Back
1990 Supreme(Cal) 307
High Court Of Calcutta
M. N. ROY, SUNIL KUMAR GARG
ROTOFLEX INDUSTRIES - Appellant
Versus
COLLECTOR OF CUSTOMS - Respondent
Matter 1481 Of 1990
Decided On : 08/03/1990
HASMUKH KUNDALIA, P.K.MULLICK, R.N.DAS, S.K.SENGUPTA
The Customs Authorities cannot refuse to release goods after initially releasing some of the goods under the same R.E.P. licenses and assessment of duty, especially when such action is taken to frustrate proceedings pending in Court.
Headnote:
CUSTOMS - Import of goods - Release of goods - Goods imported under R.E.P. licenses - Goods assessed and warehoused under Section 59 of the Customs Act, 1962 - Subsequent refusal to release goods by Customs Authorities - Appellants challenge refusal - Court directs release of goods on payment of duty and furnishing of Bank guarantee for redemption fine - Customs Authorities restrained from passing final confiscation order - Appeal expedited.
Fact of the Case:
Appellants imported various packaging materials under R.E.P. licenses and warehoused them under Section 59 of the Customs Act, 1962. After assessment of duty, the Customs Authorities initially released some of the goods but later refused to release the remaining goods. Appellants challenged the refusal and sought release of the goods.
Finding of the Court:
The Court found that the Customs Authorities had initially released some of the goods after assessment of duty, indicating their satisfaction with the import. The subsequent refusal to release the remaining goods was not justified and appeared to be an attempt to frustrate the proceedings pending in Court. The Court also noted that the Customs Authorities had taken action against the appellants despite having directed release of several pallets of the consigned goods on similar set of facts.
Issues: 1. Whether the Customs Authorities were justified in refusing to release the goods after initially releasing some of the goods under the same R.E.P. licenses and assessment of duty? 2. Whether the subsequent actions of the Customs Authorities were taken to frustrate the proceedings pending in Court?
Ratio Decidendi: 1. The Court held that the Customs Authorities were not justified in refusing to release the goods after initially releasing some of the goods under the same R.E.P. licenses and assessment of duty. The initial release of goods indicated the satisfaction of the Customs Authorities with the import, and the subsequent refusal was not supported by any valid reason. 2. The Court found that the subsequent actions of the Customs Authorities, such as issuing show cause notices and threatening confiscation of the goods, were taken to frustrate the proceedings pending in Court. The Court noted that the Customs Authorities had previously agreed to accept the release of the goods, and their change of stance was unjustified.
Final Decision: The Court directed the release of the goods on payment of duty and furnishing of a Bank guarantee for the redemption fine imposed on three consignments. The Customs Authorities were restrained from passing any final confiscation order, and the validity of any such order would be decided after hearing the appeal finally. The Court also expedited the hearing of the appeal and directed the Customs Authorities to try to dispose of the pending proceedings within eight weeks.
( 1 ) APPELLANT No. 1, is a partnership firm, duly registered under the Partnership Act and Appellant No. 2, is the partner of the same. The said partnership firm at all material times carried on and still carries on business of importation of various packaging materials viz. poly porpylin (poly propylin packaging film ). It has been claimed by the appellants that such importation of the packaging film of fixed qualities and sizes are made from several manufactures and shippers from U. S. A. , U. K. , West Germany and Belgium and after importing those goods, they are converted in accordance with the customers' specifications and requirements at the ancillary manufacturing unit of the appellants viz. Modern Controverter at Raichand Lane, on payment of necessary charges.
( 2 ) IT was the case of the appellants that they are importing such materials regularly from United States, so also the diverse other European countries as mentioned above, with the knowledge and satisfaction of the concerned Customs authorities and they are also holders of several R. E. P. licenses. It was their case that on the basis of such licenses, importation of 60 pallets of the concerned goods, approximately valued at Rs. 11,36,560. 47 was made from M/s. Mario International Corporation, U. S. A. (hereinafter referred to as the said foreign seller ). It was their further case that on or about 28th July, 1988, the vessels MV Bengal Progress - Voy-121 Line No. 298 and Rotation No. 464 carrying the concerned goods arrived at the Port of Calcutta. It has been stated that before such arrival, on or about 12th July, 1988, the appellants through their clearing agent M/s. New India Corporation, Calcutta, filed the relevant Bill of Entry with all relevant and necessary papers and import licences, for assessment of the said goods for warehousing under Section 59 of the Customs Act, 1962 (hereinafter referred to as the said Act) and then, the concerned appraiser of Appraising Group-II Customs House, Calcutta, checked and verified and/or scrutinised all documents and import licenses as filed and passed the Bill of Entry for counter-signature of Assistant Collector of Customs, Appraising Group No. II, who, after reaching his complete satisfaction on necessary scrutiny, passed adjudication order under Section 47 of the said Act and assessed a sum of Rs. 2,60,22,613/- as duty, payable. It has also been stated that on or about 1st August 1988, the concerned Customs Authorities physically verified and checked the concerned goods and on being satisfied that they were as per declaration and description of the invoice duly cleared them and allowed the goods in question, to be stored in non-duty paid warehouse under Section 59 of the said Act.
( 3 ) THE appellants have stated that they filed Ex-Bond Bill of Entry in respect of four pallets of the concerned goods and paid part of the assessed duty of Rs. 10,74,841/-, whereupon the Customs Authorities duly allowed clearance and released the said four pallets of the concerned goods under Ex-Bond Bill of Entry No. 1-1513 dated 21st November, 1989.
( 4 ) THEREAFTER, the appellants filed another Ex-Bond Bill of Entry, for clearance of four pallets of the concerned goods, whereupon the Customs authorities, on payment of the pro rata, part of the assessed duty of Rs. 10,74,841/- duly cleared and released four pallets of the concerned goods to the appellants under Ex-Bond Bill of Entry dated 25th January 1990.
( 5 ) IT was the further case of the appellants that between 14th January 1989 and 23rd May 1989, they duly imported two further consignments of the concerned goods from U. S. A. and U. K. under similar R. E. P. licenses, duly transferred in their favour in the manner as indicated above and on arrival of the said two consignments, they also filed Bill of Entry for warehousing of the goods in question under Section 59 of the said Act, whereupon, the Customs Authorities duly assessed duty under Section 17 of th
