Madras High Court
Vijaya Industrial Products (P) Ltd. vs Union Of India on 27 October, 1994
Equivalent citations: 1995(76)ELT531(MAD)
ORDER
1. The petitioner, in the affidavit filed in support of the writ petition, claims that they proposed to the establish a Nylon Monofilament Fishnet Twine at Cuddalore and for that purpose, they needed a plant called "Nylon Monofilament Extrusion Plant" not manufactured in India and approached the Government of India for the grant of an import licence for importing the said plant. Taking note of the fact that the machinery in question was not manufactured in India, the Government of India granted an import licence on 4-9-1990 to import the Plant. It is also claimed that the petitioner established a letter of credit with the suppliers in Japan for a value of Rs. 36 Million Japanese Yen, equivalent to about 1.10 crores (c.i.f. value) and the consignment landed in the Madras Port Trust in February, 1993. It is further claimed that due to reasons beyond the petitioner, the plant could not be cleared resulting in heavy damages to the petitioner. The petitioner when approached the authorities, they were called upon to pay the duty at the market rate instead of the official rates not to the satisfaction of the petitioner. The case of the petitioner was that the item imported by them fell under Chapter 84 in general and Item referable to 84.44 in particular, and that in terms of the provisions contained in the Tariff Act read with Exemption Notification No. 59/87 issued under Section 25 of the Customs Act, the duty leviable in respect of the goods imported by them was only 35%. Their claim also is that the whole of the additional duty leviable under Section 3 of the Customs Tariff Act was exempted in respect of all the goods falling under Chapter 84 or 85. This exemption was claimed on the basis of the statements said to have been made by the Hon'ble Finance Minister. Union of India, while presenting in Parliament the budget for the year 1994-95. At the same time, it is stated that by mistake or by oversight, the assurance or the statement of the Finance Minister was not effectively carried out while issuing the amendment to the Notification No. 59/87 and taking advantage of the statement during the Budget speech alone the exemption is claimed not-withstanding the infirmity alleged in the consequent exemption notification issued in this regard.
2. On an earlier occasion, when the petitioner approached this Court by filing Writ Petition No. 12635 of 1994 for a writ of mandamus, Shivaraj Patil, J. by an order dated 25-7-1994 rejected the said writ petition even at the stage of admission, giving certain liberties and also directions to the authorities for considering the claims in the light of the directions made therein. It is thereupon the impugned proceedings dated 31-8-1994 appear to have been passed by the second respondent. The liability of the petitioner as a consequence of the impugned order is with reference to the payment of basic duty, the additional or countervailing duty and the difference in rate of exchange to be applied in computing the value for assessment of the basic duty. The second respondent, by the impugned order, overruled the objections and representations of the petitioner including the plea for waiver of duty chargeable.
3. Mr. R. Krishnamoorthy, learned Advocate General appearing for the petitioner, while reiterating the stand taken for the petitioner, submitted that though the liability to pay the basic duty as claimed cannot be seriously disputed by the petitioner, the conclusions of the second respondent with reference to the rate of exchange to be applied in computing the value for assessment of duty is contrary to law. It is the contention on behalf of the petitioner that having regard to Section 14(1) of the Customs Act, 1962, hereinafter referred to as 'the Act' and the proviso thereto and Section 15 of the Act, the assessment should be at the rate of exchange prevailing on the date of presenting the Bill of Entry and not any subsequent date and that the action of the second respondent in adopting an enhanced rate of exchange prevailing as on 1-7-1994 as against the rates prevailing as on 30-6-1994 on which date the Bill Entry was presented and saddling the petitioner with an additional sum of Rs. 3,49,056/- is liable to be set aside. As for the additional or countervailing duty, the plea on behalf of the petitioner is that the sum of Rs. 15,06,213/- was not leviable in view of the statement said to have been made by the Hon'ble Minister for Finance of the Government of India during the Budget speech as noticed supra and that the demand of the said amount also from the petitioner is liable to be set aside.
4. The respondents have filed a counter affidavit. In the counter affidavit, an objection is taken on the ground that the petitioner has an effective alternative remedy by way of an appeal under Section 128 of the Act and that, therefore, this Court ought not to interfere in the matter at the instance of the petitioner. On merits, the counter affidavit adopts the stand taken by the second respondent in the impugned order and justifies the action of the second respondent. As for the plea with reference to the rate of exchange to be applied for computing the value to assess the duty, it is stated for the respondents, that the Bill Entry bearing No. 27270 was filed with the Customs Department for admission only on 30-6-1994, after a long delay from the date of landing of the goods in February, 1993, that the petitioner/their clearing agents did not furnish in the said Bill of Entry, a very essential detail, namely the Importer Code number and when the Bill of Entry was fed into the Computer on 30-6-1994, it was not accepted and only on the clearing agents furnishing the necessary details relating to the import code on 1-7-1994, the same was admitted by the Import Manifest Department. It is also claimed that while filing the Bill of Entry on 30-6-1994, the Certificate issued by the Licensing Authority was not furnished and that also was submitted only on 1-7-1994 and, therefore, the petitioner's Bill of Entry was assessed to duty under the Customs Tariff Heading No. 84/44 at 25% in terms of the Customs Notification No. 61/94 and countervailing duty at 10% and since the Bill of Entry was for the purpose of the Act, presented only on 1-7-1994, the rate of exchange prevailing on 1-7-1994 was adopted or applied. It is contended that the presentation of a Bill of Entry can only mean the presentation of valid Bill of Entry complete in all respects. As for the countervailing or additional duty, it is stated that no right flows to the petitioner or any importer for that matter on the mere statement or assurance made or given by the Finance Minister, be it on the Floor of the House of Parliament and unless due effect is given in the legal form to the same, the petitioner is not entitled to or base any right on such statements and cannot claim legitimately exemption from the additional or countervailing duty. Reliance is placed on Notification No. 61/94 and Notification No. 99/94. Mr. Sundaram, learned Standing Counsel appearing for the respondent-department while reiterating the above stand in the counter affidavit also, contended that the Bill of Entry obliged to be presented in the prescribed form must be such as capable of being acted upon and action taken pursuant thereto and if the presentation was such and also defective that no action thereon could be taken it should be considered as though there had been no presentation of the Bill of Entry in the prescribed form on the date of such defective presentation.
5. The learned Standing Counsel for the respondent-department also relied upon two decisions, one is of the Supreme Court and the another is of this Court reported in 1993 (65) E.L.T. 465 (S.C.) [B.K. Industries v. Union of India] and 1991 (56) E.L.T. 22 [Sulochana Enterprises (P) Ltd. v. Union of India] of a single Judge of this Court. In the decision of the Supreme Court referred to above, it has been held that the Finance Minister's Speech is not law and exemption cannot be claimed merely on the strength of a statement made by the Finance Minister in the Budget Speech. In the Judgment of the learned single Judge of this Court it was held that a Budget Speech can neither constitute law nor operate as an estoppel to constitute promissory estoppel against the State.
6. I have carefully considered the submissions of the learned counsel appearing on either side. The plea and objection of availability of alternative remedy, in my view, will not help the respondents in this case to object to this Court countenancing the writ petition for consideration. The Appellate or Revisional Authorities exercising jurisdiction under the Act are, strictly bound by the provisions of the Act and the Rules as well as the Notifications issued under the Act and cannot entertain for consideration the claims of the nature based upon equitable or promissory estoppel against the State for granting relief even in the absence of any specific provision or countenance of a plea of promissory estoppel against the department even in the teeth of a notification to the contra and consideration of such plea may not be permissible before the Statutory Authorities bound by the specific provisions contained in the Act, rules or any notification issued thereunder. Consequently, it cannot be said that in this case, this Court has to reject the writ petition referring the petitioner to have recourse to the alternative remedy under the Act. In the light of the above, I have heard extensive and detailed arguments made by the learned counsel appearing on either side.
7. As for the difference in the rate of exchange applied to the case on hand as prevailing on 1-7-1994, the same has been objected to relying upon Sections 14, 15 and 46 of the Act. Section 14 which provides for valuation of goods for purpose of assessment of duty under the Act stipulates in proviso to sub-section (1) of Section 14 of the Act that price shall be calculated with reference to the rate of exchange as in force on the date on which a Bill of Entry is presented under Section 46, or a shipping bill or bill of export, as the case may be, is presented under Section 50. Section 46 of the Act provides that the importer of any goods, other than goods intended for transit or transhipment, shall make entry thereof by presenting to the proper officer a Bill of Entry for home consumption or warehousing in the prescribed form. The other provisions of the Act stipulate the procedure to be followed or complied with in the matter of such presentation of the Bill of Entry and the fact that the Bill of Entry is to be made "in the prescribed form" and that too for the purpose of making entry for the home consumption or warehousing cannot be completely lost sight of. Section 15 of the Act which stipulates about the date for determination of rate of duty and tariff valuation provides that the rate of duty and tariff valuation applicable to any imported goods shall be the rate and valuation in force, in the case of goods entered for home consumption under Section 46, on the date on which a Bill of Entry in respect of such goods is presented under that section. A combined reading of the above provisions would, in my view, lead to an inescapable conclusion that the presentation of the Bill of Entry in the prescribed form and not in any different format or in any other ordinary manner, would suffice to confer a right on the importer to have the tariff valuation and rate of duty, as in force on the date of presenting such a Bill of Entry under Section 46 assessed and determined with reference to the date of such presentation and not as on any subsequent or further date. The stipulation in Section 46 pertaining to the persentation of the Bill of Entry is confined to it being merely in the prescribed form and not necessarily with all and every one of the particulars and particularly complete in all respects and more so with accuracy of the information given. The mere fact that any one information in the prescribed form is not furnished or any defective or incorrect informations is furnished, for any reason whatsoever, is no disentitling or disqualifying factor to outright reject or condemn the Bill of Entry presented otherwise in the proscribed form or to treat the same as one not presented on the actual date of its presentation as such. In this case, indisputably the Importer's Code number alone has not been given and I am of the view that the lapse or omission in this regard will not in any manner detract the Bill of Entry presented, the credibility of it being the Bill of Entry presented in the prescribed form or the fact that it has been for all purposes of the Act presented on 30-6-1994. The fact that the information relating to the Importer's Code number was furnished only on the next date will not, in my view, make the Bill of Entry one presented on the next day only. The plea on behalf of the petitioner that if the department could not act upon a Bill of Entry presented with any deficit information, it should be considered as though it has not been presented at all in the prescribed form on the date of its actual presentation, is too wide a plea or proposition which cannot be countenanced, having regard to the object and purpose of the filing of the Bill of Entry as also the specific provisions contained in Sections 14 and 15 to which a reference has already been made. If only the object or the intention of the Legislature was such, as is sought to be projected for the respondents, the provisions contained in Sections 14 and 15 of the Act would have been altogether different and be otherwise referable to the date on which action could be taken, unlike the actual stipulation contained in these provisions which have reference and relation to only the actual date of presentation of the Bill of Entry in the prescribed form. In this case, as noticed earlier, the mere absence of detail or omission in furnishing the Importer's Code number alone is no ground to treat the said Bill of Entry really presented on 30-6-1994 as one not presented in the prescribed form on the said date of its factual and actual presentation. Consequently, the application of the exchange rates prevailing as on 1-7-1994 to the case on hand is contrary to law and wholly unsustainable and the same is liable to be rejected to this extent. The order of the second respondent in this regard deserves to be and it is hereby set aside.
8. As for the plea on behalf of the petitioner based on the issue of promissory estoppel or the claim for the exemption based merely on the basis of the Finance Minister's statement during the course of the Budget Speech, I am of the view that the stand taken for the Revenue in this case is well merited. It is by now a well settled proposition of law that the speech made by the Minister, be it on the Floor of the Legislature while presenting the Budget and declarations and announcements therein, is no law by itself which could be enforced in a court of law and that unless the same is followed up by proper implementation and acquires a legal recognition in the form of either a statutory provision or a statutory rule or a notification issued under any Statute, no right could be based or claimed upon such a statement alone. The two authorities referred to supra relied upon by the learned counsel for the Revenue would squarely fortify such a position. The contentions to the contrary on behalf of the petitioner, therefore, shall stand rejected and the petitioner cannot avoid liability in respect of the additional or countervailing duty.
9. For the reasons stated above, the writ petition shall stand partly allowed only in respect of the levy of a sum of Rs. 3,49,056/- which represents the differential duty on account of adopting the rate of exchange as on 1-7-1994, and in other respects, the writ petition shall stand dismissed. No costs.