Johnson & Johnson Ltd. vs Deputy Chief Controller of Imports & Exports & another

Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2002 Supreme(Bom) 1342

IN THE HIGH COURT OF BOMBAY
Daga V.C. Devadhar J.P., JJ.
Johnson Johnson Ltd. .... Petitioner.
Versus
Deputy Chief Controller of Imports Exports another.... Respondents.
Writ Petition No. 3783 of 1987, decided on 17-12-2002.
Advocates appeared :
J.F. Pochkhnawalla, Sr.A. with G.R. Joshi H. Daruwalla i/b. Crawford Bayley Co., for petitioners.
R.V. Desai, Sr.C. with K.R. Chaudhari i/b. T.C. Kaushik, for respondents.

Headnote:Constitution of India - Article 14 - Principle of natural justice - Whether not followed - Contention that pulpwood importers registered to avail OGL facility were allowed to import under OGL even after 1980 - Other active operators were required to obtain licence - It was a clear type of discrimination - Held - The Dy. Controller tried to decide issue without hearing petitioners - His adverse opinion must have been brought to notice of Court - Its non supplying amounts to violation of rules of natural justice. - The adverse material; in the form of clarification from DGTD came on the record of the proceedings subsequent to the date of hearing i.e. after 12th May, 1987. This adverse material was never brought to the notice of the petitioners. As a matter of fact, keeping in view the principles of natural justice, it was obligatory on the part of the respondent No. 1 to draw the attention of the petitioners to this letter and invite their views. The adverse report ought to have been brought to the notice of the petitioner, which was obtained by the 1st respondent behind the back of the petitioners, that too after the hearing was completed. In a quasi judicial proceedings, non supply of the adverse material to the effected person, but supply thereof to the authority taking decision against him on that basis; constitutes violation of rules of natural justice as held by the Apex Court in Union of India and others v. Mohd. Ramzan Khan, AIR 1991 SC 471.

JUDGMENT - DAGA VIJAY C., J.:---Heard learned Counsel for the rival parties. This petition is directed against the order dated 11-11-1987 passed by the Deputy Chief Controller of Imports Exports, New Delhi; in exercise of powers conferred under Clause 8 of the Import (Control) Order, 1955, whereunder; the entitlement of the petitioners i.e.; the quota to import raw material for manufacturing Sanitary Napkins was reduced by 20%. In other words, petitioners were permitted to make imports under OGL Licence and receiving import licences and customs clearance permits and allotment of imported material from State Trading Corporation (STC) and Minerals Metals Trading Corporation (MMTC) or any other similar agency for the period from 10th November, 1987 to 31st March, 1990 to the extent of 80% of their entitlement. Thus, the entilement of the petitioners to import raw material was curtailed by 20% for the period 10-11-1987 to 31-3-1990.

2. The facts brought on record reveal that the show cause notice dated 18-8-1986, which came to be issued under Clause 10 of the Imports (Control) Order, 1955 proposing to take penal action against the petitioner under Clause 8(g) thereof; was based on the premise that the petitioner had illegally imported wood pulp between 1980 and 1985, in violation of paragraph 19(1) of Appendix 10 of the Import Policy 1982-83, and the corresponding provisions of the 1983-84 and 1984-85 policies and thereby committed breach of the Import (Control) Order, 1955.

3. The aforesaid said show cause notice was replied and number of grounds were put forth to show that show cause notice, and the proposed action was unwarranted. The show cause notice was also challenged on the various legal grounds; but, none of the submissions found favour with the respondent No. 1. He was pleased to hold that the petitioners had committed a breach of the relevant Import Control regulations by making imports of wood pulp under OGL licence. He, thus, passed order on 11-11-1987; debarring the petitioner from making imports; the details of which are given in the opening para of this judgment.

4. Being aggrieved by the above order, petitioners have filed this petition under Article 226 of the Constitution of India. While granting Rule, this Court vide interim order dated 18-12-1987 had stayed the operation of the impugned order with the result impugned order could not operate. In the other words, order could not be implemented. Now, after 15 years this petition has come up for final hearing.

5. The impugned order is being challenged on the various amongst other grounds; including that the action is discriminatory and violative of Article 14 of the Constitution of India, inasmuch as, the person who was not earlier entitled to import wood pulp, prior to the introduction of the system of Open General Licence (OGL) in 1980, was permitted to freely import wood pulp after 1980; subject to his only being an actual user; but, the persons like petitioners, registered as an actual users were barred from importing wood pulp after 1980 due to the purported condition. That once the scheme of OGL was introduced, it equally applied to all actual users of the wood pulp so long as they were registered with the sponsoring authority. In this view of the submissions, the contention canvassed and urged is that interpretation adopted by the respondent had the effect of discriminating against the petitioners and treating other similarly placed persons differently, to the detriment of the petitioners, as such the action complained of is in breach of Article 14 of the Constitution of India.

6. The another ground of challenge relates to the breach of principles of natural justice. This ground of challenge, if upheld, can alone decide the fate of this petition, as such, we propose to deal with this challenge first. If necessary, we may consider other grounds of challenge at the later stage of the judgment.

7. The learned Counsel for the petitioners in order to demonstrate bre

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