TaxTMI 
TaxTMI 
1984 (9) TMI 65
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....ately thereafter. 2. The petitioner appointed a clearing agent and submitted the bill of lading, a letter of gift from the petitioner's father and a certificate from the Consul General, Embassy of India in Japan, Tokyo. The petitioner in order to avoid demurrage and pilferage of and from the said car which is still lying at the K.P. Docks 6 (K.P.D.), submitted an application for warehousing the said car under the provisions of Section 49 of the Customs Act, 1962. The respondent No. 3, the Assistant Collector of Customs, for Appraisement Group VII intimated that until and unless the licence and/or customs clearance permit for the said car was obtained by the petitioner from the requisite authorities, the prayer for warehousing could not be entertained. The said car is leviable to customs duty by virtue of various provisions of Customs Act, 1962, the Customs Tariff Act, 1975 and Item No. 87.02 of the First Schedule to the Customs Tariff Act, 1975. The scheduled rate of duties specified for the said car in the Customs Tariff Act, 1975 as amended by the Finance Act, 1984 is 15% -.basic and auxiliary duty at the rate of 40% and additional duty at the rate of 5% plus Rs. 10,500 plus 5....
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....importers have imported cars without a licence and customs clearance permits, the customs authorities allowed the concerned importers to clear the cars in question upon payment of customs duty and a fine in lieu of confiscation. Instances of such importation have been given in the writ petition. The grievance of the petitioner was that the Appraising Officer for the Customs Department has received a telex message from the Central Board of Excise and Customs and/or other instructions directing the latter to confiscate all cars imported into India without a licence and/or customs clearance permit without giving the importer an option to pay a fine in lieu of confiscation under Section 125 of the said Act. Section 125 of the Customs Act provides as follows :- "125. Option to pay fine in lieu of confiscation.- (1) Whenever confiscation of any goods, is authorised by this Act, the officer adjudging it may, in the case of any goods the importation or exportation whereof is prohibited under this Act or under any other law for the time being in force, and shall in the case of any other goods, give to the owner of the goods an option to pay in lieu of confiscation such fine as the said o....
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....nd passed an interim order directing the respondents not to give any effect to the order, dated 30th August, 1984 and removing the car without the leave of the Court. I also directed to produce the records relating to importation and release of the cars as mentioned in Annexure D to the second writ petition. The respondents were also directed to produce the relevant records relating to release of the foreign cars upon payment of redemption fine during the last one year. The matter was fixed on 12th September, 1984. On 13th September, 1984 the records were produced by Mr. Taher Ali. He submitted that in this case the petitioner should move the Tribunal and appropriate order should be obtained from the Tribunal. Further he submitted that he does not admit the allegations contained in the petition but the Court may pass appropriate orders on the basis of the records produced by him before this Court. 8. Certain other facts have been mentioned in this writ application. Pursuant to the order passed by me on 24th August, 1984 the petitioner received a letter from the Deputy Collector of Customs for appraisement although the letter was signed by the Assistant Collector of Customs. By t....
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....r exportation whereof is prohibited under the said Act or under the law for the time being in force, give to the owner of the goods an option to pay in lieu of confiscation such fine as the officer thinks fit. Even if the importation of the goods is prohibited under the Act, the adjudicating officer has the discretion to give an option to the importer to pay in lieu of confiscation such fine as the officer thinks fit. The Act has not provided the circumstances under which the prohibited goods should be released upon payment of fine in lieu of confiscation. The adjudicating officer may, in his discretion, give the importer an option to pay in lieu of confiscation a fine. The exercise of this discretion by the adjudicating officer is a quasi-judicial function and cannot be controlled by the dictates of the Central Board of Excise and Customs or any other authority. The power to give option to the importer to release the prohibited goods upon payment of fine is a power coupled with the duty and in any event it should be exercised fairly and reasonably and not arbitrarily and capriciously. The question in this case is whether the Collector of Customs has acted fairly and reasonably in ....
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....ives at a conclusion partly on relevant consideration and partly on irrelevant consideration, the order is liable to be struck down as it cannot be decided how far the mind of the authority was influenced by such irrelevant consideration. The Collector of Customs although has said that he came to an independent conclusion without being governed by the instruction of the Central Board of Excise and Customs, it is admitted, by Mr. Taher Ali that there is an instruction from the Central Board of Excise and Customs that the authorities concerned shall not give any option for release of the imported car upon payment of redemption fine in lieu of confiscation under Section 125 of the Customs Act, 1962. Although the Collector of Customs has said in his order that he was not influenced by the said instruction, but from the tenor of the order passed I have no doubt in my mind that the authority followed the said instruction of the Central Board of Excise and Customs blindly. The Board has no authority or jurisdiction to direct an officer to exercise his discretion in a particular way. The discretion is vested in the adjudicating officer. While the adjudicating officer performs the statutory....
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.... previous decisions may still remain a debatable controversy in the world of law; nevertheless I am clearly of the opinion that neither the Appraiser nor the Collector of Customs can change his mind from time to time in respect of the same articles by assessing them in the case of one importer under one section and then assessing them for another importer under different section. To allow the customs to do so will lead to utter confusion in the very basis and principles of taxation and grave uncertainty in business and foreign trade of India. Its more serious result will be the most unfair discrimination of taxes in respect of the same goods with regard to different importers. That cannot be permitted by the Constitution which insists on the equality of law as one of its fundamental guarantees. I am, therefore, inclined to hold that the customs are bound by their own precedents in administering taxing statutes involving the very basis of taxation in respect of a particular article and not leave it to them to modify their own previous decisions but to leave it to them to apply to Courts or Parliament or Legislatures as the case may be to put the law beyond doubt. In a recent Tariff ....
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.... car fitted with one air-conditioner was sent by the father of Miss. Vandana Wadhwa as a wedding gift. The Deputy Collector of Customs (P.G. Pal) in his order, dated 4th February, 1984 has stated as follows : "I have gone through the records of the case. Although the car has been imported as a wedding gift its clearance cannot be allowed without a valid import licence/C.C.P. Since the importer has failed to produce a valid import licence/C.C.P. for clearance of the consignment, the importation is treated as unauthorised. Accordingly, I confiscate the goods u/s. 111(d) of C.A. 62 read with Section 3(2) of Imports & Exports Control Act, 1947. However, the importer is given an option to redeem the goods on payment of fine of Rs. 75,000/-in lieu of confiscation." 16. It may be mentioned that when the said order was passed by the Deputy Collector of Customs the present Collector who has passed the order in this case was the Collector. In another case there was unauthorised importation of one used BMW 1983 model motor car of capacity 1990 c.c. fitted with air-conditioner, radio/cassette with spares and food stuff and toilet requisites by one Iswar Bhagwandas valued at Rs. 73,399.45....
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....e goods under Section 111(d) of the Customs Act, 1962. In lieu of confiscation the importers are however, given the option under Section 125 ibid., to clear the goods on payment of a fine of Rs. 1,20,000/- (Rupees one lakh twenty thousand only) within 15 days from the date of issue of this order." 20. There are two other cars which have been imported by two different persons, one by Shankarlal Sharaf, the other by Gobindlal Agarwalla. The cars were Toyota Cressider and Honda. Both the cars were gifted by one Atu Balani of Hongkong. It appears that no enquiry was made of the circumstances under which Atu Balani allegedly gifted two cars, one Honda and the other Toyota, to the aforesaid two persons. They are not related. But after the adjudication was made in those two cases by the then Collector of Customs, the cars were released upon payment of fine of Rs. 1,00,000/- in each of the aforesaid two cases. The Collector accepted the story in those two cases that those were unsolicited gifts from one Atu Balani. 21. In another case, one Jagmohan Jindal imported a car. It appears that the case was adjudicated by the Deputy Collector (P) on 26th December, 1984. The order was issued ....
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....o. 250-Cus., dated the 27th August, 1983 the Deputy Collector was empowered to exercise jurisdiction under Section 125 of the said Act as the adjudicating authority in respect of the said car.. That is why he directed the Assistant Collector to issue the show cause notice. The show cause notice was issued on 18th August, 1984 by the Assistant Collector directing the petitioner to show cause in writing to the Deputy Collector of Customs, for appraising. The petitioner thereafter came to this Court and order was passed by me on 24th August, 1984. It appears from the records that the petitioner wrote a letter asking for personal hearing. The personal hearing was fixed on 28th August, 1984. The Assistant Collector thereafter discussed the matter with the Deputy Collector (P) and obtained his verbal orders. The following note is found on record :- "As regards the M.O.P. its percentage has to be decided on the basis of the present market price on such car in India in terms of Section 125 of C.A. 62." The Officer gave a note that the valuation of a similar type of car in the present market would amount to Rs. 2,90,000/-to Rs. 3,00,000/-and the total amount of customs duties will com....