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TMI Blog1987 (10) TMI 301X X X X Extracts X X X X X X X X Extracts X X X X ..... st that the Board's order may be upheld. 4. The learned barrister reiterated that the Board's order and the Collector's order may be set aside as the action was illegal ab initio and the Collector had no power to stop export and the goods were not liable to confiscation and they were not liable to any fine or penalty. He emphasised that they had followed the prescribed law and procedure and the stopping of the consignment was an illegal and malafide act. The Board in its findings had not discussed or evaluated the so-called evidence relied upon by the Collector Board's reliance upon the Collector's order was mis-placed and its finding on the point of country of origin was wrong. The Collector himself was wrong in relying on the opinion of NAFED & Agmark authorities. The person who gave the opinion was not expert and his opinion was of no evidentiary value. 5. Moreover, the Collector had not acted as per his own best judgment or discretion but had taken action & passed the impugned order at the behest of some higher authorities. The order was, therefore, malafide. It was indeed an instance of abdication of jurisdiction by the Collector. His order was, therefore, not proper order. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he arguments were also submitted. In view of the respective submissions by the parties I proceed to examine them in detail. 14. The first point on behalf of the appellants is that when the goods in question had reached Jogbani the Land Customs authorities posted there had certified that the goods were of Nepalese origin and there was proper compliance with the formalities laid down in the Treaty between the two countries. In this connection they have drawn my attention to the Customs Transit Declaration (Export) placed at page 31 of the paper book with respect to 155 bags. There is an endorsement made in it by the Chief Customs Officer, Customs Office, Biratnagar, Govt. of Nepal to the effect that necessary checks have been made in terms of the provisions of the export procedure of the Treaty of Trade & Transit between the two Govts. and the goods certified therein were allowed to move to Calcutta port duly sealed. There is also an endorsement of the Border Examiner, Land Customs, Jogbani on it. In it the description of the goods shows that 155 bags of Nepal origin turmeric were packed in double gunny bags. In any view of the matter it has now been disputed that the Border Examin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that at least the department has not challenged their reports. Shri Saraf has submitted that from all these it would appear that since Nepal and India are bordering countries and since the same stretch of land extends between the two countries on both sides of the boundary in which turmeric is grown, it is not only difficult but almost impossible to state, so far as the turmeric grown on this stretch of land is concerned, whether it is of Indian or Nepalese origin. 18. In this connection my attention has been drawn to the case of Padam Kumar v. Addl. Collector of Customs (AIR 1972 SC P. 542). This was a case of export of Masur dal from Nepal to other countries through Calcutta. It was held by the Customs authorities that the Masurdal in question was of Indian origin. It was, however, held by the Hon'ble Supreme Court that there was absolutely no basis for any such conclusion by the adjudicating officer, since the witnesses examined frankly conceded that it was not possible for them to say distinctly that the dal in question was of Indian origin. They further deposed that they were unable to distinguish between Indian Dal and the Nepalese Dal. Shri Saraf has submitted that the f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ic are concerned, they have not been examined and their names have not been disclosed. Shri Varghese has admitted that he had gone to Nepal 10 years ago but there is no record to show that or the fact that he had occasion to see Nepalese turmeric. From all these it would appear that Shri Varghese cannot be said to be an expert within the meaning of the Section 45 of the Evidence Act and that this opinion, if at all, is not based on his own scientific examination of the samples. Hence, any such opinion cannot inspire confidence. It is well known that in the eyes of law an expert is one who has acquired specialised knowledge, skill or experience in any branch of science, trade or profession. 21. Moreover, Shri Varghese has not given any scientific data to come to the conclusion that the turmeric in question was of Indian origin. As a matter of fact, he has admitted in his report that the same was not put to any chemical examination since according to him the laboratory test will not help in determining the origin. In any view of the matter, as observed by the Supreme Court (AIR 1959 SC 488), the Court can refuse to place its reliance on the opinion of an expert which is unsupported ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3.47 per Kg. for the total quantity of 15,362 MT, would be Rs. 53,309,000/-. From these discussions it would appear that the Department has not been able to show that the goods were of Indian origin and not of Nepalese origin. The report of the National Planning Commission for the year 1976-77 was also shown to the learned adjudicating officer. It was pointed out by Shri Saraf, the learned advocate, that the similar question with respect to Masurdal came up for consideration before the Hon'ble Supreme Court in the case mentioned above (AIR 1972 SC P. 542). Under the circumstances it was submitted that it has not been properly proved by the department that the turmeric in question was of Indian origin and not of Nepalese origin. 25. It was submitted that the main point involved in the present appeals is whether the turmeric exported from Nepal by the appellants in transit through India were of Indian origin and whether the same has been conclusively proved to be so by the Customs authority. It was further submitted that the next point for consideration would be whether the appellants were entitled to export the said goods under the Treaty between the two Govts. On behalf of the app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y any fine or penalty. He emphasised that they had followed the prescribed law and procedure and the stopping of the consignment was an illegal and malafide act. The Board in its findings had not discussed or evaluated the so-called evidence relied upon by the Collector. Board's reliance upon the Collector's order was mis-placed and its findings on the point of country of origin was wrong. The Collector himself was wrong in relying on the opinion of NAFED & Agmark authorities. The person who gave the opinion was not expert and his opinion was of no evidentiary value. 30. Moreover, the Collector had not acted as per his own best judgement or discretion but had taken action and passed the impugned order at the behest of some higher authorities. The order was, therefore, malafide. It was indeed an instance of abdication of jurisdiction by the Collector. His order was, therefore, not a proper order. 31. They have suffered for nearly nine years from 1971 onwards for no fault of their own and a lot of harassment and financial loss and difficulties have been caused to them. He would pray that in view of their submissions their appeals may be accepted and allowed. 32. I have discussed i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hear the appeal and the appeal is not maintainable. He has referred to the definition of the Adjudicating Authority as given under sub-section (1) of Section 2 of the Customs Act, 1962. The learned J.D.R. has referred to old Section 128 (before amendment) and has argued that the remedies available are under the erstwhile section to the appellants. The Ld. J.D.R. has argued that the Collector of Customs had no authority to order to stop the export of the goods under Customs Act. He has referred to Page 74 of the Paper-Book which is the operative part of the Order passed by the Collector of Customs relates to (i) the imposition of penalty and confiscation of goods under C.A. '62 and (ii) stoppage of the export of the goods. The Ld. JDR has also referred to the provisions of Section 129A of the Customs Act which vests the aggrieved person the right to file an appeal before the Tribunal. Shri Chatterjee, J.D.R., during the course of his arguments also argued that the goods for export were of Indian Origin and were going to be exported in the guise of goods of Nepalese Origin which could not be permitted to be exported. He has also stated that the decision was taken at the highest level ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s Order at its own level. It was the submission of Shri Chatterjee that the Board had set aside the confiscation order of the goods and the penalty. What remained is merely the stoppage of the goods for export without any confiscation or any offence under Section 113 as well as 114 of the Act. This, by itself, cannot be deemed to be a decision under the Act so as to enable anyone to file an appeal before the Tribunal within the provision of Section 129A of the Customs Act, 1962 with special reference to the definition of 'Adjudicating Authority' provided under Section 2, Sub-Sec. (1) of the Customs Act, 1962. 36. In reply, Shri S.L. Saraf, the Ld. Barrister argued that the Ld. J.D.R.'s arguments should be recorded. The Ld. Barrister has argued that the J.D.R. was trying to say that there are two portions of the adjudicating order and of the two portion one protion can be heard in appeal whereas the other portion of the order cannot be heard in appeal. The Ld. Barrister has also requested for recording the argument of the J.D.R. that the decision of the Collector in stopping the export of the goods is not a decision under the provisions of the Customs Act, 1962 and the Collector ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Collector of Customs had acted or purported to have acted under the Provisions of Customs Act, 1962 and as such the Appellate Authority has got the jurisdiction to hear the appeal. He has referred to Page 26 of the Indo-Nepal Treaty. 37. In reply, Shri A.K. Chatterjee, the Ld. J.D.R. agreed with the arguments of Shri Saraf to the extent that the Collector had powers to stop the goods for export. He, however, emphasised that only the confiscation and imposition of penalty were under the Customs Act. Stoppage was with reference to the Indo-Nepal Treaty. Shri Chatterjee reiterated that the Board had set aside the order passed by the Collector in respect of confiscation and penalty and what remains is the stoppage of goods under the Treaty which, by itself, cannot be a subject matter of appeal. 38. Shri Saraf, the Ld. Barrister in clarification has stated that the Ld. J.D.R. is not correct in saying that the Collector has the power to stop the goods from exporting. If such goods, after compliance with the prescribed procedures, come for exportation, the Collector has no such power. The Collector's Order is, therefore, illegal and arbitrary. 39. It is observed from a perusal of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... spect of the subject export consignments should not be refused in terms of the provisions of Article-II, VI and VIII of the Treaty of Transit between HMG of Nepal and the Government of India and why the goods should not be confiscated under Section 113(d) and 113(i) of the Customs Act, 1962 and penalty should not be imposed on the exporters under the Customs Act, 1962." 40. In other words, this show cause notice is a notice under the Customs Act to show cause to the Collector of Customs as to why the proposed action should not be taken against them under the Customs Act. The articles of the Indo-Nepal Treaty of Transit and the Agreement of Co-operation have essentially come into picture as an integral part of the facts and circumstances of the case; and the stoppage of export and confiscation and penalty were the consequences of the situation as perceived by the Customs Authorities in view of the laws in force in India. The Order-in-Original is a one single composite order covering various aspects of the case including the infringement of Treaty and the Article of the Agreement and (consequentially) the provisions of the Indian Laws. At the Board's level also what has apparently h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng to the proceedings as a whole and their respective orders as a whole. 42. The so-called delinking or splitting of the order into executive and non-executive parts appears to me to be imaginary having no basis in fact or in law. 43. Since the Show Cause Notice was issued under the Customs Act with reference to the facts and circumstances as a whole (including the Nepal-India Treaty of Transit and Agreement of Co-operation and the Order-in-Original was passed under the Customs Act and the Order-in-Appeal was also passed with reference to the aforesaid order under the Customs Act and the Revision Petition was filed with reference to the Order-in-Appeal passed under the Customs Act and the said Revision Petition has been transferred to the Tribunal in terms of Section 131B of the Customs Act and is before us as a deemed appeal under the Customs Act, it is obviously clear that the Tribunal is required to look into the facts and circumstances as a whole and to hear the submission of both sides with reference to the Order-in-Original and Order-in-Appeal as a whole under the Customs Act. As already mentioned the jurisdiction cannot be exercised in a piecemeal manner and prima facie th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... competent to hear and decide only those transferred matters in which either the duty or fine or penalty was more than 10,000 rupees. In the instant case, neither any duty, nor any fine, nor any penalty is involved. Therefore, it was his contention that the jurisdiction to hear and decide the cases on merits continued to rest with the Central Govt. It was, therefore, his submission that the cases may be transferred to the Central Government. The learned Barrister Shri Saraf pleaded that this Tribunal has already passed an order with reference to the jurisdiction conferred on it in terms of Sections 129A & 129B read with Section 13 1B. This is apparent from the first paragraph as well as the last paragraph and the operative part of the order. Therefore, once this issue has been decided, it cannot be reopened and the Tribunal was bound to proceed further in the matter in terms of its own order. It was his submission that it was open to the other side to have raised this point and urge it during the course of previous hearing, but they, having chosen not to raise this issue, cannot now come up with the plea of non-existence of jurisdiction and agitate it after an order on this aspect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e other side thought that it is the Government and not the Tribunal which was the proper authority, they should have taken up this aspect first and then sought the orders of the competent authority on the issue of maintainability. Although no duty, fine and penalty are involved, as rightly held by this Bench in its order dated 30-8-1985, a grievance still persists and an appeal lies to this Tribunal. In fact, the appellant has sufferred a huge loss of about Rs. 40 lakhs approximately (involving an amount of not less than five to seven lakhs of rupees in each of the Appeals viz. (1) CD-203/80, (2) CD-204/80 (3) CD-205/80, (4) CD-206/80 & (5) CD-207/80 - in which identical issues are involved). The goods are still in the custody of the Department and have already become dust and worthless. It was also his submission that proviso to Section 131B(2) does not apply in such circumstances. In view of the above position, he would urge that since the Tribunal has already passed an order specifically on the point of jurisdiction and referred to Section 129A and B as well as Section 131B and the Tribunal is bound by its own orders, he should, therefore, be allowed to proceed further and he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , Shri B. Prasad has passed his order dated 10-6-1987. My order is as follows: 47. Brief stated, it is the appellants' case that they were citizens of Nepal, engaged in export business, who had purchased the Turmeric in Nepal with a view to export to Singapore. They had obtained export licences from H.M.G. of Nepal and produced the goods as well as the relevant documents before the Nepalese Customs who had found the same in order and endorsed the documents accordingly. Thereafter, they had produced the goods and the documents before the Indian Customs at Indo-Nepal border and sought permission to transit the goods across Indian territory in terms of Nepal-India Treaty of Transit (1978). The Indian border officers had examined the goods and the documents and found them in order and allowed the goods to be transported to Calcutta as per the C.T.D. in question. At Calcutta, the Customs had found the seals of the wagons intact. However, when they requested permission to ship the goods, the Calcutta Customs withheld the permission and after a gap of several months, served them with the show-cause notices in question. We may pause here for a moment to note that these bare facts are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... harges by (1) invoking Section 113(d) on different grounds namely attempt to export the goods contrary to the terms of the Treaty and the Agreement of Cooperation (instead of E.T.C. orders), (2) invoking Section 113(i) [(in addition to 113(d)] on the ground of mis-declaration). Furthermore, while initial show-cause notices were based mainly on the report of NAFED Manager, the supplementary show-cause notices refer, in addition, to a booklet "What Nepal Offers" and the statement of border examiners and cross-examination of the NAFED Manager and the border examiners. Thus, the basis of the charges was sought to be expanded and the charges themselves were amended. 49. Now coming to the apparent omissions in the show-cause notices (both original and supplementary), it is observed that: (1) they do no mention or refer to any source or authority under the Customs Act, '62 (or allied laws) by which or under which cognizance of violation of the Treaty or the Agreement of Cooperation could be taken by the Indian Customs. That is to say, the do not mention any basic provision of Customs Act, '62 (whether substantive or procedural) for violation of which penal provisions could be invok ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n was actually withheld initially? (3) the legal status of the goods pending shipment after permission had been withheld i.e. whether initial action of the Customs resulting in non-shipment amounted to detention or seizure of the goods? (4) Whether the proceedings before the Collector after the issue of the initial/original show-cause notices had remained incomplete/inconclusive or they had been duly concluded at that time. In case, they had been concluded, why no order was passed? (5) Since the supplementary show-cause notices were issued after the hearings, a question arises as to whether it was proper to do so? 50. Before examining the matter with reference to the above questions and observations it may be useful to go through the relevant portions of the Nepal-India Treaty of Transit (1978) and the Agreement of Cooperation. Article -I The contracting Parties shall accord to 'traffic in transit' freedom of transit across their respective territories through routes mutually agreed upon. No distinction shall be made which is based on flag of vessels, the places of origin, departure, entry, exit, destination, ownership of goods or vessels. Article - II (a) Each Contracting ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ough India, the exporter or his agent (hereinafter referred to as the exporter) shall be required to observe the following procedure at the corresponding Indian Border Customs Post: 1. The Senior most officer in charge of the Nepalese Customs Office at the border shall furnish the following certificate on the Customs Transit Declaration:- "I have verified that the goods specified in this declaration and of the quantity and value specified herein have been permitted to be exported by His Majesty's Govt. of Nepal under licence No.....……Dated......". 2. The exporter shall prepare the Customs Transit Declaration in quadruplicate and shall present it to the Indian Customs Officer at the Customs Post through which the goods are to enter India. The Customs Transit Declaration shall contain the following particulars: (a) Name and address of the Exporter; (b) No., description, marks and serial Nos. of the packages. (c) Country to which consigned, (d) Description of goods, (e) Quantity of goods, (f) Value of goods, (g) HMG's Export Licence No. and date, (h) Indian Customs office of entry from Nepal, (j) A declaration at the end in the following words:- "I/We declar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on duly endorsed by the Customs House with the duplicate and triplicate received by it from the border. In case of goods which have moved under seals and locks, the Customs House shall check the seals and locks and where there is suspicion that they have been tampered with, will examine the goods to identify them with the corresponding Customs Transit Declaration. After the verification as contemplated in this paragraph is completed by the Customs House, it shall permit the export of the goods and will in case of goods specified in sub-para (ii) of para 3 ensure that these are duly shipped. After the goods have been shipped, the Customs House shall endorse all the copies of the Customs Transit Declaration, hand over the original to the exporter and send the triplicate copy to the Indian Customs Border Office and retain the duplicate." Agreement of Co-operation between His Majesty's Govt. of Nepal and the Govt. of India. Article - II The Contracting Parties agree to cooperate effectively with each other, to prevent infringement and circumvention of laws, rules and regulations of either country in regard to matters relating to Customs, foreign exchange and foreign trade and shall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not normally allowed. Part 'B' - Items export of which is allowed on merits or subject to ceiling or other conditions to be specified from time to time. Schedule - III: Open General licence. 52. The Export Policy included, inter alia, a policy statement regarding licensing policy of the items listed in the Schedule & Annexure and an explanatory note to the Policy Statement. This shows that allegations regarding violation of Export Policy and or Export (Control) Order must in the ordinary course include reference to the relevant part of the Schedule and the item number and the policy during the relevant period to be meaningful. Significance of my observations regarding non-mention of these particulars in the show-cause notices thus becomes apparent. I will touch upon the legal consequences of this omission as we proceed further. We may first examine at this stage the order-in-original passed by the Collector. 53. A perusal of the order of the Collector dated 30-7-1979 shows inter alia that he had in the ........ - (1) observed that there has been no seizure of goods under Section 110(i) of the Customs Act, 1962; (2) examined the date of the production, consumption and expor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s Act, 1962, "for attempting to export the goods contrary to the provision as mentioned earlier an act of commission/omission which rendered the goods liable to confiscation under Section 113 of the Customs Act, 1962." A perusal of the findings and the operative portion of the Collector's order thus shows that the Collector has not even touched upon the major issues and problems noted by us and has not dealt with the questions which obviously called for answers. 54. We will examine the matter further as we proceed. We may first look at the Board's order and see what the Board has done in this regard. The operative part of the Board's order is as under:- 'The Board has carefully considered the facts and the submissions made in the memorandum of the appeal. The Board does not find it necessary to wait for a hearing at a later date. The Collector of Customs did not allow the export of the consignments of Turmeric, as at that time there was an export ban. This was applied to the consignments under reference which were claimed to be of Nepalese origin, on the basis of the evidence discussed in the Collector's order refuting the claims of Nepalese origin and holding that the goods ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ations and the consequences of such an order as we proceed further. Since the show-cause notices and the Collector's order refer to certain sections of the Customs Act, it is necessary to refer to these sections and it will be useful and convenient to reproduce the relevant portions thereof which are as follows: "Section 113: Confiscation of goods attempted to be improperly exported, etc. - The following goods shall be liable to confiscation: (d) any goods attempted to be exported or brought with the limits of any Customs area for the purpose of being exported, contrary to any prohibition imposed by or under this Act or any other law for the time being in force; (i) any dutiable or prohibited goods (or goods entered for exportation under claim for draw-back) which do not correspond in any material particular with the entry made under this Act or in the case of baggage with the declaration made under Sec. 77 respect thereof; Section 114:- Penalty for attempt to export goods improperly, etc. Any person who in relation to any goods does or omits to do any act which act or omission would render such goods liable to confiscation under Section 113, or abets the doing or omission of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nabling provision by which the legislature has empowered the Govt. to utilise the Customs machinery for any of the purposes mentioned therein. It is, however, a discretionary provision and the Govt. may utilise this mechanism, if and when necessary and to the extent deemed proper by issue of appropriate notification (s). For better appreciation we may go through the relevant portion which reads as follows:- "11. Power to prohibit importation or exportation of goods:- (1) If the Central Govt. is satisfied that it is necessary so to do for any of the purposes specified in sub-section (2), it may, by notification in the official gazette, prohibit either absolutely or subject to such conditions (to be fulfilled before or after clearance) as may be specified in the notification the import or export of goods of any specified description. (2) The purposes referred to sub-section (1) are the following: (a) to (q) ............... (r) Implementation of any treaty, agreement, convention with any country. A plain reading of this provision shows that the Indian Customs officers come into picture in the field of implementation of any Treaty or Agreement or Convention with any country, pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . (ii) That the Collector of Customs, Calcutta, had no authority to detain or seize the goods and to refuse shipment and that the Collector of Customs, Calcutta, was not justified in placing reliance on the opinion of the NAFED authorities and Agmark authorities and the booklet, "What Nepal Offers". (iii) That the Manager, NAFED, was not an expert and his opinion was not reliable as it does not disclose any basis or criteria. As such in view of the Supreme Court judgement reported in AIR 1959(SC) 488 the Collector should not have relied on. He should not have given his finding on the basis of such report and the Board should not have confirmed it. (iv) That Turmeric was grown on both sides of the border and it was not possible to distinguish between the Indian Turmeric and the Nepalese Turmeric and even the NAFED had admitted as much. (v) That they had purchased the Turmeric in Nepal and it was meant for export to third countries. (vi) That the burden of proving that it was of Indian origin was on Customs and the Customs have not been able to discharge this burden. (vii) It was also their contention that the Collector had abdicated his functions in acting on the orders of som ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Nepalese origin after making due enquiry, the goods were estopped or debarred from legitimately raising the question regarding origin of the goods at Calcutta. (xxii) That there was no material before the Ld. Collector and the Ld. Member of the Board to prove that the Turmeric which was alleged to have been exported from India was being re-exported form Nepal as goods of Nepalese origin. (xxiii) That the goods in question were the same very goods which had been exported from India to Nepal and as such the finding of the Ld. Collector and the Ld. Member of the Board was based on mere guess, surmises and conjectures. (xxiv) That none of the border examiners had in their evidence or written statements before the Ld. Collector stated that the goods were not of Nepalese origin. (xxv) That the opinion of the NAFED Manager was no evidence. It was not worthy of being relied upon as it did not disclose any basis or criteria relied upon. (xxvi) That the Ld. Collector and the Board had made a mistake in accepting the said Manager, NAFED, as an expert. (xxvii) That the Customs authorities erred in relying upon the report of the Agmark authorities inasmuch as it was never a part or bas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... power to stop export and the goods were not liable to confiscation and they were not liable to any Fine or penalty. He had emphasised that they had followed the prescribed law and procedure and the stopping of the consignment was an illegal and malafide act. The Board in its findings had not discussed or evaluated the so-called evidence relied upon by the Collector. Board's reliance upon the Collector's order was mis-placed and its findings on the point of country of origin was wrong. The Collector himself was wrong in relying on the opinion of NAFED and Agmark authorities. The person who gave the opinion was not expert and his opinion was of no evidentiary value. Moreover, the Collector had not acted as per his own best judgement or discretion but had taken action and passed the impugned order at the behest of some higher authorities. The order was, therefore, malafide. It was indeed an instance of abdication of jurisdiction by the Collector. His order was, therefore, not a proper order. They have suffered for nearly nine years from 1971 onwards for no fault of their own and a lot of harassment and financial loss and difficulties have been caused to them. The learned counsel had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods for verification of facts or removal of doubts was understandable. In fact, the power to detain is inherent or implied in the power to check and verify. But detention (and such prolonged detention at that) without indicating either the reasons or the authority at that time was neither fair nor proper. 69. Further, as already noticed, in so far as Articles II, VI and VIII of the Treaty and Article III of the Agreement of Cooperation cited in the show-cause notices as also in the Collector's orders are concerned, they require certain measures to be taken in pursuance of the provisions of the said Articles. 70. The Hon'ble Supreme Court had also occasion to make similar observations in the famous Masur dal case - Padam Kumar Agarwal v. Addl. Collector of Customs, Calcutta (AIR 1972 SC 542). The Supreme Court had noted in this case the department could not show measures, if any, taken in pursuance of the Treaty. 71. I also notice that in the present cases as well the department has not produced any material whatsoever indicating that persons concerned had been put on notice regarding prohibition or restriction, if any, considered necessary for the purpose of safeguarding the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his was not done, I am afraid, the Customs Act could not come into play and provisions of the Customs Act could not be invoked even in cases of proven violation of the terms of the Treaty or the Agreement of Cooperation. Therefore, in the instant cases, Sections 113(d) and 113(i) and 114 of the Customs Act, '62, were not available to the Customs for taking action against the appellants even if the violation of the Treaty was established. 75. In the instant cases actually there is no positive proof of violation of the Treaty and the Agreement, as there is no positive proof that the country of origin was India and the goods were the very same goods which were initially exported from India to Nepal, (and in this respect also these cases are similar to Masurdal case) (AIR 1972 SC 542). 76. Generalisations and surmises on the basis of production, consumption and export date are of no avail and the Collector was right in concluding that the so called circumstantial evidence does not conclusively prove anything. This is yet another point of similarity between these cases and the aforesaid Masurdal case. Therefore, it is not clear as to on what basis the Collector has distinguished the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Schedule-I which is a list of items, the export of which is not normally allowed. On the contrary, it figures as item No. 18(iii) in Part B of Schedule -I of the Policy (Page 85). 81. And as already noticed, the export of items mentioned in Part-B is allowed on merits. In other words, it is not banned or prohibited, but permissible subject to fulfillment of certain conditions and, in fact, as per the statement of policy, the export of Allepcy finger Turmeric was allowed within limited ceiling in 1978-79 (page 15). Therefore, strictly speaking, the Customs officers were incorrect in stating that the export of turmeric was banned/prohibited under Export (Control) Order during the relevant period. This point is largely of academic interest (in view of our findings). However, it may be worthwhile to note that turmeric is botanically a species of Curcuma called Curcuma Longa or Curcuma Domestica. The Rhizomes which are short and thick constitute turmeric of commerce. It is cultivated by sowing live (raw) rhizomes which act as propagules. The finger-like yellow pieces normally found in the market are off-shoots of rhizomes made marketable by processing, which consists of cooking, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ur earlier observations regarding want of measures under the Treaty (and the Agreement) and the Customs Act (1962). 86. Neither the Collector nor the Board have examined these aspects and consequentially have erred in passing the impugned order. 87. Thus, I find that the department has not been able to establish any of the charges mentioned in the show-cause notices. It has not been able to show the violation of any of the terms of the Nepal-Indian Treaty of Transit (1978) or the Agreement of Cooperation or the Export Procedure prescribed in the memorandum to the Treaty of Transit. 88. It has not been able to establish violation of any provision of the Customs Act or the allied laws. 89. It has not even been able to show that the Collector of Customs, Calcutta had the jurisdiction to pass the impugned order in the circumstances of these cases. 90. The learned Junior Departmental Representative, on the other hand, has disclosed in the open court that the action in the instant cases was taken by the Collector at the instance of some higher authority and the Collector had merely acted as an agent. This statement coupled with glaring defects in the show-cause notices, the unusual ..... X X X X Extracts X X X X X X X X Extracts X X X X
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