Case: Collector Of Customs. Calcutta Vs. M. Shashikant And Co

The respondent, Shashikant &Company, had applied for the grant of Export House Certificate under the Import Policy 1978-79. The Certificate was denied on the ground that the respondent had not diversified its exports, Against the said order the writ petition filed by the respondent was allowed by the Bombay High Court and the respondent was held entitled to the Export House Certificate. Special leave petition filed by the Union of India against the said order was heard along with a bunch of similar petitions under the title Union of India v. Rajnikant Brothers. The petitions were dismissed on April 18, 1985 by an order in the following terms:  "We have heard counsel for the parties and have gone through the judgment of the High Courts of Bombay and Delhi. We are unable to find, in the facts and circumstances of the case, any requirement of diversification of exports as a condition for the grant of Export House Certificates in the Import Policy for the year 1978-79. While confirming the High Courts Judgment quashing the order impugned in the Writ Petition in the High Court we direct the appellants to issue the necessary Export House Certificates for the year 1978-79. The Export House Certificates shall be granted within 3 months from this date. Save and except items which are specifically banned under the prevalent import policy at the time of import, the respondents shall be entitled to import all other items whet her canalised or otherwise in accordance with the relevant rules. The appeals are disposed of accordingly with no order as to costsPursuant to the above quoted directions of this Court the respondent was granted additional licence dated September 4, 1985 for the import of Palm acid oil which was a canalised item under the Import Policy 1985-88. The respondent entered into a contract dated May 5, 1986 with a Singapore firm for supply of 4000 M .T. of Palm acid oil. The invoice in respect of the said contract was dated september 1, 1986 and the respondent filed the Bill of Entry on September 11,e Collector Customs Calcutta by his order dated, October 31, 1986, confiscated the goods on the ground that the import of Palm Acid Oil-a canalised item-was unauthorised. The respondent was, however, given the option to get the goods released on payment of a fine of Rs. 58, 00, 000/- in lieu of confiscation.The appeal filed by the respondent before the Customs, Excise &Gold (Control) Appellate Tribunal (hereinafter called `the Tribunal) was allowed and the order of Collector confiscating the goods was set aside. The Tribunal directed the refund of the redemption fee to the respondent.The tribunal decided in favour of the respondent broadly on three grounds, It came to the conclusion that till September 12, 1986, when this Court delivered judgment in Union of India v. M/s Godrej Soaps Ltd. 1986 (3) SCR 771 , the customs authorities were interpreting the order of this Court dated April 18, 1985 (Rajnikant Case) to mean that the additional licence holders were permitted to import even the canalised items. Secondly the import by the respondent was bona fide because of the following factors:  (a) On April 3, 1986 in a meeting attended by Mr. Swaminathan, Member, Central Board of Excise and Customs, Mr R.M. Singh, Principal collector of Customs and the representatives of the Federation of India Export Organisation, it was decided that the import of items, which were under Open General Licence during 1978-79 and were categorised as canalised under the Import Policy 1985-88, would be allowed to the additional licence holders.  (b) The Government of India in its letter dated April 23, 1986 stated that the Chief Controller Imports/exports, in consultation with the Additional Solicitor General, has permitted the additional licence holders to import canalised items against their licences.(c) The C ollector in his letter dated May 14, 1986 observed that clearance of canalised items against the additional licences was being unconditionally allowed.  The Tribunal, therefore, found that the respondent, having acte d on the representation of the Departmental authorities, was justified in importing the canalised item. Thirdly the Tribunal relied on the judgment of this Court in B. Vijay Kumar v. Collector of Customs, Civil Appeals Nos. 4445 &4446 of 1988 decided on December 16, 1988 and granted relief to the respondent in similar terms. that the Chief Controller Imports/exports, in consultation with the Additional Solicitor, has permitted the additional licence holders to import canalised items against their licences.  (c) The Collector in his letter dated May 14, 1986 observed that clearance of canalised items against the additional licences was being unconditionally allowed.allowed.  The Tribunal, therefore, found that the respondent, havingacted on the representation of the Departmental authorities, was justified in importing the canalised item. Thirdly the Tribunal relied on the judgment of this Court in B. Vijay Kumar v. Col lector of Customs, Civil a Appeals Nos. 4445 &4446 of 1988 decided on December 16, 1988 and granted relief to the respondent in similar terms.This appeal before us if by the Union of India through Collector Customs Calcutta against the judgment of the Tribunal.

Court's reasoning:
There is no ambiguity in the order which makes it clear that the additional licence holders would not be entitled to import the items which are specifically banned under the import policy 1985-88. No other interpretation is possible. Some of the Departmental officers were not justified in taking the view that the order permitted the import of canalised itemsThere was no ambiguity in the order dated April 18, 1985 (Rajnikants case). Assuming it needed clarification, the same was done by this Court on March 5, 1986 in Raj Prakashs case. The respondent entered into contract for the import of the item on May 5, 1986 much after the judgment in Raj P rakash case. We are of the view that the Tribunal fell into grave error in accepting the plea of bona fide raised by the respondent and setting aside the order of Collector. The opinions expressed by the officers in interdepartmental communications is of no consequence. In the face of clear and unambiguous judgments of this Court it was not open for the department authorities to entertain a contrary opinionIt is no doubt correct that the facts in B Vijay Kumars case relied upon by the Tribunal are somewhat similar to the facts in this case. This Court decided Vijay Kumars case on the special facts and circumstances of the said case. This Court while deciding Vijay Kumars case observed as under:"We do not consider it necessary to deal with these submissions in detail as we are of the opinion that in view of the special facts and circumstances of the case specially having regard to the findings of the Tribunal that the appellants imported the canalised items of goods bonafide under the additional import licence granted to them in pursuance of the express conditions contained in t e orders of this Court, which finding has not been challenged before us rather the Additional Solicitor General has fairly conceded the correctness of the findings of the Tribunal relating to the bonafide of the appellants in importing the disputed goods, we are of the view that the Collector and the Tribunal both were not justified in confiscating the goods or in imposing redemption fine..........We would like to emphasise that since we have decided the matter in view of the special facts and circumstances available in these cases this order will not be treated as a precedent." *Even otherwise, in view of the judgments of this Court discussed above, we hold that B Vijay Kumars case does not lay-down correct law.