1957 Supreme(Cal) 40

HIGH COURT OF CALCUTTA
Sinha
EAST INDIA COMMERCIAL CO. LTD. - Appellant
Versus
COLLECTOR OF CUSTOMS - Respondent
Matter 99  Of  1955
Decided On : FEBRUARY 25, 1957

The importation of goods without a special license is prohibited under the Imports and Exports (Control) Act, 1947, and such goods are liable to confiscation under the Sea Customs Act, 1878.

Headnote:

IMPORTS AND EXPORTS (CONTROL) ACT, 1947 - SECTION 3(1), 3(2), 4, 5 - SEA CUSTOMS ACT, 1878 - SECTION 167(8) - IMPORT TRADE CONTROL NOTIFICATION NO. 23-I. T. C./43 DATED 1-7-1943 - IMPORT TRADE CONTROL NOTIFICATION NO. 2-I. T. C./48 DATED 6-3-1948 - IMPORT TRADE CONTROL NOTIFICATION NO. 1(13)-I. T. C./47(i) DATED 26-7-1948 - IMPORTATION OF FLUORESCENT TUBES AND FIXTURES - CONDITIONS IMPOSED IN THE LICENSE - VIOLATION OF CONDITIONS - CONFISCATION OF GOODS - NOTICE ISSUED BY COLLECTOR OF CUSTOMS - WRIT PETITION - MAINTAINABILITY.

Fact of the Case:

The petitioner company imported a quantity of Fluorescent Tubes and Fixtures from the United States of America under a special license issued by the Chief Controller of Imports, New Delhi. The license was granted subject to the condition that the goods would be utilized only for consumption as raw material or accessories in the license-holder's factory and that no portion thereof would be sold to any party. The petitioner company, however, sold a portion of the goods to other parties in breach of the condition. The Collector of Customs issued a notice to the petitioner company proposing to confiscate the goods under Section 167(8) of the Sea Customs Act, 1878, and to impose a penalty under Section 5 of the Imports and Exports (Control) Act, 1947. The petitioner company filed a writ petition challenging the notice.

Finding of the Court:

The court held that the Import Trade Control Notification No. 1(13)-I. T. C./47(i) dated 26-7-1948 was an order made by the Central Government under Section 3(1) of the Imports and Exports (Control) Act, 1947. The court further held that the condition imposed in the license that the goods would be utilized only for consumption as raw material or accessories in the license-holder's factory was not a condition imposed by an order of the Central Government under Section 3(1) of the Act. However, the court held that the petitioner company had imported goods for which the special license was not issued, which was another way of saying that the goods were imported without being covered by a special license. The court also held that the notice issued by the Collector of Customs was not a statutory notice required by the Sea Customs Act, 1878, but was a notice given because rules of natural justice require that the person whose goods are to be confiscated or upon whom a penalty is to be imposed, should be afforded an opportunity to defend his case.

Issues: 1. Whether the Import Trade Control Notification No. 1(13)-I. T. C./47(i) dated 26-7-1948 was an order made by the Central Government under Section 3(1) of the Imports and Exports (Control) Act, 1947? 2. Whether the condition imposed in the license that the goods would be utilized only for consumption as raw material or accessories in the license-holder's factory was a condition imposed by an order of the Central Government under Section 3(1) of the Act? 3. Whether the petitioner company had imported goods for which the special license was not issued? 4. Whether the notice issued by the Collector of Customs was a statutory notice required by the Sea Customs Act, 1878?

Ratio Decidendi: 1. The court held that the Import Trade Control Notification No. 1(13)-I. T. C./47(i) dated 26-7-1948 was an order made by the Central Government under Section 3(1) of the Imports and Exports (Control) Act, 1947, because it was a notification issued by the Government of India and numbered as an import trade control notification, it said on the face of it that it contained decisions made by the Government of India, and it had a reference to order No. 23-I. T. C./43, which was the original prohibition on the importation of the goods in question. 2. The court held that the condition imposed in the license that the goods would be utilized only for consumption as raw material or accessories in the license-holder's factory was not a condition imposed by an order of the Central Government under Section 3(1) of the Act, because it was a condition imposed by the licensing officer under the authority vested in him by Notification No. 2-I. T. C./48 dated 6-3-1948. 3. The court held that the petitioner company had imported goods for which the special license was not issued, because the application for the license and the license itself showed that the goods were required for the petitioner company's own use, whereas the petitioner company had sold a portion of the goods to other parties. 4. The court held that the notice issued by the Collector of Customs was not a statutory notice required by the Sea Customs Act, 1878, but was a notice given because rules of natural justice require that the person whose goods are to be confiscated or upon whom a penalty is to be imposed, should be afforded an opportunity to defend his case.

Final Decision: The court dismissed the writ petition and held that the petitioner company had not successfully made out any ground why the court should interfere at this stage. The court also held that the respondents had done nothing more than to issue a notice proposing to do certain acts and asking the petitioners to show cause why it should not be done, and that there was no reason why the court should interfere at this stage.