TaxTMI 
TaxTMI 
1988 (9) TMI 66
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....utory application and as the Writ Petitions themselves are pending, disposal and elaborate arguments have been advanced by Counsel appearing for both parties, yet, in the interests of the parties, only the prima facie point involved is considered for finding out whether the grant of injunction and directions issued are justified or not. 3.The averments in W.P. No. 6494 of 1988 are taken into account to appreciate the points involved in these appeals. Petitioner has claimed that it is engaged in manufacture of handloom fabrics etc. The petitioner is entitled to net duty exemption import licence to the value of 40% of the value of the finished goods, which is known as Advance Licencing Scheme introduced in 1976-77. Under the Scheme, there is an export obligation to export handloom goods and for which purpose, licences were issued as mentioned in paragraph 3. Under the scheme, being entitled to a duty exemption while importing goods, it had imported the goods as mentioned in paragraph 4. The entries on these aspects of export and imports have been entered in Duty Entitlement Certificate. After referring to various imports and exports done by it, it is stated that respondents No. 3 ....
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....ursuant to the advance licence issued and from interfering with petitioner's rights to perform their export obligations under the Duty Exemption Scheme and consequently direct them to issue detention certificates for goods lying in the harbour. Pending disposal of this Writ Petition, they had filed W.M.P. No. 9399 of 1988 for grant of interim injunction restraining the said respondents from proceeding with the enquiry and investigation and W.M.P. No. 9400 of 1988 was filed for issue of directions to them to return the documents, licences including DEEC books seized from them and also for permitting them to clear the imported goods. W.M.P. No. 9401 of 1983 was filed to direct them to release the imported dyes and pigments which are kept in the bonded warehouse. W.M.P. No. 9403 of 1988 when filed to direct them to issue detention certification for the said goods. All these petitions were taken up together and on the learned Judge ordered the petitioners, these appeals have been preferred. 4.Learned Advocate General appearing for the appellants submits that whatever actions that may be taken by the Controller of Imports and Exports relating to the licence issued by him, yet when th....
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....er of Imports and Exports and the liability to pay customs duty would be dependent upon the nature of performance by the importer relating to the export obligations in respect of goods which have been imported under the Scheme till the contingency arises for payment of duty as provided in the advance licences, the Customs Authorities will have no jurisdiction to demand payment of customs duty. When import had been made based on a licence issued by a co-ordinating authority constituted under another enactment, unless and until he takes a decision as to whether customs duty had become payable or not; the Customs Authorities cannot entrench upon the powers of the Controller. The duty exemption entitlement certificate states that, after completion of exports, these certificates shall be produced with endorsement for discharge of the bond/legal agreement, before the licensing authority concerned, who, after discharging the bond/legal agreement, shall retain the certificate with him. While importing, the importer under clause 2(1) in Appendix 19 to import and Export Policy, has to execute a bond with a bank guarantee to the licensing authority. Clause 29(1) deals with follow up panel act....
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....nder various circumstances. If the imported materials are not fully utilised for no fault of the licence, the balance of it, imported under the Scheme, would suffer payment of customs duty with interest thereon as found in paragraph 29(3) of Duty Exemption Scheme. 8.Circumstances would certainly arise in cases therein, in inspection in a factory and Authorities of the Customs Department may come across certain goods which are covered by the said Scheme and found irregularities of evasion of customs duty and in such of these instances what they will have to do is to forward the particulars which have come to their notice to the Controller of Imports and Exports who will have to take the follow-up actions and determine whether any customs duty would become payable, as stipulated in the Scheme in respect of goods which are not covered by the Scheme, certainly, it is the customs duty personnel who would have the jurisdiction to seize and take-up follow-up actions under the Customs Act. 9.Such a view had been taken in Shivshankar Tilakraj v. Union of India [1987 (28) E.L.T. 342 (Bom.)] by holding that Customs Authorities are not empowered to sit in judgement over the powers exerci....