2014 (2) TMI 829 - HC - Customs

Court upholds validity of notifications under Customs Act and Constitution, dismisses petitions challenging parliamentary approval

RUCHI SOYA INDUSTRIES LTD. Versus UNION OF INDIA

RUCHI SOYA INDUSTRIES LTD. Versus UNION OF INDIA - 2014 (299) E.L.T. 391 (Guj.) Issues Involved:1. Publication of the Notification.2. Availability to the Public and Trade.3. Requirement of Parliamentary Approval.4. Compliance with Section 14(2) of the Customs Act.5. Alleged Discrimination under Article 14 of the Constitution.Detailed Analysis:1. Publication of the Notification:The petitioners contended that the notification of 2002 was not published in the Official Gazette on 2-9-2002, and therefore, it cannot be applied to their imports. The court, however, found clear and unequivocal assertions from the respondents, supported by affidavits and documentary evidence, that the notification was indeed issued and published on 2-9-2002. The court concluded that the notification was validly published on the said date.2. Availability to the Public and Trade:The petitioners argued that the notification was not made available to the public and trade until 3-9-2002, and thus it should not be applicable. The court examined the statutory requirement under Section 25(4) of the Customs Act and found that the notification was published in the Official Gazette, which is the primary requirement. The court also noted that the respondents provided sufficient evidence to show that the notification was sent for publication on the same day, and thus, the petitioners' contention was dismissed.3. Requirement of Parliamentary Approval:The petitioners claimed that the notifications were ineffective as they were not placed before the Parliament as required under Section 159 of the Customs Act. The court reviewed the documents produced by the Government, which showed that both notifications were indeed placed before the Parliament. The court highlighted that the statutory language of Section 159 does not require the Government to seek approval from the Parliament but only to lay the notifications before it. Therefore, the court found that the requirement was fulfilled, and the notifications were valid.4. Compliance with Section 14(2) of the Customs Act:The petitioners challenged the notifications on the grounds that the requirements of Section 14(2) were not fulfilled. The court examined the documents and found that a detailed exercise was conducted before issuing the notifications. The Board considered various factors, including international price trends and recommendations from the Director of Valuation. The court concluded that the notifications were issued after due deliberation and full consideration of relevant factors, fulfilling the requirements of Section 14(2).5. Alleged Discrimination under Article 14 of the Constitution:The petitioners argued that the notifications were discriminatory as they fixed tariff values for only certain categories of edible oils, violating Article 14 of the Constitution. The court disagreed, noting that Article 14 prohibits class legislation but allows reasonable classification. The court found that the classification of edible oils into different sub-categories was rational and based on intelligible differentia. The court also observed that the Karnataka High Court in a subsequent decision upheld a similar notification, distinguishing it from the earlier decision in Param Industries. The court concluded that the notifications did not violate Article 14.Conclusion:The court dismissed the petitions, finding no substance in the challenges raised by the petitioners. The notifications were held to be validly issued, published, and in compliance with the statutory requirements, including those under Section 14(2) and Section 159 of the Customs Act. The court also found that the notifications did not violate Article 14 of the Constitution. The interim relief was vacated, and the rule was discharged.