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TMI Blog1991 (12) TMI 172X X X X Extracts X X X X X X X X Extracts X X X X ..... hen Manager of the Punjab and Sind Bank. 2. Vide the impugned order, penalties are also imposed, on M/s. I.R. Sharma Co. as also Mr. H.S. Bhatia, but they do not appear to have preferred any appeal against the order. 3. The appellants M/s. Kasinka Traders imported all the six subject consignments, which landed at Sahar International Air Port, Bombay, on various dates, and the said appellants through their CHA, filed six Bills of Entry claiming clearance of five of the said six consignments against Licence No. P/W/0338376/C/XX/81 dated 28-12-1981 and of the sixth consignment against Licence No. P/X/10390376/C/XX/81 also dated 28-12-1981. Both the licences were additional licences, under Product Group A , Merchant Exporters, bearing endorsement for import of items of appendices 5 and 7 excluding items of Appendix 26 of the Import Policy 1981-82 with further endorsement of same having been issued under para 186 of Policy 1981-82. The subject items were importable under the said licences during the policy period 1981-82, during which the subject licences were issued. During the period of Policy 1982-83, however, item oxytetracycline was brought under Appendix 4 (Non-permissibl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... denied the ante-dating of the Letter of Credit and pleaded his non-involvement. The parties were given personal hearing. The adjudicating authority, however, came to the conclusion that the subject item was not importable under the licences produced, and also held the documents to have been ante-dated, and passed the impugned order. 4. Dr. N.R. Kantawala, the Ld. Advocate for the appellants M/s. Kasinka Trading, pleaded that the appellants admittedly possessed licences issued during the Policy Period 1981-82, and as per the said policy provisions, by virtue of endorsement for para 186 of the Policy Book, they were eligible to import the subject goods. He submitted that, as per the transitional provisions, under the policy 1982-83, which became effective with effect from 5-4-1982 the appellants were still eligible to import the subject goods, as what was placed under Appendix 4 (banned items) was only oxytetracycline, and not their salts and the ban on import of salts was placed only vide ITC Public Notice No. 21/82 dated 19-4-1982, and pleaded that before that, the contract was already entered into and Letter of Credit was also opened. Pleading that the Public Notice, could not b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was not permissible under the new Policy, as the item was placed under the list of banned items. Placing reliance on the judgment of the Supreme Court in Union of India v. Godrej Soaps Pvt. Ltd. - 1986 (26) E.L.T. 465 (SC) = 1986 (9) E.C.R. 1 (SC) and in D. Navinchandra v. Union of India, 1987 (29) E.L.T. 492 (SC) = 1987 (11) ECR 824, Mr. Naik pleaded that under the Policy 1982-83, when the subject goods were imported, they were removed out of OGL list, and as such, they were not permissible under the licence. On merits, he submitted that the evidence on record clearly indicated that both, the invoice as also the Letter of Credit, were ante-dated and were so ante-dated to overcome the ban imposed on the import. In his submission, no interference was therefore called for. 6. In reply Dr. Kantawala, pleaded that if item was initially permissible, subsequent ban imposed could not affect the import, and referred to the Bombay High Court judgment in Jayant Vegoils and Chemicals Pvt. Ltd. v. Union of India 1987 (30) E.L.T. 134 as also the Supreme Court decision in M/s. Bharat Barrels Drums Mfg. Co. P. Ltd. v. Collector of Customs- A.I.R. 1971 SC 704. 7. Mr. P.V. Sathe, the Ld. Adv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ture, and that papers for opening of Letter of Credit were initially received by him and sent to other officers for due processing and opening of L/C. 9. From the submissions made, and from what has been held by the Ld. Adjudicating authority, some undisputed factual position be identified. Both the subject licences have been issued in the. name of appellant M/s. Kasinka Trading, and they are the importers. Both the licences have been issued during the Policy Period 1981-82 and are valid for import of subject goods if the importation is within the Policy Period, 1981-82. Though dispute exists in relation to the placement of order and opening of the Letter of Credit, it is not in dispute that they were opened during the Policy Period 1982-83, and that the actual import i.e. entry of the goods into India was subsequent to even issuance of the IT.C. Public Notice No. 21/82 dated 19-4-1982. There is also no dispute over the issue that oxytetracycline was included in Appendix 4 (list of banned items) in Policy Book 1982-83 with effect from 5-4-1982, and salts thereof were banned by virtue of the aforementioned IT.C. Public Notice. The identity of the item imported being oxytetracycli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... subject licences, which too are issued to Export House, and during the same Policy Period) bear an endorsement on the face of it, which reads:- The licence is granted under the Govt. of India/ Ministry of Commerce and Industry Order No. 17/55 dated the 7th December, 1955, as subsequently amended, issued under the Imports and Exports (Control) Act, 1947 (XXIII of 1947) and is without prejudice to the application of any other prohibitions or regulations affecting importation of the goods, which may be in force at the time of their arrival. This condition being the part of the main body of the licence cannot be over looked or taken as having no or little significance. A plain reading of the condition indicates that importability of the item has to be subjected to the regulations or prohibitions existing on the day of arrival of the goods. The Bombay High Court does not appear to have examined the licence from this angle. The term identical to the one here, in a licence, has been examined by the Delhi High Court in Jain Exports Pvt. Ltd. v. Union of India, 1987 (29) ELT 753. The licence under consideration before the said High Court, was the one issued during the Policy Period ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6, to import such of the items, as the policy specifies to be OGL. It is only pursuant to the policy statement, as incorporated in para 186, that the subject import was made permissible to the appellants. Thus, the import to that extent was dependent on policy provisions. The point does not appear to have been submitted before the Bombay High Court in the aforesaid decision in Re: Climax Chemicals (supra) from this angle as well. 14. When the condition appearing on the face of the licence, as also the decision of the Supreme Court, in Re : M/s. Andhra Industrial Works (supra) have not been examined by the Bombay High Court in Re : Climax Chemicals (supra), the submissions that the said decision is applicable on all fours to the set of circumstances here, cannot be accepted. 15. In Jayant Vegoil and Chemicals (P) Ltd. v. Union of India - 1987 (30) E.L.T. 134 (Bom.) also, the matter does not appear to have been placed before the Hon ble Court, from the angle of the condition incorporated in the licence, and the same appears to be the case, before the Tribunal when it decided the appeal in Gujarat Machinery Manufacturers v. Collector of Customs, 1986 (25) E.L.T. 108 (Tri.). 16. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sharma, the Managing Director of M/s. J.R. Sharma Co. (Pvt.) Ltd. and demi copy of the indent and have pleaded that both, the invoice and the Letter of Credit have been antedated, the appellants have placed strong reliance, on the documentary evidence, including the letter dated 17-4-1982 from the foreign suppliers confirming the contract, where the number of Letter of Credit has also been mentioned, and have pleaded that Letter of Credit was opened on the date specified, and in the alternative pleaded that criteria for ascertaining the firm commitment is not the date of opening of the Letter of Credit but the date of placement of order, and for that, have relied upon the decision of the Tribunal in Gokuldas Harbhagwandas v. Collector of Customs 1987 (29) E.L.T. 379 (Tri.). 23. Examining first the issue whether the Letter of Credit was opened on 8-4-1982 as pleaded by the appellants or somewhere around 4th or 5th May 1982, as alleged by the Department, it is evident from the record mat the Letter of Credit No. 21/8000 was despatched on 5-5-1982. The appellants have produced a letter dated 8-4-1982 addressed to the Bank with a request to the Bank to make some amendment in the L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not bear any endorsement of Inward Entry. 25. With a view to refute the allegation of the Letter of Credit having been opened in the month of May, strong reliance is placed on the letter dated 17-4-1982 from the suppliers in the foreign country, confirming the contract entered into with their Indian Agents, and emphasis is laid on the point that the said letter mentions the Letter of Credit number with further endorsement of their having received the copy but not the original from the bank. Apart from the fact that the date of issue of Indent No. D/4565/82 from M/s. J.R. Sharma, itself is challenged, the said indent does not bear any Letter of Credit number. The invoice date is 6-4-1982 and obviously it could not bear the Letter of Credit number as admittedly the Letter of Credit was not opened on that day. Even going by the appellants case the Letter of Credit was opened only on 8-4-1982. M/s. J.R. Sharma Co. Pvt. Ltd. have their office in New Delhi and order was placed at their said office by Mr. Oberoi of M/s. Jaggat Singh Sons Bros. The Letter of Credit was reportedly opened at Jullundar Branch of Punjab and Sind Bank. It remains unexplained as to how the number and cop ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e oral version of Mr. J.R. Sharma that provides evidence on the point. Besides his alleged personal knowledge, he has referred to and verified from the documents, in the form of demi copy, available in the office. His statement, therefore, cannot be discarded as the one of a person not acquainted with the day to day work. Further, there is no retraction of the same by him. This evidence, thus indicates that the Indent was, in reality not drawn on 6-4-1982 and viewed in the light of other connected evidences, more particularly the most important supporting evidence of opening of the Letter of Credit, clear indication is available that Indent was also not issued on 6-4-1982 or on any day prior to issuance of ITC Public Notice dated 19-4-1982 but was subsequently ante-dated. 27. In the result, there exists no justifiable ground to differ from the conclusion drawn by the adjudicating authority, and the finding that the licences produced were not available, and that the import was unauthorised and the goods were liable to confiscation vide Sec. 111(d) of the Customs Act, was to be sustained. 28. While maintaining the order of confiscation, we also do not see any reason to interfere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the subject goods, by placement of order, with getting both, the indent and Letter of Credit, ante-dated. Their involvement is thus complete and unassailable. The penalty is therefore properly imposed on them, and considering the circumstances, we find no justifiable ground to interfere with even the quantum of penalty amount which is Rs. 1,00,000/- for an attempted import of goods worth Rs. 5,91,907/- with a deliberate idea of flouting the policy provisions and fabricating false evidence in that regards. The same is therefore confirmed. 32. For appellants M/s. Jaggat Singh Sons and Brothers, the penalty is Rs. 3000/-. From the evidence brought on record, it appears that Mr. Oberoi of the said firm, acting for and on behalf of the firm, negotiated the entire deal. It was he,who procured the indent. When the indent is held to have been ante-dated, the action of Mr. Oberoi, could not be taken as the one, bona fide carried. Further the firm has received brokerage to the extent of Rs. 1,00,000/- as is reflected from their letter dated 3-5-1982, which, considering the CIF value of the goods, appears rather abnormal. There could therefore be no hesitation to conclude that the firm was ..... X X X X Extracts X X X X X X X X Extracts X X X X
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