9911796707
TMI Blog1987 (2) TMI 217X X X X Extracts X X X X X X X X Extracts X X X X ..... rance under Section 59 of the Act after furnishing the requisite bonds with bank surety or cash deposit; (c) a notice dated 31-5-1984 was issued to the Respondent along-with M/s,. Skefko India Bearing Co. Ltd. and Punjab Bearing Traders, alleging, inter alia, (i) the existence of a special relationship between the Respondent and the overseas supplier through the media of M/s. Skefko India Bearing Co. Ltd. and M/s. Punjab Bearing Traders; (ii) mis-declaration (of the values by the Respondent for the imports in question) rendering the goods liable to confiscation under Section 111(m) of the Act; (iii) absence of I/Licences to cover the appropriate value rendering the goods liable for confiscation under Section 111(d) of the Act read with Section 3 of the Imports and Exports (Control) Act, 1947; (iv) certain acts of omission and commission liable to be penalised by the levy of penalties under Section 112 of the Act; and requiring all three of them to show cause against the confiscation and levy of penalties proposed; (d) in adjudication by the Additional Collector (Customs) it was held by his order dated 19-4-1985 (and issued on 9-5-1985) inter alia, that - (i) the inv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... powers vested upon it under Section 129D(1) of the Act, further directs the Collector of Customs, Bombay, to make a request to the Appellate Tribunal for Stay of the operation of the aforesaid order of Additional Collector of Customs or in the alternative adequate safeguard for the revenue be taken as may be deemed fit in the form of a Bank guarantee or cash deposit. ; (f) the order would, however, appear to have been endorsed to the Additional Collector; (g) an application purporting to be in Form No. C.A. - 5 and the instant application for stay of operation of the order in original, both signed by the Collector and not the Additional Collector, were the sequel; (h) in the application for stay, with an affidavit sworn by the Collector in support thereof, it was alleged, inter alia, that - (i) as a result of the order of the Additional Collector of Customs, the related Bills of Entry have to be assessed to final duty and bank guarantees and revenue deposits have to be released in favour of importers; (ii) the Bills of Entry are required to be assessed to final duty. In case of decision of CEGAT in favour of department would not enable the department to obtain cost recov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Customs in his order. (3) No order shall be made under sub-section (1) of sub-section (2) after the expiry of one year from the date of the decision or order of the adjudicating authority. (4) Where in pursuance of an order under sub-section (1) or subsection (2), the adjudicating authority or any officer of Customs authorised in this behalf by the Collector of Customs, makes an application to the Appellate Tribunal or the Collector (Appeals) within a period of three months from the date of communication of the order under sub-section (1) or sub-section (2) to the adjudicating authority, such application shall be heard by the Appellate Tribunal or the Collector (Appeals), as the case may be, as if such application were an appeal made against the decision or order of the adjudicating authority and the provisions of this Act regarding appeals, including the provisions of sub-section (4) of Section 129A shall, so far as may be, apply to such application. 5. It will be observed that - (a) the provision envisages decisions made or orders passed by two tiers of officers. They are : (i) a Collector of Customs as an adjudicating authority , [sub-section (1)]; and (ii) an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id provision, in the facts and circumstances of the case, are - (a) Who is the appropriate officer who should have been directed to apply to the Tribunal in terms of Section 129D(1)? (b) Could the Collector of Customs be required to prefer the application when the decision made or order passed was by an Additional Collector of Customs? (c) What is the effect of the endorsement of the Board s directive to the Additional Collector? (d) Is the application preferred by the Collector of Customs in conformity with the provisions of the statute, and consequently competent and maintainable, when the decision or order in relation to which the application was made was rendered by the Additional Collector of Customs? (e) Were the points arising out of the decision or order and requiring determination by the Tribunal specified? If not, to what effect? 7. In terms of the statute, an Additional Collector is comprehended within Collector of Customs [Please see Section 2(8) of the Act and our reference to a larger Bench in 1983 (2) ETR 574 and the decision of the larger Bench in accord with our views therein reported in 1983 (2) ETR 537]. In the facts and circumstances of the case, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... usly, therefore, the Board was empowered to call for and examine the record of the proceedings in this case where an Additional Collector had passed a decision or order as an adjudicating authority, with a view to satisfy itself as to the legality and propriety of any such decision or order . 9. The controversy centres around the consequential steps the Board is to take. Whom should the Board direct to apply to the Tribunal? Can it be any Collector (including within its ambit an Additional Collector ) or is it the Collector or Additional Collector who passed the decision or order as an adjudicating authority (and no other) - alone that is to be directed? 10.(a) The clue lies in the words such Collector , which in the context in which they occur, can be understood to refer only to that Collector or Additional Collector who passed the decision or order as an adjudicating authority and no other. (b) (i) Generally, the word such refers only to what was previously indicated, characterised or specified. Such is an adjective meaning the one previously indicated or refers to something which has been said before; (ii) Such has been defined by Webster as having the part ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e by an officer other than the Collector or Additional Collector as an adjudicating authority. A different construction for. the identical word when used to qualify Collector is hardly called for; (f) Nor support drawn from sub-section (4) of Section 129D wherein it is provided that the adjudicating authority or any officer of Customs authorised in this behalf by the Collector of Customs may make the application. (i) The contention is that the words such Collector in sub-section (1) can only mean the jurisdiction Collector and not necessarily the Collector (or Additional Collector) who made the decision or order, seeing that it is competent for any officer of Customs authorised by the Collector to prefer the application in terms of sub-section (4). And if an officer authorised by the jurisdictional Collector could prefer the application in terms of sub-section (4) he himself can apply and accordingly be directed to apply in terms of sub-section (1) as well. (ii) To elaborate the argument - sub-section (4) of Section 129D speaks of the competence of an officer of Customs authorised in this behalf by the Collector of Customs , who would necessarily be the jurisdictional C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uld arise, as it would, if there is an ambiguity and admits of more than one meaning. When the language is plain and unambiguous and admits of only one meaning, no question of construction arises, for the Act speaks for itself. [per Subba Rao J. in AIR 1963 S.C. 946 at 950 (State of Uttar Pradesh v.- Vijay Anand Maharaj); AIR 1955 S.C. 504 (Thakur Amar Singhji v. State of Rajasthan); AIR 1982 S.C. 1230 at p. 1233 - Om Prakash Gupta v. Vijendrapal Guptha]. Says Gajendragadkar If the words used are capable of one construction only, then it would not be open to the Courts to adopt any other hypothetical construction on the ground that such construction is more consistent with the alleged object and policy of the Act. [AIR 1957 S.C. 807 at p. 910 -Kantilal Sur v Paramnidhi Sadhu Khan]. Thus, in deciding that a return of income signed by the son of an illiterate person was invalid, not having been signed or verified by the assessee himself as required in the Bengal Agricultural Income-tax Act, (Act II of 1946) it was observed by S.R. Das J. in AIR 1950 SC 265 at 270 (CIT Agri. v. Keshab Chandra Mondal) that hardship or inconvenience cannot alter the meaning of the language employed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he provision itself. (vii) A construction contrary to the plain and unambiguous meaning of the words used in a statutory provision is not to be adopted merely because it may frustrate the legislative policy in enacting it. In AIR 1957 S.C. 912 and AIR 1971 S.C. 1, amongst those cited herein above, this was the precise contention. The short point raised in AIR 1957 S.C. 912 was if under Section 5(1) of the Calcutta Thika Tenancy Act (West Bengal Act II of 1949) as amended by the Calcutta Thika Tenancy (Amendment) Act (West Bengal Act VI of 1953), execution proceedings taken out by the Decree Holder against the tenant could be entertained only by the Collector and not the Civil Courts. It is a question of competency and jurisdiction. While holding that the aforesaid provision, on its language, was wholly inapplicable to a land lord who holds a decree for ejectment in his favour, their Lordships repelled a plea for a beneficent construction of a welfare legislation in the light of the scheme and object of the Act, in these words : - The words used in the material provisions of the statute must be interpreted in their plain grammatical meaning and it is only when such words are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at is to direct such authority to apply to the Collector (Appeals). Sub-section (4) comprehends both the cases dealt with separately in sub-sections (1) and (2). In fact, it refers to both the sub-sections in two places, in their sequence. Nevertheless it speaks compendiously of the communication of the order to the adjudicating authority only, in fixing the terminus for the commencement of the period of limitation. The words adjudicating authority may, therefore, be taken to mean an imply a Collector of Customs who passed the decision or order as an adjudicating authority (sub-section 1) as well as an adjudicating authority subordinate to him (sub-section 2). In either case the period is three months from the date of such communication to them. If, therefore, adjudicating authority in the latter part of sub-section (4) can comprehend both the cases, it is, necessarily, to be given the same meaning when it occurs in the earlier part of the sub-section. Once this so, then what do the words or any officer of Customs authorised by the Collector of Customs mean and imply? Collector of Customs in this part of sub-section (4) cannot obviously mean the Collector of Customs who ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ub-section (1), this can be the only plausible interpretation of sub-section (4). In any view, it cannot be that the Board can direct a Collector of Customs who has not passed any order or decision to apply just because an officer authorised by him is also competent to apply in terms of sub-section (4). (g) In the premises, the conclusion is irresistable, in answer to queries (a), (b) and (d) in Para (6) supra, that the Board could not have directed any Collector (or Additional Collector) other than the one who, as an adjudicating authority has passed any decision or order." Any such direction is contrary to the specific mandate of the legislature and cannot invest the officer so directed with the competence or authority to apply to the Appellate Tribunal in terms of Section 129D. The application made by the Collector, pursuant to such a direction is incompetent and not maintainable. Nor is there any question of any Collector or any person authorised by him being competent to apply when the Collector (or the Additional Collector) who was the adjudicating authority is available. 11. While, it may be that the order of the Board was endorsed to the Additional Collector, who was t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ainst increase in the assessable value at all or to any specified extent whatsoever and recovery of the consequential difference in duty, which, accordingly, were not the subject matter of the adjudication - not within its scope and ambit at all - the Tribunal is to be asked to determine points in relation to them. (b) Section 129D is a provision analogous to Section 130 of the Act, enabling reference by the Tribunal of questions of law arising from its order in the Appeal before it to the High Court. Upon such a reference, the jurisdiction of the High Court is to render advise on the legal issues raised. The High Court does not sit in appeal in a reference case so as to remand or modify the Tribunal s order. In fact, its jurisdiction being merely advisory, the High Court is not even competent, to make an interlocutory order of Stay upon recovery [1986 (24) E.L.T. 193 (SC) - CIT v. Bansidhar Sons]. The matter continues in Seisin of the Tribunal to be disposed of in the light of the advice rendered by the High Court. Similarly, once the points duly formulated are referred to the Tribunal for determination, it is the advisory jurisdiction of the Tribunal -not its appellate jur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the application under Section 129D were being raised after the expiry of the period of limitation prescribed for filing it. Had they been raised prior to such expiry, they could have been, possibly, taken care of and such action as may be necessary to ward of and pre-empt such questions could have been taken. Now that the period of limitation has expired, and it be held that the application was not maintainable not being competent, it will result in the deprivation of any remedy, whatsoever, to the applicant - not even by way of an appeal - for which also limitation has expired. Such a contingency, being entirely due to the latches of the Tribunal, should not be allowed to come about or eventually result. (ii) Such a contention assumes that there was no obligation on the part of the applicant to see to it that application preferred did not suffer from incompetence or otherwise was not maintainable and it was the duty of the Tribunal to indicate such fatal errors in the application well before the expiry of the period of limitation so as to enable the applicant to rectify them, if he so chooses. (iii) It was, as already stated, at our instance that the application for stay wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ory mandate and, hence, incapable of investing him with any authority to file the application for an appropriate relief. The incompetence is incurable. 14. For all the foregoing reasons, it has to be held that the main application itself is incompetent and not maintainable. Accordingly, it is hereby dismissed. The application for Stay in an Application under Section 129D - not otherwise maintainable - also fails and is dismissed. Dated : 4-12-1986. Sd/- (M. Gouri Shankar Murthy) MEMBER. 15. [Per : D.C. Mandal, Member (T)]. - The learned Member (Judicial) has held that the application made by the Collector of Customs, Bombay to this Tribunal under Section 129D(4) of the Customs Act, 1962 (hereinafter-referred to as the Act ) in this case is not maintainable as the Board issued direction under Section 129D(1) of the Act to the Collector of Customs, instead of to the Additional Collector of Customs, who passed the adjudication Order and the Board also did not specify the points for determination by the Tribunal. He has also held that the provision of Section 129D is analogous to Section 130, which enables the Tribunal to refer questions of law to High Court and the Trib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his Act regarding appeals, including the provisions of sub-section (4) of Section 129A shall, so far as may be, apply to such application. 17. Section 3 of the Act specifies the classes of Officers of Customs. They are: (a) Collector of Customs; (b) Collector of Customs (Appeals); (c) Deputy Collector of Customs; (d) Assistant Collector of Customs; and (e) Such other class of Officers of Customs as may be appointed for the purposes of this Act. According to the definition in Section 2(1) of the Act, adjudicating authority means any authority competent to pass any order or decision under this Act, but does not include the Board, Collector (Appeals) or Appellate Tribunal. In Section 2(8) of the Act, it is stated that Collector of Customs includes an Additional Collector of Customs. According to Section 2(34) of the Act, Proper Officer in relation to any functions to be performed under this Act, means the officer of Customs, who is assigned those functions by the Board or the Collector of Customs. Section 5(2) of the Act provides that an officer of Customs may exercise the powers and discharge the duties conferred or imposed under this Act on any other officer of C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lf for smooth running of the work. In the present case, by a written order, the Collector of Customs, Bombay assigned the adjudication work to the Additional Collector of Customs due to the formers pre-occupation with other work. The Order No. S/14-208/81-C, dated 3-6-1981 issued by the Collector of Customs, Bombay assigning the adjudication work to the Additional Collector of Customs reads as follows :- As I am pre-occupied with a number of disciplinary cases and appeals besides some special work, all adjudications within my powers will be put up by the Groups to the Additional Collector Shri V.S. Naik until further orders. 20. In sub-paragraph (ix) of paragraph 10(f) of the Order written by the learned Member (Judicial), he has held the view that Once an adjudicating Officer a Collector of Customs, has been directed to apply, and before he obeys and carries out the directive he becomes altogether unavailable for any reason whatsoever, it is reasonable to conclude that the direction can be fulfilled by any Customs Officer authorised by the Collector of Customs although he never made the order in adjudication. The directive has to be carried out and if the adjudicating auth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of this Section would, therefore, warrant an interpretation that under sub-section (1) the directive may be given by the Board to the Collector of Customs even when the order in adjudication has been passed by an Additional Collector of Customs by virtue of the function allocated to him by the Collector of Customs under Section 2(34) of the Act. An interpretation contrary to this will be too narrow a view, not in conformity with the intention of Section 129D of the Act and it will create anomaly between these two sub-sections. 21. The learned S.D.R. Shri Ajwani has cited a number of judgments of the Supreme Court and High Courts in support of his arguments for harmonious interpretation and intention of Section 129D and the Customs, Excise and Gold (Control) Appellate Tribunal (Procedure) Rules. He has relied on the judgments reported in AIR 1953 S.C. 394, AIR 1957 .C. 628, AIR 1967 S.C. 1649, AIR 1969 S.C. 513, AIR 1969 Punjab and Haryana 270, AIR 1983 Punjab and Haryana 50, AIR 1969 Goa 6 and AIR 1980 M.P. 37. In AIR 1953 S.C. 394 at page 397 (Rao Shiv Bahadur Singh and another v. The State of Vindhya Pradesh) the Hon ble Supreme Court has held that it is incumbent on the cour ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... b-sections (l) and (4) of this Section as already explained in paragraph 20 (Supra). Such an interpretation makes the two sub-sections inconsistent and it will defeat the purpose of this Section. It will render sub-section (4) devoid of any meaning or application in certain situation. Under sub-section (4) of Section 129D the Collector of Customs has been empowered to authorise any officer of Customs to apply to the Tribunal as directed by the Board under sub section (1). There is no question of his authorising an officer to apply to the Tribunal unless the Board directs him to apply to the Tribunal. The object of Section 129D is to set right an illegal or improper order or decision passed by a Collector of Customs as an adjudicating authority. This section empowers the Board to review such illegal or improper order and direct the Collector of Customs to apply to the Tribunal for the determination of such points arising out of the decision or order as may be specified by the Board in its order. Once the Board has exercised this power and has decided that an application should be made to the Tribunal, this decision to apply is to be implemented by issue of a direction to the Collect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act could also be made by the Collector of Customs, as directed by the Board. 23. The learned Member (Judicial) has held that no points have been mooted for determination by this Tribunal. I find that the Board discussed the facts of the case and the reasons why it considered the Additional Collector s order as illegal and improper vide paragraphs (1) to (4) of its order No. 26-R/85, dated 7-6-1985 under Section 129D(1) of the Act. In paragraph 5 of that order the Board summarised the alleged errors committed by the Additional Collector and in para 6 of the order it gave direction to the Collector of Customs to apply to this Tribunal. The order speaks about undervaluation of imports and paragraph 6 thereof gives a direction to the Collector of Customs to apply for determination of points relating to appropriate increase in the assessable value of the goods under Section 14 of the Act, recovery of consequential difference in duty and imposing fine in lieu of confiscation of the goods in question under Section 111(d) of the Act read with Section 3(2) of Imports Exports (Control) Act, 1947 as also under Section 111(m) of the Act and imposition of personal penalty under Section 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the show cause notice the charge of under valuation and consequent amount of duty sought to be evaded has been levelled against the respondents. After the under valuation is established, consequent increase in the assessable value and payment of duty on the basis of increased assessable value become imperative if the goods are cleared by the importer. This point will be required to be looked into when the merit of this appeal is gone into. At the present stage when the maintainability of the appeal is under consideration, this point is not a determining factor. When this application under Section 129D is otherwise maintainable, it can not be rejected in the basis of this point. 25. The provision of Section 129D is not analogous to Section 130 of the Act. It has got appellate jurisdiction. Sub-section (4) of Section 129D says that an application made to the Tribunal under this sub-section shall be heard by the Appellate Tribunal as if such application were an appeal made against the decision or order of the adjudicating authority and the provisions of this Act regarding appeals, including the provisions of sub-section (4) of Section 129A shall apply to such application. Further ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nments covered by the Bills of Entry Nos. 2350/39, 2350/40, 2198/56, 2198/59, 1909/78, 1909/39, 2496/68, 2350/51, 1909/79, 2350/41 (including in Ex. H hereto); (ii) to refund to the Petitioners the amount of revenue deposit paid by them of Rs. 3,69,128.25 with interest thereon at the rate of 18% per annum in any event from 9th May, 1985 till the date of actual refund; (iii) to discharge the Bank guarantee of Rs. 2,87,850/-given by them;" The stay petition filed by the petitioners before this Tribunal, which bears No. CD/Stay/1065/85-A, is, therefore, to be dismissed as infructuous. I order accordingly. 28. We have not heard the appeal on merits. No order on merits thereof can be passed at this stage. The other points raised by the learned Advocate for the respondents during the hearing, viz. prayer in the application is impossible to be performed, Tribunal is not competent to grant relief claimed, imposition of fine and penalty by the Tribunal etc. are connected with merits of the case and as such, I refrain from giving any findings on the same. These points may be argued by the respondents, if they so desire, when the appeal is heard on merits. 29. I agree with observ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hus : So far as the fiscal statutes are concerned, we must remember one more principle. The provisions in a fiscal statute are not to be so construed as to furnish a chance of escape and a means of evasion. In case of doubt, the fiscal statute should be construed in favour of and beneficial to the subject. Having regard to the above guidelines laid down by the Supreme Court with regard to the interpretation of machinery provision in fiscal statute, 1 am in agreement with the views expressed by learned brother Shri D.C. Mandal, Member (Technical). Dated : 28-1-1987. Sd/- (K.S. Venkataramani) Member (Technical) FINAL ORDER 31. In accordance with the views of the majority of the Members hearing and deciding this matter, it is held that the application in question under Section 129D of the Customs Act, 1962 is maintainable. 32. The application for stay, however, is dismissed. 33. Let the application be posted in due course for hearing on merits. Dated : 5-2-1987. Sd/- (M Gourishankar Murthy) Member (Judicial) Sd/- (D.C. Mandal) Member (Technical) Sd/- (K.S. Venkataramani) Member (Technical) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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