TaxTMI 
TaxTMI 
2010 (4) TMI 584
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....r referred to as "the Customs Act") the importer of any goods is required to file a Bill of Entry and present it to the officer concerned in the prescribed format. Once such Bill of Entry is filed, if the goods are imported, and duty payable has been paid thereon, clearance may be given thereof under Section 47 of the Customs Act. 3. Learned counsel for the petitioner submits that, no Bill of Entry (hereinafter referred to as "B/E") was filed in respect of the said consignment of 'pig bristles' that had arrived in the Container No. HDMU 2368478, by any per son, neither was the said consignment claimed by any importer and it remained un-cleared in the warehouse of respondent No. 2, who was the custodian of the said goods. It is submitted that Section 48 of the Customs Act deals with procedure in cases where goods are not cleared from the warehouse or transit within 30 days after they are unloaded. Section 48 reads as under: "Procedure in case of goods not cleared, warehoused, or transhipped within [thirty days] after unloading. -If any goods brought into India from a place outside India are not cleared for home consumption or warehoused or transhipped within [thirty days] from....
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....was the highest bidder for the said consignment, and the same being manifest from the final result of the auction notified by respondent No. 2 on 10-4-08 which specifically approved the petitioner's bid, the petitioner applied for further necessary clearance, as per Circular No. 13/2007-Cus., dated 2-3-07 issued by the Central Board of Excise and Customs (hereinafter referred to as "CBEC") and the same required that all consignments of live stock products be cleared by the Animal and Quarantine Departments. Learned counsel for the petitioner submits that vide letter dated 25-4-2008, the sample was forwarded by respondent No. 2 to the Animal and Quarantine Departments and a bare reading of the said letter itself discloses that respondent No. 4 had acknowledged the fact that the goods even on that date stood sold to the petitioner. 7. It is submitted by the counsel for the petitioner that even otherwise, in accordance with the Bill of Entry Regulations, a consolidated Bill of Entry prepared by respondent No. 2 and submitted to Customs Authorities, by virtue of Regulation 3 the said Bill of Entry filed by the custodian of the goods was deemed to be a Bill of Entry filed under Secti....
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....yment of the balance amount by the petitioner thereafter, which petitioner under takes to pay. It is next submitted by counsel for the petitioner that the petitioner cannot be divested of its right to the possession and delivery of the goods in issue. It is submitted that ex facie, the filing of the 'Bill of Entry' by respondent No. 3 is not bona fit especially keeping in view the period of almost one year which has elapsed between the arrival of goods and the filing of the Bill of Entry. Counsel for the petitioner submits that it appears that officials of respondents No. 2 and 4 are permitting such belated filing of the Bill of Entry to suit their own ends. Learned counsel for the petitioner submits that it is not permissible, in the present circumstances, for respondents No. 2 and 4 to even delay the delivery let alone deny the delivery of the goods to the petitioner for which the petitioner has submitted the highest bid and fulfilled all requisite formalities. 11. While opposing the present petition, learned counsel for respondent No. 2 submits at the outset that the present petition is not maintainable since it involves disputed question of facts which cannot be adjudicated ....
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.... at any time before the goods are actually, physically delivered out of the campus and without disclosing any reasons for such withdrawal. Learned counsel for respondent No. 2 submits that respondent No. 4 vide letter dated 13-6-08 withdrew the lot of 'pig bristles' in question, in accordance with Clause 3(ix) of the terms and conditions of the auction and in view of the said withdrawal, respondent No. 2 could not have given delivery of the shipment to the bidder/petitioner inasmuch as the instructions of the Customs Authorities are binding on respondent No. 2. Therefore, the petitioner lost its right to take delivery of the lot/consignment in question. 14. Learned counsel for respondent No. 2 has further vehemently submitted that even otherwise, mere confirmation of a bid does not cloth the petitioner with the title of the consignment, till the physical possession of the consignment is handed over to the bidder i.e. the present petitioner in the case. It is submitted that the petitioner has not even exhausted the alternative remedies as provided for within the meaning of Clause 12 of the terms and conditions of the tender-cum-online auction sale and that the present petition is....
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.... the E Auction, accepting to abide by the general conditions of sale, it is not open to the petitioner to question the right of the respondents to withdraw the auctioned goods from the sale. In the impugned order, it is clearly stated that due to administrative reasons, the auctioned goods have been withdrawn from the sale. Condition No. 11, as extracted above, clearly shows that the respondents are entitled to withdraw the auctioned goods from sale with out disclosing the reasons for such withdrawal." 16. Learned counsel for respondent No. 3 further submits that the petitioner has not presented the correct factual position before this court. Learned counsel submits that correct facts of the case are that respondent No. 3 entered into a sales contract with M/s. CHONG QING SHENGCHENG ANIMAL BY PRODUCTS (hereinafter referred to as "M/s. CHONG QING") for a consignment of white boiled bristles with certain specifications Accordingly the sales invoice and a Bill of Lading was drawn M/s CHONG QING confirmed the receipt of an advance payment of US $ 2000 from respondent No. 3 and in pursuance of the said agreement respondent No 3 received pig bristles from M/s CHONG QING in the month o....
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....le Corporation, by the Ministry of Agriculture, a copy of which has been placed on record, wherein the Regional Officer, Department of Animal Husbandry, had informed the Assistant Commissioner, Customs, that the products may either be deported back to the port of origin or destroyed at the owners cost. 18. Counsel for respondent No. 3 submits that when the auction was initiated in March, 2008, respondent No. 3 did not participate because Sh. Deepak Gaba, the concerned person, was unwell for a long time and even otherwise respondent No. 3 was under the impression that the goods could not have been auctioned being prohibited goods. It is next contended by counsel for respondent No. 3 that it is only by a notification dated 23-5-2008 that the earlier notification was amended and the terms thereof relaxed by allowing import of pig bristles subject to clearance by Quarantine and goods free from any virus infection by the Animal Husbandry Department, subject to the condition that the relaxation would follow for imports made post 5-6-2007 but prior to 11-11-2007 in a situation where either advance payment has been made, LC opened and shipment is prior to 5-6-2007. Despite the fact that....
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....riginal importer, by permitting him to file Bill of Entry and allowing clearance of goods. Counsel for respondent No. 3 further submits that respondent No. 3 has paid Custom Duty of Rs. 19.66 lakhs with interest accrued thereon; the land retention charges of CONCOR, respondent No. 2, of Rs. 3.37 lakhs; paid auction/de-auction charges of its. 4.00 lakhs to the Container Corporation, as also Rs. 1.77 lakhs to the Shipping Line, besides roughly Rs. 52.00 lakhs to the foreign supplier, totaling approximately Rs. 81.00 laths, as against which the petitioner has only paid a sum of Rs. 8.00 lakhs i.e. the 20% of the auction amount. Counsel for respondent No. 3 also submits that respondent No. 3, the original owner of the Cargo, had never abandoned or relinquished title of the goods, which could only have been acquired after the Ministry of Agriculture took a conscious decision that imports which had been made after 5-6-2007 should also be entitled to be cleared subject to the conditions. 20. Counsel for respondent No. 3 has relied upon Clause 3.0(ix) of the Terms of Auction, in support of his plea that the Custom Department, respondent No. 4, was well within their right to withdr....
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.... that a party to a contract is bound by the arbitration clause contained in the contract and he has to seek for arbitration in terms of the stipulations contained in the agreement. Hence, having agreed to abide by the conditions contained in general conditions of the auction, which contain as above said an arbitration clause in condition No. 28, the petitioner cannot invoke the writ jurisdiction of this Court." 23. Learned counsel for respondents No. I and 4 while supporting the case argued by counsel for respondents No. 2 and 3 submits that the case of the petitioner is devoid of any merit. 24. Learned counsel for respondent No. 4 submits that in the auction held on 26/27-3-2008 (as per the petitioner it was held on 27/28-3-2008), the consignment comprising of pig bristles in container No. HDMU 2368478, was sold at the highest bid price of Rs. 41,42,435/- to the petitioner. Samples were drawn and sent to the wild life as well as to the quarantine department for obtaining the requisite No Objection Certificate (NOC). The test reports from both the departments were received and both had given the NOC. The NOC dated 29-5-08 is sued by the Animal Quarantine and Certification Ser....
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....epartment gave a No Objection Certificate to respondent No. 3 vide letter dated 13-6-08. It is submitted that the importer has the legitimate right to the goods till the time the goods are lying with the custodian and that the petitioner s claim on the consignment of Pig Bristles (imported in Container No. HDMU 2368478 (LOT No. - 106)), is null and void. 26. In the rejoinder filed by the petitioner to the counter affidavit of respondent No 1 and 4, it has been stated that the reliance placed upon by respondent Nos 1 and 4 on circular No 50/2005 in support of the contention that the goods can be withdrawn from the auction, is entirely misplaced. It is contended that the said circular is totally inapplicable in the facts of the present case as the said circular clearly states that the liberalised procedure would not apply to goods which have been lying uncleared for a period of less than one year from the date of their import Even assuming, without admitting the fact that the said circular is applicable the said circular supports the case of the petitioner by clearly stating that the customs shall not withdraw any consignment at the last moment from the auction except with t....
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....ful to recall that under Article 226 of the Constitution of India while exercising the power of judicial review the High Court does not sit as a Court of appeal and it is not to examine the merits of the decision but only the decision making process. The Court must take into account whether a public authority has exercised its jurisdiction in a ma/a fide manner and that the administrative authority has followed the norms and standards of procedure laid down Courts must examine and protect individuals against arbitrary action even in contractual matters and the decision taken by the authority is to be examined on the basis of the Wednesbury's Principle of reasonable ness. Further it can be safely said that the practice of judicial review of administrative action, ordinarily, constitutes the exception and not the rule. Unless a decision is coloured in mala fide exercise of discretionary power or is demonstrably capricious or arbitrary and not informed by any reason or otherwise purports to create an unreasonable classification, Courts should restrain from finding too many loopholes therein. 30. The exceptional circumstances warranting the application of judicial review in administ....
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....d position of law to the facts of the present case, it is the case of the petitioner that there was collusion between CONCOR and respondent No. 3 to defeat the legitimate right of the petitioner. It is submitted that Respondent No. 3 never cleared the goods at the first instance and, therefore, the goods were put to auction. it is further contended that Respondent No. 3 did not participate in the auction and since the petitioner was the highest bidder, initial payment having been deposited by the petitioner and besides having submitted the requisite certificates from the Quarantine and Wildlife Authority, procured on 11-4-2008 and 25-4-2008, the goods, in question, should have been released to the petitioner. It has been contended by counsel for the petitioner that the goods could not have been withdrawn by CONCOR or the Customs Authorities as there was no justification for the same. Neither any instruction for withdrawal has been placed on record. 34. The question which thus arises for my consideration is whether the respondents No. I and 4 could withdraw the goods after the petitioner was declared the highest bidder? And if yes, whether the same were withdrawn for cogent reaso....
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....f the tender would show that the respondent would be well within its right to withdraw a lot or any part thereof at any time before it is actually physically delivered out of the campus without disclosing the reasons for such withdrawal. 38. I further find that Lot No. 106 was withdrawn by respondent No. 2, CONCOR, based on the communication dated 13-6-2008 received on 16-6-2008 from the Assistant Commissioner (Customs). 39. It has been strongly urged before this Court by learned counsel for the respondents that Lot No. 106 was withdrawn by the Customs Department before the No Objection Certificate could be issued in favour of the petitioner for release of goods on account of the fact that a representation dated 2-6-2008 was received from the importer, respondent No. 3, as they had filed the Bill of Entry No. 698971 dated 29-5-2008. The importer of goods, respondent No. 3, also in formed the Customs Authorities that it had deposited the duty of Rs. 19,66,448/- along with interest of Rs. 5,657/- vide Challan No. 160 dated 11-6-2008 and sought No Objection Certificate to get their consignment cleared. 40. Learned counsel for the Customs Department has further justified its a....
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....auction. Letters dated 12-6-2008 and 13-6-2008 read as under: "OFFICE OF THE COMMISSIONER OF CUSTOMS ICD, TKD, NEW DELHI (DISPOSAL) C.No. VIII(ICD) 6/TKD/Disp./01 /08/Pt. 8751 Date 12-6-2008 The Chief Manager, CONCOR, ICD, TKD, New Delhi. Sir, Subject :- Lot No. 106 - Auction held on 27/28-3-2008 - Reg. It is to inform your that M/s. Shine Enterprises have filed B/E No. 698971 dated 29-5-2008 to clear their consignment of 'Bristles' and have de posited duty of Rs. 19,66,448/- along with interest of Rs. 5,657/- vide TR-6 Challan No. 160 dated 11-6-2008. They have requested to give NOC for the release of their consignment and willing to comply with all the remaining formalities for clearance of their goods. This office has no objection if the goods contained in container No. HDMU 2368478 are released to the importer M/s. Shine Enterprises. Yours faithfully, ASSISTANT COMMISSIONER (Dip.) Copy to: M/s. Shine Enterprises, C-27, Double Story, Ramesh Nagar, New Delhi-15 to complete the formalities of clearance of their goods vide B/E No. 698971 dated 29-5-2008. ASSISTANT COMMISSIONER (Disp.)" "....