NAVIN CHEMICALS MFG. AND TRADING CO. LIMITED versus COLLECTOR OF CUSTOMS

Citation: [1993] SUPP. 2 S.C.R. 326 · Decided: 15-09-1993 · Supreme Court of India · Bench: B.P. JEEVAN REDDY · Disposal: Dismissed

Judgment (excerpt)

A 
NAVIN CHEMICALS MFG. AND TRADING CO. LIMITED 
B 
c 
v. 
COLLECTOR OF CUSTOMS 
SEPTEMBER 15, 1993 
[B.P. JEEVAN REDDY AND S.P. BHARUCHA, JJ.) 
Customs Act, 1962-Sections 129-C(3), 129-C(4), 129-D(S), 130(1), 
130-E (b )-Central Excise and Gold Control Appellate Tribunal-Questions 
which could be decided by Member of thP. Tribunal sitting singly-Expression 
'detennination of any question having a relation to the rate of duty of Customs 
or to the value of goods for purposes of assessment' in S. 129-C(3 )-Meaning 
of-Appeal to Supreme Court directly from CEGAT in certain cases--
Relevance of. 
Under an advance import licence for the import of crude emetine 
D under a duty exemption scheme, which required the importer to export the 
goods after processing them, the goods imported by the appellants com-
pany were found, to contain emetine hydrochloride, moisture and other 
impurities. The Additional Collector of Customs held that the goods 
imported being emetine hydrochloride, the licence was not valid for the 
E same. In as much as the import had been made without the cover of a valid 
licence, the goods in question were ordered to be confiscated. However, the 
appellants were given an option to pay a fine of Rs. 10,000 in lieu of such 
confiscation. 
The appellant company prefered an appeal to CEGAT. A member of 
F 
the Tribunal sitting singly, rejected the appeal and confirmed the Addi-
tional Collector's order. 
In the instant appeal before this court against the Tribunal's order, 
the appellant company contended that since the case involved the deter-
G mination of a question having a relation to the rate of customs duty 
applicable to the said goods, it could not have been heard by a member of 
CEGAT sitting singly but ought to have been heard by a Special Bench 
thereof, as per provisions of Section 129-C of the Customs Act. 
On behalf of the respondent it was submitted, that no question 
H having relation to the rate of customs duty had been determined by the 
326 
NAVIN CHEMICALS MFG. v. COLLECTOR OF CUSTOM 
327 
order of the Additional Collector and, therefore, it was not a matter that A 
could have been heard only by a Special Bench of CEGAT. 
Dismissing the appeal, this Court 
HELD : 1. The controversy relates to the meaning to be given to the 
expression 'determination of any question having a relation to the rate of B 
duty of customs or to the value of goods for purposes of assessment. The key 
lies in the words 'for purposes of assessment' therein. Where the appeal 
involves the determination of any question that has a relation to the rate of 
customs duty or value of goods f~r the purposes of assessment, such appeal 
must be heard by a Special Bench. Cases that relate to the rate of customs 
duty for the purposes of assessment and which relate to the value of goods 
for the purposes of assessment are advisedy treated separately and placed 
before Special Benches for decision because they, more often than not, are 
c 
of importance not only to the importers who are parties thereto but also to 
many other importers who import or propose to import the same or similar 
goods. Since the decisions of CEGAT in such matters would have wide D 
application they are, by the tei:ms of the statute, to be rendered by Special 
Benches. The phrase 'relation to' is, ordinarily, of wide import but, in the 
context of its use in the said expression in section 129-C, it must be read as 
meaning a direct and proximate relationship to the rate of duty and to the 
value of goods for the purposes of assessment. [331-F-H, 332-A·B] 
E 
2. The statutory definition of the expression 'for the purposes of this 
sub-section' in the Explanation to sub-section 5 of Section 129-D of the Act, 
indicates that it has to be read to limit its application to cases where, for 
the purposes of assessment, questions arise directly and proximately as to 
the rate of duty or the value of the goods. Although the expression is F 
confined to section 129-D(S), it is proper that the said expression used in 
other parts of the Act should be interpreted similarly. [333-H, 334-A] 
3. The order of the Additional Collector under appeal before CEGAT 
in the instant case did not have any direct or proximate relation, for the 
purposes of assessment, either to the rate of duty applicable to the said G 
goods or to the value thereof. All that the Additional Collector's order did 
was to confiscate the said goods allowing to the appellant the option of 
redee

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