Judgment

SAWANT, J.:- The respondent which is a partnership firm was at the material time engaged in the manufacture of stainless steel equipments and utensils with its factory at Bangalore. Under the Registered Exporters Promotion Scheme promulgated by the Government of India and in operation at that time, an exporter of leather was entitled to a licence for importing raw material. The Scheme also provided that the exporter could nominate another person to receive the said import licence. The respondent-firm was so nominated by an exporter of leather and pursuant to this nomination, the respondent obtained an import licence dated June 7, 1969 for the import of certain raw material. In accordance with the provisions of paragraph 85 of the Import Trade Control Hand Book, 1969 which was effective from April 1969, the respondent imported stainless steel strips which landed at Madras on September 12, 1969. The import was in three consignments of the total value of Rs. 3,46,087. It is not necessary to refer to the intervening facts leading to the imposition of penalty of Rs. 8,48,000/- on the said three consignments. Suffice it to say that this penalty was imposed by the Central Board of Excise and Customs under Section 112(a) of the customs Act, 1962 on the ground that the import of the stainless steel strips was unauthorised. Against the said order the respondent preferred a revision to the appellant and the appellant by its order of August 2, 1972 dismissed the same. The respondent then approached the Madras High Court by way of a writ petition under Art. 226 of the Constitution. The learned single Judge of the High Court dismissed the same. Against the said order, the respondent preferred a Letters Patent Appeal before the Division Bench of the High Court and the Division Bench allowed the appeal holding that paragraph 85, as it stood at the relevant time, did not prohibit the import of stainless steel strips. Consequently, the order imposing the penalty was quashed.

2. The only question in controversy before us is whether the provisions of said paragraph 85 prohibited the import of stainless steel strips. It is not disputed that the relevant provisions of paragraph 85, to be precise of 85(l)(i)(c) as they stood in 1967 did not allow the import of stainless steel strips of any specifications. This provision was, however, modified in 1968 and the import of stainless steel sheets, plates, strips and circles of any specifications was not permitted. It may be observed from this modification made in 1968 that as against the expression "stainless steel of any specifications" which occurred in the 1967 provisions, this modification detailed the various forms of stainless steel such as sheets, etc. which included strips and stated that the import of stainless steel in these forms was prohibited. In the next year, i.e., 1969 which is relevant for our purpose, there was a further amendment to this provision and that read as follows:

"The import of stainless steel and sheets/plates/circles, of any specifications and the import of items licensable under the import policy in force subject to production of non - availability certificates from indigenous procedures, will not be permitted under this facility. "

It is thus apparent that in this year what was prohibited was stainless steel and sheets, plates, circles of stainless steel. Strips were specifically omitted from this prohibition although it was specifically included in the prohibited items in 1968 and impliedly in 1967 for the expression "stainless steel of any specifications" would include every form of stainless steel. Since the strips were specifically omitted, it appears on June 26, 1969 an erratum was issued which was published on July 1, 1969 and that erratum reads as follows:

"The following corrections shall be deemed to have been made in the Import Trade Control Handbook of Rules and Procedure, 1969, published under the Ministry of Foreign Trade and Supply Public Notice No. 63 / I