1984 Supreme(Mad) 376

High Court of Judicature at Madras
THE HONOURABLE MR. JUSTICE NAINAR SUNDARAM
Ranjit Export Private Limited - Appellant
Versus
Collector of Customs, Madras - Respondent
Case No : Writ Petition No. 7061 of 1984
Decided On : 06 September 1984

The essential ingredient of export is the taking out of India. The acts complained of must fall in the course of movement of the goods with an intention to take them out of India. All other acts done anterior to this step, namely, movement would only partake the character of preparations. If the petitioner has done any act towards the exportation, namely, taking of the goods out of India and if the act or acts could be fitted in the course of such movement of the goods, or, in other words, the act could fall in the course of progress towards the actual physical taking of the goods out of India, the mischief of section 113(d) would be attracted. There should be a direct physical movement towards the taking of the goods out of India after all the preparations are made and which preparations may also fall within the satisfaction of the provisions and completion of the formalities under the Act, There must be an act or acts done towards the actual physical movement of the goods with an intention to take them out of India. That alone, in the Court's view, would constitute an attempt to export the goods, that too depending on the facts and circumstances of the case.

Headnote:

CUSTOMS ACT, 1962 - SECTION 113(D) - EXPORT - ATTEMPT TO EXPORT - ESSENTIAL INGREDIENT - MOVEMENT OF GOODS - SATISFACTION OF FORMALITIES UNDER THE ACT - NOT SUFFICIENT - ACT OR ACTS TOWARDS ACTUAL PHYSICAL MOVEMENT OF GOODS WITH INTENTION TO TAKE THEM OUT OF INDIA - NECESSARY - RESPONDENT NOT IN ORDER TO DETAIN GOODS ON THE GROUND THAT SECTION 113(D) OF THE ACT IS ATTRACTED.

Fact of the Case:

Petitioner sought for the issue of a writ of mandamus, directing the respondent to release the 39 bales of fabrics in respect of which orders of detention have been passed under section 110 of the Customs Act, 1962. The petitioner filed four shipping bills, Nos. 00799 dated 21-5-1984, 00816 dated 22-5-1984, 00896 dated 22-5-1984 and 00859 dated 23-5-1984. The four shipping bills covered 41 bales of silk fabrics of various varieties, valued at Rs. 5, 48, 828.80 CIF. The shipping documents were prepared and the goods were shown to the Central Silk Board authorities for certifying as to the correctness of the description in the invoices. Out of the 41 bales, only 2 bales valued at Rs. 45, 333.33 CIF pertaining to shipping bill No. 00859 dated 23-5-1984 were brought inside the Customs examination area. At the time of the inspection of the goods, it was found that the goods were dupion silk fabrics as against the description in the shipping bill, viz., "Handloom natural silk fabrics made of 100% mulberry raw silk filature reeled yarn other than dupion". The petitioner had declared in the shipping bills that the shipments were in pursuance of discharge of the obligations against export production and the petitioner claimed registration of the shipping bill in anticipation of the grant of advance licence and duty exemption entitlement certificate, for which it has already applied to the Joint Chief Controller of Imports and Exports, Calcutta and obtained letter of permit from him. The petitioner further declared that the material used is of the same description qualities, technical characteristics and quantities as mentioned in the application for advance licence and duty exemption entitlement certificate, which was already in its stock and has been utilised in the manufacture of the resultant products and that the exempt imported materials for which it has applied for the advance licence and duty exemption entitlement certificate will be used to replenish the same. The inspection of the consignment covered under shipping bill No. 00859 revealed that the goods were not in accordance with the declaration in the shipping bill. All the four shipping bills filed for the clearance of 4 bales were assessed by the Customs authorities. However, 39 bales covered by shipping bill Nos. 00799, 00816 and 00896 were not tendered for export and instead, the petitioner, by its letter dated 26-5-1984, requested for cancellation of these three shipping bills on the ground that it has got a telephonic message from the buyer saying that the relevant orders were cancelled because of delay in execution. The Customs authorities suspected that the contents of the remaining 39 bales covered by the three shipping bills would not be in accordance with the declaration in the shipping bills and invoices. This prompted them to search the premises of the petitioner at Madras and it is claimed that certain incrimination documents were seized from there under mahazar. It was learnt that the 39 bales covered by the three shipping bills were already sent to the Central Station, Madras, for onward despatch to Calcutta and they were called back. The 39 bales were detained under section 110 of the Act with the reasonable belief that the said goods are liable to confiscation. One Ghosh, Export Executive of the petitioner admitted that the two bales covered by shipping bill No. 00859 contained dupion silk fabrics contrary to the declaration and as regards the 39 bales covered by the other three shipping bills, Ghosh admitted that 36 bales contained "Matka Silk fabrics" as against the declaration "100% spun silk fabric" 3 bales contained "Raw Matka silk fabrics" as against the declaration "100% mulberry raw silk fabric". The premises of the petitioner at Calcutta were also searched by the Customs authorities at Calcutta and the documents and files have been taken therefrom. Representative samples from the 39 bales detained at the premises of the petitioner at Madras were also sent for test and they were shown to the Central Silk Board authorities. Investigation revealed that the two samples drawn from the consignments declared as "100% spun silk fabrics" were only "hand spun silk fabric (matka fabric)" and one sample drawn from the consignments declared as "Silk fabric containing 100% mulberry silk yarn (other than dupion)" was raw silk and hand spun matka fabric. The documents recovered from the petitioner's premises both at Calcutta and at Madras were perused and incrimination details have been noticed. It appears that in the past also the petitioner exported goods by misdeclaring the goods in the shipping documents.

Finding of the Court:

The Court found that the respondent was not in order to detain the goods on the ground that section 113(d) of the Act is attracted and the goods are liable to confiscation on that ground. The Court held that the essential ingredient of export is the taking out of India. The acts complained of must fall in the course of movement of the goods with an intention to take them out of India. All other acts done anterior to this step, namely, movement would only partake the character of preparations. If the petitioner has done any act towards the exportation, namely, taking of the goods out of India and if the act or acts could be fitted in the course of such movement of the goods, or, in other words, the act could fall in the course of progress towards the actual physical taking of the goods out of India, the mischief of section 113(d) would be attracted. There should be a direct physical movement towards the taking of the goods out of India after all the preparations are made and which preparations may also fall within the satisfaction of the provisions and completion of the formalities under the Act, There must be an act or acts done towards the actual physical movement of the goods with an intention to take them out of India. That alone, in the Court's view, would constitute an attempt to export the goods, that too depending on the facts and circumstances of the case.

Issues: Whether the respondent was in order to detain the goods on the ground that section 113(d) of the Act is attracted and the goods are liable to confiscation on that ground.

Ratio Decidendi: The essential ingredient of export is the taking out of India. The acts complained of must fall in the course of movement of the goods with an intention to take them out of India. All other acts done anterior to this step, namely, movement would only partake the character of preparations. If the petitioner has done any act towards the exportation, namely, taking of the goods out of India and if the act or acts could be fitted in the course of such movement of the goods, or, in other words, the act could fall in the course of progress towards the actual physical taking of the goods out of India, the mischief of section 113(d) would be attracted. There should be a direct physical movement towards the taking of the goods out of India after all the preparations are made and which preparations may also fall within the satisfaction of the provisions and completion of the formalities under the Act, There must be an act or acts done towards the actual physical movement of the goods with an intention to take them out of India. That alone, in the Court's view, would constitute an attempt to export the goods, that too depending on the facts and circumstances of the case.

Final Decision: Writ petition allowed.