1991 (7) TMI 172 - HC - Customs

Summary

Issues:
Challenge to the legality of an order under Clause 8-B of Imports (Control) Order, 1955.

Detailed Analysis:
1. The petitioners challenged the legality of an order dated March 21, 1991, passed by the Deputy Chief Controller of Imports and Exports under Clause 8-B of the Imports (Control) Order, 1955. The order directed that the grant of license and allotment of imported goods to the petitioners be kept in abeyance for six months due to allegations of mis-utilization of goods imported against Special Imprest and Advance Licences. The power under Clause 8-B allows for such actions without obtaining further details regarding the circumstances of the mis-utilization.

2. The petitioners contended that the Deputy Chief Controller exercised drastic powers under Clause 8-B without any material available. The petition was filed before the Court's closure for summer vacation and certain ad-interim reliefs were granted during the vacation. However, upon the respondents' failure to file a return, the Court directed the disclosure of the concerned officer's name. An affidavit by the Deputy Chief Controller revealed that the exercise of power under Clause 8-B was justified, and the petitioners' grievance was misconceived.

3. Clause 8-B empowers the Chief Controller of Imports and Exports to keep in abeyance the grant of license or allotment of imported goods without assigning a reason if it is in the public interest. The investigation revealed that the petitioners had obtained licenses by misrepresentation and had not utilized the imported goods as per the license conditions. The petitioners were found to have sold a significant quantity of imported steel plates in violation of the license conditions and import policy. The actions of the petitioners, as revealed by the investigation, supported the decision to keep the grant of license and allotment of goods in abeyance.

4. The petitioners argued that their actions were bona fide, claiming to have sold the goods to pay off loans. However, the Court held that the satisfaction of the Chief Controller was crucial in determining the justification of the abeyance order under Clause 8-B. Despite the petitioners' submissions, the Court refused to interfere with the order, as the material disclosed in the return indicated questionable conduct by the petitioners. The order under Clause 8-B can only remain in operation for six months, and the Court declined to disturb it based on the prima facie satisfaction of the petitioners' conduct.

5. Consequently, the petition was summarily dismissed, and all ad-interim orders were vacated. The Court upheld the decision to keep the grant of license and allotment of goods in abeyance based on the findings of the investigation and the provisions of Clause 8-B.