Per Jyoti Balasundaram :

The background of these ROM applications is as follows:

2. In September, 1991 the applicants herein imported goods described in the three bill of entry as "compound alcoholic preparations, namely under proof whisky used only for the manufacture of IMFL - Indian Whisky" and claimed clearance thereof against REP licences issued prior to 06.12.1990; the commercial invoices issued by the supplier described the goods in identical terms. The REP licences were valid for import of items covered in Appendix 3-A items in terms of entry No. 218 of Appendix 3-A of Import Policy 1990-93 which covered "ethyl alcohol". In the alternative it was claimed that the goods were covered by the residuary entry at serial No. 524 of Appendix 3-A which covered "chemical and allied items other those listed in Appendix 2, 5 and 6". The department objected to the imports on the ground that the goods were "concentrates of alcoholic beverages" covered by serial No. 31 of Appendix 2B of the Policy and hence the REP licence did not cover the goods.

3. Show cause notice dated 12.12.1991 was issued proposing confiscation of the goods under Section 111 (d) and proposing penal action under Section 112 (a) of the Customs Act, 1962. Against the issue of the notice the importers filed Writ Petition No. 3664 of 191 before the Bombay High Court; the High Court directed that the importers should file written submissions which they did, and the Collector of Customs by the order dated 23.01.1992 held that the imports under three bills of entry were unauthorised as the goods attracted mischief of entry at serial No. 31 of Appendix 2B of the Policy, confiscated the goods with option to redeem them on payment of fine of Rs. 13.25 lakhs, Rs. 13.70 lakhs, and Rs. 13.70 lakhs respectively for each bills of entry and imposed a total penalty of Rs. 3 lakhs. While accepting the contention of the importers that the goods are under-proof whisky only (in para 26 of the adjudication order) he rejected their contention that only over-proof whisky is a concentrate of alcoholic beverage, and held that both over-proof whisky and under-proof whisky are covered by the expression "concentrate of alcoholic beverages". Aggrieved by this order the importers filed appeal No. C/119/92.

4. In November, 1991 the applicants imported once consignment described in the bill of entry as "compound alcoholic preparations namely under-proof strength whisky used only for the manufacture if IMFL, namely Indian whisky" and claimed clearance in terms of serial No. 524 of Appendix 3-A which covered "chemical and allied items other those listed in Appendix 2, 5 and 6". The department was of the view, based on the test report of the goods showing that the goods had the characteristics of whisky and alcoholic contents is 54.4% i.e. under-proof, that the REP licences did not cover the goods which appeared to be covered by serial No. 31 of Appendix 2B and hence a show cause notice dated 24.01.1992 was issued proposing confiscation and penal action. By the order dated 23.04.1992 the Collector of Customs upheld the charge in the show cause notice, confiscated the goods with option to redeem on payment of fine of Rs. 13.65 lakhs and imposed a penalty of Rs. 3 lakhs on the importers. Against this order the importers filed appeal No. C/263/92.

5. In February, 1992 the applicants imported one consignment described in the bill of entry as "compound alcoholic preparations namely under-proof strength brandy used only for the manufacture of IMFL - Indian whisky" and claimed clearance against REP licence valid for import of Appendix 3A items under serial No. 524 covering "chemical and allied items other those listed in Appendix 2, 5 and 6". Show cause notice dated 13.03.1992 was issued proposing confiscation and imposition of penalty on the ground that the goods were not covered by the licence and by adjudication order dated 24.08.1992 the Collector of Customs ordered confiscation of the consignment w