Transferred R.E.P. licences and customs clearance: alleged fraud did not justify refusal where the licence remained effective until avoided.

Transferred R.E.P. licences could be used for customs clearance under paragraph 141 of the Import and Export Policy, April 1982 to March 1983, without endorsement or prior permission from the licensing authority. Where the bills of entry were filed before suspension of the licence, the transfer appeared bona fide and clearance was to follow on production of the transfer document. Fraud was not readily inferable on the stated facts, and a licence obtained by fraud was treated as voidable rather than void ab initio, meaning it remained effective until avoided. On that basis, imported goods could not be denied clearance merely because fraud was alleged in the licence transaction.

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Issues: Whether goods imported under a transferred R.E.P. licence could be denied clearance on the ground that the original licence-holder had obtained the licence by fraud and the transfer was alleged to be fraudulent.

Analysis: Paragraph 141 of the Import and Export Policy, April 1982 to March 1983, permitted transfer of R.E.P. licences without endorsement or permission from the licensing authority, and customs clearance was to be allowed on production of the transfer document. The bills of entry had been filed before the licence was suspended, supporting the bona fides of the transfer. Fraud could not be readily inferred and, in any event, a licence obtained by fraud is not void ab initio but voidable and remains effective until avoided.

Conclusion: The imported goods were validly imported and clearance could not be refused on the asserted ground of fraud in the licence transaction.

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