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Eurasian Equipment and Chemical Ltd. Vs. Union of India (Uoi) and ors. - Court Judgment

LegalCrystal Citation
CourtKolkata High Court
Decided On
Case NumberMatter No. 337 of 1972
Reported inAIR1974Cal208
AppellantEurasian Equipment and Chemical Ltd.
RespondentUnion of India (Uoi) and ors.
Advocates:Bagchi, Adv.
DispositionPetition dismissed
Cases ReferredBareily Electric Supply Co. Ltd. v. Their Workman
- the aircraft after drawing representative samples from drums nos. 10 and 18 in presence of one hardip singh. a representative of the carrier klm royal dutch air liners. on request of the customs officer at the air port, the said hardip singh telephoned two directors of the petitioners' company, shri lachmi prosad jajodia and shri manik chand jajodia to come over to the air port immediately to be present at the time of drawing samples from the consignment and furnishing guarantee bonds as required by the customs authority. the said two directors informed hardip singh that they would come over to the air port but insisted that the shipment must go on the same date and asked hardip singh to attend the customs examination and drawing samples from shipment. as there was not much time for.....

Amiya Kumar Mookerji, J.

1. A consignment of 25' drums declared to contain Chinchona Fabrifuge belonging to the petitioner Eurasian Equipment and Chemicals Limited, was exported from Dum Dum Air Port to Amsterdam (Holand) by K. L. M. Flight No. 861 on October 12, 1970. The Customs Authority allowed the consignment to be loaded in the Aircraft after drawing representative samples from drums Nos. 10 and 18 in presence of one Hardip Singh. a representative of the Carrier KLM Royal Dutch Air Liners. On request of the Customs Officer at the Air Port, the said Hardip Singh telephoned two Directors of the petitioners' Company, Shri Lachmi Prosad Jajodia and Shri Manik Chand Jajodia to come over to the Air Port immediately to be present at the time of drawing samples from the consignment and furnishing guarantee bonds as required by the Customs Authority. The said two directors informed Hardip Singh that they would come over to the Air Port but insisted that the shipment must go on the same date and asked Hardip Singh to attend the Customs examination and drawing samples from shipment. As there was not much time for the Plane to touch down at the Air Port, samples were drawn from the shipment and sealed by the Customs Authority in presence of the said Hardip Singh. The two Directors of the Petitioner's company arrived at the Air Port when the Aircraft left carrying the consignment, As requested by the Assistant Collector (Custom), Export, respondent No. 3, the said two directors of the petitioners' company executed a bond in the prescribed form, by which the petitioners undertook to accept the result of test of the representative samples drawn, to pay such duty, fine and penalty as might be imposed on them, and demanded by the Assistant Collector Custom. At the time of signing the guarantee, a remark 'the sample was not drawn in our presence' was noted in ink.

2. Thereafter the sample was tested in the Central Drug Laboratory, Calcutta, and it was found to be Quinine Sulphate and not Chinchona Fabrifuge as declared in the shipping bills. The price of Quinine Sulphate is Rs. 318/- per kg. and for 500 kgs. net weight, the exporter should have declared a price of Rs. 1,59,000/- while they have declared the price in the Shipping Bills as Rs. 21,500/-only. So they have misdeclared the description of the goods and the value to the extent of Rs. 1,37,500/- in respect of the consignment of Quinine Sulphate exported by them. On 4-9-1971 a show-cause notice was issued calling upon the petitioners to show cause why penal action in terms of guarantee bondshould not be taken against them. In the show-cause notice it was stated that the petitioners should be given opportunity of being heard in person. The samples were tested thrice; once in the Custom Laboratory and twice 'in the Central Drug Laboratory. The test report was duly sent, to the petitioners in course of personal hearing on 27-12-1971 before the Collector of Customs. Calcutta clarifications were sought for by the petitioners' lawyer in connection with second test report. A copy of the clarification made by the Central Drug Laboratory was sent to the petitioners on February 26, 1972. The petitioners through their Advocate's letter dated 27-5-1972 to the respondent No. 2, prayed for cross-examination of said Hardip Singh in connection with the letter written by him on 19-7-1972 (19-5-72?). The respondent No. 2 did not accede to the prayer of cross-examination. The petitioners thereafter did not participate in the personal hearing held on May 31, 1973 (1972?). The Collector of Customs by his order dated 3rd of January, 1972 (1973?), imposed a penalty of Rs. 1,37,000/- on the petitioners in terms of the guarantee bond executed by it. The petitioner being aggrieved by the said orders moved this Court under Section 226 of the Constitution and obtained the present Rule.

3. Mr. Bagchi, appearing on behalf of the petitioner, in support of the Rule, contended that in the present case samples were drawn not in accordance with Section 144 of the Customs Act, 1962. Admittedly, samples were not taken in presence of the owner as provided in the said section.

4. Section 147 of the Act provides that where the Customs Act requires anything to be done by the owner, importer or exporter of any goods, it may be done on his behalf by his agent. It appears from the letter of Hardip Singh dated 19-7-1972 that the owner was requested to be present at the time of drawing samples but they did not come. If the petitioner had any doubt as regards drawing of samples, the directors should not have executed the guarantee bond. Two directors of the petitioner's company insisted the shipment must be made on that particular date. Accordingly, the petitioner was allowed to export the goods by executing the bond under Section 135 of the Act. It also does not appear from the records, that, at any time for the purpose of Chemical test, the directors of the petitioner asked for any sample. In the instant case, Hardip Singh acted as an agent of the petitioner at the time of drawing samples as he has been authorised by one of the directors of the petitioner company on phone which fact has not been denied by the said directors of the petitioner's company, that they did not request Hardip Singh to be present at the time of drawing samples. That being so, I find no substance in the first point raised by Mr. Bagchi.

5. Mr. Bagchi next contends that the result of the first chemical test held by the Central Drug Laboratory, materially differsfrom the result of the second test. The petitioner was not bound by the result of the second test as that test was not made out of the sealed sample No. 78. So, according to Mr. Bagchi, there could not be any charge against the petitioner on the basis of the second chemical test report.

6. It has been stated in the affidavit in opposition by the respondent No. 3, Addl. Collector of Custom for Export, that the first lest was carried out from the sample sent to the Central Drug Laboratory duly sealed with the Custom House Chemical Examiner's seal and remnant was lying with the Central Drug Laboratory after the first test was carried out by it and the second test was done from that remnant sample. The said sample was tested thrice, that is, once in the Custom's House Laboratory and twice in the Central Drug Laboratory. Hence, it is not possible that the same seal No. 78 would remain intact for all the time. It also appears from the letter of the Director, Central Drug Laboratory, dated 14th February, 1972, which is anncxure 'B' to the affidavit in opposition affirmed by Dinesh Chandra Mondal, that there was no discrepancy between first and second report. That being so, in my view, it cannot be said that the petitioner could not be charged on the basis of the second chemical test report as contended by Mr. Bagchi.

7. Lastly, Mr. Bagchi contended that there has been violation of principles of natural justice in the adjudication proceeding as the petitioner's prayer for cross-examination of Haredip Singh was refused by the Collector of Customs and in support of his contention Mr. Bagchi referred a decision, of the Supreme Court, M/s. Bareily Electric Supply Co. Ltd. v. Their Workman, : (1971)IILLJ407SC .

8. It was a case under Industrial Disputes Act relating to the payment of bonus. In that case the Supreme Court observed that the application of principle of natural justice docs not imply that what is not evidence can be acted upon. On the other hand, what it means is that no materials can be relied upon to establish a contested fact which are not spoken to by persons who art competant to speak about them and are subjected to cross-examination by the party against whom they are sought to be used. If a letter or other document is produced to establish some fact Which is relevant to the enquiry, the writer must be produced or his affidavit in respect thereof be filed and an opportunity afforded to the opposite party who challenges this fact. This is both in accord with the principles of natural justice and also according to the procedure under Order 11 of the Civil Procedure Code and the Evidence Act, both pf which incorporate these general principles.

9. I am unable to follow how that principle is applicable to the facts and circumstances of the present case. At no stage of the proceeding, the petitioner did challengethe contents of the letter written by Hardip Singh, a copy of which was shown to them, long before. If the contents of the said letter Were denied by the petitioner, in that case, certainly, it was incumbent upon the adjudicating authority to produce the writer and the petitioner should have been given opportunity to cross-examine Mm. Even in the present petition under Article 226 of the Constitution, the petitioner nowhere challenged the truth of the contents of the letter written by Hardip Singh. So, under these circumstance, I am unable to hold that there has been violation of the principles of natural justice in view of the fact that Hardip Singh, the writer of the said letter was not produced for cross-examination.

10. In the result, all the points raised by Mr. Bagchi fail and this Rule is discharged. But, there will be no order as to costs.

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