Ghanshyam Chejra Vs. Collector of Customs - Court Judgment

Ajit K. Sengupta, J.

1. In this application under Article 226 of the Constitution of India, the petitioner has challenged the order passed on 29th September, 1987 (being annexure 'M' to the petition) by the Collector of Customs and despatched to the petition on 15th December, 1987. By the said order, the Collector of Customs purported to confiscate entire consignments imported by the petitioner.

2. The petitioner is the sole proprietor of M/s. Trident Electronics. The petitioner is an importer of various electronic components and material parts of T.V., V.C.R., Electronic Typewriter and other accessories. He is also eligible to purchase imported materials from Export Houses, imported under valid additional import licence granted to such export houses in terms of the Export House Scheme as per para 263 of the Import-Export Policy, 1985-88. The petitioner is also authorised to acquire various components and parts of T.V., V.C.R. and other allied parts.

3. The case of the petitioner is that in or around July 1987, the petitioner purchased 600 pieces of Tape Deck Mechanism from one such Export House, namely, M/s. Mercury Exports on 'High Sea Sales Basis'.

4. The petitioner also purchased 600 pieces each of V.C.R. Top Cover, Bottom Plates and Chasis Front Panel from M/s. Oriental Leather Industries who is also an Export House on 'High Sea Sales Basis'.

5. Apart from the above-mentioned two High Seas purchases, the petitioner himself imported two consignments of Printed Circuit Board Sub-Assembly, Remote Control and Misc. Hardware.

6. The goods imported by M/s. Mercury Exports and M/s. Oriental Leather Industries are covered by two separate valid import licences dated 16th December, 1986 and 11th February, 1987. The Custom authorities had examined and physically verified the said goods imported by the said two Export Houses. Upon such examination and verification, they found the goods according to the declaration as regards the value and specification. Thereafter they assessed the Customs duty. The Customs authorities permitted the goods imported by M/s. Mercury Exports to be kept in the Bonded Warehouse under Section 59 of the Customs Act. The petitioner has taken delivery of 100 pieces of the said goods from the Bonded warehouse upon payment of the customs duty as already assessed.

7. The goods purchased from Messrs. Oriental Leather Company were assessed, duty paid and were duly released for home consumption under Section 47 of the Customs Act, 1962.

8. The remote control and accessories imported by the petitioner were adjudicated by an appropriate officer of the Customs and fine and penalty were levied thereon and on payment of such fine and penalty, the goods were released to the petitioner for home consumption under Section 47 of the Customs Act, 1962.

9. It is the case of the petitioner that on 7th August, 1987, the Assistant Collector of Customs, SIB along with other Customs officials raided the business place of the petitioner and seized goods which, according to the petitioner, have been legally and validly imported by him. Statements under Section 108 of the Customs Act, 1962 were taken from various persons. The concerned customs officials also issued summons under Section 108 of the Customs Act, 1962 and in compliance with the said summons the petitioner appeared before the concerned customs authorities on several dates. The petitioner's case is that inspite of the fact that the goods imported by M/s. Mercury Exports had been duly assessed in all respects and such assessment had not been challenged by the Customs authorities, the Customs authorities were refusing to release the goods upon payment of the Customs duty. The petitioner by his letter dated 19th August, 1987 demanded release of the goods and upon such request the respondent authorities released 10 cartons of the said goods upon payment of necessary duty. The Customs authorities released the goods for home consumption under Section 47 of the Customs Act, 1962 on the basis of the value declared by the petitioner. The Assistant Collector of Customs, SIB by his letter dated 27th August, 1987 despatched on 2nd September, 1987 informed the petitioner that the department is conducting an investigation into the alleged underinvoicing and imports in the name of the name lender firms. It was further alleged in the said letter that the goods in question were imported by the petitioner in the name of M/s. Mercury Export, respondent No. 6. According to the petitioner, the said allegation was prima facie wrong and absurd and M/s. Mercury Export is a registered and recognised export house having export of about 1.5 crores per year and 100% export growth. According to the petitioner, the said letter was purported to be back-dated to circumvent and confuse the fact that one hundred prices of Tape Deck mechanism was released by the authorities on August 28,1987 for home consumption on the basis of the value declared by the petitioner. Due to the withholding of all the above consignments and non-availability of the parts in time, the petitioner's production came to stand still and he lost good market during World Cup Cricket, Puja Festival and Deepwali festival. The petitioner then filed an application under Article 226 of the Constitution of India challenging the illegal search and seizure and orders were passed thereon. On 24th September, 1987 the following order was passed by the Writ Court :-

'Considering the submissions of the learned counsel of the respondents, the Collector of Customs is directed to conclude the investigation and/or adjudication before the 8th October, 1987 and the matter will be heard further as to whether the goods can be released. It is made clear that the petitioner will cooperate with the respondent authorities and there will be prompt appearance to complete the investigation and/or adjudication. It is also made clear that at the time of adjudication, the respondent authorities will consider the background of the release of the 100 pieces before and as referred to in the application and in accordance with law.'

10. According to the petitioner, subsequent to filing of the said writ petition and pursuant to the above order dated 24th September, 1987, the petitioner's representative appeared before the Assistant Collector of Customs, SIB upon whom summons under Section 108 of the Customs Act was served. On 25th September, 1987 the petitioner appeared before the respondent No. 3 in compliance with the said order and summons served under Section 108 of the Customs Act. On the said date the petitioner also appeared before the Collector of Customs and he directed him to again appear on 28th September, 1987. In the meantime on the same date a further summons under Section 108 of the Customs Act was served upon the petitioner at the Customs House directing him to produce certain document and the petitioner duly complied with the said summons. The petitioner also appeared before the Collector of Customs on the said date when after hearing submissions made by the petitioner's Advocate and persuing the documents, the Collector of Customs assured him that the consignments which are the subject matter of the writ application would be released on amicable settlement and requested the petitioner to withdraw the said writ application and on such assurance the petitioner instructed his Advocate-on-record to withdraw the writ petition. However, the respondent No. 1, Collector of Customs allegedly failed, neglected and/or refused to keep his commitments despite the fact that writ petition was withdrawn after Puja Vacation as per the petitioner's commitment. The Customs authorities passed an order of adjudication - on or about 29th September, 1987 whereby the goods were alleged to be confiscated but allowed to be redeemed on payment of redemption fine of Rs. 2 lakhs and imposition of a penalty of Rs. 5 lakhs.

11. Pursuant to such direction and under protest the petitioner paid the said sum of Rs. 2 lakhs. By another letter dated 8th October, 1987 originally addressed to importer M/s. Oriental Leather Industries, respondent No. 7 and a copy forwarded to the petitioner, the Assistant Collector of Customs, SIB demanded the sum of Rs. 2,90,672.62 as duty short levied in terms of the adjudication order passed by the Collector on 29th September, 1987. The said amount was also paid by the petitioner under protest. By another letter dated 8th October, 1987 addressed to the importer, M/s. Mercury Exports, respondent No. 6 and a copy forwarded to the petitioner, the respondent No. 3 further demanded a sum of Rs. 28,119.33 as duty short levied and the petitioner also paid the said sum under protest. By another demand letter dated 8th October, 1987, the respondent No. 3 demanded further sums of Rs. 68,431.91 and Rs. 24,765.82 and the petitioner' also paid the same under protest. So, it appears that the petitioner paid a total sum of Rs. 11,11,990.11. The break up, according to the petitioner, is as follows:

(i) Personal penalty as per verbal demand of Assistant Rs. 5,00,000.00Collector of Customs (SIB) and also paid at his office(ii) Fine as per verbal demand of Assistant Collector of Rs. 2,00,000.00Customs (SIB) stated to be a redemption fine in lieu of con-fiscation of Printed Circuit Board Sub-assembly consignment.(iii) Demand made under letter S. 45-54/87 S.I.B. by the Rs. 93,197.73Asstt. Collector SIB dt. 8-10-1987(iv) Demand made under letter F. Nos. 45-54/87 SIB by Rs. 2,90,672.62Assistant Collector of Customs, SIB, dated 8-10-1987 ad-dressed to M/s. Oriental Leather Industries who were not party to adjudication(v) Demand made under letter Nos. 45-54/87 SIB, dated Rs. 28,119.338-10-1987 addressed to M/s. Mercury Exports who were not party to adjudication. -------------------Rs. 11,11,989.68-------------------

12. According to the petitioner though he was not liable to pay the said amount but he paid the same under protest without prejudice to his rights and contention with a view to restart the production in his factory which was lying closed for want of materials being the subject matter of the instant writ application.

13. Finding no other alternative, the petitioner made representation before the Union Minister of Finance, looking after Customs and narrated his grievance. The matter was joint heard by the Hon'ble Minister & the Chairman, Central Board of Excise & Customs at Delhi. On 24th November, 1987, a joint meeting of the Hon'ble Minister, the Chairman, Central Board of Excise and Customs, respondent No. 1 and respondent No. 2 was convened. The said meeting was also attended by the petitioner's Advocate and a member of Parliament and the decision arrived at the said meeting was to immediately release the detained balance quantity of materials of all consignments and to issue adjudication order immediately. On or about 25th November, 1987, the respondent No. 1 called the petitioner and his Advocate Mr. Hansmukh Kundalia and Assistant Collector of Customs, Appraising Groups and released total balance quantity of detained consignments. No adjudication order was issued by him.

14. On or about 15th December, 1987, the petitioner's clearing Agent M/s. M. Dutta was called to Special Investigation Branch of the Collector of Customs. He was handed over a copy of the impugned order in original passed on 29-9-1987. Against the said impugned adjudication order dated 29th September, 1987, the instant application under Article 226 of the Constitution has been filed by the petitioner.

15. It was contended on behalf of the petitioner that in exercise of a statutory power of adjudication in terms of Section 47 of the Customs Act when the proper officer has accepted licences and assessed the goods after examination of the goods, such an order which is an order of adjudication in law, can be modified or revised only in a manner known to law. According to the petitioner, there is no legal basis empowering the Collector of Customs with any authority or jurisdiction under the Act to initiate proceedings once over in respect of the goods in question on identical evidence and on identical set of circumstances. After the construction of the Tribunal on and from 11th October, 1982, there is no power of review or revision available to the Collector of Customs under the said Act and the only recourse open to him is to file an appeal in terms of Section 129D of the Act.

16. According to the petitioner, no show cause notices have been served upon the concerned importers, respondent Nos. 6 and 7 nor were they invited to participate in the purported adjudication proceedings.

17. By the said impugned order, the Collector of Customs held that assessable value of goods in question shall be determined ignoring the invoice value declared. He further confiscated the detained goods under Section 111(d)(m) of the Customs Act, 1962 read with Section 3(2) of the Import & Export (Control) Act, 1947, and imposed redemption fine of Rs. 2 lakhs. He further held that as the goods had been imported in SKD condition allegedly mis-declaring the description of goods and imposed a penalty of Rs. 5 lakhs on the petitioner. He further directed that the assessment of goods in question for duty shall be made by taking the goods as complete VCR imported in unasses-sable or assessable condition as provided in Interpretative Rule 2(a) of the Customs Tariff Differential Duty shall be demanded.

18. It is contended by the petitioner that the entire proceeding leading to the order passed by the Collector of Customs is totally perverse, vindictive, wrongful, illegal and without jurisdiction. According to the petitioner, several earlier consignments of similar nature imported by other importers have been cleared without any fine or penalty and the imposition of the redemption fine and penalty and the assessment of VCR as components of the VCR and/or as complete VCR clearly manifest vindictiveness and discrimination. Customs authorities having allowed the importers clearance of such identical goods on early occasion cannot depart from the same and they cannot act differently in identical set of circumstances. The petitioner has annexed in Annexure 'N1' relevant copies of the documents evidencing Customs clearance of similar identical consignments imported by other petitioners. The petitioner contended that all the consignments in question were validly imported under OGL and the licence given in terms of import trade control policy and related bills of entry were properly classified and assessed by the proper officer. It is further contended by the petitioner that once the importations are attested as valid under the Import Trade Control Policy by the proper officer in position below the rank of the Collector of Customs having quasi-judicial power, the. said decision cannot be revised by the Collector of Customs and he is not entitled to pass contradictory order unless the, remedies provided under Section 128 and 129D of the Customs Act, 1962 are resorted to. According to the petitioner, the Collector of Customs has gone beyond the statutory jurisdiction in rejecting the decision of the Customs, Excise and Gold Control Excise Tribunal and other decision of High Courts and Supreme Court which have laid down the principles of determination of the question as to importation of components in SKD condition.

19. At the hearing, the learned counsel for the respondents has submitted that the present application is not maintainable. According to the respondents, the writ petitioner had earlier moved a writ petition on the very self-same grounds. In the said writ petition, this Court passed certain interim orders. It was contended on behalf of the respondents that this Court should not interfere inasmuch as the Customs Act being a self-contained Act provides the Forum for redressal of any grievance of the importer. The writ petitioner should have exhausted the remedy available under the Act before moving the writ petition. The writ petitioner thereafter withdrew the earlier petition and as such the same was dismissed and thereafter submitted to the jurisdictional adjudicating authority. The Collector after hearing the parties has passed the adjudication order which is appealable to the Central Excise, Customs and Gold (Control) Appellate Tribunal. Accordingly, the second writ petition is bad in law and/or premature inasmuch as the petitioner has not exhausted the alternative remedy provided by the Act by way of preferring an appeal to the Tribunal. It is also contended that the writ petitioner has not challenged nor can be challenged the jurisdiction of the adjudicating authority in adjudicating the matter nor has he pointed out any procedural infirmities in passing the said order.

20. I am, however, unable to accept this contention. It is true that the writ petitioner moved earlier and certain interim orders were made in the said writ application. The writ petitioner also preferred an appeal against the said interim orders refusing to release the entire consignment. There is no doubt in my mind that there was some understanding between the writ petitioner and the respondents regarding the manner and mode of assessment to be made. But for one reason or other, the respondents did not rise up to the expectation. The writ petition and the appeal arising out of such writ petition were withdrawn in the expectation that the respondents would judiciously load the value. It may be mentioned that at that time because of the ensuing World Cup, the petitioner was interested to get the release of the goods so that no delay was caused and he did not suffer any prejudice. The writ application was not dismissed on merit. It was allowed to be withdrawn to enable the parties to arrive at a settlement. This fact is recorded by the Collector in his adjudication order passed in another matter where the present petitioner was also a party. The said order is as follows :-

'12. On 25-9-1987, Shri Dwivedi, Advocate, Calcutta High Court, forwarded a letter addressed to the Collector of Customs enclosed therewith a copy of the letter dated 25-9-1987 written by his client Shri Ghanashyam Chejara stating therein that he has received instructions from his client, the petitioner to withdraw the writ petition and the appeal pending before the Hon'ble High Court at Calcutta; that the same will be done on re-opening of Court, that as he understands that the matter is going to be settled amicably between the parties. His client waived the show cause notice so that the adjudication proceedings should be quickly settled and his client agreed for any reasonable or judicious loading of the price that might be decided at the time of adjudication proceedings.

13. In view of the above letter and undertaking, the matter was heard on 29-9-1987, as agreed waiving issuance of the show cause notice.'

21. As the settlement failed, which is demonstrated by the order of adjudication, the petitioner has challenged the validity of such order. That apart the first writ petition was against the show cause notice, and the present one is against the final order. Accordingly, it cannot be said that the petitioner cannot invoke the writ jurisdiction for the second time.

22. The next question is whether alternative remedy which has been provided under the Act is an efficacious remedy and whether such remedy completely bars jurisdiction of this court in entertaining the second writ application. It is now well settled that alternative remedy under the relevant statute is not a complete bar to the maintainability of the writ application. It is equally well-settled that if the impugned order is passed without jurisdiction or in violation of the rules of natural justice or it discloses an error of law apparent on the face of the record or if the impugned order is based on extraneous and malafide consideration or the statutory remedy is not adequate or onerous, the Court can invoke Article 226 of the Constitution even if there is an alternative remedy under the statute. The Court can also interfere where the resort to statutory remedy would cause irreparable injury to the citizen or where the impugned order infringes on a fundamental right of a citizen or where the impugned order betrays complete non-application of mind. The petitioner has challenged the impugned order on the ground that it discloses error of law apparent on the face of the records - an error of law which would render the adjudication order invalid. It may be that the Collector had jurisdiction to pass adjudication order under the Act, but if such order demonstrates arbitrariness or on the face of it manifests error of law, in that event, this Court can allow the writ petitioner to invoke writ jurisdiction. In this case, Collector had adjudicated and passed an order which is highly prejudicial to the petitioner. If this order has to be challenged in the appropriate forum, the petitioner may not get the desired relief for long time to come. This aspect of the matter cannot be overlooked in considering whether the application is maintainable or not. The impugned adjudication order has proceeded ignoring the clear pronouncement of the Division Bench of this Court. I shall deal with this aspect later. This order is, therefore, contrary to law. On the facts and in the circumstances of this case, I am of the view that the order of adjudication is illegal and manifestly arbitrary and unreasonable and delay would cause irreparable loss and prejudice to the petitioner. In the premises, the contention that the writ petition is not maintainable cannot be accepted/

23. It has not been disputed that the respondents have at the material time been clearing the spares of Tape Deck Mechanism more or less at the same price as declared by the petitioner. The petitioners have annexed with the writ petition at pages 153 to 205 some of the Bills of Entry showing that the respondents were and still are clearing the spares which are the subject of the application more or less at the same price as declared by the petitioner. Thus the action of the respondents is arbitrary. The petitioner has also relied on Bill of Entry evidencing purchase of identical goods at more or less similar price. On these facts it is contended that Customs Authorities being creatures of statute are bound by their own precedent. Once the Customs authorities have accepted the value of a particular item, it becomes a precedent and subsequently it cannot hold that the valuation is not correct. In support of the aforesaid contentions, Mr. Sen relied on a decision of this Court Kazaria Exports Ltd. v. Collector of Customs and Ors. reported in 1986(1) CLJ 231 wherein it has been held that for under-invoicing Customs Authorities may refuse clearance. But, quotation at higher rate would not by itself show under-invoicing of the goods sought to be imported. To arrive at a decision of under-invoicing the concerned authority must act reasonably. When a few months earlier the Authority cleared the goods to others at the same invoice amount, the Authority cannot take the plea of under-invoicing.

24. It is contended on behalf of the respondents that on merits also, the writ petition is liable to be dismissed. The main contentions of the respondents are that the goods are imported in SKD condition and are not covered under Import Licence and/or Open General Licence and are consumer goods and hence not covered by the licence. It is also contended that the goods are undervalued.

25. I shall first take up the question relating to the under-valuation. When the identical goods were imported earlier the Customs authorities determined the valuation of such goods. But in the instant case, the Customs authorities have changed their stand and purported to fix a new valuation on the identical items.

26. In Mercantile Express Co. Ltd. v. Assistant Collector of Customs, reported in : 1978(2)ELT552(Cal) , it has been held as follows :-

'The Custom now say that they are not bound by their previous decisions. Whether the doctrine of precedents applies in its full rigour to Administrative Agencies and Officers, and whether a reasonable latitude should be given to them or administrative tribunals to correct or modify their previous decisions may still remain 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 on the very basis and principles of taxation and grave uncertainty in business and foreign trade of India.'

'The Customs are bound by their own precedents in administering taxing statutes involving the very basis of taxation in respect of particular article and not leave it to them to modify their own previous decisions to leave it to them to Courts or Parliament or Legislatures; as the case may be, to put the law beyond doubt, Tariff rulings are in the nature of administrative directions or guides....These departmental instructions, guides or rulings can always be examined by Courts of Law and if found wrong in law can be over-ruled and set aside by the Court.'

27. In Godrej and Boyce ., Bombay and Anr. v. Union of India and Ors., reported in : 1984(18)ELT172(Bom) , the Bombay High Court relied on the decision of Mercantile Express Co. Ltd. (Supra), the learned single Judge of the Bombay High Court observed that observations of the Calcutta High Court that the Customs authorities were bound by their own decisions in administering taxing statutes would apply with even greater force in the case of the same assessee who is sought to be taxed differently for the same article. The Bombay High Court in the aforesaid decision also considered the case of IBM World Trade Corporation v. Union of India reported in 1980 ELT 274 where the Bombay High Court held as follows :-

'Once a finding is given by a Superior authority on contentions raised before it, it is binding upon the subordinate authorities in subsequent proceedings, unless some other material is brought to their notice, which compels them to take a contrary view. The Court was concerned with the levy of countervailing duty in that case. The same principle would apply to the levy of excise also. In the present case, no other material was before the subordinate authorities at the time when the show cause notices were issued, which would warrant a different view being taken by the subordinate authority for either the previous or subsequent years or the same years.'

28. The declared value of the tape deck mechanism has been accepted by the Customs Authorities by its order dated 29th August, 1987 and consequently the balance goods were released. Once the Customs Authorities have accepted the valuation, they should be bound by their own precedents and estopped from acting to the contrary.

29. Some of the instances set out in the adjudication order regarding valuations are quotations and it has been held in Kajaria Exports Limited (supra) that quotation at higher rate would not by itself show under-invoicing of the goods sought to be imported. The fact is that the respondents were and still are clearing the spares which are the subject matter of the instant application more or less at the same price as declared by the petition and others. Some of such bills of entries evidencing the aforesaid fact has been annexed with the writ petition at pages 153 to 205. The petitioner has also relied on some more bills of entries evidencing the purchase of identical goods more or less at similar price. Documents evidencing such importations at more or less similar price before and after filing of the writ petition have been produced before this Court. Hence the charge of under-valuation is misconceived and cannot be sustained. The respondents cannot ignore the basic materials in the form of their previous orders and decisions and proceed on the basis of their ipse dixit. Examples set out in the adjudication order pertains to small consignments whereas in the instant case bulk quantities were contracted for and a part of that was imported by way of part shipment. The same is also applicable in the case of the Export Houses also. It is a matter of common knowledge in the International as well as in the Inland trade that purchasers of bulk quantity enjoys a better discount.

30. Further the order of the Appellate Authority is binding on the subordinate authorities even in the subsequent proceedings and the Collector has acted without jurisdiction in not considering the said principles.

31. Finding of the Collector that three consignments of parts of VCRs if assembled together would make complete V.C.Rs or that consignments were imported in S.K.D. condition is not tenable for the reason that one part if imported by a Government Recognised Export House, M/s. Oriental Leather Industries being respondent No. 6 which was already cleared and delivered to the said Export House after completing all the formalities of acceptance of valid import licence and of Customs formalities inclusive of payment of assessed Customs duties. Another part was imported by M/s. Mercury Exports, the respondent No. 7 which is also a Government Recognised Export House for their import of item Tape Deck Mechanism. There is no dispute regarding its import licence. Both the aforesaid consignments were purchased by the petitioners on High Sea Sales Basis while it is alleged by the Customs authorities that the said Export Houses, being respondent No. 6 and 7 were name-lenders only.

32. Petitioner himself imported only one consignment i.e. P.C.B. Sub-assembly without valid import licence.

33. Goods as aforesaid were imported by three different entities and separate individual identities. Therefore, the petitioner cannot be said to have been imported complete V.C.R. in S.K.D. condition.

34. The instances and/or examples set out in the Adjudication Order are mostly based on US Dollar, but the subject importation was valued at Singapore Dollar, conversion of US Dollar into Indian Rupees and then re-conversion to Singapore Dollar is not justified to prove any misdeclaration or under-valuation. The learned counsel on behalf of the petitioners also referred to the decision of the Tribunal in Janata Traders, Bombay v. Collector of Customs, Bombay, reported in to reinforce his argument. In my view the Department has failed to establish any case of under-invoicing.

35. Some of the instances set out in the Adjudication order regarding valuation are quotations. A quotation at higher rate would not by itself show under-invoicing of the goods sought to be imported. For many reasons quotations may disclose higher rate. It is only after the quotations are accepted and contract is concluded and actual sale takes, the price may then indicate whether there is any case of under-invoicing. In Kazaria Exports Ltd. and Ors. v. Collector of Customs and Ors. reported in 1986 (1) CLJ 231, Umesh Banerji, J., considered at length this aspect of the matter and negatived the contention of the revenue. A higher quotation would not by itself without there being any other material or evidence justify the inference of under-invoicing.

36. I fail to appreciate how the Customs authorities can bypass the orders passed by the Tribunal dealing with the identical issues. There must be some finality somewhere. The Customs Authorities cannot ignore the decision of the Tribunal and come to a finding contrary to the decision of the Tribunal. An assessee has the right to arrange its affairs on the basis of views taken consistently by the Tribunal. If the authorities take different views at different times at different ports on the same set of facts, the assessee will suffer the consequence. The order of Appellate Authority is binding on the subordinate authorities even in the subsequent proceeding. The Collector has acted without jurisdiction in not considering the decision of the Tribunal. My attention is drawn to a decision of the tribunal (Susha Electronics Industries v. Collector of Customs & Central Excise) where the Tribunal rejected similar contention of the Revenue based on more or less similar facts.

37. Having regard to the facts and circumstances of this case it appears to me that the Customs authorities have failed to produce any evidence to prove under-valuation. In the premises, the value declared by the petitions has to be taken to be correct, in the absence of any evidence to the contrary.

38. In fact the Customs authorities have failed to produce any evidence to prove under-valuation and in the premises, the valuation declared by the petitioner has to be taken to be correct in the absence of any evidence to the contrary. More so, when the Customs authorities have cleared identical goods at identical price in the past, they are bound by their own precedence. Further they did not forward any evidence that money has been remitted to the Exporter clandestinely. In absence of any such proof the authorities should be estopped from alleging under-valuation. There are a few other facts to be noted.

39. The main contention of the Customs Authorities is that the subject consignments are not spares. They are complete VCR set in SKD condition and hence not covered under OGL. This contention is wholly without any substance Reliance has been placed in the decision of the Supreme Court in Union of India v. Tarachand Gupta & Bros, reported in 1983 E.L.T. 1455. The facts and contentions would appear from the judgment which are reproduced as under :-

'The respondents held an important licence dated July 10,1956 permitting them to import parts and accessories of motor scooters as per appendix XXVI of the Import Policy Book for July-December, 1956. Under the said licence, the respondents imported certain goods which arrived in two consignments, each containing 17 cases, by two different ships. According to the respondents, the goods so imported by them were motor cycle parts which their licence authorised them to import. The Customs authorities, on the contrary, held, on examination of the goods, that they constituted 51 sets of 'Rixe Mopeds complete in a knocked down condition'. The Deputy Collector of Customs thereupon held an enquiry in pursuance of two show cause notices issued by him.

The result of the enquiry was an order under which Deputy Collector directed confiscation of the said goods with an option to the respondents to pay certain sums in lieu of confiscation and also personal penalties. That order was passed on the basis that the goods imported were not parts and accessories of motor cycles and scooters permissible under Entry 295 of the Schedule to the import Control Order but were motor cycles/scooters in completely knocked down condition, prohibited under remark II against Entry 294, a licence in respect of goods covered by it would authorise import of motor cycles and scooters. The order of the Deputy Collector dated November 19,1957 reads as under :-

'On examination of the goods and scrutiny of the documents relating to the Bills of Entry stated above, it was ascertained that M/s. Tarachand Gupta and Bros, had imported 51 sets of 'Rixe' Mopeds complete (except tyres, tubes and saddles) in a knocked down condition. The total number of consignments covered by the aforesaid two Bills of Entry were sufficient to give exactly 51 sets complete Rixe 'Mopeds (Except for tyres, tubes and saddles which would in any case have required a separate licence). The packing was also such as to show that those were nothing but 'Mopeds in a disassembled condition, since each of the cases contains components relating to three mopeds. Moreover, it was found that major components such as the frames, completely fitted with electrical wires and control cables and grips, had been imported in equal numbers - All these went to show that the .goods were not imported as spare parts but as complate vehicles in a knocked down condition. The goods were therefore considered to be correctly classified under Item 75(2) of the I.C.T. corresponding to S.No. 294/IV of the I.T.C. schedule. The licence under which clearance was sought, could not, therefore, be accepted.The Deputy Collector rejected the respondents' contention that the two consignments which arrived in two different ships at different dates should be viewed separately, that the machines were incomplete as they were without tyres, tubes and saddles, and therefore, they could not be said to constitute motor cycles in knocked down condition. He held, on the other hand, that though the goods were not in completely knocked down condition it made no difference as the tyres, tubes and saddles were easily obtainable in India and their absence did not prevent the machines being otherwise complete. He also found that there was a trade practice under which traders were supplying motor cycles without tyres, tubes and saddles unless the purchaser specially asked for those parts. According to him, the goods could not be regarded as spare parts but were 'Mopeds in disassembled condition.'

40. The Supreme Court noted the argument that since there was a restriction in Entry 295 against imports of motor cycles and scooters in C.K.D. condition, the importer could not be allowed to do indirectly what he could not do directly. The Supreme Court repealed the contention in the following words :-

'The argument apparently looks attractive. But the question is what have the respondents done indirectly what they could not have done directly. In the absence of any restriction in Entry 295, namely, that a licence in respect of goods covered by Entry 295 would not be vaild for import of parts and accessories which, when taken together, would make them motor cycles and scooters in C.K.D. condition, the respondents could import under their licence all kinds and types of parts and accessories. Therefore, the mere fact that the goods imported by them were so complete that when put together would make them motor cycles and sccooters in C.K.D. condition, would not amount to a breach of the licence or of Entry 295. Were that to be so, the position would be anamolous as aptly described by the High Court. Suppose that an importer were to import equal number of various parts from different countries under different indents and at different times, and the goods were to reach here in different consignments and on different dates instead of two consignments from the same country as in the present case. If the contention urged before us were to be correct, the Collector can treat them together and say that they would constitute motor cycles and scooters in C.K.D. condition. Such an approach would mean that there is in Entry 295 a limitation against importation of all parts and accessories of motor cycles and scooters. Under that contentions even if the importer had sold away the first consignment or part of it it would still be possible for the Collector to say that had the importer desired it was possible for him to assemble all the parts and make motor cycles and scooters in C.K.D. condition. Surely, such a meaning has not to be given to Entry 295 unless there is in it or in the licence a condition that a licensee is not to import parts in such fashion that his consignments, different though they may be, when put together would make motor cycles and scooters in C.K.D. condition. Such a condition was advisedly not placed in Entry 295 but was put in Entry 294 only. The reason was that import of both motor cycles and scooters as also parts and accessories thereof was permitted, of the first under Entry 294 and of the other under Entry 295. A trader having a licence in respect of goods covered by Entry 294 could import assembled motor cycles and scooters, but not these vehicles in C.K.D. condition, unless he was a manufacturer and had obtained a separate licence therefor from the Controller of Imports who, as aforesaid, was authorised to issue such a licence on an ad hoc basis. Thus the restriction not to import motor cycles and scooters in C.K.D. condition was against an importer holding a licence in respect of goods covered by Entry 294 under which he could import complete motor cycles and scooter and not against an importer who had a licence to import parts and accessories under entry 295.

If Dr. Syed Mohamed's contention were to be right we would have to import remark (ii) against Entry 294 into Entry 295, a thing which obviously is not permissible while construing these entries. Further, such a condition, if one were to be implied in Entry 295, would not fit in as it is a restriction against import of motor cycles and scooters in C.K.D. condition and not their parts and accessories. There is, therefore, no question of a licensee under Entry 295 doing indirectly what he was not allowed to do directly was importing, motor cycles and scooters in C.K.D. condition under a licence under which he could import complete cycles and scooters only. That restriction, as already observed, applied to a licence in respect of goods described in Entry 294 and not a licensee in respect of goods covered by Entry 295.

The result is that when the Collector examines goods imported under a licence in respect of goods covered by Entry 295 what he has to ascertain is whether the goods are parts and accessories, and not whether the goods, though parts and accessories, are so comprehensive that if put together would constitute motor cycles and scooters in C.K.D. condition. Were he to adopt such an approach, he would be acting contrary to and beyond Entry 295 under which he had to find out whether the goods imported were of the description in that entry. Such an approach would, in other words, be in non-compliance of entry 95.'

41. Then the Supreme Court proceeded to hold :-

'The respondents' licence admittedly authorised them to import goods covered by entry 295. They would, therefore, legitimately import, on the strength of that licence, all and several kinds of parts and accessories of motor cycles and scooters. The only question, therefore, before the Collector was whether the respondents' licence covered the goods imported by them, i.e. whether the goods were parts and accessories. If they were, the imports were legitimate and no question of their being not covered by the licence of the respondents having committed breach of Section 3 of the Imports and Exports (Control) Act or Section 167(8) of the Sea Customs Act could possibly arise. What the Collector, however, did was that he put the two consignments together and held that they made up 51 'Rixe' Mopeds in C.K.D. condition and were, for that reason, not the articles covered by entry 295 but articles prohibited under remark (ii) of entry 294. But entry 294 deals with motor cycles and scooters complete and assembled. Remark (ii) against that entry prohibits an importer who held a licence to import motor cycles and scooters from importing motor cycles and scooters in C.K.D. condition. Remark (ii) containing that prohibition had nothing to do with entry 295 which did not contain any limitations or restrictions whatsoever against imports of parts and accessories.

That being so, if an importer has imported parts and accessories, his import would be of the articles covered by entry 295. The Collector could not say, if they were so covered by entry 295, that when lumped together, they would constitute other articles, namely motor cycles and scooters in C.K.D. condition. Such a process, if adopted by the Collector would mean that he was inserting in entry 295 a restriction which was not there. That obviously he had no power to do. Such a restriction would mean that though under a licence in respect of goods covered by entry 295 an importer could import parts and accessories of all kinds and types, he shall not import all of them but only some, so that when put together they would not make them motor cycles and scooters in C.K.D. condition. In the present case even that was not so because he would have to buy tyres, tubes and saddles to convert them into motor cycles and scooters into C.K.D. condition. That would be tantamount to the Collector making a new entry in place of entry 295 which must mean non-compliance of that entry and acting in excess of jurisdiction during the course of his enquiry even though he had embarked upon the enquiry with jurisdiction. In our view that was preciously what the Collector did. This is, therefore, not one of those cases where between two competing entries the statutory authority applied one or the other, though in error, and where a civil court cannot interfere.'

42. In Collector of Customs v. Mitsuny Electronic Works reported in : 1987(30)ELT345(Cal) , the Division Bench of this Court noted the contention of the revenue and rejected similar contention that was raised in that Court and the contention of the revenue was rejected as follows :-

'The first contention of Mr. Dipankar Ghosh for the Customs authorities is that if all the consignments covered by all the bills of entry in the case of three export houses are assembled together, there will be complete T.V. Sets and as such their import is prohibited. Such a course, however, cannot be adopted to find out whether individual licence covers the goods imported. It is a sheer coincidence that all the consignments have arrived at a time. One has to look into the respective licence. The writ petitioner may have purchased all the articles covered by all the licences but that cannot be a ground for withholding the goods alleging that complete T.V. sets have been imported. We are, therefore, unable to accept this contention of Mr. Ghosh.'

43. Similar view was also taken by Bhagabati Prasad Banerjee, J. in Debabrata Kanjilal v. Union of India, C.O. No. 7694 (W) of 1988 where the judgment was delivered on 29th July, 1988.

44. Strangely enough, the decisions which have been cited before the Collector of Customs were not considered at all. A Quasi judicial authority ought not to be allowed to act arbitrarily by refusing to take into consideration or by-pass the relevant decisions of the Supreme Court, High Courts and the Tribunals. This by itself a serious infirmity in the order of adjudication authority. The impugned order of the Collector is on the face of it contrary to law laid down by the Supreme Court and the Division Bench of this Court referred to above. Each consignment has to be separately assessed. Even if one importer brings different items which are admittedly spare parts and components, the Revenue authorities cannot take the plea that if those are assembled together, there would be complete V.C.R. set. This is exactly what has been done in this particular case, notwithstanding the decisions of the Courts and Tribunals as mentioned earlier.

45. It is contended by the Customs authorities that the importation of Printed Circuit Board is not covered by any licence. It is not a contraband item. Importation of the said item has been and still is being allowed by the Customs authorities after adjudication on certain terms. The petitioner has relied some such instances. It is unfortunate that the Customs authorities did not rely on the evidence produced by the petitioner where the goods have been released earlier of the items which are not otherwise contraband on certain terms. The Customs authorities are estopped from extending the said benefits to the petitioner. This only reveals the malafide or harassing attitude of the respondents.

46. Apart from the importation by the petitioner himself the petitioner purchased items imported by two Export Houses on 'High Sea Sales Basis'. In one case, after assessment the goods were allowed to be stored in Bonded Warehouse under Section 59 of the Customs Act and in other case, the goods were assessed and Upon payment of duty, the goods were also released. The petitioner is a bonafide purchaser of value of those items purchased from the Export House being the respondent Nos. 6 and 7 herein. If those assessments are invalid or illegal for any reason, it is for the Customs authorities to take recourse of the provisions of Section 129D of the Customs Act They cannot impose any liability on the petitioner who is the purchaser of the imported goods. It is strange that without serving any show cause notice to the Export Houses, the petitioner was sought to be fastened with the liability in respect of the goods purchased from the Export Houses. The demand was made on the Export Houses in respect of those goods which the petitioner purchased on 'High Sea Sales Basis' in respect of the goods assessed and/or released to the Export Houses from whom the petitioner purchased, but the petitioner had to pay under protest their liability only to get the release of the said goods so that the factory might run. This is not only illegal but without jurisdiction. The Collector has no power or authority to review his own order. It may be done only under the provisions of Section 129D. The procedure adopted is contrary to all rules and norms and only to prejudice the petitioner, the loading was made in the value and thereupon the demand was realised from the petitioner. This is one of the crucial fact which has to be taken into account in judging the conduct of the respondents. Under Article 226 of the Constitution, no tax can be levied or collected except by authority of law. In the instant case, as indicated earlier, monies were collected without any authority of law. The goods cleared for home consumption were re-assessed and duty collected on it illegally and wrongfully circumventing the provisions of the Act. Secondly, the redemption fine upon confiscation and' penalty were collected even before the impugned adjudication order dated 29th September, 1987 was communicated to the petitioner. This Act of high handedness can only be corrected by an appropriate writ of this Court.

47. In my view, on the facts and in the circumstances of the case, the order of adjudication except to the extent imposition of penalty and redemption fine on the goods imported by the petitioner himself without any licence, but the valuation of such goods for determination of the quantum of penalty and redemption fine, however, cannot be sustained on the reasons mentioned hereinabove. So far as the collection of monies on account of the Export Houses from whom the petitioner purchased the goods on 'High Sea Sales Basis' cannot be sustained particularly in view of the fact that the duty has been charged not on the basis of spares but on the basis of complete V.C.R. without taking into account that two independent Export Houses recognised by the Government of India imported spares against valid licences and accordingly the question of clubbing of those items in the hands of the petitioner could not and did not arise at all. This case leaves in my mind an impression that the authorities proceeded with vindictively and malafide. The malice in law and fact writ large cannot be ruled out. Even after the adjudication proceedings were over, various summons were issued to the Export Houses who had been selling the authorised goods imported under valid licence to the petitioner.

48. For the reasons aforesaid, it must be held that the finding of the Collector that three consignments of spares of VCR, if assembled would make complete V.C.R. cannot be sustained. The Export Houses, being the respondent Nos. 6 and 7 imported the goods under Open General Licence. Their import was authorised. So long as the assessments made upon them are set aside in accordance with the provisions of the Act, the Revenue cannot indirectly refuse or modify the assessments indirectly which it could not have done directly. The importation of Printed Circuit Board Sub-Assembly by the petitioner himself is without the valid import licence. Therefore, redemption fine for the particular consignment cannot be interfered with even though the redemption fine is on high side having regard to the valuation adopted. There is no evidence that the goods have been under-valued. At least the department failed to establish such alleged undervaluation. The realisation of the alleged short levy from the petitioner cannot be sustained and must be quashed.

49. In the result, this application is allowed to the extent indicated above. The order of adjudication including short levy demand notices shall stand set aside and quashed. The Collector of Customs is directed to refund the amount collected by the Customs authorities from the petitioner as and by way of short levy demand. The Customs authorities shall also refund the excess amount of Customs duty realised by levying duty of spare parts as complete V.C.R. Sets. Customs duties shall be charged on assessment of the consignment as components/parts only. Let the personal penalty amount paid by the petitioner be refunded to the petitioner.

50. Parties will act on the signed copy of the operative part of the judgment and order.