1. The question which falls for determination in this petition filed under Article 226 of the Constitution of India, is whether the petitioners are entitled to claim advantage of partial exemption notification dated June 9, 1975 in respect of payment of Customs duty.
2. Only few facts are required to be stated to appreciate the grievance of the petitioners. The petitioners pursuant to an import licence dated August 5, 1974 imported certain goods by ship, which crossed the custom's barrier and territorial waters on July 30, 1975. On that day the import of the goods was governed by the benefits granted by the Notification of the Ministry of Finance (Department of Revenue and Insurance) dated June 9, 1975, whereby the Central Government in exercise of powers conferred by sub-section (1) of Section 25 of the Customs Act, 1962 (hereinafter referred to as the Act), exempted endosulfan being imported into India in a commercially pure form from so much of the duty of customs leviable thereon as was in excess of 35 per cent plus 5 per cent ad valorem. The notification was to remain in operation till March 31, 1976.
3. The petitioners cleared the goods on July 16, 1976 and on the days of the clearance the exemption notification was not in force. The customs authorities demanded duty at the rate of 60 per cent plus 15 per cent on the ground that the Notification was not in force on the date of clearance of the goods. The petitioners paid the duty and cleared the goods. The petitioners thereafter filed an application for refund amount of Rs. 1,69,717.45 as the excess duty recovered. The refund application was turned down by the Assistant Collector of Customs by order dated August 13, 1976. The appeal preferred by the petitioners to the Appellate Collector of Customs also ended in dismissal. The two authorities took the view that the relevant date for computing the duty is the date of clearance and not the date of arrival of the consignment within the customs barrier. The two authorities found that in view of the provisions of Section 157 of the Customs Act, the petitioners are to pay the duty in existence on the date of the clearance. The petitioners have filed the present petition to challenge the legality of those orders and the petition was lodged in this Court on March 11, 1978.
4. During the pendency of this petition, the revision application preferred by the petitioners before the Government of India against the two orders of the Assistant Collector and the Appellate Collector, was disposed of by order dated August 12, 1981. The revisional authority concurred with the conclusion recorded by the two authorities below and the revision was dismissed. Shri Dhanuka, the learned counsel appearing in support of the petition requested that the petitioners should be permitted to amend the petition and to challenge the legality of the order passed by the revisional authority. In my judgment, the prayer made by the petitioners deserves to be granted as that would avoid the multiplicity of proceedings. Accordingly, I have granted permission to the petitioners to amend the petition to challenge the legality of the order passed by the revisional authority. Shri Dhanuka assures me that the requisite amendment would be carried out within a period of one week from today. The grant of amendment would not require adjournment of the petition, because the revisional authority have relied upon the same grounds which appealed to the Assistant Collector so also the Appellate Collector while exercising appellate powers. In view of this, it is not necessary for the respondents to file any further return in respect of amendment of the petition.
5. Shri Dhanuka very fairly stated that in view of the decision of the Division Bench of this Court reported in 1981 Excise Law Times, page 414 in the case of Synthetics and Chemicals Ltd. v. S. C. Coutinho and others, the controversy is concluded as far as this Court is concerned. Shri Dhanuka stated that on the date of filing of the petition, a Single Judge of this Court had taken the view in Miscellaneous Petition No. 346 of 1970 that the relevant date to determine the liability to pay the customs duty is the date of arrival of the consignment within the customs barriers and the territorial waters. The decision of the Single Judge was over-ruled by the Division Bench in the case cited hereinabove. The Division Bench has considered in paragraph 12 of the Judgment the cases where the Notification partially exempts certain goods from payment of duty on the date of arrival within the customs barrier, but such exemption stands withdrawn on the date of actual removal from the warehouse. The Division Bench took the view that the importer is liable to pay the duty prevalent on the date of clearance of the goods from the warehouse and the advantage of partial exemption could not be claimed merely on the ground that the goods entered the barrier on the date when the exemption notification was in existence. The Division Bench held that if the goods were totally exempted on the date of its entry, within the custom's barrier, then duty cannot be recovered merely because such total exemption was withdrawn on the date of the clearance, but in cases where there is only partial exemption available on the date of entry in the custom's barrier, then withdrawal of such partial exemption would make the importer liable to pay the normal duty, if on the date of clearance of the goods exemption stands withdrawn. In view of the dictum laid down by the Division Bench, the petitioners would not be entitled to any relief in this petition.
6. Accordingly, the petition fails and the rule is discharged, but in the circumstances of the case there will be no order as to costs.