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TMI Blog1989 (3) TMI 399X X X X Extracts X X X X X X X X Extracts X X X X ..... acts as commission agents of foreign principals and is also an exporter of teas. The teas grown in various parts of West Bengal and Assam are sold in auctions in Calcutta by the Tea Auctioners like J. Thomas Co. Private Ltd. and Caritt Moran Co. Private Ltd. conducted under the auspices of the Calcutta Tea Traders Association. A show-cause notice was issued, which is Annexure J to the petition. The show-cause notice states as follows:-- No. S5-(Gr. IV-10/75E Dated 30-4-75 From: Asstt Collector of Customs, for Export Custom House, Calcutta. To: M/s. A. Tosh Sons Pvt. Ltd. P-32 33 Indian Exchange Place, Calcutta. Sub: Misdeclaration of value contravention of the provisions of Customs Act, 62 FERA, 1973 -- Notice to Show Cause. M/s. A. Tosh Sons submitted a shipping bill which serially numbered 2723 on 11-4-75 for shipment of 20 chests containing 876.6 Kg. of tea to M/s. Paul Schrader Co., West Germany under a telegram dated 4-4-75 in lieu of contract. The telegram shows the contract prices quoted by the foreign buyer for sample Nos. 26 and 42 @ ₹ 50 per kg. and for sample No. 45 @ ₹ 60 per kg. But the exporter confirmed the price at a muc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oms Act 1962 and why penal action should not be taken against them under Section' 114 of the Customs Act 1962. Their written explanation should be addressed to the undersigned within the period mentioned above along with the documentary evidence in support of their reply, Sd/- Asstt. Collector of Customs (Export (I).) The petitioner replied to the said show-cause notice. By an order dated 12th May 1975 the Asstt. Collector of Customs Export I allowed the petitioner to export the goods at the price offered by the foreign buyer i.e. the so-called bid price and not the price quoted by them in the shipping bill. They were warned to be careful in future. Being aggrieved by the said order the petitioner preferred an appeal and by the appellate order dated 28th May 1975 the Assistant Collector of Customs set aside the original adjudication order and remanded back the case. Thereafter the matter was heard again and a fresh order of adjudication was passed. After setting out the background of this case the Assistant Collector of Customs for Export I passed the following orders:-- The adjudication of the case was accordingly reopened de novo. In the de novo proceedings, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -4-75 produced in the Custom House along with shipping bill in lieu of a contract, for the sale does not indicate that prices quoted in the same are bid prices for each lot of teas mentioned therein. Therefore, the arguments put forward by exporter's Advocate that 'bid' price is not contractual price is not relevant in this case. Contract is a document asked by the Custom House assessing Officers to be produced in connection with scrutiny of an export consignment as an evidence showing buyers' willingness to buy goods at an agreed price. It is examined for satisfaction of the assessing officer for the purpose that price declared in the shipping bill is correct as per buyers' agreement which is deemed to be the maximum bargain price of the goods mentioned therein. Foreign buyers offer price of any goods, if it reasonably covers the domestic value of the goods plus exporter's profit and cost of charges for shipment, and if that price is fairly competitive in relation to offers made for the said goods by other buyers in that buying country or the quoted price is in conformity with the prevailing market condition in the said country such price is considered t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... full export value on the GRI and as such teas are liable to confiscation under Section 113(d) and (i) of the Customs Act 1962. I further hold that the exporters are also liable to penal action under Section 114 ibid. ORDER However, having regard to the circumstances of the case and the fact that they are a firm of considerable reputation and there is no antecedent of their commission of under-invoicing in the past, I take a lenient view in this case. I order that the teas in the subject consignment, be allowed shipment at prices offered by foreign buyer in their telegram dated 4-4-75 received in Calcutta on 5-4-75 and not at the prices declared in the invoice and the S/Bill. The exporters, M/s. A. Tosh Sons Pvt. Ltd. are cautioned to be careful in future. Sd/- Asstt. Collector of Customs for Export (I) Copy forwarded to M/s. A. Tosh Sons Pvt. Ltd. for information. Sd/- Assistant Collector of Customs for Export (I). 3. Being aggrieved by the said order this application under Article 226 has been made. Upon such application being made on the 12th June 1975 this rule nisi was issued. Mr. B. C. Dutt, learned Advocate for the petitioner has made the foll ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irectly to any place so specified unless a declaration supported by such evidence as may be prescribed or so specified, is furnished by the exporter to the prescribed authority that the amount representing the full export value of the goods has been, or will within the prescribed period be paid in the prescribed manner. 5. The decision of the Supreme Court in Union of India v. Shreeram Durga Prasad Pvt. Ltd. (supra) was under Section 12 (1) of the 1947 Act before its amendment. After such decision an Ordinance was promulgated whereby Section 12 of the 1948 Act was substituted by introduction of the following provisions. This was later replaced by an amending Act. 12 (1). The Central Government may, by notification in the Official Gazette, prohibit the taking or sending out by land, sea or air (hereinafter in this section referred to as export) of all goods or of any goods specified in the notification from India directly or indirectly to any place so specified unless the exporter furnishes to the prescribed authority a declaration in the prescribed form supported by such evidence as may be prescribed or so specified and true in all material particulars which, among others, s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bank by the exporter in this behalf, authorise or permit or allow or in any manner be a party to, the sale of such goods for a value less than that declared: Provided that no permission shall be refused by the Reserve Bank under this clause unless the exporter has been given a reasonable opportunity for making a representation in the matter: Provided further that where the exporter makes an application to the Reserve Bank for permission under this clause and the Reserve Bank does not, within a period of twenty days from the date of receipt of the application, communicate to the exporter that permission applied for has been refused, it shall be presumed that the Reserve Bank has granted such permission. Explanation-- In computing the period of twenty days for the purposes of the second proviso, the period, if any, taken by the Reserve Bank for giving an opportunity to the exporter for making a representation under the first proviso shall be excluded. 7. I shall take up the first contention of Mr. Dutt first. The whole question is what is the export value of the goods. In order to ascertain the export value of the goods the adjudicating officer has relied on various fact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r such order, it would have come to some other conclusion. Appraisement of evidence is not permissible in a Writ Jurisdiction. In that view of the same I reject this contention of Mr. Dutt. 9. The next question is whether there has been a violation of Section 18(1) of FERA 1973. I have already quoted the relevant section in this connection. The Supreme Court's decisions are based on the original Section 12 (1) under the old Act which is quoted above. The Supreme Court came to its conclusion on the basis of such section as it then stood. It was pointed out in the majority of the decisions of the Supreme Court that there was no such violation. The Supreme Court pointed out that the only question that arose for decision in those appeals was whether on the facts set out in the show cause notices, which facts have to be assumed to be correct for the purpose of the proceedings, the respondents can be held to have contravened Section 12 (1) as it then stood. The Supreme Court pointed out that admittedly the stipulated declarations in the prescribed forms have been furnished. The evidence specified has also been given. Therefore prima facie there was no contravention of Section 12 ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not require that the particulars given in the declaration must be true and correct in all respects and the requirement of the said section therefore will have to be given even if the particulars of declaration were incorrect. In my opinion it cannot be said that the decision of the Supreme Court in Rai Bahadur Sri Ram Durga Prasad's case is still applicable after the amendment or after 1973 Act. As rightly pointed out by the Division Bench of this Court the old Section 12 (1) prior to the amendment did not require that particulars given in the declaration must be true and correct in all respects. After the amendment and particularly after the 1973 Act came into force, under which the present show-cause notice has been issued, once it is held that the particulars given in the declaration are not true or correct in all respects immediately Section 18 is attracted and there is a violation of the said Act. In the present case the finding of the adjudicating officer is to the effect that there has been under-invoicing. It automatically attracts the provisions of Section 18 because in that event the declaration furnished was not true in all respects and accordingly it must be held th ..... 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