TaxTMI 
TaxTMI 
1994 (11) TMI 253
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....s the amendment in the name of consignee. Sec.30(3) of Customs Act provides that if the proper officer is satisfied that the import manifest or import report is in any way incorrect or incomplete and there was no fraudulent intention, he may permit it to be amended or supplemented. The amendment is permissible in the IGM wherein there is no fraudulent intention. In the instant case the B/L for subject item were issued in the name of M/s Star Wires and Cable Industries and the same were subsequently changed in the name of M/s. Marvel Impex Pvt. Ltd. and accordingly an IGM was filed in the name of M/s . Marvel Impex Pvt. Ltd. M/s. Star Wires & Cable Industries and M/s. Marvel Impex Pvt. Ltd. are appearing in the list of fictitious benami firms of Didwania Group. Investigations were also conducted as to ascertain ownership of the supplier M/s. Donal McCarthy and it was found that it is also a firm owned by Didwania Group. M/s. Star Wire & Cable Industries and M/s. Marvel Impex Pvt. Ltd are non existent firms and not having any importer code No. Therefore, any consignment booked through them is an ITC violation. The B/L in the case is dated 9-7-1993 whereas the invoice raised in the ca....
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....ails of 7 consignments covered by the invoices dating from 29-6-1993 to 28-12-1993. In all these cases the Customs Department have not raised any objection and they have cleared the goods though emanating from the same suppliers. Only in regard to this consignment, they are refusing to entertain their B/E, by suitably amending the manifest to substitute the name of the appellants. There is no dispute that the documents are not retired by M/s. Marvel Impex Pvt. Ltd. and hence the title of the goods vests with the supplier. In these circumstances, the supplier is at liberty to transfer the title over the goods to the appellants, who have already entered into contract with the supplier, for monthly supply of 40/42 M. Tons. There is no allegation that the appellants are in any way connected with the Didwania group or in any way involved in fraudulent transactions with the supplier. Even the alert circular dated 24-3-1993 only refers to under invoicing aspect in respect of the consignment from the suppliers to some fictitious companies of Didwania group. In this case, since the values are based on LME prices, even this allegation cannot be sustained. (ii) The goods can be import....
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....n the judgment of the Supreme Court would be binding on this Bench and should be preferred to the judgment of the Madras High Court in the case of J.B. Trading Corporation, which is also distinguishable as aready pointed out. (v) In this case, when the goods came to india there was no importer, since the allegation is that the import is against a fictitious name not having any import code number. Hence, when the appellants, having the import code number and are also a bona fide actual user, have purchased the goods in terms of the contract with the foreign suppliers, they could be construed to be the importer and allowed clearance by permitting filing of B/E. Moreover, no action has been taken under Section 48 of the Customs Act in regard to the goods which have arrived in the name of M/s. Marvel Impex Pvt. Ltd. No proceedings for confiscation of the goods has also been initiated against M/s. Marvel Impex Pvt. Ltd. Hence, it is not open for the Department to bar the appellants to file the B/E, especially, when the documents transferred in their name have been retired and the title of the goods presently vests with them. 3.  Shri Misra, the 1d. SDR, for the Departmen....
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...., who claims to have purchased the goods in bona fides from the supplier to point out that M/s. Marvel Impex Pvt. Ltd. is a bona fide eligible importer in India. In fact, though a paper book has been filed, there are no correspondence from the supplier to point out that the goods were earlier supplied to the bona fide eligible importer in India and because of their backing out by refusing to retire the documents, the supplier is reselling the goods to the appellants. The appellants' previous clearances as well as the subsequent clearances have been rightly allowed by the Customs Department only because of the fact that the goods were consigned to an eligible importer having import code number and is also an actual user. This itself shows that the objection taken in this case is valid, mainly because the goods, having been unauthorisedly imported are sought to be legalised by substituting the name of the importer from a fictitious firm to another person having the import code number. Such an attempt has been dismissed by the Madras High Court by relying on the judgment of the Calcutta High Court. Hence, the ratio of judgment of the Madras High Court would be squarely applicable in t....
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....ted with this Didwania Group. We find that there are no evidences either from the supplier of the goods or from the appellants to rebut this finding. On a perusal of the contract and the correspondences, we find that there are no documents filed in the Paper Book particularly with regard to this consignment, where the goods are said to have been bonafidely resold to the appellants, on account of non retirement of documents by M/s. Marvel Impex Pvt. Ltd. If the supplies have been made in the course of normal international trade, the foreign supplier would have shipped the goods to an eligible importer having import code number. In this case, M/s. Marvel Impex Pvt. Ltd. are alleged to be a fictitious firm having no import code number. This finding of the adjudicating authority is not rebutted in any way by the appellants in the form of supplier's letter to show that the goods originally supplied to a bona fide importer who has backed out from the commitment. The correspondence only show that the suppliers will be shipping certain quantity of copper rods to the appellants and the other 7 consignments are consigned in the name of the appellants and has been allowed clearance, because t....
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....tual user. The import can be made only by a person having been recognised as an eligible importer by allotting a code number by the prescribed authority. Any contravention of this Act can also be construed to be a contravention under Section 11 of the Customs Act and hence would attract the provisions of Section 111 of the Customs Act. In view of this position, the goods, when they were imported into the country are to be construed to be as unauthorised imports attracting the provisions of Section 111(d) of the Customs Act. 4.4 Viewed in the context of the aforesaid legal provision, we now look into the case laws cited before us by both the sides. In the case of J.B. Trading Corporation - 1990 (45) E.L.T. 9 (Mad.), the main plea of the ld. counsel on behalf of the petitioner was as follows :- "(1) The definition of an Importer is found under Section 2(26) of the Act having regard to the same, if the petitioner, before the goods are cleared for home consumption, would hold itself out to be the importer, it has every right to clear the goods. The petitioner is an importer under law since the documents have been transferred to it and the bank documents, the bills of la....
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....y for clearance. It is almost certain that having come to know of the proceeding, the petitioner, with a view to circumvent the same, is claminig itself as 'importer' in order to set at naught the adjudication proceedings and the confiscation of goods. It is rather surprising that when the petitioner has accepted that it's payment is against S/P basis instead of refusing to retire the documents, it is making ingenious attempts to clear the goods which have been illegally imported into India by a fictitious firm on the strength of forged documents, concerning which R.C. No. 19 of 1986 is pending. There is absolutely no scope for the petitioner to claim the right of Importer, more so, after the first information report came to be filed on 2-12-1986, while the invoices of the petitioner bear the dates 15-12-1886 and 16-12-1986. Fraud is infinite in its variety and this is one such variety". 4.5 In the case before us, the counsel has taken pains to point out certain factual differences for urging that the said case law would not be applicable in this case. We have carefully looked into the differences pointed out by the ld. counsel. However, we are unable to agree that the rati....
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....t the ratio of the Madras High Court judgment would be squarely applicable in this case in the context of the factual position as discussed above. 5. We also looked into the decision of the North Regional Bench in the case of Savitri Electronics Co. citied by the ld. counsel. We find in Para 9 of the aforesaid judgment, the North Regional Bench have extensively quoted the decision of the Supreme Court in the case of Sampat Raj Dugar reported in 1992 (58) E.L.T. 163 (S.C.). In the case of Sampat Raj Dugar, the Supreme Court considered a case where the goods were supplied originally to an importer holding a DEEC licence. The importer, after clearing the goods against DEEC licence, is alleged to have diverted the goods and mis-utilised the licence and hence when the investigation commenced in regard to imports he did not choose to clear the goods. Then the supplier sought to resell the goods to another person, the claim of the buyer was rejected and the goods were held liable to confiscation. In the context of the above factual position, the Supreme Court held that the person who has cleared the goods by way of resale could be construced to be an eligible importer. While arriv....