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Issues:
1. Prospective operation of the order passed by the Deputy Chief Controller of Imports and Exports dated 31st August, 1979. 2. Confiscation of imported materials due to lack of correlation with end-products as raw materials. 3. Entitlement to further leniency for the appellants if their contentions are not upheld. Analysis: Issue 1: The learned advocate argued that the cancellation of the license by the Chief Controller of Imports and Exports in 1979 should be prospective in operation. He cited legal provisions and previous judgments to support his contention. The Tribunal referred to relevant case laws, including East India Commercial Co. Ltd. v. Collector of Customs, to establish that importation cannot be deemed unauthorized if the cancellation of the license occurred after the importation. The Tribunal found that the license was canceled in 1979, while the goods were imported in 1968, and previous cancellations were set aside by the High Court. Therefore, the Tribunal held that the order of 1979 had prospective operation. Issue 2: The Respondent contended that the imported goods should correlate with the end-products as raw materials for production, failing which the goods are liable for confiscation. However, the Appellant argued that the goods were covered by the license, and Customs authorities cannot challenge the import based on end-use criteria. The Tribunal referenced a previous case, Usha Micro Process Control Ltd. v. Collector of Customs, stating that as long as the goods conform to regulations, Customs authorities should not be concerned with the end use of the product. The Tribunal held that since the goods matched the description in the license, there was no need for the Appellant to establish a correlation with the end products. Consequently, the Tribunal ruled in favor of the Appellant. Issue 3: Given the findings on the first two points, the Tribunal concluded that the third issue regarding leniency for the Appellants did not survive. The appeal was allowed, and the Appellant was granted consequential reliefs. This judgment clarifies the prospective operation of the license cancellation, the requirement of correlation between imported goods and end-products, and the limitations on Customs authorities to challenge imports based on end-use criteria when the goods are covered by a valid license.
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