LexRIB TAPES (INDIA) PVT. LTD. & ANR. versus UNION OF INDIA & ORS.
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
RIBTAPES (INDIA) PVT. LTD. & ANR.
v.
UNION OF INDIA & ORS.
SEPTEMBER 2, 1986
[G.L. OZA AND S. NATARAJAN, JJ.)
Customs Act,
/962;~Section III(m)-Difference in 'value'-
Whether could be made basis of breach prior to 1973. ·
Statutory Interpretation:-Object and Reasons of Bill-Resort
to-For intention of Legis/aaae-Permissib/e.
The appellants, owners.of a hoisery factory, imported 27 knitting
machines in 1972 under the import licence held by them. According to
the Customs authorities the machinery was not new as the licence
permitted to import, but was old reconditioned, and that the price
shown was much lower than the actual value. After hearing the appel-
lants, the .Collector of Customs found that the appellants had commit-
ted breach of s. l l l(d) and also of s. l l I(m) of the Customs Act 1962
and for both the counts he imposed the penalty, which was maintained
by the Board. On revisfon the Central Government reduced the penalty
from Rs. 1,47 ,000 to Rs.1,000,00 which had been imposed'for breach
of s. 11 l(m). A writ petition filed by the appellants was dismissed by the
High Court.
In the appeal to this Court, on behalf of the appellants It was
contended that a penal proviSion has to be construed strictly and in
absence of specific words requiring 'value' to be mentioned, it could not
be inferred that any difference in value coul!J be made the basis of
penalty.
'
On behalf of the respondents it was contended that although the
term 'value' was not ins. lll(m) before the 1973 amendment but that
will make no difference as even without the term 'value' a mis·
.description could be interpreted to be a mis-description on the basis of
value stated and ultimately the goods found tO be of a higher value. By
the amendment the Legislature had only tried to explain or clarify the
.position.
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698
SUPREME COURT REPORTS
[1986] 3 S.C.R.
Allowing the Appeals, the Court,
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HELD: I. The impugned orders are set aside and the penalty
imposed on the appellants under s. l ll(m) read with s. 11 l(d) of the
Cnstoms Act 1962 is.quashed. [704A-B]
2. Before the amendment in 1973, s. lll(m) did not contemplate
any difference in material particulars in respect of value but it referred *
matters other than the value. [703B-C]
3. Unamended s. lll(m) indicated that wherever goods actually
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imported are different in material particulars than the goods which '
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were shown in the bill of entry or a declaration as contemplated in s. 46
then it will be a breach of s. 11 I(m). The difference in particulars could
be in respect of anything but value, as this sub-clause clearly shows that
the difference in value could not be made the basis of breach of this
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sub-clause before the amendment of 1973, when the term 'value' has
been introduced into this sub-clause. [701B-C]
4. In order to interpret a particular provision and to infer the
intention of the Legislature, the Objects and Reasons stated in the Bill,
when it is presented to the Legislature, could be used. [703BJ
5. _The amendment inserting the term 'value' ins. lll(m) cannot
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be said to be explanatory. [703F]
Union of India & Ors. v. Mis. Rai- Bahadur Shree Ram Durga
Prasad (P) Ltd. & Ors., [1969] 2 SCR 727, relied upon.
;
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 172
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of 1979
From the Judgment and Order dated 4.4.1978 of the Delhi High
Court in Civil Writ No. 261of1978.
B.R. Aggarwala for the Appellants.
O.P. Sharma for the Respondents.
The Judgment of the Court was delivered by
OZA, J. This appeal on special leave arises out of a Judgment of
RIB TAPES PVT .. LTD. v. U.0.1. [OZA. J.J
699
the Delhi High Court dated 4th April, 1978. The leave is granted on a
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limited question as regards the question of interpretation of sub-clause
(m) of Section 111 of the Customs Act, 1962 ('Act' for short). The
appellants imported 27 knitting machines as the appellants owns a
hosiery factory in 1972. The appellants held an import licence for
import of knitting machinery.
B
According to the Customs authorities the machinery was not new
-.J
as the licence permitted to import, but was old reconditioned. The
Customs authorities also held that the price shown by the appellant on
the basis of invoice was much lower than what the price actually should
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be. The price shown by the appellant on the basis of invoice was
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Rs.77441 whereas according to the Customs auExcerpt shown. Read the full judgment & AI analysis in Lexace.