ORDER :

K.N. SINGH, J.

1. Delay condoned. Special Leave granted. Heard counsel for the parties.

2. These appeals are directed against the judgment and order of the Customs Excise and Gold (Control) Appellate Tribunal (hereinafter referred to as the Tribunal) West Regional Bench Bombay, dated 10.8.1987 rejecting the appeal filed by the appellants against the order of the Collector of Customs confiscating the goods imported by them and imposing redemption fine in view of confiscation and imposing penalty against them.

3. The appellants imported canalised items under additional import licence granted to them in pursuant to this Court's order dated 18.4.1985 in Civil Appeal No. 1423/84, Union of India v. Rajni Kant Brothers. By that order this Court directed the Union of India to issue additional licences for the import of items placed under OGL during the policy period 1978-79, with direction that "save and except the items which are specifically banned under the relevant import policy at the time of import, such licence holders would be entitled to import all other items either canalised or otherwise in accordance with the relevant Rules". (emphasis supplied). The importers as well as the Customs Authorities and the Union of India interpreted the order of this Court authorising import of canalised items under the additional import licence. In fact the Principal Collector Customs Central Excise, Bombay by his letter dated 15/15th May, 1986 informed the Federation of Indian Export Organisation that in view of the Supreme Court's orders regarding the permissibility of import of the canalised items a decision had been taken that the canalised items shall be cleared unconditionally imported against additional import licence. The appellants thereupon entered into contract for the import of the canalise items and imported the same but when the goods arrived, the same were not cleared instead the Collector imposed penalty and also issued orders for the confiscation of the goods, although he permitted appellants to take delivery of the goods on payment of redemption fine. The appellants preferred appeals before the Tribunal. In their appeal the appellants urged that in view of the various orders of this Court and further in view of the Customs Authorities own orders the appellants bona fide believed that they could import canalised items under the additional licence issued to them and in pursuance thereof they bona fide imported the goods which were not prohibited items. Since the appellants acted bona fide in accordance with the orders of this court and the communication issued by the Customs Authorities, they had not committed breach of any law and they were not liable to pay any penalty or fine and the goods so imported were not liable to be confiscated. The Tribunal allowed the appeals partly, it held that the disputed imports had not been made in defiance of the Import Policy or the law laid down by the Supreme Court, it observed "at best there was a wrong understanding of the law laid down by the Supreme Court. This wrong understanding was not only on the part of the importers but was also on the part of the licencing authority and even the Union Government and the importers were also entitled to seek sustenance from the judgment of the Bombay High Court." On these findings the Tribunal set aside the penalties imposed on the appellants. But while considering the question of confiscation of goods the Tribunal recorded inconsistent finding holding that though the imports were not in wilful disobedience of law or in deliberate defiance of the policy and the law laid down by the Supreme Court, yet their action was not bona fide. On these findings the Tribunal upheld the order of imposition of redemption fine but it set aside the order of the Collector imposing penalty against the appellants.

4. Learned counsel for the parties referred to the decisions of this court in Rajni Kant Bros. case in Raj Prakash Chemicals case 1986 (1) SCR 448, and