1987 (12) TMI 213 - HC - Customs

Summary

Issues Involved:
1. Entitlement to import rapeseed under REP licences.
2. Canalisation of rapeseed as per Import & Export Policy.
3. Compliance with the conditions of REP licences and Import Policy.
4. Past practice of Customs authorities in clearing similar consignments.
5. Validity of the clarification issued by the Joint Chief Controller of Imports and Exports.

Summary of Judgment:

1. Entitlement to Import Rapeseed under REP Licences:
The petitioner, operating under the name M.B. Impex, obtained several REP licences permitting the importation of "seeds/bulbs/mother plant/germ plasm." The petitioner entered into a contract for importing approximately 1410 M.T. of rapeseed and obtained the necessary permit from the Ministry of Agriculture & Rural Development. The petitioner submitted 15 Bills of Entry for the consignments, but the Customs Authorities verbally intimated that the rapeseed would not be cleared under the REP licences, claiming rapeseed is a canalised item.

2. Canalisation of Rapeseed as per Import & Export Policy:
The Customs authorities contended that rapeseed falls under Appendix 5, Part B of the Import & Export Policy (April 1985 - March 1988), which states that items like rapeseed oil/seeds are to be imported by the State Trading Corporation of India (STC) or Hindustan Vegetable Oils Corporation under Open General Licence. However, the court noted that Chapter IV of the Policy allows REP Licence holders to import canalised items if they appear in the licence or can be imported under specific provisions of the policy.

3. Compliance with the Conditions of REP Licences and Import Policy:
The court highlighted that REP licences are freely transferable and not subject to 'Actual User' conditions unless specified. The petitioner, as a transferee, did not claim any import facilities restricted to registered exporters. The licences specifically permitted the importation of "seeds/bulbs/mother plant/germ plasm," and there were no restrictive conditions in Column 5 of Appendix 17 against these items. The petitioner also complied with paragraph 197(1) by furnishing particulars to the Canalising Agency.

4. Past Practice of Customs Authorities in Clearing Similar Consignments:
The court noted that in April 1987, similar consignments of rapeseed imported by other entities were cleared by Calcutta Customs under similar REP licences. The Customs authorities claimed these clearances were mistakes but provided no details on how the mistakes were detected. The court emphasized that the Customs authorities cannot ignore past practices and adopt different standards arbitrarily.

5. Validity of the Clarification Issued by the Joint Chief Controller of Imports and Exports:
A telex message from the Joint Chief Controller of Imports and Exports clarified that rapeseed is not covered by the shopping list in Appendix 17. The court ruled that this clarification, being an inter-departmental communication without public notice, does not have the force of law and cannot be relied upon by the Customs authorities. The court also noted that the clarification was issued after the importation of the consignments.

Conclusion:
The court concluded that the Customs authorities cannot withhold the release of the consignments based on the arguments presented. The petitioner is entitled to import rapeseed under the REP licences, and the Customs authorities are directed to release the consignments forthwith. The court also addressed the procedural aspects, including the role of the Receiver and the discharge of duties.

Order:
The application is allowed, and the respondents are directed to release the consignments immediately. The assessment should be completed within a week, and the goods should be released thereafter. The Receiver is instructed to deliver the goods to the petitioner and will be discharged upon completion.