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Judgments
Janta Dal Mill, Proprietor Firm, Through its Proprietor, Dhrub Prasad alias Dhrub Kumar vs (1) State of Bihar, Through Secretary, Supply Department; (2) Commissioner, Gaya Division, Gaya; (3) District Magistrate, Gaya; (4) District Supply Officer, Gaya
[PATNA HIGH COURT, 26 Aug 2010]
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Sagar Knitters vs Union of India and others
[PUNJAB AND HARYANA HIGH COURT, 17 Aug 2010]
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Kotak Mahindra Bank Limited vs J. B. Diamonds Limited
[BOMBAY HIGH COURT, 11 Aug 2010]
Corporate - Banking & Finance - FEMA - Indian Contract Act, 1872, s. 23 - The Reserve Bank of India Act, 1934, ss. 45U(a) and 45V - Foreign Exchange Management Act, 1999, s. 2(c), 10(1) - Foreign Exchange Management (Foreign Exchange Derivative Contracts) Regulations, 2000, regns. 2, 4, sch. I - Petitioner granted various facilities to respondent-company including the revolving facility to enable the respondent to hedge foreign currency exposure to the extent of Rs.7,50,00,000 - Respondent-company entered into two forward contract transactions with Petitioner - Respondent-company confirmed to petitioner that it was liable to pay the petitioner a sum of Rs. 1,40,57,265 and a sum of Rs. Rs.1,03,50,000 respectively and requested 90 days to repay the dues with interest at 8% in installments - Petitioner stated that interest at 13% would be charged on the overdue amount and demanded the amount - Respondent-company admitted its liability and stated that it would soon come out of it temporary financial difficulties and that it was making an all-out effort to honour petitioner's dues - Statutory notice was issued by petitioners to the respondent-company - Petition for winding up filed by the petitioners against respondent-company - (A) Whether transactions between the petitioner and respondent-company illegal? - Held, transactions entered into between the petitioner and the respondent-company were permissible in law and were legal, valid and binding on the parties - Petitioner was an authorized dealer within the meaning of ss. 2(c) and 10(1) of the FEMA and the transactions entered into by the respondent are those for which the sale and/or purchase of foreign exchange is permitted under the FEMA; in the statement of disclosure the respondent-company stated that it had the legal capacity to enter into derivative transactions by the regulations and laws applicable to this country and agreed to undertake only such derivative transactions as are permitted by the laws of India by which it is governed including the RBI guidelines - (B) Whether respondent-company was liable to be wound up on the ground that it was unable to pay its debts? - Held, this is not a fit case to even admit the petition without first giving the respondent-company an opportunity of making payment in a phased manner firstly, respondent-company employs about 2500 people which is certainly an important consideration especially where it was found that the company was going through a temporary financial crisis and there is a possibility of it overcoming the same secondly the assessment note referring to the other 12 banks/financial institutions certainly establishes that the respondent-company was going through a severe financial crisis, however, it also indicates that there was a possibility of it overcoming the same; the fact that a consortium of 13 prominent banks/financial institutions have sanctioned a package prima-facie supports the same; the assessment note merely indicates that that though the respondent-company was at present unable to pay all its dues it will be able to do so shortly and if there was a possibility of the respondent-company overcoming the financial difficulties public interest demands that it ought to be afforded an opportunity of doing so - Order accordingly.
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(1) Malaysian Airlines; (2) Saudi Arabian Airlines; (3) North West Airlines; (4) Kenya Airways Limited vs (1) Union of India; (2) Joint Secretary (Camp Mumbai) Government of India; (3) Commissioner of Customs (Appeals); (4) Deputy Commissioner of Customs
[BOMBAY HIGH COURT, 09 Aug 2010]
Indirect Tax - Customs - Finance Act, 1979, s. 38(3) - Foreign Travel Tax Rules, 1979 - Imposition of penalty u/s. 38(3) of the Finance Act, 1979 for delay in payment of Foreign Travel Tax (FTT) to the Government - Petitioner was a Airline Company engaged in the business of carrying passengers between various locations in India and abroad - Petitioner in the course of its business collected FTT from passengers going abroad in accordance with the Finance Act and FTT Rules - Petitioner for the months of April, August, September and December, 2001 failed to pay the FTT within the stipulated period - Show cause notices were issued to the petitioner - Adjudicating authority imposed penalty for late payment of FTT - Appeals filed thereagainst dismissed - Hence, present writ petition - (A) Whether authorities below were justified in imposing and sustaining penalty in consonance with subsection (3) of s. 38 of the Act ignoring proviso to r. 11 of the FTT Rules? - Held, a delegated legislation would have to be read in the context of the primary statute under which it is made and, in case of any conflict, it is primary legislation that will prevail - R. 11 runs contrary to the provision of the Act - There is a clear conflict between the proviso to r. 11 and s. 38(3), the substantive provision of the Act - Reconciliation thereof is not possible - Rule being sub-ordinate legislation cannot override the provision of primary legislation - Hence, submission of the petitioners that the penalty must be in consonance with proviso to r. 11 of the FTT Rules and not in line with s. 38(3) of the Act is without any substance - (B) Whether power to impose penalty under section 38(3) of the Act is exercisable only in case of "failure to pay the tax" and not where there is only a delay in the payment of tax? - Held, concept of failure to pay can be quoted with non-payment - As per the provisions of the Act, amount of FTT collected becomes due within fifteen days from the date of collection thereof - Failure to pay within this prescribed time frame would mean non-payment or failure to pay - If any person fails to pay within the statutory period of fifteen days, then such person is well within the sweep of the words "failure to pay" - Once the period of fifteen days is over and breach in payment of tax is committed, then it is immaterial when the defaulter in future is making the payment - (C) Mens rea - Held, question as to whether mens rea is essential ingredient or not depends upon the nature of the right of the parties and the purpose of penalty for which penalty is sought to be imposed - S. 38 of the Act nowhere fastens criminal liability - Penalty leviable under Chapter-V or u/s. 38 of the Act is penalty in case of default or failure of statutory obligation or in other words for breach of civil obligation - Therefore, there is no need to establish proof of criminal motive or any mens rea on the part of the defaulter - Petitions dismissed.
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S. Manivannan vs (1) District Collector; (2) Regional Manager, TASMAC; (3) District Manager, TASMAC
[MADRAS HIGH COURT, 09 Aug 2010]
Trade - Socio-Economic - Liquor business near temples - Justifiability - Respondent/Authority opened a wine shop which was opposite a District Court and within a distance of 50 meters of four temples - Petitioner contended that location of the wine shop in the present place was causing great hardships to the petitioner, worshippers of four temples, school going children passing through the way - Petitioner filed the present writ petition for restraining the respondents from carrying on liquor business through the wine shop from the present location - Respondent contended that the wine shop was located in commercial area and shifting would cause loss of revenue to the Government - Held, since four temples and District Court existed in the nearby area of wine shop in question, respondents were not justified in contending that the liquor shop cannot be shifted to other place - Several liquor shops were ordered to be shifted or the same were shifted by the authorities themselves on HC orders in similar petitions - Respondents are bound to take a pragmatic view in similar kind of matters depending on the ground realities though there may not be any statutory bar prohibiting the location of liquor shop in a given area - Therefore, direction issued to respondents to shift the liquor shop situated at the location in question to any other unobjectionable place - Petition allowed.
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Sai Shipping Company Private Limited vs (1) Union of India; (2) Commissioner of Customs (Appeals); (3) Asst. Commissioner of Customs
[BOMBAY HIGH COURT, 04 Aug 2010]
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Commissioner of Customs vs Air Travel Bureau Limited
[DELHI HIGH COURT, 03 Aug 2010]
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Commissioner of Customs (Import), New Customs House vs Sea Bulk Offshore LLC
[BOMBAY HIGH COURT, 03 Aug 2010]
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Flemingo (Duty Free Shop) Private Limited, Represented by its General Manager, P. A. Ponnappa vs (1) Chairman, Tuticorin Port Trust; (2) Traffic Manager, Tuticorin Port Trust; (3) M/s. United Chemicals
[MADRAS HIGH COURT, 27 Jul 2010]
Trade - Contract & Commercial - Award of contract - Experience of constituent establishment - Consideration of - 1st respondent/Port Trust issued a tender notice inviting sealed tenders for operation of the Duty Free Shop in its canteen building wherein cl. 3 of the tender notice would read that only those who were experienced in the similar nature of business should participate in the tender - Petitioner submitted their bid and thereafter, petitioner and 3rd respondent were shortlisted - Petitioner send a letter to 1st respondent questioning the competency of the 3rd respondent to participate in the tender, as they learnt from reliable sources that the 3rd respondent did not have required experience in the similar nature of business - Since there was no response from the 1st respondent, petitioner filed the present petition - However, 1st respondent, in the meantime, awarded the contract to 3rd respondent on the basis of quoted amount - Whether the 3rd respondent has fulfilled the mandatory cl. 3 of the tender notice - Held, chemical business dealt with by the 3rd respondents cannot be equated with the retail business in consumer articles - Duty Free Shop business would involve the efficiency in dealing with the retail customers of multinational origin - 3rd respondent, who has no experience in the field of retail business in consumer articles, cannot be said to have got any experience in the similar Duty Free Shop business - Further, contention of the 3rd respondent that one of its constituents has got similar experience in Duty Free Shop business, cannot be accepted since the mandatory requirement u/cl. 3 of tender notice was the experience of the participants and not its consultancy or its top level officers - Therefore, 1st respondent should not have considered either the experience of 3rd respondent's constituents or their top level officials while taking into account the required experience of the participants in the tender - Hence, order of confirmation passed by the 1st and 2nd respondents in favour of the 3rd respondent is quashed -Direction issued to the 1st respondent to invite fresh tender for giving scope for more participants with clear terms concerning the eligibility criteria - Order accordingly.
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Mahesh Kantilal Zaveri vs Union of India others
[DELHI HIGH COURT, 26 Jul 2010]
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State of Madhya Pradesh vs Nerbudda Valley Refrigerated Products Company Private Limited and others
[SUPREME COURT OF INDIA, 23 Jul 2010]
Land & Property - Trade - Constitution of India, 1950, art. 226 - Alternative remedy - Availing of - Appellant/State leased the dispute land to respondent/Company for the purpose of developing trade in refrigerated food stuffs - Respondent raised construction on the disputed land without approval of the appellant - Nazul Officer issued a show-cause notice to respondent with regard to the construction - Respondent referred the matter to an arbitrator - Arbitrator, by his award, held that there was no prohibition in the lease deed for raising constructions to develop industry, trade and commerce - Appellant challenged the arbitration award before the HC - HC upheld the award - Appellant permitted the respondent to change the use of leased land from industrial purpose to commercial or residential purpose on payment of lease rent according to the rules and regulations - Respondent made an application for the grant of No Objection Certificate (NOC) before the Nazul Officer for raising commercial and residential constructions on the leased land - Since Nazul Officer did not consider respondent's application, respondent filed a writ petition before the HC - HC directed Nazul Officer to take a decision on respondent's application - Nazul Officer rejected respondent's application - Respondent challenged rejection before the HC - Appellant contended that respondent had an alternative remedy to challenge the Nazul Officer order, therefore, writ petition before the HC was not maintainable - HC directed respondent to submit the documents and information sought for by the Nazul Officer and also directed the Nazul Officer to decide the application of the respondent for grant of NOC by passing a speaking order - Further, HC observed that the Nazul Officer was trying to frustrate and circumvent the directions issued by the HC directing him to explain his 'misconduct' - (A) Whether the HC has exceeded its jurisdiction u/art. 226 of the Constitution of India while setting aside the Nazul Officer order in a writ petition when an alternative remedy was available to respondent to challenge the said order before the Collector as per s. 18 of the Revenue Book Circular - Held, Nazul Officer is better equipped to decide the application for grant of NOC and when the ultimate order of Nazul Officer can be canvassed before the Collector, the HC ought not to have exercised its extraordinary jurisdiction u/art. 226 as an appellate court over the finding of fact arrived at by the Nazul Officer - Even if the Nazul Officer order, requires interference, it is for the appellate authority to look into it and take a decision one way or the other and it is not an extraordinary case which warrants direct interference by the HC u/art. 226 - If respondents are aggrieved by the Nazul Officer order, they are free to challenge the same before the Collector, therefore, interference by the HC against the order of the original authority, which is based on factual details, is not warranted - (B) Whether the HC is justified in directing the Nazul Officer to be present personally to explain his 'misconduct' - Held, even if there is any error on Nazul Officer order, it is for the Collector/Government to set it right and the HC is not justified in asking the officer to personally present and explain his 'misconduct' hence HC has exceeded its jurisdiction in issuing such a direction - Therefore, impugned HC order is set aside and liberty granted to the respondent to avail the remedy available u/s. 18 of the Revenue Book Circular - Appeals allowed.
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(1) Commissioner of Customs (Exports), Custom House; (2) Biomed Hitech Industries Limited, Represented by its Executive Director vs (1) Biomed Hitech Industries Limited; (2) Customs Excise and Service Tax Appellate Tribunal; (3) Commissioner of Customs (Sea Port-Export), Custom House; (4) Assistant Commissioner of Customs (EPCG), Commissioner of Customs (Sea Port-Export)
[MADRAS HIGH COURT, 21 Jul 2010]
Customs - Practice & Procedure - Customs Act, 1962, ss. 3, 5(2), 122, 129-A - Appeal against the order of Chief Commissioner of Customs - Maintainability - 1st respondent imported capital goods under Export Promotion Capital Goods (EPCG) Scheme with zero duty vide license issued by the Director General of Foreign Trade in terms of Notification No.111/95 dated 5-6-1995 - Directorate of Revenue intelligence (DRI) send a show-cause notice to 1st respondent alleging that 1st respondent had wrongfully availed of the benefit of the notification by mis-declaration - Chief Commissioner of Customs adjudicated 1st respondent's case u/s. 5(2) of the Act and dropped the charges against 1st respondent - Revenue filed an appeal before the Tribunal u/s. 129-A of the Act - Tribunal returned the appeal as not maintainable on the ground that an appeal u/s. 129-A of the Act would only be maintainable against the order passed by the Commissioner of Customs and not that of Chief Commissioner of Customs - (A) Whether the Tribunal was right in dismissing the appeal as not maintainable since the appeal was filed against an order passed by the Chief Commissioner of Customs - Held, Chief Commissioner of Customs passing any order as an adjudicating authority of the officer at the level of Commissioner of Customs would be an order which can be subject matter of appeal before the Tribunal as provided u/s. 129 of the Act - Chief Commissioner of Customs also would include a Commissioner of Customs in a case where he exercises the power of the Commissioner of Customs (Adjudication) and in such an eventuality the Chief Commissioner of Customs becomes a proper officer and an adjudicating authority - Chief Commissioner of Customs can step into the shoes of the Commissioner (Adjudication) and acts in such a capacity while discharging his function u/s. 5(2) of the Act - Mere fact that the Chief Commissioner of Customs has signed the original order of adjudication as Chief Commissioner of Customs cannot make the said order as the one passed by the Chief Commissioner of Customs in its own capacity but the same has to be construed as the one passed by the Commissioner (Adjudication) - Therefore, Tribunal was not right in dismissing the appeal in question as not maintainable - (B) Whether the Tribunal was right in ignoring the provisions of s. 5(2) of the Act empowering an officer of Customs to exercise the powers and discharge the duties conferred or imposed under the Act on any other officer of Customs who is subordinate to him - Held, Commissioner of Customs is subordinate to the Chief Commissioner of Customs and Chief Commissioner of Customs has the power to act as an adjudicating authority and thereby, he can exercise the power of Commissioner in such circumstances - Conjoint reading of s. 3 and s. 5(2) clearly indicated that Chief Commissioner of Customs can exercise the power of Commissioner (Adjudication) and in turn Commissioner of Customs can exercise the power of his subordinates - Therefore, power has been exercised u/s. 5(2) of the Act by the Chief Commissioner of Customs was in accordance with hierarchy provided u/s. 3 of the Act - (C) Whether the Tribunal was right in not considering that in the case on hand the Chief Commissioner of Customs passed the order in appeal exercising his powers as Commissioner of Customs - Held, Chief Commissioner of Customs decided the case as a Commissioner (Adjudication) and not on his own - U/s. 122 of the Act only the Commissioner of Customs has been made as an adjudicating authority and as against the order passed by him an appeal would lie u/s. 129-A of the Act - Therefore, the mere fact that u/s. 129-A does not mention about the Chief Commissioner of Customs itself is a clear indicative of the fact that the order is passed by him only as an Commissioner (Adjudication) and not as a Chief Commissioner of Customs - Therefore, the Tribunal was not right in not considering that in the case on hand the Chief Commissioner of Customs passed the order in appeal exercising is powers as Commissioner of Customs - Petition dismissed.
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Naresh Sharma vs Union of India and others
[PUNJAB AND HARYANA HIGH COURT, 16 Jul 2010]
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Commissioner of Customs, Bangalore vs N.I. Systems (India) Private Limited
[SUPREME COURT OF INDIA, 15 Jul 2010]
Customs - Indirect Tax - Customs Tariff Act, 1975, headings 8471,9031 and 9032 - Classification - PXI Controllers, Input/Output Modules, Signal Converters and Chassis and its parts - Importer claimed impugned items as computers and/or parts of computers and classified them under Customs Tariff Heading 8471 - Importer submitted that imported items cannot perform any specific function unless the end-users have an appropriate programming software - Original Authority rejected the importer's classification of impugned items and classified same under Chapter 90 - Commissioner dismissed appeal filed against said order - Tribunal allowed appeal filed against said order and held that PXI Controller per se is not a measuring instrument and it can be used only in conjunction with an independent measuring instrument with suitable interface, hence, the PXI Controller/ other Controllers imported by the assessee cannot be classified under Chapter 90 of the Customs Tariff Act, 1975 - Hence, present appeal - Whether impugned items are classifiable under chapter heading 8471 or under chapter 90 of Customs Tariff Act, 1975? - Held, in order to attract Note 5(E) of Chapter 84 the real test is whether or not the machine imported is performing a specific function relatable to the functional unit as a whole - The said machine should be seen as a System - As a functional unit, the imported machine should perform a function other than data processing or it should perform a function in addition to data processing - The sentence in Chapter Note 5(E) 'incorporating or working in conjunction with an ADPM' merely indicates that the overall package, which is presented before the Department, had an ADP Machine in it - Moreover, if the contention of the importer is accepted, it would mean that every machine that contains an element of ADP would be classifiable as an ADP Machine under Chapter 84 - This would completely obliterate the specific function test and the concept of functional unit - Imported items were rightly classified by the Department under Chapter 90 - Impugned order of tribunal set aside - Revenue's appeal allowed.
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Shamsher Mehar and others vs State of Uttarakhand and others
[UTTARAKHAND HIGH COURT, 14 Jul 2010]
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Yoginder Pal vs State of Haryana and others
[PUNJAB AND HARYANA HIGH COURT, 13 Jul 2010]
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Smiths Detection (Asia Pacific) Pte Limited and another vs Union of India
[DELHI HIGH COURT, 12 Jul 2010]
Trade - Petitioner is a manufacturer of container scanning systems which are based on X-ray technology - Petitioners seek quashing of Global Notice Inviting Tender (GNIT) issued by Central Board of Excise and Customs, Department of Revenue, Ministry of Finance, for procurement of three mobile gamma rays scanners - Petitioners are aggrieved by fact that mobile X-ray scanners, which according to them, are as good, if not better, than mobile gamma ray scanners, have been arbitrarily and unreasonably excluded from said GNIT - Whether Global Notice Inviting Tender (GNIT) issued for procurement of three mobile gamma rays scanners can be quashed? - Held, on going through WCO Note, nothing indicates that X-ray based systems should be preferred over gamma ray based systems insofar as mobile scanners are concerned - This document also indicates that various compromises have to be made in considering appropriate technology to be utilized - It has also made it clear that a comparison of X-ray technology with gamma ray technology purely on basis of penetration would not be appropriate and two technologies may operate in same field, but they are certainly not easy to compare - While X-ray technology is certainly better for fixed scanners, same cannot be said for mobile scanners - After considering all technical aspects and specific requirements of customs authorities, and after taking into consideration advice from Atomic Energy Department with regard to safety and radiation concerns, respondent has chosen to employ a combination of technologies for its scanning requirements at said three ports and decision has been arrived at after considering pros and cons of both technologies and these are technical issues which are best left to technical experts and courts should not interfere with decisions on such matters unless and until something grossly arbitrary or unreasonable is brought to attention of court - On going through manner in which decision was taken and also WCO Note, it cannot be said that decision to adopt gamma ray technology for mobile scanners was arbitrary, whimsical or unreasonable -There is no question of interfering with said GNIT - Petition dismissed.
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Kandla Port Trust vs Goodrich Maritime Private Limited and another
[SUPREME COURT OF INDIA, 06 Jul 2010]
Customs - Customs Act, 1962, ss. 11, 111(d) and 112 - Major Port Trusts Act, 1963, ss. 48, 49, 59, 61 and 62 - Demand of container storage charges and ground rent - Respondent No.1 was agent of international shipping line, transported goods belonging to different consignees under 3 bills of lading in which the final place of destination was shown as Kandla Port - Description of the goods as given in the bills of lading was 'Heavy Metal Scrap' and Hollow Section Tubes, though, in fact, all the containers contained war material/explosives such as artillery shells, etc. - Said containers were shipped to Kandla Port and were off-loaded - Since the goods were not as per the description given in the bills of lading, the same were confiscated by the Customs Department-Appellant - Appellant sent communications to Superintendent of Police and General Staff Officer to take possession of the war material/explosives but both the authorities declined to do so by citing the grounds of lack of power to do so or non availability of resources - Appellant issued bills to respondent No.1 for levy of container storage charges and ground rent - Respondent No.1 challenged the same vide civil applications - Single Judge dismissed said civil applications and held that it was the duty of the importer to take the delivery of cargo in the container - Respondent No.1 questioned the correctness of the order of the Single Judge - Separate counter affidavits were filed on behalf of the appellant in both the appeals - DB did not avert to the counter affidavits filed on behalf of the appellant and allowed the appeals on the ground that there was no reasonable basis for levy of container storage charges or ground rent because letter addressed by respondent No.1 to the Traffic Manager, Kandla Port Trust for permission to remove the containers to de-stuff the cargo was not attended by the concerned authority - Hence, present appeal - Whether order of DB could be upheld? - Held, no - Undisputedly, the special civil applications filed by respondent No.1 were summarily dismissed by the Single Judge without calling upon the appellant and respondent No.2 to file counter affidavits to admit or controvert the averments contained therein - Appellant had a legitimate right to file counter affidavits in the appeals preferred by respondent No.1 and the DB was duty bound to consider the contents of the counter affidavits and then decide the issue relating to liability of respondent No.1 to pay container storage charges and ground rent - Without examining the issue in a correct perspective the DB granted relief to respondent No.1 only on the ground that representations made by the said respondent for release of containers after de-stuffing the goods were not decided - Hence, order of the DB could not be upheld - Appeals allowed.
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Hari Shankar Yadav vs Union of India and others
[ALLAHABAD HIGH COURT, 02 Jul 2010]
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Ind-Swift Limited vs Union of India and others
[DELHI HIGH COURT, 02 Jul 2010]
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Shri Shakambari Exports, Represented by its Proprietor, Mahendra Singh vs (1) Joint Director of Foreign Trade, Office of the Joint Director of Foreign Trade; (2) Assistant Commissioner of Customs, Office of the Commissioner of Customs; (3) Oriental Bank of Commerce, Represented its Chief Manager
[MADRAS HIGH COURT, 01 Jul 2010]
Customs - Indirect Tax - Foreign Trade (Development and Regulation) Act, 1982 - Export Import Policy, 2002-07 - Customs Act, 1962 - Customs notification No.30/1997 - Petitioner/exporter was granted three advance licenses for import of stainless steel under Customs notification No.30/1997 without payment of duty with a corresponding obligation to manufacture and export of stainless steel utensils- Petitioner executed a Bank Guarantee as per the terms of Export Import Policy - 2nd respondent/Assistant Commissioner invoked the Bank Guarantee - Whether the 2nd respondent is justified in invoking the Bank Guarantee - Held, Directorate of Revenue Intelligence (DRI) visited petitioner's office premises and found that there was no such office functioning in the said premises - 1st respondent/Joint Director issued show-cause notice to petitioner cancelling the advance license on the basis of the outcome of DRI investigation - 2nd respondent being an authority, functioning under the provisions of the Customs Act is bound by the notification and is entitled to enforce the statutory bond executed by the petitioner for while availing the benefit of Customs Notification No.30/97 - As long as the export obligation, discharge certificate is not produced before the Customs authority, they are entitled to invoke the provisions of the bond executed by the petitioner - Since the office premises of the petitioner does not exist as given in the license, there has been violation of conditions of the notification - When there is a violation of a notification issued under the Customs Act, the 2nd respondent would be justified in initiating action - Therefore, there is no error in the action of the 2nd respondent in invoking the Bank Guarantee - Petition dismissed.
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A. Sundaram vs (1) State of Tamil Nadu, Represented by the Secretary, Public (SC) Department; (2) Union of India, Represented by its Secretary, Ministry of Finance Department of Revenue, New Delhi; (3) Superintendent of Central Prison, Central Prison
[MADRAS HIGH COURT, 29 Jun 2010]
(A) Customs - Customs Act, 1962 - Fertiliser (Control) Order, 1985, O. 29 - Mis-declaration - Detention - Validity - Detenu was given Let Export Order for exporting Industrial Salt, however, Customs authority checked the consignment and send the samples to Customs House Laboratory (CHL) for chemical examination - Chemical analysis report confirmed that the samples were Muriate of Potash (MoP) - Customs authority seized the consignment and arrested the detenu - Detenu obtained an anticipatory bail, however, Customs authority issued the impugned detention order - Whether detention order is valid - Held, Analysis Report of the CHL did not give the percentage of Water Soluble Potash content in the samples therefore no decision can be arrived by relying on the report - Report itself suggested that an expert opinion be obtained from Regional Fertilizer Control Laboratory to find out as to whether the sample was classifiable as MoP - Reliance placed by the Detaining Authority on the said report to conclude that the sample was MoP, was erroneous and reflects non-application of mind - Further, CHL, in the present case, was not notified for the purpose of analysis under O. 29 by the State Government - Detaining Authority, in the grounds of detention, having alleged violation of the provisions of the 1985 Order, cannot rely on the Analysis Report of a Laboratory, which is not notified under O. 29 - Petition allowed.(B) Customs - Customs Act, 1962 - Customs Valuation (Determination of Value of Export of Goods) Rules, 2007 - Undervaluation - Detention order - Validity - Detenu allegedly declared the value of consignment which was less than its original value - Detenu contended that the valuation ought to have been made as per the Rules and not as per the method of valuation of imported goods - Held, Detaining Authority has relied upon an unsigned valuation report submitted by the Sponsoring Authority and the said report does not contain any signature, date or seal - Rules have not been followed while valuing the consignment and the Detaining Authority did not seek any clarification from the Sponsoring Authority, reflected the non-application of mind on the part of the Detaining Authority, which vitiated the order of detention - Petition allowed.(C) Customs - Customs Act, 1962 - Smuggling activity - Apprehension of future indulgence - Detention order - Validity - Held, it is the first export of the detenu and there is no prior transaction and there was no other past activities as could lead to a reasonable conclusion that the detenu possesses the propensity or the potentiality to indulge in smuggling activities in future to prevent which detention is necessary - Therefore, the impugned order suffers from total non-application of mind to a relevant and vital material touching the necessity to order the detention and it cannot be sustained - Petition allowed.
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Ayisha Beebee vs State of Kerala
[KERALA HIGH COURT, 22 Jun 2010]
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DK Enterprises, Bombay vs (1) Pimpri Chinchwad Municipal Council; (2) Regional Manager of Central Warehouse Corporation; (3) Commissioner of Customs, Pune
[BOMBAY HIGH COURT, 18 Jun 2010]
Customs - Indirect Tax - Contract & Commercial - Constitution of India, 1950, art. 226 - Bombay Provincial Municipal Corporation Act, 1949, ss. 127, 128, 453, 454, 455, 457, 465, 466 - Customs Act, 1962, ss. 2(15), 17, 61, 150 - Octroi Rules, rr. 2(g), (h) and (m), 6, 22(10)(b) - Code of Criminal Procedure, 1973, ss. 195 and 340 - Determination of liability to pay octroi - Advertisement was issued for Auction though authorized Auctioneer by Commr. of Customs for sale of various items - Petitioner participated in the public auction and was adjudged highest bidder - Petitioner paid the total value of goods purchased paid by him - Thereafter, petitioner requested for removal of goods to Municipal Corporation, same was refused for want of payment of octroi payable on the goods since goods were not cleared within a period of one year from the date the goods lodged in the warehouse - Petitioner stated that it was the liability of the Customs Department/Central Warehouse corporation - Hence, present petition - Who should bear the liability of the payment of octroi payable to the Municipal Corporation on the goods auctioned by the Commr. of Customs, which were stored with the Central Warehouse Corporation for a period more than one year? - Held, as per the provisions of the Bombay Provincial Municipal Corporation Act, 1949, Octroi Rules and the Standing orders, the goods which were detained in a bonded warehouse beyond the prescribed period of one year attracts full octroi as contemplated under the Standing Order No.22(10)(13) and the same is required to be charged and paid to the Corporation by the Warehouse - Under the Standing Order 22(10)(a), if goods are to be kept in Warehouse beyond a period of 30 days, then permission of the Municipal Commissioner is necessary which cannot be granted for a period more than 90 days; if the goods are not exported within the said specified period then the transporter is liable to pay octroi at the prevailing rate on such goods - In the present case, the goods were confiscated by the customs under the provisions of the Customs Act, 1962 and were warehoused for a period of more than one year; as such deeming provision under sub-cls. (c) of sub-cls. 10 of cls. 22 of the Standing Order operated and the Municipal Corporation became entitled to recover octroi duty from the respondent No. 2, the Warehousing Corporation - Hence, liability to pay octroi was the liability of the Warehousing Corporation, which they could recover from the person claiming custody of the goods by giving notice in this behalf, but no such attempt was made by the respondent No.2; the petitioner was never informed of this liability and as such cannot be made liable to pay octroi duty - (B) Application of sale proceeds sold by Customs Department - Held, s. 150 the Customs Act, 1962 provides for procedure for sale of goods and application of sale proceeds thereof and lays down manner and priorities in which amount realised is required to be applied - Order accordingly.
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Commissioner of Central Excise and Customs vs Jagat Texturising
[GUJARAT HIGH COURT, 17 Jun 2010]
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