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TMI Blog2015 (12) TMI 477X X X X Extracts X X X X X X X X Extracts X X X X ..... sify efforts to produce more and more standard and quality goods so as to help in inducing faster growth, increasing exports and making available goods to the satisfaction of the consumers. Towards this end, the Act has been enacted and the terms have been defined. Ministry of Steel has urged that imports circumventing the said Steel Products Quality Control Order, 2012 should stopped in view of their damage to the interest of the Indian Steel industry as well as from the angle of safety of infrastructure and housing projects in the country. They have to necessarily meet with the specifications set out in the standards and have to bear the standard mark of the BIS. This is apparent from reading of Foreign Trade Policy, 2009-2014, ITC (HS), 2012. The Import Policy and General Notes regarding import policy, whereunder it is stipulated that all goods imported into India are subject to mandatory Indian Standards as notified. Standard devised for high strength deformed steel bars and wires for concrete reinforcement specification will have to be complied with. Mr. Nankani could not dispute that the schedule and which is styled as the Steel and Steel Products (Quality Control) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le. The Respondents waive service. By consent, Rule made returnable forthwith. 2] By this Writ Petition under Article 226 of the Constitution of India, the Petitioners pray for the following reliefs: ( a) that this Hon'ble Court be pleased to declare that the impugned Circular No.450/176/2014CustIV dated 7th November, 2014 is unconstitutional and ultra vires Articles 14, 19(1)(g) and 300A of the Constitution of India and the provisions of the Bureau of Indian Standards Act, 1986. (b) that this Hon'ble Court be pleased to issue a Writ of Mandamus, or a Writ in the nature of Mandamus, or any other appropriate Writ, Order or direction, directing the Respondents; (i) to forthwith clear the goods covered by Commercial Invoice dated 18th September, 2014; and (ii) to forthwith clear the consignments of Alloy Steel of Deformed Bars/Deformed Bars as per the practice prevalent prior to the impugned Circular dated 7th November, 2014. (c) that this Hon'ble Court be pleased to issue a Writ of Prohibition, or a Writ in the nature of Prohibition, or any other appropriate Writ, Order or prohibition, restraining the Respondents by themselves, their servants, agents, su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ded for in paragraph 4 thereof. The Schedule contains a list of steel products under mandatory Bureau of Indian Standards Certification and is divided into 3 columns. Column 1 covers the relevant Indian standard numbers. Column 2 refers to the corresponding heading/subheading of ITC (HS). The Schedule to this order was amended vide order dated 31st March, 2014. The said goods are covered by serial No.5 of the amended schedule which now also contains column 4 which relates to the date of coming into force of the product in the standard to the extent given therein. Serial No.5 of the amended schedule reads as under: Indian Standard Number Title ITC (HS)Code Date of coming into force of the product in the standard to the extent given below 1 2 3 4 (A)Product (B)With effect from 1786 High Strength deformed steel bars and wires for concrete reinforcement(8 mm and above) 72131090 7214 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... further issued Steel and Steel Product (Quality Control), Amendment Order, 2014 on 4th December, 2014 wherein it is clearly set out that ITC (HS) codes are generic and merely indicative in nature. It is not exhaustive. Thus ITC (HS) codes are not the guiding criteria for the BIS Act. The said ITC (HS) codes are only used as a point of reference. The said order clears all the confusion pertaining to inclusion of alloy and nonalloy steel in the Schedule. In view of the said order, the Petitioner cannot raise such allegations as the same are contrary to the statute. 10] Mr. Nankani, learned Senior Counsel, submits that the controversy in the Writ Petition is now restricted to the position prevailing prior to 7th November, 2014. Though the Petitioner is partially satisfied with the above clarification issued in the affidavit in reply, yet, the amendment made vide page 165 of the paper book does not redress the grievance of the Petitioner completely. Now, in terms of the amendment the consignments prior thereto ought to be treated accordingly. However, since there is no such commitment forthcoming, the Petitioner is raising a restricted challenge. Mr. Nankani submits that the Circul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he manufacturers and/or rerollers of steel, who have vested interests and discriminate against persons like the Petitioners. The impugned Circular is a clear case of bias against the Petitioners and reveals the case of nepotism in relation to some of the manufacturers and/or rerollers of steel. The impugned Circular, is therefore, arbitrary, unreasonable and violative of Article 14 and Article 19(1)(g) of the Constitution of India. 13] Mr. Nankani has further submitted that the impugned Circular ignores relevant facts and provisions of law. The explanation to the amended schedule, on a plain reading, confirms that in order that the provisions of the Steel Quality Control Order are made applicable, the goods must fall under both the relevant BIS standards a well as ITC (HS) Code. The explanation to the amended schedule reads as under: Explanation : For the purposes of this Order, it is hereby clarified that while taking a decision on the levy of duty as per the Customs Tariff Heads, the provisions of this Order shall apply to the specific products described under corresponding entry under column (2), covered under the Indian Standard number mentioned under corresponding entry ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th. Those standards and qualities are evolved and every country is free to prescribe its own standards and qualities of goods. Mr. Singh has relied upon para 9 of the affidavit in reply to submit that the goods imported by the Petitioners are meant for consumption of construction industries that is for concrete reinforcement purposes. Further, it is not disputed that the manufacturer or exporter overseas/abroad has not applied for a BIS license and the goods imported do not bear the standard mark of BIS. 17] Mr. Singh has relied upon para 10, 11 and 15 of the affidavit in reply which read as under: 10. I say that the Schedule to the Steel and Steel Products Quality control in column 3 thereof gives ITC (HS) Code which has been defined in Clause 2(d) of the Order to mean 'Indian Trade Classification' (Harmonised Systems) Codes as specified in the entries in column (3) of the Schedule. However, there is no reference to the ITC (HS) Codes at any other place other than column 3 of the Schedule and the Explanatory Note (in the) Steel and Steel Products Quality Control Order. Also clause 3 provides that a person is prohibited to manufacture, storage or sale or distribution ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le 14 or 21 of the Constitution of India. He submits that there is no merit in the Writ Petition particularly when the allegations of malafide and discrimination are patently false. 19] Mr. Rafiq Dada and Mr. D. B. Shroff, learned Senior Counsel, appearing for some of the Associations have supported the stand taken by Mr. Singh. 20] For properly appreciating the rival contentions, a reference is necessary to the statutes in the field. The Bureau of Indian Standards Act, 1986 is an Act to provide for the establishment of a Bureau for the harmonious development of the activities of standardisation, marking and quality certification of goods and for matters connected therewith or incidental thereto. Section 2 contains the definitions. The term Indian Standard is defined in section 2(g) which reads as under: 2(g) 'Indian Standard' means the standard (including any tentative or provisional standard) established and published by the Bureau, in relation to any article or process indicative of the quality and specification of such article or process and includes (i) any standard recognized by the Bureau under clause (b) of section 10; and (ii) any standard establishe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Standards Institution Certification Mark specified by the Indian Standards Institution. 23] Then, Mr. Nankani has relied upon section 11 and to urge that no person shall use, in relation to any article or process, or in the title of any patent, or any trade mark or design the Standard Mark or any colourable imitation thereof, except under a licence. 24] Mr. Nankani has also invited our attention to section 14 of this Act which reads as under: 14. Compulsory use of Standard Mark for articles and processes to certain scheduled industries. If the Central Government, after consulting the Bureau, is of the opinion that it is necessary or expedient so to do, in the public interest, it may, by order published in the Official Gazette, a. notify any article or process of any scheduled industry which shall conform to the Indian Standard; and b. direct the use of the Standard Mark under a licence as compulsory on such article or process. Explanation For the purposes of this section, the expression schedule industry shall have the meaning assigned to it in the Industries (Development and Regulation) Act, 1951(65 of 1951). 25] Then, we are required to refer to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... effect accordingly. [(4) without prejudice to anything contained in any other law, rule, regulation, notification or order, no permit or licence shall be necessary for import or export of any goods, nor any goods shall be prohibited for import or export except, as may be required under this Act, or rules or orders made thereunder.] 6. Appointment of Director General and his functions. (1) The Central Government may appoint any person to be the Director General of Foreign Trade for the purposes of this Act. (2) The Director General shall advise the Central Government in the formulation of the [foreign trade policy] and shall be responsible for carrying out that policy. (3) The Central Government may, by Order published in the Official Gazette, direct that any power exercisable by it under this Act (other than the powers under sections 3, 5, 15, 16 and 19) may also be exercised, in such cases and subject to such conditions, by the Director General or such other officer subordinate to the Director General, as may be specified in the Order. 27] Chapter III of this Act deals with the importer and exporter Code number and licence. That is to enable allotment and gra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (A) Mandatory Indian Standards of Bureau of Indian Standards (BIS) : Quality of the products that are subject to mandatory Indian Standards, as applicable to domestic goods, shall be required to comply with quality specified for the product as per same Indian Standards. For compliance of this requirement, all manufactures/exporters of these products to India, shall be required to obtain BIS license for using Standards mark on their product. The present list of 'Items under mandatory BIS certification' is given in AppendixIII of this Schedule. As and when BIS notifies the quality specifications for new product(s) as an Indian Standards, the said Indian Standards would deemed to be part of AppendixIII from the date of implementation of the said Indian Standards for the said product(s) and the import of that product(s) shall conform to that specified Indian Standard from the date of implementation as specified for the said product(s) by BIS. 31] It is in this context that the ITC (HS) classification of export and import items with customs tariff rates and exemptions have to be seen. Chapter 72 is entitled Iron and Steel . Steel, stainless steel, other alloy steel and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , 2012 the Commissioner of Customs (Imports), Chennai referred the matter to Bureau of Indian Standards for clarification. The Board also made a reference to Ministry of Steel to align the Steel Products Quality Control Order, 2012 with the correct CTH. In this regard, Ministry of Steel has informed that the Steel Products Quality Control Order, 2012 is strictly based on the relevant Indian Standard though ITC (HS) Code has been provided for reference purposes. This is also clarified in the Explanation to the said Steel Products Quality Control Order, 2012. Ministry of Steel has concluded that all products covered by the relevant Indian Standard fall under the said Steel Products Quality Control Order, 2012 and import of such products without BIS certification is in circumvention of the said Order. It is categorically confirmed that rebar/ TMT bar containing 0.0008% or more Boron falling under alloy steel category is covered by Indian Standard IS 1786 regardless of the ITC(HS) Code given in the said Steel Products Quality Control Order, 2012. Ministry of Steel has urged that imports circumventing the said Steel Products Quality Control Order, 2012 should stopped in view of their ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quality devised by the Board is to caution that no violation of the quality standards is permissible. We do not see how such a stand taken in the circular can be said to be violating the mandate of Article 14 of the Constitution of India. Chapter 72 of the ITC (HS) is dealing with Iron and Steel and contains Notes and Supplementary Notes. That is classification of Export and Import items with Customs Tariff Rates and Exemptions. The code is to facilitate ImportExport and referable to section 7 of the Foreign Trade (Development and Regulation) Act, 1992. 37] We are in agreement with Mr. Singh, learned Additional Solicitor General of India, that even imported goods and which are to be used in this case for construction industries should meet the standards of quality. Mr. Singh and Mr. Dada were right in contending that larger public interest is subserved by insisting on the imported goods complying with all the domestic laws. 38] We have perused all the relevant material. It is referred by us extensively hereinabove. It is brought on record by the Petitioners. We have not found anything either in the Foreign Trade (Development and Regulation) Act, 1992 or in the Import Policy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hall not affect operation of certain Acts. However, a perusal of section 40 would indicate that the operation of the Agricultural Produce (Grading and Marketing ) Act, 1937 or the Drugs and Cosmetics Act, 1940 or any other law for the time being in force, and which deals with any standard or quality control of any article or process alone is not affected by the Bureau of Standard Acts, 1986. 40] We do not find anything in the provisions and which are relied upon as indicative of the fact that the standards and which are devised so as to take care of the quality and specification of the article or process, do not facilitate foreign trade. The Foreign Trade (Development and Regulation) Act, 1992 or the Customs Act, 1962 cannot be construed so as to override the BIS Act, 1986 insofar as the prescription and devising of standards. If the Petitioners have imported goods which are of the description BIS 1786:2008, then, such goods meant for construction industries not having the BIS license and the imported goods not bearing the standard mark BIS, that the circular cautioning the customs officers and adjudicating authorities has been rightly issued by the Central Board of Excise and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... can also be exercised to prevent the contravention of any law for the time being in force or any other purpose conducive to the interest of the general public. In such circumstances, we are not in agreement with Mr. Nankani that the Board lacked the power to issue the impugned circular. 42] Similarly, we are not in agreement with Mr. Nankani that the ITC (HS) is code by itself. His argument overlooks the fact that the same is only to identify the goods which are permitted to be imported or exported. That is a code devised in terms of the Foreign Trade (Development and Regulation)Act, 1992 so as to identify the goods which are imported or exported. It is an importer or exporter code number which is essential. However, the act under which all this is devised itself clarifies that the Central Government may make a provision for prohibiting, restricting or otherwise regulating, in all cases or in specified classes of cases and subject to such exceptions, if any, as may be made by or under the order, the import or export of goods or services or technology. In relation to this aspect section 3 of the Foreign Trade (Development and Regulation) Act, 1992 needs to be noticed. That reads ..... X X X X Extracts X X X X X X X X Extracts X X X X
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