JUDGMENT

Santosh Hegde, J.-M/s. Associated Cement Company Ltd. (for short ACC ) had embarked upon a project of substantial expansion and modernisation of its cement factory at Shahabad in Karnataka. The ACC had floated a tender inviting supply of high standard deformed steel bars. In that tender, ACC had claimed that the project was aided by the International Bank for Reconstruction and Development (for short the IBRD ), which would give the importer exemption from the import duty. In response to the said tender, M/s. Virgo Steels made an offer to supply 5,187 MT of steel. The offer was accepted by the ACC and the said Virgo Steels obtained an advance licence under the Deemed Export Scheme for duty-free import of the concerned steel under Notification No.210/82. This notification specifically required that if the goods in question was rot used for the purpose for which importation was permitted then the importer was liable on demand to pay a sum equivalent to the duty leviable. Sometime in November 1988, the ACC decided to abandon the work of expansion, hence, the licence obtained under the above said scheme for importation of duty-free steel became invalid. In spite of the same M