LexTOOLSIDASS JEWRAJ versus ADDITIONAL COLLECTOR OF CUSTOMS AND OTHERS
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TOOLSIDASS. JEWRAJ
v.
~ ADDITIONAL COLLECTOR OF CUSTOMS AND OTHERS
MARCH 13, 1991
[N.M. KASLIWAL AND K. RAMASWAMY, JJ.]
Sea Customs Act, 1878/Foreign Exchange Regulation, Act, 1947:
>ls. 167(8), 167(37)/ss. 12(1), 23A, 23B-Export Declaration of incor-
rect F.O.B. values in shipping bills and G.R.l forms-Object being
unethical and objectionable-Undervaluation detected before goods
actually shipped-Order of confiscation, fine and penalty-Validity of.
The appellant firm, a jute goods exporter, entered into contracts
on December 19, 1961 for shipment of goods to a foreign company in
January 1962. Due to appreciation in price in Jan. 1962, the firm
~- arranged to ship the consignment in June, 1962, and before actually
shipping the goods, on 1.6.1962 submitted to the Customs authorities
the shipping bills and G.R. forms wherein F .O.B. was found to be
undervalued. The firm waived show cause memo and agreed to abide by
the decision of the Customs authorities. The ship left without taking
the consignment.
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The Additional Collector of Customs held that a "phatka' busi-
-ness was being carried on by the consigness abroad in which the ship-
pers had, as brokers, undertaken to remit to them invisibly the profits
so earned, by harnessing into service the medium of the said export
business, and the firm in attempting to ship the goods without making
proper declaration of (1) the amount representing full export value, and
(2) the period and manner of payment, violated s. 12(1) of Foreign
Exchange Regulation Act, 1947 and committed offences under s. 167(8)
Q_f Sea Customs Act, 1878 read with s. 23A and 23B of Foreign
-....:-' Exchange Regulation Act, 1947. He confiscated the goods and imposed
-, fine and personal penalty on the appellant firm.
On appeal, the central Board of Revenue atTmned the order of
confiscation and penalty but reduced the fme. The firm filed writ peti-
tion before the High Court.
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The Single Judge, relying on two decisions** of this Court,
held that once a declaration incorrect or untrue was filed, s. 12(1) of
Foreign Exchange Regulation Act was complied with, and the Addi-
821
A
B
c
D
E
F
G
H
822
SUPREME COURT REPORTS
{1991] 1 S.C.R.
tional Collector, Customs bad no .iurisdiction to pass the order; and ;;iik_
A allowed the writ petition. Revenue appealed before the Division Bench
B
of the High Court, which distinguished the decisions relied on by the
Single Judge, and allowed the appeal. Hence the present appeal by the
shippers.
Dismissing the appeal, this Court,
HELD: The appellant firm had made an attempt to. remit profitS----4...
to the consignees abroad by discounting it from the sale price and
declaring the export value of the goods at a lower rate. It was a case
where undervaluation in respect of full export value of goods was
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detected even before the goods were actually shipped or exported. The
...
C
Additional Collector, Customs was right in holding that there was Vio-
D
lation of s. 12(1) of Foreign Exchange Regulation Act, 1947 and the
appellant firm thus committed offences under s. 167(8) of the Sea y
Customs Act, 1878 read with ss; 23A and 238 of the Foreign Exchange
ReglationAct, 1947. [828E-F; 826C-FJ
The Division Bench rightly distinguished the two decisions relied
on by Single Judge, and rightly reversed his order and maintained the
order of the centrol Board of Revenue. [ 828F-G]
**Union of India & Ors. v. Mis Rai Balzadur Shree Ram Durga ~
E
Prasad (P) Ltd. & Ors., [1969] 2 SCR 727 and Becker Gray & Co. Ltd.
F
and Ors. v. Union of India & Anr., [1970] 3 SCR 445, distinguished.
The shipping bills and G.R.1 forms filed on behalf of the appel-
lant firm showed that the value mentioned therein was less than the foll
export value of the goods in the market at the relevant time. The F.O.B.
values declared by the shippers in the G.R. forms were, on their own_
admission, incorrect and the object of these incorrect declarations was ->
unethical and otherwise highly objectionable on more than one ground
of economics. [8260-E; 827A-B]
CIVIL APPELIATE JURISDICTION Civil Appeal No. 893 of
G
1976.
From the Judgment and Order dated 6.2.1975 of the Calcutta~
High Court in Appeal from Original Order No. 200 of 1972.
A.K. Oanguly,. 8. Sukumaran-, Ms. Amrita Misra and D.N.
H
Misra for the Appellants.
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T.D. TEWRAJ v. ADDL. COLLECTOR !KASLIWAL, J.]
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Kapil Sibbal, Additional Solicitor General, A. Subba RaExcerpt shown. Read the full judgment & AI analysis in Lexace.