysis:

1. Jurisdiction of the Court under Article 226 of the Constitution:

The petitioner sought a writ of certiorari and mandamus against the Customs Authorities to quash the orders dated December 21, 1957, and November 30, 1959, and to refund the customs duty paid on short-landed goods. The Customs Authorities contended that the court had no jurisdiction to interfere as the assessment order was administrative and final under Section 188 of the Sea Customs Act. They relied on the decisions in *Glaxo Laboratories (India) Private Ltd. v. A. V. Venkateswaran* and *East India Commercial Ltd. v. Collector of Customs* to support their argument.

However, the court referred to the *Assistant Collector of Customs v. Mercantile Express* case, which held that assessing authorities must act according to the law, and their orders are subject to judicial review if they exceed jurisdiction or contain errors on the face of the record. The court emphasized that the power of the High Court to issue certiorari under Article 226 cannot be curtailed even by express statutory provisions, as the Constitution is paramount.

2. Entitlement to Refund of Customs Duty Paid for Short-Landed Goods:

The petitioner was the consignee of 200 bags of betelnuts, of which 70 bags were short-landed. The Customs Authorities admitted the short-landing but rejected the refund claim for 48 bags, stating that the loss was a normal trade risk since the bill of entry was filed before the goods arrived. The court found no evidence to support the claim that the 48 bags sank on May 27, 1957, and held that the petitioner did not receive the goods, thus should not bear the loss.

The court noted that the duty was assessed and paid based on the bill of entry, which anticipated the arrival of 200 bags. Since 70 bags were short-landed, the duty was paid under a mistake of fact, making the petitioner entitled to a refund.

3. Validity of the Customs Authorities' Rejection of the Refund Claim:

The Customs Authorities rejected the refund claim partly due to the petitioner's failure to produce a certified claim bill accepted by the steamer agents. The court found this requirement unreasonable and extraneous, as the petitioner could not compel the shipping company to produce such a document. The Customs Authorities' insistence on this document and subsequent rejection of the claim on this ground were deemed improper and a failure to apply their minds to the real issue.

The court also criticized the Assistant Collector of Customs for attempting to influence the appellate process by insisting on the production of the document even after the appeal was filed.

4. Availability of Alternative Remedies:

The Customs Authorities argued that the petitioner had an alternative remedy by filing a suit against the shipping company. However, the court clarified that the suit against the shipping company was for the loss of goods, not for the refund of customs duty. The petitioner's claim against the Customs Authorities was distinct and justified, and the existence of a separate suit did not preclude the petitioner from seeking a writ.

Conclusion:

The court concluded that the petitioner was entitled to a refund of the customs duty paid for the short-landed goods. It quashed the orders dated December 21, 1957, and November 30, 1959, and directed the Customs Authorities to refund the sum of Rs. 10,885 to the petitioner. The court also awarded costs to the petitioner, certified for two counsel.

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