TaxTMI 
TaxTMI 
2014 (9) TMI 289
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....at the Advance Licence No. 03014593 was issued on 22nd November, 1996 in favour of M/s. Amrit Laxmi Machine Works against its past export of textile machinery. The overall value of the licence was set out and the Licencee was permitted import of 248 pieces of bearings of specified specifications. It is stated that there are 4 amendments made to the licence and the validity period was extended up to 21st May, 1999. In February, 1999 one Mr. Vakaria introduced Mr. Manharlal Vohra and Mr. Ashwin Mehta to the licence holder i.e. M/s. Amrit Laxmi Machine Works following which an Memorandum of Understanding (MoU) was executed between Mr. Ahwin Mehta and the licence holder M/s. Amrit Laxmi Machine Works. It was agreed that if the licence is made transferable by the Licencing Authority and the said Authority amends the licence to cover the bearings generally instead of those with particular specifications, then, they are interested in purchasing the said licence at an agreed premium. Thereafter, the licence and other documents were handed over to. Mr. Vohra and Mr. Mehta for engaging a Consultant. The Consultant was, thus, engaged for applying to the Licensing Authority and for carrying ou....
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....e deal and transaction. Our attention is invited to paragraphs 6.20 and 6.21 of the order of the Tribunal and it is submitted that the new findings going beyond the show cause notice have been rendered. The precise submission is, therefore, that a substantial question of law would arise inasmuch as the Tribunal was not entitled to make out entirely a new case by going beyond the show cause notice and adjudication thereof. 7. It is then submitted that a substantial question of law would arise inasmuch as the Authority and the Tribunal have failed to understand the concept of invalidation of the licence and nullification of imported transaction. Mr. Jain submits that the licence which has been obtained by misrepresentation or fraud is not void, but is voidable and is valid till it is suspended or cancelled. In these circumstances that it is submitted that these appeals raise a substantial question of law. 8. On the other hand, it is submitted by Mr. Rao, learned counsel appearing for the Respondent/Revenue that these appeals do not raise any substantial question of law. There are clear findings of fact and which cannot be said to be vitiated. It is submitted that a su....
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....st Information Report on 25th September, 1999 with the Police reporting loss of the original advance licence No. 030014593 dated 22nd November, 1996 along with DEEC book and at that stage, the licence had not been made transferable. The Authorities noted that the application in that behalf was made on 27th November, 1999. In the meanwhile, Mr. Mehta sent a draft letter to the Licence Holder M/s. Amrit Laxmi Machine Works addressed to the Joint Director General of Foreign Trade for issuance of a duplicate licence. That draft letter is dated 27th September, 1999 and it was submitted to the office of the Joint Director General of Foreign Trade after obtaining the signature of the licence holder. There was letter dated 18th November, 1999 from the office of the Director General of Foreign Trade and in response thereto, M/s. Amrit Laxmi Machine Works vide letter dated 29th' November, 1999 informed about payment particulars of duty and CVD along with interest. However; all said payments were made by Mr. Mehta and Mr. Vora. The duplicate licence in lieu of the original licence and valid upto 21st May, 1999, was issued on 22nd November, 1999 and revalidated upto 21st November, 1999. Thus, ....
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....pect of 10 Bills of Entry filed on 28th December, 1999 the duplicate licence with transferability stood suspended on 24th December, 1999. Thus, there was no valid licence in the names of original importer on 28th December, 1999. As regards, the Bills of Entry filed on 15th and 20th December, 1999, the duplicate licence was issued on 22nd December, 1999 and the endorsement thereon clearly shows that the validity of the licence was at the best till May, 1999 or November, 1999. Thus, taking into account the grace period of validity the licence could have been valid up to the end of November, 1999. Hence, the finding of fact that in respect of all imports made there was no valid licence in favour of the importers at the time of importation and therefore, the denial of benefit of exemption notification, was rightly upheld. 11. It is in this context that we must appreciate the argument of Mr. Jain based on the judgment in Union of India v. Sampat Raj Dugar reported in 1992 (58) E.L.T. 163 (S.C.). The whole emphasis of the argument is reliance on this judgment. In this case what the Hon'ble Supreme Court noted was that the second Respondent Ms. Renu Pahilaj was carrying on busines....
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....rt licence granted to the second respondent was cancelled by the Competent Authority on 12th May 1986. No orders were passed with respect to the said goods. Thus, the Collector of Customs passed the order on 9th September, 1986 imposing penalty of Rs. 5 lacs on the second respondent. The penalties were also levied on other two persons said to be Associates of the second respondent. The first Respondent's claim was rejected on the grounds, namely the advance import licence against which the said four consignments were imported has since been cancelled by the competent authority which means that there is no valid import licence for clearance of those goods; and since for re-export of the goods a valid import licence is necessary and because it is not there and also because the second respondent has abandoned the goods, permission for re-export cannot be granted. That is how the first respondent without preferring an appeal, directly challenged this order in the Bombay High Court by way of a Writ Petition and that Writ Petition was allowed and thereafter, the Letters Patent Appeal preferred by the Revenue was dismissed by the Division Bench. 12. It is in these circumstances th....
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....imposed with respect to three earlier consignments, it may not be possible to presume that it would not be observed even with respect to the four consignments in question. Be that as it may, it is sufficient for the present to notice that so far no action has been taken on that account either under the Customs Act or under Section 4G of the Imports-Exports (Control) Act, 1947. Section 4G of 1947 Act is also conceived to meet such situation, as a reading thereof would disclose. It says that non-compliance with any condition of licence relating to utilisation of such goods renders the said goods liable to confiscation notwithstanding that such goods are mixed up with other goods or material. Even though a period of more than five years has passed by, no action has been taken either under the Customs Act or under Section 4G of Imports-Exports (Control) Act, though the import licence of the second respondent has been cancelled. We must presume in the circumstances that no such action was or is contemplated. In these circumstances the title of the first respondent to the said goods remains free of any cloud." 13. Therefore, the observations of the Hon'ble Supreme Court must be s....