Customs, Excise and Gold Tribunal - Tamil Nadu
Steel Authority Of India Ltd. vs Collector Of Customs on 24 July, 1987
Equivalent citations: 1988(15)ECC92, 1988ECR413(TRI.-CHENNAI), 1987(33)ELT363(TRI-CHENNAI)
ORDER S. Kalyanam, Member (J)
1. The above appeals are directed against the order of the Collector of Customs (Appeals), Madras dated 24-9-1986 confirming the order of the original authority namely, the Assistant Collector of Customs, Visakhapatnam dated 24-12-1985 and rejecting the appellant's refund claims. Since the above appeals arise out of a common impugned order relating to the same appellant, they are taken up together and disposed of by a single order.
2. The appellants filed claims for refund in respect of the duty paid on goods imported and covered by 11 Bills Entry referred to in the order of the original authority. The refund claims were made on the ground that the appellants would be entitled to concessional assessment under the Customs Tariff Schedule 84.66(1) of the Customs Tariff Act, 1975 and have paid in excess of the amount payable by them. The original authority rejected the appellants' refund claims of the ground that the goods imported were shipped between 7-5-1984 and 19-10-1984 after expiry of the validity period of the licence for the import of the same and, therefore, the appellants were disentitled to the concessional assessment in terms of the Project Imports (Registration of Contract) Regulations, 1965. The findings of the original authority were confirmed by the lower appellate authority under the impugned order as against which the appellants have come by way of appeals before us.
3. Shri Habibullah Badsha, the learned counsel for the appellants at the outset fairly conceded that refund claims covered by appeal Nos. 512, 513, 514, 515 and 516 of 1987 relating to goods respectively covered by the Bills of Lading Nos. 23310, 23309, 21659, 1405 and 45223, are not sustainable in law and, therefore, he would not press the same and would only confine himself to the other appeals. In respect of the claims covered by the other appeals the learned counsel inter alia contended that the authorities below have negatived the appellant's claim for concessional assessments in terms of Project Imports (Registration of Contract) Regulations, 1965 and consequential refund on the ground that the goods imported were shipped after the expiry of the licence period. The learned counsel assailed the correctness of this finding of the authorities below on the ground that in terms of para 208 of the Handbook of Import-Export Procedures, 1983-1984 the validity period of the licence will have to be considered in the light of the grace period of 60 days permissible thereunder in which case the licence will become valid till 30-6-1984 entitling the appellant to concessional assessment in respect of the Project Imports (Registration of Contract) Regulations, 1965. The learned counsel further submitted that this question with reference to validity of licence by applying the grace period was not gone into by the authorities below and considered on merits. It was urged that the CEGAT by Order dated 27-6-1986 in Customs Appeal No. 162/85 and Customs Appeal No. 213/85 upheld the order of the Additional Collector of Customs and gave a finding that the goods imported were in contravention of I.T.C. Regulations. The learned counsel submitted that CEGAT in the said decision did not address itself to the validity of the licence in question with reference to the applicability of the grace period as per law and as a matter of fact the appellants were not permitted to raise the plea. It was, therefore, urged that since the appellants were not permitted to raise a plea regarding the validity of the licence, by application of the grace period the issue was not considered at all under the Order of the CEGAT referred to supra and the authorities below should have therefore addressed themselves to that question and given a finding in favour of the appellants. The learned counsel further submitted that notwithstanding the fact that the CEGAT under the order referred to supra found that the import Was in contravention of law; the ruling has not reached a stage of finality; inasmuch as against the finding of the Tribunal, the appellants have gone before the High Court seeking a direction in terms of Section 130(3) of the Customs Act, 1962 ('the Act' for short) for reference. The learned counsel also pleaded that the appellant's claim also cannot be negatived on grounds of res judicata since the issue with reference to the validity of the licence by application of the grace period was not considered at all by the Tribunal under the order referred to above.
4. Shri K.K. Bhatia, the learned Senior Departmental Representative submitted that in respect of the import in question proceedings were instituted for contravention of the provisions of the Customs Act, 1962 by the Additional Collector of Customs, Visakhapatnam which eventually culminated in an order-in-appeal in Order No. 529/1986 and 530/86 dated 27-6-1986 resulting in an order of confiscation of the goods and a fine in lieu thereof and a personal penalty. Such a finding of the Tribunal has reached a stage of finality and the same cannot be now nullified indirectly by the appellant claiming the relief under the Project Imports (Registration of Contract) Regulations, 1965 as if the goods imported were covered by valid licence. The learned S.D.R. further submitted that the plea in regard to the validity of the licence with reference to the grace period was never urged by the appellant during the original adjudication proceedings of the Additional Collector of Customs, Visakhapatnam and the Tribunal, therefore, rightly did not allow the appellant to raise that issue. The learned S.D.R. further submitted that even in the present refund application the present plea in regard to the grace period has not been set out and no specific ground has also been taken before the lower appellate authority.
5. We have carefully considered the submissions made before us. The short question that is canvassed before us is with reference to the validity of the licence by application of the grace period for entitling the appellant to claim the benefit of concessional assessment in terms of Project Imports Regulation, 1965 and for a consequential refund in respect of the duty paid on the goods imported. We would like to state certain facts which are necessary for appreciating this question. In respect of the goods in question admittedly proceedings were instituted against the appellant by the Additional Collector of Customs, Visakhapatnam who in adjudication confiscated the goods imported and released the same on payment of a fine in lieu of confiscation besides a personal penalty under the Act. On appeal against the same, the Tribunal confirmed the findings of the adjudicating authority by its order dated 27-6-1986 in Order Nos. 529/86 & 530/86. As against the order of the Tribunal the appellants preferred a Reference Application which was also rejected. The Tribunal in the said order has referred to the plea of the party in regard to the grace period of the licence, and has observed, "...the plea of the import being during the grace period cannot be now raised by the appellants. It is strange that they had not adverted to this even while explaining that the licences had been sent for re-validation. In the circumstances the orders passed by the Additional Collector is correct in law."
This finding of the Tribunal has reached a stage of finality. The plea of the learned counsel that the issue in regard to the grace period for the licence in question has not been considered by the Tribunal and, therefore, the appellants would be entitled to agitate this question in a refund application without being barred by the principles of constructive res judicata is not well-founded in law. It is now a well-settled proposition of law that quasi-judicial authority is bound by the principles of constructive res judicata and the learned counsel did not dispute this proposition. Indeed this issue is also covered by a ruling of the Madras High Court in the case of 'S.P.S. Jayaram & Co. v. Assistant Collector of Central Excise (Preventive), Madurai', reported in 1987 (28) E.L.T. 20 (Mad). This Madras High Court in that ruling has adverted to the ruling of the Supreme Court reported in AIR 1970 SC 1498 in the case of 'Orient Paper Mills v. Union of India'. It is now fairly well-settled on principles of constructive res judicata that an adjudication is conclusive and final not only as to the actual matter determined but as to every other matter which the parties might and ought to have litigated and have had decided as incidental to, or essentially connected with, the subject-matter of the litigation and every matter coming within the legitimate purview of the original action both in respect of matters of claim or defence. Where a plaintiff might and ought to have urgbed a question in a former litigation, he would be estopped from raising the same question in a subsequent suit or other form of litigation. The Courts have gone to the extent of holding that a plea not raised owning to a wrong view of the law cannot be said to be one which could not have been raised. Where the facts are such that the party could have known them had he acted with due diligence he cannot plead ignorance as an excuse for not raising the point. In the present case as rightly contended by the learned S.D.R. the plea in regard to the grace period was never raised in the original adjudication proceedings before the Additional Collector of Customs, Visakhapatnam referred to supra. The issue was raised for the first time in appeal before the Tribunal and the same was negatived. Therefore, on application of the principles of constructive res judicata the order of the Tribunal should be held conclusive and final even in regard to the issue which the party might and ought to have litigated. We would also like to note in this context the fact that the plea in regard to the question of grace period was not put forth even in the refund claim before the original authority namely, the Assistant Collector of Customs, Visakhapatnam nor was it raised as a ground in the appeal before the lower appellate authority. To a specific question from the Bench in this regard the learned counsel for the appellant fairly conceded this but urged that even though it was neither pleaded before the original authority nor taken up as a ground before the lower appellate authority; subsequent to the personal hearing, in a letter addressed to the Collector (Appeals) giving the points to be considered in the appeal, this point was mentioned and it was also referred to in the order of the Collector (Appeals). We find from the letter in question that this has been included as an additional point, from which it appears that it was raised for the first time after the personal hearing was over. In any event, this point would not help the appellants because the import in question was found in contravention of law by a competent adjudicating authority culminating in an order in Appeal at the hands of the Tribunal which is the final appellate authority. As rightly contended by the learned S.D.R. the order of the Tribunal cannot be set at naught or nullified by the appellant by claiming the benefit of concessional assessment in terms of Project Imports (Registration of Contract) Regulations, 1965 and if the refund claims were to be allowed, it would virtually mean that the import in question was covered by a valid import licence and such a finding would be clearly in conflict with the earlier finding of the Tribunal and such a course would present an incongruous spectacle of two orders from the same authority in respect of the same issue mutually at variance with each other. Such a course apart from being not permissible is also inconceivable in law. The learned counsel for the appellants fervently pleaded that the issue relating to the validity of the licence by application of the grace period is a pure question of law and can, therefore, be urged at any time even if it is not pleaded. We are unable to countenance this plea of the counsel either. The real question is with reference to the factual particulars in the licence in regard to the date of licence and the period of expiry, the date of shipment, factual particulars in the Bill of Lading etc. for application of the grace period. In the absence of a specific plea in regard to the factual particulars with specific reference to the grace period the appellants cannot be permitted to raise the same as a question of law. In this context we would like to refer to the ratio decidendi of the ruling of the Supreme Court reported in the case of 'Lathia Industrial Supplies Co. Pvt. Ltd. v. Collector of Central Excise, Baroda', reported in 1987 (29) ELT 751 (SC), where the Supreme Court rejected the plea in regard to limitation on the ground that the same was not raised by the party in the earlier proceedings. For the reasons set out above, we are inclined to hold that the rejection of the refund claims of the appellants under the impugned order is clearly sustainable in law. In the result of the appeals are dismissed.