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TMI Blog2008 (8) TMI 44X X X X Extracts X X X X X X X X Extracts X X X X ..... se proceedings are as follows: In the year 1982, M/s Rashtriya Chemicals Fertilizers Limited (hereinafter referred to as `RCF'), a Government of India Undertaking, floated a global tender for supply of various types of capital goods required for its Thal project. Responding to the said tender notice, the appellant, a partnership firm, through its managing partner, Mr. Manohar M. Kulkarni, an ex-army man, submitted its quotation for supply of thermocouple compensating cables and extension cables. The tender was accepted by RCF and by a purchase order dated 13th October, 1982, they agreed to purchase cables worth Rs. 17,49,000/- from the appellant. 4. In order to avail of customs duty exemption on the import of certain raw materials required in the manufacture of capital goods to be supplied to RCF, on 22nd November, 1982, the appellant applied to the Joint Chief Controller of Imports Exports (for short `JCCI'), Bombay, for issuance of an import licence with duty exemption entitlement certificate etc. for import of raw materials free of duty or at a concessional rate of duty in terms of Import Policy Book for AM 83. According to the appellant, as they were not clear about the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ime to time. (e) In the event of failure to fulfil the export obligation within the time stipulated, the bond will be enforced and the licence holder shall pay customs duty on the proportionate quantity of the material corresponding to the products not exported." 6. The requisite Bond in terms of the aforementioned condition (b) was accordingly, executed on 17 th June, 1983. The appellant imported raw materials from time to time, aggregating to C.I.F. value of Rs.3,01,439/-, and cleared the same without payment of duty in terms of the Bond. It is not in dispute that the appellant has utilised entire quantity of the imported raw materials in the manufacture of resultant products, valued at Rs.17,59,382/-; supplied to RCF in order to fulfil export obligation, as stipulated in the licence, against the export obligation of Rs.17,49,000/-. 7. Having thus, fulfilled the export obligation, the appellant approached the project authority, viz. RCF, for requisite endorsement on Duty Exemption Entitlement Certificate (for short 'DEEC'). Initially RCF declined to make the endorsement, on the ground that the Thal Project was financed by the Government of India and not by organizatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) certificate of exports in original nor the original export documents were furnished by the appellant. Incidentally, the forfeiture order as well as the appellate order was passed by the same officer, namely, Smt. R. Johny, though the appellate order is purported to have been issued with the approval of JCCI. 10. Aggrieved thereby, the appellant preferred second appeal before a Committee of Joint Director General of Foreign Trade, New Delhi. 11. During the pendency of the second appeal, the customs authorities sought to recover customs duty amounting to Rs.3,71,614.82 from the appellant in respect of the raw materials imported and cleared without payment of duty under the Special Imprest Licence (SIL) dated 30 th May, 1983. The proposed action was challenged by the appellant by preferring Writ Petition No.2038 of 1988. However, when the petition was taken up for final hearing on 21 st October, 2002, counsel for the appellant volunteered to deposit the customs duty as demanded. Thereupon, counsel for the revenue made a statement that within two weeks of the deposit of the said amount, a proper show-cause notice shall be issued and the same would be adjudicated in accordan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce to execute the order. The appellate authority finally concluded thus: "The appellants may have mis-comprehended the policy in force. But, they did not object when the special imprest licence under reference was granted to them under the deemed export category with specific export obligation with reference to 100% duty free imports. Since they accepted the conditions of the licence and also executed a bond to abide by the conditions of the licence which carried an export obligation, it was incumbent on them to complete formalities in support of their contention of having discharged export obligation notwithstanding that the imported goods were utilised for the execution of the project. The project they executed or supplied they made towards the execution of the RCF, Thal Project was not a project falling under the category of deemed exports. This project was not aided by IDA/IBRD. Their request for conversion of their supplies to RCF, Thal Project in the deemed category of exports was duly considered by the competent authority in the Import Trade Control Organization. Under letter dated 30.10.1985, their request was not considered as the supplies made by them to RCF, Thal Proje ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Bond/bank guarantee executed by the appellant on 17 th June, 1983 shall not be enforced; and (b) within six weeks from the date of its order, JCCI, Bombay shall amend the Special Imprest Licence (SIL) into a licence which may entitle the appellant to seek regularisation of the imports already made under the said licence at concessional rate of duty, if permissible under the Customs Act. However, the High Court declined to grant appellant's prayer for Cash Compensatory Support, hereinafter referred to as CCS, permissible under the Special Imprest Licence (SIL). It is this part of the order which is impugned in the present appeal. 16. Mr. M.M. Kulkarni, a partner of the appellant-firm, sought permission to argue the case on behalf of the appellant on the ground that on account of several rounds of litigation, spanning over two decades, because of erroneous licence issued by the licensing authorities, the firm had closed down and, therefore, did not have the financial capacity to engage the services of a lawyer. We granted the permission and heard him at some length. 17. At this juncture, it will be relevant to note that during the course of hearing on 23 rd January, 2008 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntion cannot be hold good since Part 'F' of DEEC Part II merely bears the information of invoice no. date, description of supplied items, quantity and FOR value thereof. But it has nothing to do with the source of finance of the project. In fact, the supplies were financed by Govt. of India Fund; therefore, this supply does not fall under para 131 of Hand Book of Procedure, as such, not eligible for CCS benefit to the extent of Rs. 1,31,953/ Regarding additional claim of Rs.14,478/- raised by you vide your letter dated 31.3.08, it is to inform you that this claim was not originally included in the writ petition No.1174/03 field before the Hon'ble High Court of Bombay, which is a subject matter of SLP No.16917/2003 filed before the Hon'ble Supreme Court of India. Even this claim is not supported by the required documents, therefore, your additional claim of CCS cannot be considered. Regarding payment of interest, it is hereby informed that the debarring order was in force and maintained by the Appellate Authority vide their Order dated 18.6.1992. It was in force upto 27.2.2008 i.e. till the date of Order of the Hon'ble Supreme Court of India in respect of SLP No.16917/2003. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... first time in April, 2003, when W.P. No.1174/2003 was filed, the order of forfeiture cannot be said to be mala fide inasmuch as, way back on 30 th October, 1985, i.e. prior to the forfeiture order, the appellant was advised to get their import regularised by approaching the Ministry of Finance by paying customs duty with penal interest but the appellant did not heed to the advice of the respondents. 22. It is trite that no man should suffer a wrong by technical procedure of irregularities. The Rules or procedures are the handmaids of justice and not the mistress of the justice. Ex debito justitiae, we must do justice to him. (Vide A.R. Antulay Vs. R.S. Nayak). However, in the present case, although we feel that the appellant has suffered on account of confusion in the nature of the licence to be issued to it but appellant's main prayer for conversion of Special Imprest Licence into a Project Import Licence having been granted by the High Court, the wrong caused stands remedied to a large extent. 23. Having considered the matter in the light of the afore-noted subsequent intervening events, in particular the conversion of Special Imprest Licence into Project Import Licence, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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