9911796707
TMI Blog2006 (1) TMI 145X X X X Extracts X X X X X X X X Extracts X X X X ..... stituted by the Directorate of Revenue Intelligence officers may in that above backdrop lead to the discovery of the true facts which would eventually lead to the issue of a show cause notice to which the petitioner can respond appropriately. Expression of any opinion by this Court at this stage would in that view be premature and would amount to pre-judging the issue which may arise at the appropriate stage in the context of the facts established in the course of the investigation. The issue of a certificate by the DGFT may also not be conclusive in such circumstances for any such certificate cannot circumscribe the power of the authority to reopen even a concluded matter if it is shown that such conclusion was vitiated by fraud, concealment of facts, misrepresentation or mis-declaration. Even here the respondents are investigating the alleged non fulfilment of the condition subject to which the goods had been imported. The on-going investigation cannot, therefore, be faulted on the ground of jurisdiction. There is no suggestion that the investigation is mala fide or actuated by a collateral purpose. If that be so, there is no reason why such an investigation should be scuttled by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nnounces the import export policy every five years. The said policies for the relevant years envisaged an EPCG Scheme, whereunder capital goods could be imported at a concessional customs duty of 5%, subject to an export obligation equivalent to five times of CIF value of such goods to be fulfilled by the importer over a period of 8 years reckoned from the date of the issue of the import license. It is common ground that the said Scheme permitted imports even by service providers like the petitioner company. 5.Taking advantage of the Scheme, the petitioner company appears to have imported seven luxury cars of BMW make. The petitioner's case is that the import of these cars was like other capital goods, subject to the condition that the petitioner fulfills the export obligation envisaged under the Scheme. Its further case is that the export obligation qua two of the cars imported by it had been fulfilled in recognition whereof the Director General of Foreign Trade (DGFT) had issued two discharge certificates dated 16th September, 2004 and 30th August, 2005, while the request for the issue of such a certificate in regard to the third car was pending consideration. 6.On 24th November, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was planning, according to Mr. Jaitley, to launch its own airlines by making investment of crores of rupees. Mr. Jaitley also attacked the demand for payment for differential duty, execution of bond and bank guarantees as a condition precedent for the release of the seized cars in favour of the petitioner and urged that the investigating officers could not ignore the certificate issued by the DGFT and act on an unfounded assumption that the goods had not been imported under the EPCG Scheme or that the condition subject to which such import was made had been violated. 9.On behalf of the respondents, Mr. P.P. Malhotra, learned Additional Solicitor General, argued that the import of capital goods under the Scheme including those by a service provider was, subject to the conditions stipulated under the Scheme. He urged, by reference to the Scheme as prevalent during the relevant period, that the export obligation equivalent to five times the CIF value of the imported goods had to be fulfilled by the petitioner-importer by use of the capital goods so imported. He contended that the Scheme envisaged the existence of a definite nexus between the import of the goods and their use for the f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Scheme in a particular fashion and certified due compliance with the conditions subject to which the imports were made, it is no longer open to any other agency of the Government to sit in judgment over the same, by either placing a different interpretation of the Scheme or otherwise. The interpretation sought, to be placed upon the terms of the Scheme by the officers of the Directorate of Revenue Intelligence is according to the petitioner even otherwise irrational. It was argued that the Scheme did not envisage fulfillment of the export obligation only by reference to the foreign exchange earnings by use of the capital goods. Mr. Jaitley gave the instance of a lift imported by a hotelier for installation in the hotel. He urged that it was impossible to determine the foreign exchange earnings out of the use of the lift once the same was installed for it would then be a part of the larger establishment which alone could generate foreign exchange receipts. Foreign exchange obligation could, therefore, be satisfied even if the capital goods were not themselves generating or capable of generating any foreign exchange. 11.The contrary view proceeds on the interpretation that goods ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es Act. There was, according to them an unauthorised diversion of goods contrary to the spirit of the Scheme, which could be investigated and made a basis for further action against the importer. The investigation instituted by the Directorate of Revenue Intelligence officers may in that above backdrop lead to the discovery of the true facts which would eventually lead to the issue of a show cause notice to which the petitioner can respond appropriately. Expression of any opinion by this Court at this stage would in that view be premature and would amount to pre-judging the issue which may arise at the appropriate stage in the context of the facts established in the course of the investigation. 13.That apart the power of this Court to interfere in the pending investigation is limited to cases where the investigation itself is incompetent or mala-fide. Such incompetence may arise out of any statutory bar to the institution of the proceedings or their continuance generally or by any particular authority. No such statutory bar has, however, been pointed out to us that could render the on-going investigation incompetent for want of jurisdiction. The issue of a certificate by the DGFT m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he ground of jurisdiction. 15.There is no suggestion that the investigation is mala fide or actuated by a collateral purpose. If that be so, there is no reason why such an investigation should be scuttled by interference in exercise of our extraordinary writ jurisdiction. The argument that the petitioner has a lofty plan for starting an airline which may get adversely affected by the pendency of the investigation can hardly be a reason for this Court to quash the proceedings. There is no gain saying that pendency of the investigation can never be seen as a verdict of guilt against the petitioner. It is, after all, an investigation which should be allowed to reach its logical conclusion. We have in that view no hesitation in rejecting the first limb of the petitioner's case. 16.Coming then to the question whether the seized cars should be released to the petitioner, we must in all fairness to Mr. Malhotra record that he did not seriously oppose the said prayer. All that Mr. Malhotra argued was that the interest of the revenue ought to be protected by stipulating appropriate conditions for release. We see no reason why that cannot be done to protect the interests of both the sides es ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
