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TMI Blog1986 (7) TMI 261X X X X Extracts X X X X X X X X Extracts X X X X ..... ith reference to the original contract dated 26.11.1982 for 24 Nos. of Air Jet Weaving Machines, as confirmed by the suppliers vide letter dated 2.12.1982. Since this application dated 7.4.1983 satisfied conditions of 'project Import Regulations', and was accompanied by all requisite papers including recommendation of the sponsoring authority - that being the Textile Commissioner, Bombay, in this case, - and on a statement by the party that this was for substantial expansion of their existing weaving capacity; the contract was registered which, according to the 'statement of facts' appended by the party with their memo of appeal to the Collector of Customs (Appeals), Bombay, was allowed. Registration of the contract was recorded on 18.4.1983, and the importers informed accordingly vide letter dated 22.4.1983. Thereafter, the importers cleared remaining 12 Nos. of Air Jet Looms. It appears that the 24 Looms, stated in the application for registration dated 7.4.1983, included the 12 'Air Jet Looms' already cleared on 31.3.1983. The remaining 12 Looms arrived subsequent to the registration of contract on 22.4.1983 and were accorded benefit of 'Project Import' under T.I. 84.66, as clai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uthority had arrived late, i.e., after the. importation of the goods. This could not have prevented, according to my candid opinion the registration of the goods in the Custom House for project import". In view of this, the appeal was allowed and the appellants before him (respondents herein) were held entitled to refund of excess duty paid, holding it to be a fit case for assessment under 'Project Import'. 5. Feeling aggrieved by this order, the Collector of Customs, Bombay has come up in appeal before this Tribunal. It is contended that the Assistant Collector had rightly held that the goods should be imported as per contract registered in the Custom House, and that they should be imported against a specific contract which should be registered in the manner provided in the regulations made, and such registration of the contract should be made before an order permitting clearance of the goods is made by the proper officer. The terms of the Proviso to Chapter Heading 84.66 of the C.T.A. have been reproduced in the grounds of the appeal and it is urged that, in this case, application for registration of contract having been made after clearance on 31.3.1983, of these 12 Nos. o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the date of importation inasmuch as they applied to the Textile Commissioner, Bombay, who was the sponsoring authority, for the issuance of requisite recommendation in terms of the 'Project Import Regulations', and that the contract could not be registered because of the delay caused in the Office of the said Textile Commissioner in issuing the recommendatory letter and that, since, in the meantime, the goods arrived, the appellants paid duty and got them cleared so that they do not have to suffer heavy demurrage. He, however, added that before that, they had entered a protest with the Collector of Customs vide letter dated 28.3.1983. 9. The learned Counsel laid emphasis on the fact that, in terms of para 177(3) of the Import-Export Policy 1982-83; benefit of concessional rate of duty for import of machinery under 'Open General Licence' could be allowed by the Custom Officer on the recommendation of the sponsoring authority concerned, and that there was evidence in the form of an order of the Appellate Collector of Customs, Bombay, reported in '1980 E.L.T. 303', that the Custom House did not entertain applications for registration unless there is recommendation of the sponso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mandatory conditions laid down in the proviso to the Tariff Heading 84.66, and that they were not capable of being construed as of being of a directory nature. 12. We have given our careful thought to the respective contentions canvassed by the learned SDR and the Counsel for the respondents. The whole controversy centres on the question as to whether the fact, that respondents had, admittedly, not registered, the contract for project import with the Customs authorities before the date of importation, as required in terms of Proviso to T.I. 84.66 itself, would make any difference to their plea for re-assessment on concessional rate in the background of the plea that they had moved their sponsoring authority - the Textile Commissioner - for a letter to recommend the grant of project import benefit. The thrust of the arguments advanced on behalf of respondents is that the Customs authorities do not entertain an application for registration of the contract unless a duly endorsed 'import licence' or a recommendation from the sponsoring authority, as the case may be, is produced by the importers. Shri Ganesh has cited, as proof of such a practice, an order of an Appellate Collec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any order is made by the proper officer of Customs permitting the clearance for home-consumption (emphasis supplied). The proviso is, thus, very emphatic that before the clearance of the goods takes place, a specific contract is registered before the Customs authorities and the import is disclosed to be against such a specific contract which should be registered, before claiming project import benefit, before the clearance of the goods, and all this should be an accomplished-fact before the goods are cleared for home-consumption. In face of such a triple emphasis on the filing and registration of a contract, it is not possible to entertain the plea that such a condition can be read to be of a directory nature so that its adherence could be waived. Even if there was a practice at one time in the Custom House, as the order passed in 1979 indicates, (although there is no evidence that this practice continued up to 1983, even after such a strong order having been passed by the Appellate Collector, even then the minimum which the party could have done was to do what was within their power; namely, to file the contract, against which the import was to be made, with the Customs authoriti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... because, apart from the fact that terms of the Proviso do not permit of any retrospective effect to the factum of registration; even otherwise, the contents of the letter dated 7-4-1983 reveal that, while applying for registration, the fact was nowhere disclosed that benefit is sought to be obtained even for the 12 Nos. of Air Jet Looms already cleared after full payment of duty. The Customs authorities as well could have given this contract registration on the impression being created that this was meant for prospective importation in the normal course because, as already observed, there is not even a hint of any intent to stake claim for benefit of concessional duty for the goods already cleared, prior to the application for registration, much less registration itself. 17. The learned Counsel for the appellants vehemently argued that there have been situations where it has been held that where compliance with certain provisions of law, dependent upon an assessee performing certain acts, which were not within his control but lay with some Government agency, then, in that event, the directions of statutory provisions should not be given a mandatory effect. The case on which h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not filed, and even an indication to take benefit of project import was not given on the duty-assessment papers. 19. The other cases cited by the learned Counsel for the respondents are likewise distinguishable. In the case of Madras High Court; namely, 'L.M. Ven Moppes Diamond Tools India Ltd., Madras v. Government of India' reported in '1981 E.L.T. 165 (Mad.)' which was a case where terms of certain notification required furnishing of a bond in case the importer wanted to avail of concessional rate of duty, in terms of the given notification, which were subject to certain conditions, as to end-use of the goods, and it was in that context that the Hon'ble High Court held that when, initially, the importer had paid full duty and cleared the goods and, only subsequently, claimed refund; there was no bar to his being so allowed on a proper evidence of end-use being produced because the question of having executed the bond in terms of the notification did not arise when at the time of clearance he had paid full duty, when, apparently, the bond was required only in the event of clearance being made at a concessional rate. 20. The case before Delhi High Court; namely, 'Ele ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proceeded on this premise, than his conclusion was bound to be different. He has also made passing observations that it was not clear as to whether these goods have been cleared before the project import had been registered in the Custom House or whether the Assistant Collector had not accepted the appellants' request for project import merely because the licence had not been endorsed by the I.T.C. authorities. Neither of these observations would arise had the Assistant Collector's order been read with due care. 23. There is another palpably wrong observation in the impugned order to the effect that the Assistant Collector had rejected the appellants' request for registration of import under the 'Project-import Registration of Contract' Regulations, whereas the fact remains that no such application had even been made prior to the importation or clearance of goods, and the Assistant Collector was only dealing with refund claim filed subsequent to the registration of the contract, for which application had been made long after the clearance of the goods. 24. For all these reasons, the order of the Collector in this case is wholly unsustainable and liable to be set aside. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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