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TMI Blog1990 (6) TMI 174X X X X Extracts X X X X X X X X Extracts X X X X ..... -1984. In that order the learned Collector imposed a penalty of Rs. 2,00,000.00 on the said appellants. 3. In Appeal No. C-4/85 the appellants, M/s. Shrijee Sales Corporation, Bombay, have directed the appeal against the order of the learned Collector of Customs, Custom House, Calcutta in Order No. S.33-63/83A dated 28-7-1984. In that order, the learned Collector imposed a penalty of Rs. 1,28,000/- on the said appellants, holding that the goods already released to the appellants were confiscable and therefore, imposed the abovesaid penalty. 4. The Appeal No. C-5/85 is directed against the order passed by the learned Collector of Customs, Calcutta in Order No. S.33-66/83A dated 28-7-1984. In that order, the learned Collector had imposed a penalty of Rs. 1,00,000.00 on the appellants, M/s. Sanjoy Enterprises, Bombay. 5. The questions involved in all these cases are similar in nature and therefore, common arguments were advanced on behalf of both the sides and we, therefore, dispose of these four appeals by a common order. 6. The brief facts of the cases are that in Appeal No.C-2/85 the appellants imported a consignment of 1042.7513 Metric Tons of Crude Rapeseed Oil valued at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndustrial) valued at Rs. 19,73,963.10 (CIF) per Bill of Entry bearing Rotation No. 493/83, Line No.4 Ex. S.S. Fort Coulague. The appellants claimed release of the said oil as L/A holders in respect of Import Licence No. P/W/0338570 dated 6-2-1982 issued in favour of Messrs Industrial Cables (India) Limited, Rajpura, who is the licensee. The appellants also stated that the said licensee is a recognised export house and the said licence was issued to them as REP Licence against their own export of products falling under product Group-A. 25 of Appendix-17 of AM 81 for the exports made during the period, October, 1981 against registered Contract No. 68.42/18008 dated 21-9-1980. They also stated that they made an application to the Deputy Chief Controller of Imports Exports, Amritsar for making suitable endorsement as laid down in para-176 of the said Policy and inspite of an order made in this regard the Department objected to the release of the oil in question. 9. In all the above-said appeals since the said oil was imported in bulk the appellants moved the Hon ble High Court of Calcutta for release of the said oil. The Hon ble High Court of Calcutta was pleased to pass an order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oes not appear in Column-4 in Appendix-17 of AM-81 Policy against export product Group-A-25 against which the licence has been issued, these items are not covered by the licence. The appellants were asked to show cause why the said oil should not be confiscated under Section 111(d) of the Customs Act, 1962, and why penal action should not be taken against them under Section 112 of the Customs Act, 1962. The appellants in all the above-said four appeals replied the show cause notices. The appellants denied that the import licences in question had been issued for items permissible for import during the AM-82 Policy. It was their contention in the reply that the import licences in question are to be governed by the provisions of Para-147 read with Appx. 20 of AM-81 Policy. They also contended that the provisions of Import Policy for the period-82 cannot be applied to the licences in question. It was their contention that the claim of the registration of the contract does not permit the same. They also contended that it would be incorrect to confine the permissibility of items against the REP Licences to export product only. It was also contended by the appellants that a perusal of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he relevant import policy is AM-81 during which the concerned contract was registered as indicated in the import licence itself and subsequently confirmed by the learned Deputy Chief Controller of Imports and Exports, Amritsar. In his letter dated 21-5-1983, Shri Nankani contended that the respondent had admitted in the order that the goods imported are crude rape-seed oil (industrial). He, therefore, submitted that the licences produced are registered contract REP licences with contracts registered during 1981 Policy period. It was, therefore, contended that a short point which is to be resolved in this appeal is whether the import of crude rape-seed oil (industrial) was canalised as per entry No. 5 of Para-5 of Appendix-9 of AM 81 Policy. The learned Advocate, Shri Nankani further, submitted that the conclusion of the respondent that the description of rape-seed oil is generic in nature and covers both edible as well as industrial grades is not a correct proposition. In this behalf, he relied on a decision of the Central Board of Excise and Customs, New Delhi, which is reported in 1982-ECR-530-CBEC. He relied on paragraphs: 36 and 37 of the case. In the above-said order of the C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s to be governed by the provisions of Import Policy of the AM 81 during which the relevant contract was registered. It was contended that all these appellants had produced import licences issued in favour of export houses. Since the said licences were issued to the said licensees against their own exports, they were eligible to import industrial raw-materials open to actual users, under OGL without debiting to the value of the said licences in terms of the provisions ofpara-174(v) of AM 81 Policy. He also contended that this position was confirmed by the learned Deputy Chief Controller of Imports and Exports in his letter dated 21-5-1983 addressed to the said licensee. It was, therefore, contended that the orders of the respondent are not in accordance with law. He also contended that the provisions of the Import Policy for AM 82 cannot be applied to the licences in these cases. He relied on the decision of the Supreme Court reported in AIR-1971-SC-704. He also contended that the orders of the learned Board in Order No. 412 and 413 dated 20-9-1983 are binding on the respondent and in view of those orders these reasoning of the respondent are not in accordance with law. 14. He, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ded that on the same analogy the rapeseed oil contemplated in paragraph-5 of Appx. 9 includes both edible oil and crude oil. Shri Biswas contended that the Collector of Customs no doubt was bound by the decision of the Board and when the Collector of Customs passed the impugned order the judgment of the Supreme Court dated 5-5-1988 in the case of Jain Exports Pvt. Ltd. was not available. But Shri Biswas contended that position will not assist the appellants in this case. It was his contention that it may be that the Collector of Customs should have felt bound by the decision of the Board. But the matter has passed this stage. He contended that what we are now concerned with, is not disciplining the Collector in his quasi-judicial conduct, but to ascertain the correct position in the matter. Shri Biswas, therefore, contended that when the Supreme Court on an interpretation of the 1980-81 Policy had held that oil as contemplated in paragraph-5 of Appx. 9 includes both edible and non-edible variety, the import made by the appellants is against the provisions of the relevant policy. He further contended that it is 1981-82 Policy which is applicable in this case and in this connection, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion reported in AIR-1978-SC-851 in the case of Mahendra Singh. This decision was followed by the Bombay High Court in a decision reported in 1986 (26) E.L.T.-676 in the case of Ashok Leyland v. Union of India. Therefore, the policy applicable is AM 81 Policy and the case has to be decided on that basis. The first point is answered accordingly. 16. As far as the second point is concerned the learned Advocate, Shri S. D. Nankani relied on a decision of the Board reported in 1982-ECR-530. In that decision, at para-37, the Board held that there is a reasonable inference that provisions of Appendix-9 are concerned with edible variety of oil only. It is no doubt true that at the time when the learned Collector passed the order this was the law which was binding on the learned Collector. The learned Collector passed the order on 28-7-1984. He should have followed the decision of the Board in this regard, which was available to him at that time. But that will not help the appellants as far as this case is concerned in view of the fact that Hon ble Supreme Court in a decision reported in 1988 (17) ECR-631 in the case of Jain Exports Pvt. Ltd. held at para-6 which is as follows: Para:6 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -635) in the case of M/s. Jain Exports (P) Ltd. Anr. v. Union of India Ors. their Lordships have held as follows: That, however, does not assist the appellants at ell. It may be that the Collector of Customs should have felt bound by the decision of the Board or the Central Government but the matter has passed that stage. What we are now concerned with is not disciplining the Collector in his quasi-judicial conduct but to ascertain what the correct position in the matter is. Very appropriately, appellants learned counsel has not found fault with the High Court for not following the quasi-judicial opinion of the Board or the Central Government nor has he pleaded for acceptance of that by us as a precedent. Once on analysis we reach the conclusion that coconut oil of every description was covered in paragraph 5 of appendix-9, the quasi-judicial decision ceases to be relevant. We propose to say no more on this aspect of the submission. It is, thus, seen that once when the Supreme Court reached the conclusion that an entry as oil covers both edible and non-edible as per paragraph-5 of Appendix-9, the quasi-judicial decision of the Board ceases to be relevant. In such circu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... many words that he is taking a lenient view and imposing a penalty only. The Tribunal had relied on a decision of the Supreme Court reported in AIR-1977-SC-2279 in the case of R. S. Joshi v. Ajit Mills Ltd. and another. In that decision, the Hon ble Supreme Court at pages: 2287 to 2288 held as follows : When discussing the rulings of this Court we will explore whether this true nature of forfeiture is contradicted by anything we can find in S.37(1), 46 or 63. Even here we may reject the notion that a penalty or a punishment cannot be cast in the form of an absolute or no-fault liability but must be preceded by mens rea. The classical view that no mens rea, no crime has long ago been eroded and several laws in India and abroad, especially regarding economic crimes and departmental penalties, have created severe punishments even where the offences have been defined to exclude mens rea. Therefore, the contention that Section 37(1) fastens a heavy liability regardless of fault has no force in depriving the forfeiture of the character of penalty." It was also held in a decision reported in AIR-1969 : Calcutta: 266: in the case of J. D. Crighton v. S. K. Srivastava at page 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this Act or any other law for the time being in force. As two views were possible about the validity of the import and the customs house was consistently taking the view over several years that the import was valid, in my judgment, this was not a fit case to take proceedings for confiscation and the imposition of fine in lieu of confiscation was wholly unnecessary. In my judgment, this ground itself is sufficient to dispose of the petition. Relying on the above-said cases he contended that the penalty could not be imposed on the appellants. But those decisions are not applicable to the facts of this case. In those two decisions there was corresponding practice and in view of the long-standing practice the penalty was not imposed. But in this case, no such standing practice was established by the appellants and such a plea was not raised before the lower authorities. Even the Hon ble High Court by virtue of an order passed in the original side while releasing the oil in favour of the appellants, directed the appellants to furnish a Bank Guarantee totaling 5% of the C.I.F. value of the imported crude rapeseed oil. The Hon ble High Court of Calcutta, also held that the petitioners ..... X X X X Extracts X X X X X X X X Extracts X X X X
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