Judgment

KASLIWAL, J.:- Special leave granted.

2. This appeal has been filed against the judgment of the Bombay High Court dated 18-6-1991. The short controversy raised in the present case is whether the Cloves imported by the appellant fall within Item 169 in List 8 of Appendix 6 or fall within Paragraph 167 of Chapter XIII of the Import and Export Policy April, 1990-March, 1993.

3. Brief facts of the case are that the appellant obtained by transfer an Import Licence No. 3412179 dated 29th November, 1990 for Rs. 16,10,700/- for the import of admissible Items as per Paras 220(2)(3)(4) and (6) of the Import Policy 1990-93 Vol. I. After acquisition of the aforesaid additional licence, the appellant placed an order for the supply of about 200 bags of Madagascar cloves No. 1 quality to a firm of Singapore. The appellant opened a letter of credit dated 6-5-1991 in favour of the foreign supplier. On receipt of the letter of credit the foreign supplier shipped the above mentioned goods in favour of the appellant. On arrival of the goods at Bombay Port, the appellant filed Bill of Entry for the clearance of the goods for home consumption on 30th May, 1991. The appellant claimed clearance of the goods against the additional licence on the ground that the cloves were covered under Item 169 of Appendix 6, List 8, Part I of the Import and Export Policy being "Drugs / Drug intermediate not elsewhere specified." The Department relied on Para 167 which dealt with the import of spices and took the stand that the cloves could be imported only against specific licence relating to cloves.

4. The appellant in the above circumstances filed a writ petition in the High Court of Bombay seeking a mandamus against the respondent to clear the goods against the Bill of Entry filed by the appellant. The High Court held that the cloves cannot fall within the expression "Drugs / Drug intermediate not elsewhere specified" and the import of the cloves without specific licence was not permissible. It was thus held that the action of the Customs Authorities in not permitting clearance cannot be faulted and the licence relied upon by the appellant was not valid for the import of cloves.

5. It was contended by Mr. Harish Salve, learned counsel for the appellant that though the use of clove as a spice is not in much dispute, but at the same time it cannot be disputed that clove is Drugs / Drug intermediate. It was submitted that in popular sense and trade parlance, clove is also used as drug intermediate and that being so the appellant was entitled to import the cloves against the additional licence under Para 220 of the Policy. It was also submitted that in the Import Policies of 1982-83 to 1985-86 cloves were specified as crude drug. It was thus submitted that when clove was considered as crude drug, there was no justification now to hold that it did not fall within Item 169 which provided for Drugs/ Drug intermediates. It was further argued that cloves are used for treatment of dyspepsia and flatulence. It is also used to relieve nausea and vomiting. Clove oil is famous for medicinal use and specially for tooth problems. It was also argued that in the Indian Materia Medica by A. K. Nadkarni the use of the cloves has been stated as follows :-

"Uses - Cloves (unopened flower-buds) are generally used as spice in curry foods and condiments. Medicinally they are used to correct gripping caused by purgatives, to relieve flatulence, various forms of gastric irritability, colic, dyspepsia, and to increase the flow of saliva. Combined with other spices and rock-salt clove is given to relieve colic, indigestion and vomiting and to many other uses."

6. It was submitted that in the Indian Pharmaceutical Codex issued by the Counsel of Scientific and Industrial Research, New Delhi the Action and Uses of Cloves have been stated as under :-

"Action and Uses - Clove is one of the most stimulant of aromatics. It is carminative and is used in the treatment of flatulence and dyspepsia. I