1994 (11) TMI 206 - SC - Customs

Amendment made by the public notice dated 11-11-1983 challenged on the doctrine of promissory estoppel Held that - Unable to accept the submissions of the learned counsel for the appellants. These submissions are merely a different facet of the doctrine of promissory estoppel which has been held inapplicable in such a situation. In Kanishka Trading 1994 (10) TMI 64 - SUPREME COURT OF INDIA which related to withdrawal of exemption from payment of duty etc. in exercise of the statutory powers, it was reiterated that the power to exempt includes the power to modify or withdraw that benefit and the liability to pay duty under the Customs Act, 1962 arises when the taxable event occurs being subject to payment of duty as prevalent on the date of the entry of the goods. It was held that the doctrine of promissory estoppel could not be invoked to question the withdrawal of notification issued under Section 25 of the Customs Act, 1962 when it was done in public interest. Equities have to be balanced and public interest must outweigh individual interest, Kanishka Trading clearly holds that withdrawal of such a benefit can be made in public interest during the period for which the benefit had earlier been intended. In our opinion, this is sufficient to indicate the fallacy inherent in the submissions made on behalf of the appellant. Appeal dismissed.

Issues:
1. Interpretation of Import and Export Policy for the period 1-4-1983 to 31-3-1984.
2. Validity of amendment making import of fatty acids a canalised item.
3. Challenge based on promissory estoppel.
4. Application of Article 14 in import policy amendments.
5. Retroactive effect of policy amendments.
6. Doctrine of promissory estoppel in import policy changes.
7. Entitlement to import items governed by prevailing import policy.
8. Classification between goods in transit and those not in transit.
9. Meaning of "things done" in import policy context.
10. Dismissal of appeals and imposition of costs.

Analysis:

1. The judgment deals with the interpretation of the Import and Export Policy for the period 1-4-1983 to 31-3-1984. It highlights the conditions for import of raw materials, components, and consumables by actual users, including the provisions regarding canalised items and exceptions for certain imports.

2. The validity of an amendment making the import of fatty acids a canalised item is questioned in the case. The amendment restricted the import of fatty acids to be done only by the State Trading Corporation under Open General Licence, affecting the appellants who had entered into a contract prior to the change.

3. The challenge based on promissory estoppel, which was rejected by the High Court, is discussed. The appellants' argument regarding the doctrine of promissory estoppel is deemed inapplicable in this situation, as established in previous judgments.

4. The application of Article 14 in import policy amendments is analyzed. The court considers the reasonableness of restricting imports post-amendment and evaluates if such restrictions violate the constitutional right to equality under Article 14.

5. The retroactive effect of policy amendments is deliberated upon. The court assesses whether the retrospective application of the policy change, affecting imports already in process, is legally permissible and in line with established principles.

6. The doctrine of promissory estoppel in import policy changes is discussed extensively. The court examines the consequences of opening an irrevocable letter of credit before the policy amendment and the implications of not extending exceptions to such cases.

7. The entitlement to import items governed by the prevailing import policy is emphasized. The judgment clarifies that import of canalised items must adhere to the policy in force at the time of import, and any contravention of the policy leads to consequences.

8. The classification between goods in transit and those not in transit is examined. The court justifies the distinction made in the policy amendment regarding exceptions for goods already in transit and the rationale behind such differentiation.

9. The meaning of "things done" in the import policy context is scrutinized. The court distinguishes the present case from previous judgments and emphasizes the clarity of the exception made in the amended Import Policy.

10. Finally, the appeals are dismissed, and costs are imposed. The judgment concludes by rejecting the appeals and ordering the appellants to pay costs, emphasizing the lack of merit in the case presented before the court.

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