COMMISSIONER OF CUSTOMS, KOLKATTA versus M/S. GRAND PRIME LIMITED AND ORS.

Citation: [2003] SUPP. 1 S.C.R. 401 · Decided: 07-07-2003 · Supreme Court of India · Bench: M.B. SHAH · Disposal: Appeal(s) allowed

Judgment (excerpt)

COMMISSIONER OF CUSTOMS, KOLKATTA 
v. 
M/S. GRAND PRIME LIMITED AND ORS. 
JULY 7, 2003 
[M.B. SHAH AND ARUN KUMAR, JJ.] 
Customs Act, 1962-Section //I (d) and (o)-Applicability of-Import 
restricted goods-Advance licence-Grant of-Subject to condition oJ re-export 
A 
B 
of goods-Importer failing to comply with the condition of re-export of goods C 
in case of earlier import-Importer importing another consignment-
Consignment awaiting clearance-Notice-Fearing action regarding previous 
import, importer not appearing-Non filing of bill of entry-Confiscation of 
goods-Justification of-Held: Import violative of import restrictions-Also 
the licence against which import took place was found to contain forgery, thus 
import contrary to law being without a valid licence-Hence, section I II (d) D 
attracted and goods liable to confiscation-Order of the Tribunal permitting 
re~export of the goods unsustainable. 
A firm through its proprietor imported certain goods against 
advance licence. It cleared five consignments of raw silk through the port 
free of duty subject to the condition of re-exporting after conversion. The E 
Department came to know that the firm had imported and cleared two 
consignments of raw silk against a fraudulently obtained advance licence 
and had sold the goods in the open market without discharging the export 
obligation. Department again came to know that the firm had imported 
consignments of silk fabric and tussah silk through the port and the said F 
consignments were awaiting clearance but the importer did not turn up 
to get the goods released. Department issued summons to the firm and its 
proprietor but they could not be served and they never appeared. 
Summons were also issued to other parties involved in the import of 
consignments. Parties appeared and their statements were recorded. 
Thereafter, notice was issued to the firm to show cause against the G 
confiscation of the two consignments under Section 11 l(d) of the Customs 
Act, 1962 and imposition of penalties. The firm did not respond to the show 
cause notice. Respondent No. I claiming to be the exporter wrote to 
Commissioner of Customs that they had failed to locate the importer and 
401 
H 
402 
SUPREME COURT REPORTS (2003] SUPP. I S.C.R. 
A there was no alternative purchaser, therefore the permission be granted 
to re-ship/re-export the goods comprising the said consignments. 
Respondent No l was represented by an attorney and a supplementary 
show cause notice was issued to the Respondent and its Director. 
Thereafter Commissioner of Customs held that as the importer was guilty 
B of misrepresentation of facts and falsification of documents, the import 
was contrary to law and thus the goods were liable for confiscation. 
Respondent No. I filed a writ petition, however the proceedings were still 
pending before the Commissioner of Customs. Commissioner of Customs 
passed an order and High Court thereafter held that the party had a right 
of appeal again~t the said order. It further directed that the Tribunal 
C would proceed only on the point as to whether the petitioner is the owner 
of the goods and the goods are entitled to be re-exported. Tribunal relying 
on Union of India v. Sampat Rai Dugar case held that the goods could be 
re-exported and set aside the penalties imposed. Hence the present appeal. 
Appellant contended that the Tribunal erred in relying 011 Dugar 's 
D case since there is a clear distinction between the two cases; that there is 
no valid import of goods, thus the import is contrary to law; that Section 
lll(d) of the Customs Act, 1962 is applicable in the instant case; that there 
is no provision for re-export of goods in the Customs Act, thus, there was 
no question of re-export being permitted. 
E 
F 
Respondent No.I contended that the importer had not retired the 
document of title to goods which were sent through the bank, therefore, 
the exporter had title to the goods and was entitled to re-export the goods. 
Allowing the appeals, the Court 
HELD: l.l. In the instant case, the goods are in the restricted list 
under the Import-Export Policy for the relevant period. The import of 
these goods is permitted only against a licence which is granted subject to 
the condition of re-export of goods. The importer had failed to comply 
with the condition of re-export of finished or semi-finished goods, qua, the 
G imports iilready made under the same licence. When the consignments in 
question were imported

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