Court allows writ petitions, permits import of secondhand Digital Multifunction Machines under trade policy. Confiscation deemed arbitrary.

The court allowed the writ petitions, setting aside the order restricting the import of secondhand Digital Multifunction Print and Copying Machines. It held that the goods were freely importable under the relevant provisions of the Foreign Trade Policy and the Hand Book of Procedures. The court also rejected the classification of the goods as hazardous waste and found the confiscation of goods and imposition of penalties to be arbitrary due to non-compliance with statutory procedures. The petitioners were directed to release the goods immediately, with no costs imposed.

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Issues Involved:
1. Restriction on import of secondhand Digital Multifunction Print and Copying Machines.
2. Whether the imported goods are categorized as hazardous waste.
3. Confiscation of goods and imposition of penalty under the Customs Act.
4. Availability and bypassing of alternative remedy.

Detailed Analysis:

Restriction on Import of Impugned Goods:

The petitioners sought the issuance of a writ to quash the order restricting the import of secondhand Digital Multifunction Print and Copying Machines. The petitioners argued that under the Foreign Trade Policy (FTP) 2009-2014 and the Hand Book of Procedures (HBP) V.1 2009-2014, such goods were freely importable. The court referred to the provisions of the FTP and HBP, noting that while personal computers and laptops were restricted, other secondhand capital goods, including Digital Multifunction Print and Copying Machines, were freely importable under Para 2.33 of HBP V.1 2009-2014. The court emphasized that the FTP and HBP should be read together to give a purposive interpretation, and found no conflict between them. Consequently, the court held that the respondent's finding that the goods were restricted under Para 2.17 of the FTP was contrary to law and liable to be set aside.

Imported Goods Whether Hazardous Waste:

The respondent contended that the imported goods fell under the category of hazardous waste as per Rule 3(1)(iii) of the Hazardous Wastes (Management, Handling and Transboundary Movement) Rules, 2008, specifically under Basel No.B1110 of Part B of Schedule III. However, the court found this interpretation incorrect, noting that the imported goods were complete machines, not waste or assemblies. The court highlighted that the machines were certified to be in working condition with residual life by a Chartered Engineer, and there was no evidence to classify them as hazardous waste. The court concluded that the respondent's reliance on the Basel Convention and the Hazardous Wastes Rules was misplaced, and there was no material to substantiate the claim that the goods were hazardous waste. Therefore, paragraphs 12(c) and 12(d) of the respondent's order were unjustified and liable to be set aside.

Confiscation of Goods, Imposition of Penalty & the Provisions of the Customs Act:

The court noted that the confiscation of goods and imposition of penalties under Section 111(d) of the Customs Act, 1962, read with Sections 3(2) and 11(1) of the Foreign Trade (Development and Regulation) Act, 1992, were done without issuing a show cause notice as required under Section 124 of the Customs Act. The court emphasized that the statutory procedure for confiscation and penalty had not been followed, rendering the order arbitrary and contrary to law. The court also observed that the petitioners had not waived the requirement of a show cause notice. Consequently, the order of confiscation and imposition of penalties was set aside.

Alternative Remedy:

The respondent argued that the petitioners had bypassed the statutory appeal remedy under the Customs Act by filing writ petitions. However, the court rejected this plea, noting that the earlier order directing the authority to consider the petitioners' claim for release of goods was in terms of Section 47 of the Customs Act. The court held that when an authority acts contrary to statutory provisions or in an arbitrary manner, the aggrieved party is entitled to seek protection under Article 226 of the Constitution of India. The court found the impugned order to be arbitrary and unsustainable on its face, and therefore, the plea of alternative remedy was not applicable.

Conclusion:

The writ petitions were allowed, and the impugned order was set aside. The court directed the respondent to release the imported goods forthwith, with no costs imposed. The connected miscellaneous petitions were also closed.

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