9911796707
TMI Blog1995 (3) TMI 249X X X X Extracts X X X X X X X X Extracts X X X X ..... hether the goods are allowed for import under OGL or they would require a licence for the importation. 3. Shri M.R. Srinivasan and Shri M. Ramachandran, learned Consultants, appeared on behalf of the appellants. The learned Consultant Shri Srinivasan pleaded that the appellants imported 3 consignments and filed 3 Bills of Entry dated 17-1-1994 and 19-1-1994 in respect of the same and claimed clearance of the goods under Public Notice No. 159/92-97 of 7-9-1993 issued by the Director General of Foreign Trade, claiming the benefit of clearance under OGL. He pleaded that under the said Public Notice import of Cassia was banned for importation under OGL and an exception was provided in this Public Notice by way of transitional arrangement allowing importation of Cassia in cases where the shipment was effected within 60 days of the said Public Notice and against firm orders backed by irrevocable Letter of Credit established between 16-7-1993 and 6-9-1993. He pleaded that inasmuch as the L.C. for the goods imported by the appellants had been opened on 23-7-1993 and the shipment had been effected within 60 days of the issue of the said Public Notice the appellants' goods should have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... accept on its board a cargo which was intended for a voyage commencing from Hongkong on 8-12-1993" and has also considered the intimation received from the shipping agents that the cargo was shipped on board on 7th December, 1993 without any regard to what has to be taken as the date of shipment for the purpose of importation when the date of shipment has been defined under the Import and Export Policy as set out in the Handbook of procedure for the year 1992-97. He pleaded that in the allegations made in the show cause notice reliance was sought to be made on Rules 3, 4 and 7 of the Schedule of Rules relating to Bill of Lading in the (The Indian) Carriage of Goods by Sea Act, 1925 and under Rules 3 & 4 on receipt of the goods the carrier or the master or agent of the carrier is required to issue a Bill of Lading which will be prima facie evidence of receipt by the carrier of the goods and that under Rule 7 a shipper, if he so demands, has to be given a "shipped Bill of Lading" after the goods are loaded on the vessel. He has pleaded that any reference to Rule 7 would be misplaced as once the goods had been entrusted to the carrier or his agent so far as the shipper is concerned a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7th December, 1993 and there is no averment to the contrary so far as this aspect is concerned. He pleaded, therefore, the Bill of Lading could not be considered relevant for the purpose of Public Notice under which the goods were to be imported if the shipment was effected within two months from 7-9-1993, when the item was placed on the Negative List and the goods required a licence for importation. He cited in this connection the judgment of the Tribunal in the case of Metraco (India) Ltd. v. Collector of Customs, reported in 1990 (49) E.L.T. 207 (Tribunal) and referred to paras 7, 8, 10, 12 and 14. He therefore, pleaded the shipment having been effected beyond the permissible time under the Public Notice referred to above, the goods have been rightly held to be confiscable under Section 111(d). He pleaded that so far as the condition regarding the importation under firm orders against irrevocable letter of credit is concerned the appellants' L.C. could not be taken to be irrevocable letter of credit with reference to the date of shipment of the goods. He has pleaded that originally, as per the appellants' own submission, the L.C. was valid till 31st August, 1993 for shipment and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment regarding the date of shipment and the negotiations of the letter of credit were subsequent to the ban imposed under Public Notice 159/92-97, does not in any way affect the nature of the L.C. being an irrevocable letter of credit. He pleaded the definitions and clarifications given in the Handbook of Procedure of the Import and Export Policy should be treated as part and parcel of the Policy. His plea is that the provisions in the Handbook are only for giving effect to the provisions in the Policy and both have to be read together. The date of shipment, therefore, according to him, should be read as given in the Handbook of Procedure i.e. the date on the Bill of Lading. In regard to the under-valuation aspect, he pleaded that the appellants had agreed to the loading of the price with a view not to prolong the proceedings and to get quick clearance of the goods. He pleaded that this loading was agreed to only for the purpose of assessment and it is not an acceptance of the fact that there was any under-valuation on the part of the appellants or any mala fides in the matter of importation of the goods at a lower price. He pleaded no penal consequence as a result of their agreein ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce of reference : "(3) The period of validity means the period of shipment/despatch permissible for the goods concerned. The validity of an import licence is decided with reference to the date of shipment/despatch of the goods from the supplying country and not the date of arrival of the goods at an Indian port." Date of Shipment/Despatch for the purpose of imports will "259. be reckoned as under :- Mode of Transportation Date of Shipment/Despatch By sea The date affixed on the Bill of Lading. By air The date of the relevant Airway Bill provided this represents the date on which the goods left the last airport in the country from which the import is effected. From land-locked countries The date of despatch of the goods by rail, road or other recognised mode of transport to the consignee in India on through consignment basis." The appellants' plea is that in case of shipment by sea it is the date affixed on the Bill of Lading and inasmuch as in their case the date on the Bill of Lading is 1-11-1993 the said date should be taken to be the date of shipment for the purpose of the Public Notice 159/92-97. In this context the Hon'ble Supreme Court in the case of Dars ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Public Notice banning the import under OGL except where the shipment had been effected within 60 days of the issue of the Public Notice 159/92-97 is concerned, the goods should have been already on board for the commencement of the transit to India. The Hon'ble Supreme Court in the judgment referred to above has clearly held that the transitional provision being in the nature of an exception has to be interpreted strictly. In our view the definition of the term `date of shipment' given in the Handbook of Procedure for the Policy 1992-97 does not in any way come to the rescue of the appellants. All that it envisages is as to what is to be considered as the date of shipment/despatch. So far as transport by sea is concerned the said date is referred to as the date on the Bill of Lading. In respect of transport of the goods by air or by road the date is the date on the Airway Bill provided this represents the date on which the goods left the last airport in the country from which the import is effected and in the case of despatch by road in the case of land-locked countries the date of despatch of the goods by rail or road on through consignment basis. In the case of the modes other th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pt that a Bill of Lading is issued. In view of the discussion we hold that the Bill of Lading date, as pleaded by the appellants 1-11-1993, cannot be taken as the date of shipment of the goods but 7-12-1993 when the goods were actually placed on board when the shipped Bill of Lading was to be issued representing the commencement of the transit of the goods. The West Regional Bench of the Tribunal in the case of Metraco (India) Ltd. v. Collector of Customs, reported in 1990 (49) E.L.T. 207 (Tribunal), has also taken a similar view under similar circumstances. In the above view of the matter we hold that the goods could not have been imported under OGL in terms of Public Notice 159/92-97, referred to above, and these could be imported only under a licence issued by the Director General of Foreign Trade. 7. In regard to the validity of the letter of credit, we observe that admittedly the letter of credit was amended twice and the last amendment on record was for shipment upto 31-10-1993 while the actual shipment took place on 7-12-1993, and even on the appellants' own claim for shipment, the shipment was on 1-11-1993. It has been pleaded, no formal amendment of the L.C. was carr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been put to loss in case the L.C. opened was not honoured. In case there was a default on the part of the seller of the goods the appellants had a choice to revoke the deal. In the present case admittedly the last extension for shipment was not reflected in the L.C. and since the shipment as it is could not have been made as is shown by the facts on record within the earlier extended period, no reason has been shown as to why the appellants did not cancel the order. It is not the plea of the appellants that the shipment could not be made on account of any failure on the part of the appellants and in case the supplier had not been able to make the shipment they were under no obligation to go ahead with the deal. They have yet proceeded to go on with the deal when the L.C. as confirmed was not acted upon in full. The latitude under the Public Notice for importation was obviously given where the importers had to necessarily go through with the deal already arrived at for importation on pain of any damages which may have to be paid by them in case of any failure on their part to effect the importation. In the present case, therefore, the L.C. as was opened was not acted upon by the su ..... X X X X Extracts X X X X X X X X Extracts X X X X
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