Bombay High Court
Fakirchand M. Shah vs Union Of India And Others on 1 December, 1983
Equivalent citations: 1985(20)ELT38(BOM)
JUDGMENT
1. The petitioner is carrying business as a wholesaler and retailer in engines and parts thereof in the firm name and style of M/s. Honesty Trading Corporation as the sole proprietor. The petitioner is an 'established importer', within the meaning of Imports and Exports Control Act, 1947 and Imports (Control) Order, 1955. The petitioner, as an established importer, was granted quota certificated by the Government of India and on the strength of the same, the petitioner secured from time to time import licences and quota certificates enabling him to import into Indian various goods in accordance with the policy laid down by the Government. The petitioner was holding eleven quota certificates of the aggregate value of Rs. 8,38,451/- in the year 1977. The quota certificates were for import of items covered under Serial Nos. 293, 295 and 297 of Part IV, Section IV of Import Trade Control Policy for the year April 1976 - March, 1977. The subject under these three items was 'Motor Vehicle Parts'.
2. The Import Trade Control Policy for the period commencing from April 1977 to March 1978 grouped items of motor vehicle parts under the heading 'Chassis fitted with engines, bodies (including cabs) and parts and accessories of the motor vehicles falling within Heading Nos. 87.01, 87.02 or 87.03'. The various items under this heading were given Serial No. 87.04/06 under the I.T.C. of April 1977 and it reads as under :
------------------------------------------------------------------------
RITC Description Import Remarks No. Policy
------------------------------------------------------------------------
(1) (2) (3) (4)
------------------------------------------------------------------------
87.04/06 Chassis fitted with engines, bodies (including cabs) and parts and accessories of the motor vehicles falling within Heading Nos. 87.01, 87.02 or 87.03.
(1) Motor Vehicle 10% Detailed policy for
Parts. these items is given
in Appendix 26.
(2) Spare parts for crawler/ 50% (1) Spare parts of
Agricultural tractors crawler tractors
and for tractor drawn falling under
agricultural implements Heading No.
(Sl. No. 74(iii)/V of Old 87.01 will be
ITC Schedule). permitted, for
import against
quota licences
for Heading No.
87.04/06(2).
(2) Import of items
mentioned in
Appendix 4-D,
Part I will be
permitted up
to the face value
limits indicated
against them.
(3) Licences will not
be valid for
import of spare
parts of crawlers
and agricultural
tractors and for
tractor drawn
agricultural
implements
mentioned in
Appendix 4-D,
Part II.
(4) Import of banned
types of ball,
roller tapered,
roller and needle
roller bearings,
bushes, cages,
needle roller
assemblies
mentioned in
Appendix 14 and
rollers/needle
rollers mentioned
in remarks column
against Heading
84.62(5) will not
be allowed as
spares or as
CKD parts.
(5) Import of any
types of
agricultural
steel disc will
not be permitted.
(6) Parts of
Hydraulic Lifts
which form an in
integral built up
mechanism of
tractors will be
classified as
spare parts
of the tractors.
(7) Quota licences
will not also be
valid for the
import of items
mentioned in List
I of Appendix 26.
Items mentioned
in List II of
Appendix 26 will
be allowed for
import only to
parts inter-
changeable with
motor vehicle
parts falling
under Heading
87.04/06 (Sl. No.
293, 295 and
297/IV of old
I.T.C. Schedule)
which are not
specified in List
'D' of Appendix 4
in respect of
which the policy
indicated therein
will apply.
------------------------------------------------------------------------
3. On September 24, 1977, the petitioner made an application to the Joint Chief Controller of Imports and Exports, Licensing Section, Bombay, for grant of licence for import of spare parts for Crawler/Agricultural tractors and for tractor drawn agricultural implements under Item No. 87.04/06(2) of Import Trade Control Policy of April 1977 to March 1978. The application was rejected by communication dated March 23, 1978 on the ground that the petitioner has failed to produce quota certificate for revised I.T.C. No. 87.04/06(2). The petitioner carried an appeal before the Controller of Imports and Exports, New Delhi, and the appeal ended in dismissal by communication dated October 19, 1978. The two reasons given for rejection of the appeal are as follows :
(1) the petitioner has failed to furnish quota certificates for items supplied for, and the quota certificates furnished were for different items than that of the items supplied for; and (2) there is no provision for established importers during A-M-79 period.
The petitioner preferred revision application against this order before the Ministry of Commerce, Civil Supplies and Co-operation, but by communication dated February 21, 1979, the petitioner was informed that the decision already communicated by the Joint Chief Controller of Imports and Exports, Bombay cannot be revised. The petitioner has thereafter approached this Court by filing this petition under Article 226 of the Constitution of India.
4. Shri Desai, learned counsel appearing on behalf of the petitioner, raised two contentions to claim that the petitioner is entitled to the grant of licence for importing spare parts of crawler/agricultural tractors and for tractor drawn agricultural implements. The first submission of the learned counsel is that though the quota certificate obtained by the petitioners were for an item of motor vehicle parts, in accordance with the Import Policy of April 1976 - March 1977, as the said subject was included in the Import Policy of April, 1977 - March 1978 under the Heading "Chassis fitted with engines, bodies (including cabs) and parts and accessories of the motor vehicles falling within Heading Nos. 87.01, 87.02 or 87.03", the petitioner is entitled to the grant of licence for any item covered under this heading. As set our hereinabove, under heading covered by Item 87.04/06 are two sub-items (1) Motor Vehicle Parts and (2) Spare Parts for Crawler/Agricultural tractors and for tractor drawn agricultural implements (Sl. No. 74(iii)/V of old ITC Schedule), while items of Motor Vehicle Parts were under Serial Nos. 293, 294 and 297 of Part IV of old ITC Schedule. The submission of Shri Desai is that these two items, which were under two different headings under the old ITC Schedule, were grouped together in the ITC Schedule of April 1977 - March 1978 and therefore, it open for the petitioner to claim that he is entitled to import either of the items covered under the new heading in the new ITC Schedule. It is impossible to accede to this submission. What the Government had done is to include various items under one heading, but the identity of the subject or item is not extinguished, but on the other hand, it is retained. Various items are grouped under one heading as a matter of convenience and it is impossible to conclude from this fact that the person holding an import quota certificate in respect of one item can claim licence in respect of other item. Shri Desai relied upon certain observation in the preface to the Import Policy of April 1977 - March 1978, and claimed that the Government's policy was to liberalise and simplify the import of the goods. Paragraph 8 of the preface reads as under :
"Presentation of the policy in this book is different from earlier books in certain respects. The presentation in Section II relating to policy for individual items has been completely revised in order to adopt the revised ITC classification based on BTN classification. Various appendices have been re-arranged. Their number has been reduced from 90 to 57. Some of the important appendices appear with different numbers in this book. For instance, the old Appendix 80 appears as Appendix 3 and the old Appendix 74 appears as Appendix 55 in this book. We would suggest that importers should study this volume carefully so that they can take full advantage of the liberalised and simplified policy. A new edition of the Import Trade Control Hand Book of Rules and Procedure has been issued separately."
It is difficult to appreciate how the contents of this paragraph would substantiate the claim of Shri Desai that the grouping of various items under one heading was done with a view to enable the importer to seek a licence under any of the items. There is also intrinsic evidence in the Entry itself to indicate that the petitioner, who was holding import quota certificate for motor vehicle parts cannot import spare parts of crawler/agricultural tractors. Against item of motor vehicle parts is a note that detailed policy for these items is given in Appendix 26 and turning to Appendix 26, paragraph 4 provides that quota licence issued for import of motor vehicle parts will also be valid for import of the undermentioned items up the percentage indicated against each :
(i) Ball, Roller and Tapered Roller and needle roller bearings, bushes, cages, needle roller assemblies and needle rollers other than those banned for import. ... 3%
(ii) Bolts, nuts, screws, spacers and washers (except Bi-metallic Thrust Washers). ... 3%
(iii) Garage tools detailed in Appendix 10 of this book and parts thereof. ... 4% Paragraph 10 of this Appendix 26 provides that the licences issued for RITC Serial No. 87.04/06 will not be valid for the import of certain items. Reading these two paragraphs together, it does appear that the Government policy or the intention of the Government was that the quota licence issued for import of motor vehicle parts is valid only for motor vehicle parts and not other items, like spare parts of crawler and agricultural tractors. In my judgement, the claim of the petitioner that he is entitled to grant of licence for crawler/agricultural tractors although the quota certificate issued to him was only for motor vehicle parts cannot be accepted. Shri Desai tried to draw support by pointing out certain other entries in Import Trade Control of April 1977, but it is impossible to draw any favourable conclusion in favour of the petitioner by reading some other entries. In my judgement, the claim of the petitioner on this count has no substance.
5. The second contention urged by Shri Desai is that the Department did work out the Import Policy of April 1977 - March 1978 in accordance with the interpretation which the petitioner desires to put on the said Policy. In support of the submission, it was urged that the petitioner was holding quota certificate under Serial No. 30(f)/II of old ITC Schedule for spare parts of diesel engines other than spares for diesel engines for vehicles, such as motor vehicles, tractors, earthmoving machinery, etc. The petitioner, on the strength of this quota certificate, applied for the licence on September 24, 1977 for import of parts of petrol, gas and kerosene engines. Parts of gas, petrol and kerosene engines were covered under Serial No. 31(b)/II of old ITC Schedule. Now these two items, that is spares of diesel engines and parts of petrol, gas and kerosene engines were clubbed together under a new ITC Schedule under the heading 'Internal combustion piston engines' at Serial No. 84.06. The learned counsel urged that the Department by interpreting the import policy to mean that the importer would be entitled to secure the licence for any of the items covered under the heading 'internal combustion piston engines' granted the licence to the petitioner for import of parts of petrol, gas and kerosene engines. It was urged that this action on the part of the Department would establish that the Department has also understood the new import policy of April 1977 to mean that the importer is entitled to apply for licence for any of the items falling under a particular heading. In answer to this submission, Shri R. V. Desai, learned counsel appearing on behalf of the respondents, relied upon the averments in paragraph 6 of the return dated February 7, 1980 filed by Shri G. R. Nair, Deputy Chief Controller of Imports and Exports, Bombay. The respondents claim that the licence was granted to the petitioner due to mistake or inadvertence of the officer concerned and such a mistake or inadvertence, in respect of an individual, cannot be a reason for falsely presuming that the import policy has been liberalised or changed to allow quota licences to the established importers for items for which they hold no valid quota certificate at all. It is obvious from the contents of this return that the licence granted to the petitioner for import of parts of petrol, gas and kerosene engines was clearly contrary to the Import Policy. The mistake committed by the Department in that connection cannot be used for securing the import for import of spare parts of crawlers/agricultural tractors. In my judgement, the claim of the petitioner based on the mistake of the Department cannot be sustained in this writ petition.
6. Accordingly, petition fails and the rule is discharged, but there will be no order as to costs.