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TMI Blog2010 (10) TMI 55X X X X Extracts X X X X X X X X Extracts X X X X ..... APPL No. 10659/2010 (for restoration) For the reasons stated therein, this application is allowed. The petition is restored to its file. The application is disposed of. 1. The Petitioner is aggrieved by the impugned order dated 22nd April 1996 passed by the Additional Director General of Foreign Trade ( ADGFT‟), Respondent No. 3 herein holding the Petitioner guilty of contravening the provisions of Section 4-I of the Import Export (Control) Act, 1947 ("IEC Act") and Clause (8) of the Import (Control) Order, 1955 read with Section 20 (2) of the Foreign Trade (Development Regulation) Act, 1992 ("FTDR Act") levying the penalty of Rs. 55 lakhs on the Petitioner. The Petitioner also challenges the order dated 12th August 1997 passed by the Appellate Committee Cell (ACC), Respondent No. 2 upholding the above order. 2. The Petitioner applied to the Secretariat of Industrial Approvals ("SIA"), Department of Industrial Development, Ministry of Industry, Government of India in July 1985 for setting up a 100% export oriented unit ( EOU‟) for the manufacture of video-cassette shells. By a letter dated 4th November 1985 the SIA permitted the Petitioner to establish a 100 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /) towards non-fulfillment of export obligation. The amount was to be deposited with the import licensing authority with whom the unit had executed the LUT. (2) That the unit shall undertake an export obligation of 25% of the annual production for a period of five years or for an amount equal to five times the cif value of the imports whichever was higher." 5. The Petitioner states that it had complied with the condition at (1) and requested for a waiver of the second condition. This request was accepted and the SIA informed the Petitioner on 8th September 1994 that the condition regarding export obligation would be deleted as the Petitioner could not meet the export obligation after debonding. The Petitioner then proceeded with the formalities and on 21st July 1995 the Assistant Collector of Central Excise, Division 1, Bombay-II granted the Petitioner permission for debonding of raw material, semi-finished goods, finished goods and scrap and waste. The capital goods were also permitted to be cleared at depreciated value after payment of applicable rate of duty. Although in para 16 of the petition the Petitioner had submitted that due to its poor financial condition it could no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of the imported goods. 9. Mr. M.P. Devnath, learned Counsel for the Petitioner reiterated the submissions made before the ACC. In addition, he relied upon the decisions in Amrit Foods v. Commissioner of Excise 2005 (190) ELT 433 (SC), Commissioner of Central Excise, Jalandhar v. Max G.B. Limited 2008 (221) ELT 491 (P H), Commissioner of Central Excise Customs v. Nakoda Textile Industries Limited 2009 (240) ELT 99 (Bombay) and, Optina Impex Pvt. Limited v. Union of India 2003 (151) ELT 493 (Delhi). Mr. Ravinder Aggarwal, learned counsel for the Respondents relied upon the decision in Supercom India Limited v. Directorate General Foreign Trade Ministry of Commerce 104 (2003) DLT 14. 10. The first question to be considered is whether the provisions of the IEC Act applied considering what was issued to the Petitioner was a letter permitting import of capital goods and raw material. There can be no doubt that it was only on account of the letter dated 4th November 1985 that the Petitioner was permitted to import under 100% EOU scheme for the manufacture of video cassette shells. Following this a formal agreement was entered into between the Petitioner and the Government of India ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions incorporated in the permission letter or letter of intent or industrial licence issued to him. Failure to abide by any of the said terms and conditions shall be construed as violation of this Open General Licence and the Importer shall be liable to penal action under the provisions of the Imports and Exports (Control) Act, 1947 (18 of 1947) and rules framed thereunder, without prejudice to any other action such as conciliation or revocation of permission letter or letter of intent or industrial licence." 12. The above Clause 5 A in the OGL order is a further pointer that the failure to meet the export obligation in terms of the permission letter dated 4th November 1985 would not only attract penalty as a result of such violation but under the provisions of the IEC Act as well. Consequently, this Court finds no error having been committed by the ACC which held that permission letter issued by the Petitioner should be construed as an import licence and for any failure to comply with the conditions attached thereunder action could be independently taken by the SIA as well as the office of the ADGFT under the IEC Act. 13. The next question that arises for consideration is wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es them to be used or utilized, for any purpose other than the purpose for which they are delivered to him or (c) having made a declaration for the purpose of obtaining- (i) a licence or letter of authority to import any goods or materials, or (ii) allotment of any imported goods or materials, is found to have made in such declaration, any statement which is incorrect or false in material particulars; or (d) acquires, sells or otherwise parts with or agrees to acquire, sell or otherwise part with, any imported goods or materials in contravention of the conditions of any licence of any licence or letter of authority in pursuance of which such goods or materials had been imported; or (e) acquires, sells or otherwise parts with or agrees to acquire, sell or otherwise part with, any imported goods or materials in contravention of the terms of any allotment made by any recognized agency; or (f) contravenes any direction given under a control order with regard to the sale of goods or materials which have been imported under any licence or letter of authority or which have been received from, or through, a recognized agency, shall be liable to a penalty not exceeding five time ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y is being imposed was emphasized by the Supreme Court in Amrit Food v. Commissioner of Central Excise, U.P. That was in the context of penalty imposed under Rule 173Q of the Central Excise Rules, 1944. It was observed that in the absence of any indication as to which particular clause of Rule 173Q had been contravened, the penalty could not have been imposed. The above judgment has been followed by High Courts in Commissioner of Central Excise, Jalandhar v. Max G.B. Limited and Commissioner of Central Excise Customs v. Nakoda Textile Industries Limited. The decision of this Court in Supercom India Limited v. Directorate General Foreign Trade Ministry of Commerce relied upon by Mr. Aggarwal is of no assistance since the Court proceeded on the footing that sub-clause (1) (a) of Section 4-I applied. No point appears to be have been urged, and therefore considered, on whether in fact that sub-clause applied. 18. It was sought to be contended by Mr. Aggarwal that it was Section 4-I (1) (a) of the Act stood attracted. In the first place it must be noticed that this is not the basis on which the ADGFT proceeded to impose the penalty. A fresh reason cannot be supplied for the conclusi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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