The definition of 'India' in Section 2(27) of the Customs Act, 1962, which includes the territorial waters of India, should be interpreted in the context of Section 75 of the Act, which deals with drawback allowance on export of goods.

M.N. CHANDURKAR, C.J

The substantial question which arises for consideration in this appeal relates to the determination of the stage at which goods can be treated as having been exported out of India for the purpose of drawback allowance claimable under Section 75 of the Customs Act, 1962 (Central Act 52 of 1962 - hereinafter referred to as the Act).

2.The facts of the case are not in dispute. The petitioner-appellant is a manufacturer of electrical accessories for automobiles and other engines. The appellant company had in February, 1974 filed shipping bills for export of certain items of goods manufactured by it and these goods were loaded on the ship M.V. Ratna Usha. Admittedly, the goods were assessed for export duty and examined by the customs authorities. However, after the cargo was loaded on the vessel, there was a fire in the ship and some of the goods were destroyed. The entire consignment of destroyed and damaged goods was unloaded. The goods sold by public auction to avoid the damaged goods being sold in the market as genuine goods. In the public auction, the goods were cleared by M/s. Lucas Indian Service. Ltd., Madras-2 which is a subsidiary company of the appellant and the goods were scrapped.

3.Later, the appellant company claimed drawback of the duty paid on articles which were originally imported and used in the manufacture of the exported goods. This claim for drawback has been disallowed by all the authorities under the Customs Act as well as by the Union of India on the ground that the goods shipped not having crossed the territorial waters of India cannot be treated as having been exported. The appellant company then filed Writ Petition No. 3727 of 1977 for quashing of these orders. The learned single Judge (Padmanabhan, J.) who dismissed the writ petition took the view that since India is defined in Section 2(27) of the Act as including the territorial waters of India, it was necessary for the goods being exported that they should be taken out of 'India, namely, beyond the territorial waters of India.. Since admittedly the goods had not gone beyond the port of Madras, the learned Judge held that the goods cannot be said to have been exported. The learned Judge having dismissed the writ petition, the writ petitioner has filed this appeal.

4.Mr. A.R. Ramanathan, appearing on behalf of the appellant company has contended that though undoubtedly India has been defined as including the territorial waters of India, in so far as the exporter is concerned, the export must be deemed to have been completed when the goods are placed on the ship in pursuance of the clearance given under section 51 of the Act. It is pointed out that in so far as the value of the goods is concerned, the Government of India has already earned foreign exchange and it cannot therefore be said that the goods were not exported. The argument is that the definition section 2 of the Act expressly provides that the definitions in section 2 have to be read subject to the words "unless the context otherwise requires". The learned counsel therefore contended that since the goods passed but of the control of the exporter the moment clearance is given for the exportation of the goods under section 51. The goods must be treated as having been exported and the definition of the term "India" must in that context be read as referring to the landmass of the country, and it was not necessary for the goods to cross the territorial waters of India before the goods can be said to have been exported.

5."India" in defined under the General Clasuses Act, 1987 with reference to three different period of time, namely, (i) before the establishment of the Dominion of India (ii) after the establishment of the Dominion of India, and (iii) in respect of any period after the commencement of the Constitution. In respect of the last mentioned period, "India" is defined as meaning "all territories for the time being comprised in the territory of India". Relying o