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Vardhman Spg. and Vs. the Union of India (Uoi) and ors.

Vardhman Spg. and ;general Mills Limited and anr. and ;majavor Spinning Mills Ltd. vs The Union of India (Uoi) and ors.

Type Court Judgment Court Mumbai Decided Sep 22, 1982
~3 min read
https://sooperkanoon.com/case/357372

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Citation
Court
Mumbai High Court
Judge
Decided On
Case Number
Misc. Petition No. 1450, 1451 and 1603 of 1979
Subject
Customs

Case Summary

AI-generated summary - not the official court judgment text.

Customs Act, 1962 : Sections 12 & 15;Imported Viscose Staple Fibre entitled to exemption from customs duty if it entered Indian territorial waters before the date of imposition of such duty. Relevant date for charging duty is date of entry into territorial waters. - CODE OF CRIMINAL PROCEDURE, 1973 [C.A. No. 2/1...

Key legal issue
Customs

Parties & Advocates

Appellant / Petitioner

Vardhman Spg. and ;general Mills Limited and anr. and ;majavor Spinning Mills Ltd.

Respondent

The Union of India (Uoi) and ors.

Advocate Mr. Dhanuka

Legal References

Reported In
1983LC45D(Bombay)

Excerpt

.....desai & d.b. bhosale, jj] arrest of accused - held, a police officer or a person empowered to arrest may arrest a person without intervention of the court subject to the limitations specified under the provisions of the code. the provisions of section 41 of the code provides for arrest by a police officer without an order from a magistrate and without a warrant. a distinct and different power under section 44 of the code empowers the magistrate to arrest or order any person to arrest the offender. under section 44 of the code, that power is vested in the court of the magistrate when an offence is committed in his presence. if the legislature has taken care of providing such specific power under section 44 of the code, then there could be no reason for such a power not to be specified under the provisions of chapter xii of the code. in terms of section 41, a police officer may arrest a person without a warrant or order from the magistrate for any or all of the conditions specified in that provision. language of this provision clearly suggested that the police officer can arrest a person without an order from the magistrate. thus, there appears to be no reason why on the strength of section 156(3) of the code, any restriction should be read into the power specifically granted by the legislature to the police officer. of course, freedom of investigation is the essence of these provisions but in order to suppress the mischief it is sufficiently indicated under different provisions of the code that the arresting officer should exercise his power or discretion judiciously and should be free of motive. some kind of inbuilt safeguard is available to the accused in the cases where the magistrate directs investigation under section 156 (3) of the code by taking recourse to the provisions of section 438 of the code by approaching the court of session or the high court for such relief. thus, during the course of investigation of a criminal case, an accused is not ..........11th january 1979 at which date it was liable to duty. this petition is filed to quash the show cause notices.2. it now appears from the endorsements of the customs authorities upon the bills of entry relating to the viscose staple fibre and entries in the register of outward/inward entry of vessels maintained by the customs authorities that the vessels had in fact entered indian territorial waters prior to 31st december 1978, the first named vessel on 30th december 1978 and the latter vessel on 26th december 1978.3. the division benches of this court in the judgments of m.s. shawhney v. messrs sylvania and laxman ltd. 77 bom. l.r. 380 and synthetics and chemicals ltd. v. s.c. coutinho 1981 e.l.t. 414 have held that, for the purposes of chargeability to duty under the customs act, the relevant date is the date upon which goods enter indian territorial waters. mr. dhanuka, learned counsel for the respondent, submitted that the said judgments are not good law because their ratio is contrary to that of three supreme court judgments. he fairly conceded, though, that this court would be bound by the said two judgments. applying their ratio it is clear that the viscose staple fibre was not chargeable to duty under the customs act on the date it entered indian territorial waters. the show cause notices in the petition must, therefore, be quashed.4. it is agreed that the facts of the other two petitions are similar and that the contentions raised therein would be identical.5. each of the three petitions is made absolute in terms of prayer (b) thereof with costs.6. on mr. dhanuka's application, the petitioners in each petition are ordered to keep alive the bank guarantees furnished by them pursuant to interim orders for a period of 6 weeks from today.7. mr. bhat states that he will file in court photostat copies of the four bills of entry in the first petition.

Full Judgment

S.P. Bharucha, J.

1. The facts briefly stated are of the first petition. The petitioners imported viscose staple fibre, pursuant to a valid licence, on board the S.S. 'Georgios Paravalos' and the S.S. 'Vishwa Amitabh'. The former entered Indian territorial waters on 29th November 1978 and the latter on 30th November 1978. At this date viscose staple fibre was exempted from the whole of the customs duty leviable thereon. Around November 1978 there was congestion in the Bombay port. The two vessels, therefore, left Indian territorial waters and sailed elsewhere. They re-entered Indian territorial waters prior to 31st December 1978. The viscose staple fibre thereon was cleared without payment of customs duty. Thereafter, by show cause notices, both dated 12th June 1979, the petitioners were asked to explain why duty should not be assessed upon the viscose staple fibre on the basis that the vessels had re-entered Indian territorial waters on 1st January 1979 and 11th January 1979 at which date it was liable to duty. This petition is filed to quash the show cause notices.

2. It now appears from the endorsements of the Customs authorities upon the Bills of Entry relating to the viscose staple fibre and entries in the Register of Outward/Inward Entry of vessels maintained by the Customs authorities that the vessels had in fact entered Indian territorial waters prior to 31st December 1978, the first named vessel on 30th December 1978 and the latter vessel on 26th December 1978.

3. The Division Benches of this Court in the judgments of M.S. Shawhney v. Messrs Sylvania and Laxman Ltd. 77 Bom. L.R. 380 and Synthetics and Chemicals Ltd. v. S.C. Coutinho 1981 E.L.T. 414 have held that, for the purposes of chargeability to duty under the Customs Act, the relevant date is the date upon which goods enter Indian territorial waters. Mr. Dhanuka, learned Counsel for the respondent, submitted that the said judgments are not good law because their ratio is contrary to that of three Supreme Court judgments. He fairly conceded, though, that this court would be bound by the said two judgments. Applying their ratio it is clear that the viscose staple fibre was not chargeable to duty under the Customs Act on the date it entered Indian territorial waters. The show cause notices in the petition must, therefore, be quashed.

4. It is agreed that the facts of the other two petitions are similar and that the contentions raised therein would be identical.

5. Each of the three petitions is made absolute in terms of prayer (b) thereof with costs.

6. On Mr. Dhanuka's application, the petitioners in each petition are ordered to keep alive the bank guarantees furnished by them pursuant to interim orders for a period of 6 weeks from today.

7. Mr. Bhat states that he will file in court photostat copies of the four bills of entry in the first petition.

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