Bombay High Court
T.T. Blades vs Union Of India And Others on 5 February, 1986
Equivalent citations: 1986(9)ECC104, 1989(20)ECR485(BOMBAY), 1986(24)ELT231(BOM)
JUDGMENT
1. This petition has been filed and conducted in a most casual manner and Shri Shroff, learned counsel appearing on behalf of the petitioners, after arguing for 45 minutes yesterday evening, stated today that he had wasted the time of the Court as the facts stated by him were inaccurate and the documents shown to the Court were not correct.
2. Shri Shroff desired to tender a draft amendment when the petition was taken for hearing this morning and insisted that amendment should be granted accordingly. I declined to do so because amendment to the petition cannot be granted during the hearing of the petition and that too by merely tendering across the draft amendment. The petitioners should have taken care to take out Chamber Summons as prescribed by the Original Side Rules. It seems that the petitioners and the Advisers are under the impression that Rules are not made to be observed and they can throw anything at the Court whenever it is convenient to them. I declined to permit that course. Shri Shroff thereafter also stated that he had filed an affidavit before Mr. Justice Kurdukar before when the petition came up for hearing on January 6, 1986 and was adjourned. The Affidavit is not on record. Shri Shroff insisted that the copy of the affidavit should be read. I think it is improper to read the copy of the affidavit when the original is not on record and I am not sure that the statement that the original was tendered in Court is correct. Whatever it may be, it is necessary to deal with the petition on merits and I propose to do so.
3. The petitioners are a Partnership Firm and are engaged in the business of manufacturing and exporting razor blades. For the manufacture of the goods, the petitioners import as raw-materials stainless steel strips in coils and the import is made against actual users licences granted by the Import Control Authorities. In the year 1981, the petitioners imported steel coils and removed it to the Bonded Warehouse. The Bill of Entry was filed on September 17, 1982 for Ex-Bond Clearance for Home Consumption and the Customs Authorities assessed the duty at Rs. 3,25,330.85. The petitioners made payment of sum of Rs. 3,25,330.85 being the quantum of the duty and the sum of Rs. 14,492.82 being interest from February 16, 1982 to November 10, 1982 aggregating to Rs. 3,39,823.67. The duty also with the interest was paid on November 11, 1982. The copy of Bill of Entry is annexed as Ex. B. The correctness of this copy is in dispute but more about that subsequently. Inspite of payment of duty, the petitioners did not care to clear the consignment owing to alleged labour problems in their factory.
In paragraph 4 of the petition, it is claimed by the petitioner that in the meanwhile, the respondent No. 1 brought into effect a Duty Exemption Scheme whereby importers were allowed to import goods free of customs duty if the goods imported are used for manufacture of finished goods and the same are exported. The petitioners further claimed in paragraph 4 that the said Scheme is published in the Import and Export Policy April 1983-March 1984. The next sentence is that the Central Government also issued a Customs Notification dated April 5, 1982 in implementation of the Duty Exemption Scheme. I enquired from the learned counsel as to when the Scheme initially came into force and no answer was given. In case, the Scheme has come into force by the Policy of April 1983-March 1984, then the Notification could not be of an earlier date. The fact that the Notification was issued on April 5, 1982 and the said Notification refers to Advance Licence indicated that the Scheme must have been propounded long prior to 1982. The petitioners have not cared to annexe copy of the Notification to the petition. The petitioners claimed that an application for advance licence was made to the Joint Chief Controller of Imports and Exports, Bombay and the Controller issued Advance Licence No. 2987398, dated March 14, 1983 under the Scheme for the import of 6495 Kgs. of Stainless Steel Strips of the c.i.f. value of Rs. 3,13,800 with the endorsement that the licence was valid for the clearance of the goods already arrived and lying in Custom Bonded Warehouse. The copy of the Advance Licence is annexed as Exhibit 'A'. The petition inaccurately states that the copy of the Bill of Entry is annexed as Exhibit 'A' and the copy of the advance licence is annexed as Exhibit 'B' when it is exactly contrary.
4. The petitioners addressed letter dated September 1, 1983, copy of which is annexed as Exhibit 'C' to the petition, to the Collector of Customs setting out that the consignment could not be cleared in spite of paying the duty due to labour problems in the factory and the material is still lying in the Bonded Warehouse though the duty has been paid in the month of November 1982. The letter refers to the grant of Advance Licence and requests the Customs authorities to refund the duty of Rs. 3,29,830.85. The Customs Authorities sent reply on November 15, 1983 pointing out that under Section 27 of the Customs Act, 1962, it is not permissible for the Collector also pointed out that the duty was paid and the clearance from private Bonded Warehouse was not made because of default of the petitioners and in spite of the fact that Advance Licence was secured within period of six months from payment of duty, the petitioner did not bother to seek refund. The petitioners thereafter took no steps in the matter.
On March 28, 1984, the Clearing Agents of the petitioner addressed letter to the Assistant Collector of Customs, Refund Department, stating that though the petitioners than paid the duty, the goods have not been cleared from Bonded Warehouse. The Clearing Agents claimed that the goods would be cleared against Advance Licence and the Customs Authorities should refund duty and interest charges paid by the petitioners. The Clearing Agents further claimed that the time-limit of six months referred to in Section 27 of the Customs Act would not be attracted to the facts of the case and the time begins to run only from the date of actual removal of the goods from the warehouse. I am informed by the counsel for the petitioners that the Assistant Collector of Customs, Refund Department, rejected the prayer by order dated April 4, 1984. The petitioners again did not bother to annex copy of that order to the petition. The petitioners claim that an appeal was carried against that order before the Collector of Customs (Appeal), Bombay, but the same was dismissed by an order dated December 31, 1984, a copy of which is annexed as Exhibit 'G'. The Appellate Authority held that limitation under Section 27 of the Act does not begin to commence only from the date of removal of the goods from the warehouse but the time will have to be computed from the date of payment of duty. As the application for refund was made six months after that date, the appellate authority rejected the claim. That order is now challenged by filing the present petition in this Court on March 18, 1985. The petition was admitted on March 25, 1985 and the hearing was expedited. The reliefs sought are quashing of the order passed by the Collector of Customs on November 15, 1983, refusing relief to the petitioners and quashing of order dated December 31, 1984 passed by the Appellate Authority in regard to the application for refund made by the Clearing Agents of the petitioners.
5. Shri Sethna, learned counsel appearing on behalf of the respondents, very rightly pointed out that the order dated November 15, 1983 passed by the Collector of Customs was never challenged by the petitioners by filing any appeal and it is too late in the day to claim in the present petition that the said order should be set aside. Shri Sethna also submitted that the petitioners have tried to re-open the issue by making a fresh refund application through their Clearing Agents and that too after a period of four months from the date of rejection of the application for refund made on behalf of the petitioners. The learned counsel complains that the order passed by the Assistant Collector, Refund Department, on the application of the Clearing Agents is not even annexed to the petition. Shri Sethna also pointed out that the copy of the Bill of Entry annexed as Exhibit B to the petition, though wrongly stated as Exhibit A in the body of the petition, is not accurate. The learned counsel relied upon the affidavit dated December 1, 1985 sworn by Shri R. K. Malik, Assistant Collector of Customs, and to which affidavit, a copy of the original Bill of Entry is annexed. The learned counsel pointed out that what is written on the reverse of the original bill of entry is deliberately not shown in the Annexure B to the petition. Shri Sethna points out that an endorsement on the reverse made by the Officer on November 11, 1982 to the effect "Passed out of Customs Charge" is deliberately not referred in the annexure to the petition. Shri Sethna is right in his submission that the endorsement clearly indicates that the goods have passed out of the Customs Control and mere fact that it was started by the petitioners in private Bonded Warehouse cannot lead to the conclusion that the payment of duty by the petitioners was merely a deposit.
6. Shri Shroff submitted that as the petitioners have secured the advance licence in accordance with the Notification dated April 5, 1982, the petitioners are not liable to pay any Customs Duty or Additional Duty. The learned counsel urged that in accordance with the advance licence, the Customs duty ought to have been refunded. It is not possible to accede to the submission because the refund could not be granted by the Customs Authorities after the expiry of the period of six months from the date of payment of duty. The duty was paid on November 11, 1982 and the application for refund was admittedly made subsequent to period of six months from that date. The petitioners had secured Advance Licence within a period of six months, but still did not care to file the application for refund. The petitioners also tried to be over-smart by making a second application through the Clearing Agents when their first application was rejected and against that order, no steps were taken. Shri Shroff urged that as long as the goods are not cleared from the Bonded Warehouse, the Customs Authorities cannot appropriate the duty paid by the petitioners. It is impossible to accede to this submission. The clearance from the Bonded Warehouse was not effected because of the personal reasons of the petitioners and the duty paid cannot be kept in suspension till the petitioners chose to clear the goods. Reliance was placed upon the decision of the Allahabad High Court in the case of Union of India v. Bhagwan Industries Ltd. . The case has no application because the amount was not paid as deposit and advance and which deposit was not to be appropriated. The duty was paid by the petitioners for clearance of the goods and the Customs Authorities were perfectly justified in appropriating the same. Shri Shroff submitted that the recovery of the duty was illegal and, therefore, the provisions of Section 27 would not be attracted. It is not possible to accept the submission because the recovery of duty was in accordance with law and the claim of the petitioners for refund is only on the strength of the grant of advance licence and which was granted after payment of duty. It is impossible to accede to the submission that on the date of payment of duty, the recovery was in any manner illegal. In my judgment, the Customs authorities were properly justified in rejecting the application on the ground that the application for refund was made six months after the payment of duty.
7. Before parting with the case, I must express my entire disapproval of the manner in which the petition was filed and the case was conducted. It would have been desirable if more care was taken in filing the petition and conducting it. It is time that every one should realise that the petitioners are not to be conducted in casual manner and application for amendments are not to be made as a formality. It is the duty of the petitioners to ensure that the affidavits, if any, filed by them are on the record. In my judgment, apart from the fact that the petitioners have no case on merits, the petitioners did not conduct the case with seriousness.
8. Accordingly, the petition fails and the rule is discharged with costs.