JUDGMENT
Ruma Pal, J.
1. The order impugned in these proceedings was passed on 23rd November, 1993 directly the respondents to forthwith release 400 pieces of “ZWZ” bearings of Chinese origin contained in 92 cases, (hereinafter referred to as the goods) in respect of which provisional duty had already been collected by the Customs Authorities from the writ petitioner.
2. The writ petitioner imported the goods the country of origin of which was China from Singapore. The ship carrying the goods arrived at Calcutta Port in September, 1993. A Bill of Entry was filed for home consumption. The goods were provisionally assessed to duty on 7th October, 1993 on the basis of the declared value plus 20 per cent additional provisional duty on the declared value amounting to a sum of Rs. 3,17,999/-. The petitioner paid the amount as provisionally assessed and also executed a bond for Rs. 1,89,285.00 in terms of the directions of the Assistant Collector of Customs, Calcutta. This was done also in October, 1993. The payment of provisional duty was accepted by the Customs Authorities. But the goods were not released by the Customs.
3. Being aggrieved by the refusal of the Customs Authorities to release the goods the writ petitioner moved a writ application under Article 226 challenging’ the refusal to clear the goods. An interim order was passed on 23-11-1993 by A.N. Ray, J. directing release of the goods.
4. The Learned Judge also recorded the undertaking on behalf of the writ petitioners to pay any differential duty in case same appears to be payable at the final hearing. The goods were also directed to be released within a week.
5. The respondents did not release the goods. An application for contempt was moved by the writ petitioner before. A.N. Ray, J. A Rule was issued against the respondents. The respondents then preferred this appeal from the order dated 23rd November, 1993 immediately thereafter. An interim order was granted staying the operation of the order appealed from. The interim order is still continuing.
6. In the meantime a show cause notice was issued by the Customs Authorities under Section 124 of the Customs Act, 1962 (hereinafter referred to as the Act) in which it has been said that upon further enquiry being there it was prima facie found that the goods had been undervalued to the extent of Rs. 16,57,001.70 and there was an attempt for duty evasion amounting to Rs. 22,90,001 /-. The writ petitioner was therefore, called upon to show cause as to why the goods should not be confiscated under Section 111(m) of the Act and why penal action should not be taken against them under Section 112(a) of the Act and why they should not pay extra duty of Rs. 22,90,001/- against the Bills of Entry in question. The show cause notice is dated 22-11-1993.
7. The appellant has submitted that the order was incorrectly passed at the ad interim stage without considering the fact that the provisional assessment was made without scrutinising the goods and that the discrepancy between the price of the goods as declared and price of the goods as ascertained upon enquiry was found subsequently. It is further submitted that the provisional assessment can be revised under Section 17(4) of the Act. It is also submitted that the proper officer had an unfettered discretion to withhold the clearance of the goods under Section 47 of the Act. Finally it is submitted that the release of the goods should have been granted at the ad interim stage without the filing of affidavits.
8. The last-point is taken up for consideration first. The Courts have consistently held that in certain circumstances ad interim order can be granted in ordinary Civil Proceedings even if it amounts to decreeing the suit [See : for example “Thompson v. Park -1944 (2) All. E.R. 477; Woodford and Anr. v. Smith and Anr. : 1970 (1) All E.R. 1091; New Chhatabar Coal Co. Ltd. v. J.G. Kumarmangalam : ; Indian Cable Co. Ltd. v. Sumitra Chakraborty : ; and Oil and Natural Gas Commission v. Tridib Nath Sanyal and Ors.: 1981 (1) CLJ 156]. There is no reason why the same principle should not be applied to writ proceedings. There is no bar in the Court granting virtually the entire relief at the interim stage provided there is no dispute as to the facts and the law is sufficiently clear.
9. The undisputed facts in this case are (i) that a provisional assessment has been made under Section 18 of the Act (ii) that payment of the duty as provisionally assessed has been accepted and personal bond has been executed under the provisions of the Customs (Provisional Duty Assessment) Regulations, 1963 and (iii) it is also not in dispute that there has been no final assessment under Section 17 of the Act till today.
10. The right of the Customs Authorities to refuse clearance under Section 47 is no doubt discretionary but the discretion is statutorily regulated. The relevant sub-section of Section 47 reads :-
“(1) Where the proper officer is satisfied that any goods entered for home consumption are not prohibited goods and the importer has paid the import duty, if any, assessed thereon and any charges payable under this Act in respect of the same, the proper officer may make an order permitting clearance of the goods for home consumption.”
11. Implicit in this sub-section is the necessity for the proper officer to be satisfied as to the identity of the goods that it corresponds to the description given. There is no dispute that this is so in this case.
12. It has also not been and indeed it could not be argued that the goods are prohibited goods. Prohibited goods have been defined in Section 2(33) of the Act in the following terms :-
“(33) ‘prohibited goods’ means any goods the import or export of which is subject to any prohibition under this Act or any other law for the time being in force but does not include any such goods in respect of which the conditions subject to which the goods are permitted to be imported or exported have been complied with.”
13. The other ground on which the clearance may be refused is the non-payment of the import duty assessed. The only assessment in this case is the order of provisional assessment in respect of which payment has been made. When none of these grounds exists, clearance under Section 47 cannot be refused. We are also prima facie of the view that the power of revision has not been conferred in respect of provisional assessments. There does not appear to be any scope for implying the same particularly having regard to the specific provision with regard to final assessments. The legislature having expressly provided for the power in the case of final assessments, must be taken to have deliberately omitted the same for provisional assessments. But it is not necessary to consider the hypothetical question whether a provisional assessment may be revised as in this case there has been no order of revision.
14. It is conceded that unless the final assessment is made there is no scope for taking action under Section 111(m) or 112(a) of the Act. I am also of the view that unless final assessment is made and order passed under Section 17 there is no scope for the Customs Authorities coming to the conclusion that the importer is liable to make payment of any amount over the amount as provisionally assessed in order to claim release of the goods imported.
15. The submission that the provisional assessment was made without checking the goods does not appear to be factually correct. The provisional assessment was made in terms of a circular issued by the Office of the Collector of Customs on 14th August 1989. The notification has not been withdrawn.
16. The writ petitioner has also relied upon several orders passed by the Supreme Court in matters arising under the Customs Act, 1962 releasing the goods on the basis of the provisional assessment at the interim stage and on the execution of a bond.
17. The order under appeal cannot therefore be faulted on the ground raised. Therefore, on the basis of the arguments advanced I am not satisfied that the Learned Single Judge erred in passing the order he did.
18. The writ petitioners being agreeable to furnish a bond to the extent of the excess duty claimed in the Show Cause Notice, the appeal is disposed of by affirming the order under appeal and directing the release of the goods subject to the undertaking given in the court below and subject to the execution of a bond in the sum alleged to be due on account of excess duty in the show cause notice. The clearance must be allowed within a week from the date of execution of such bond. There will be no order as to costs.
Mukul Gopal Mukherji, J.
19. I agree with the line of reasoning given by Ruma Pal, J. in the judgment but I cannot persuade my judicial conscience to agree with the ultimate direction regarding release of the goods “subject to the undertaking given in the court below and subject to execution of a bond” for the sum alleged to be due on account of the excess duty in the show cause notice. It would also perhaps not be proper to direct a clearance within a week from the date of execution of such bond in the manner suggested by Ruma Pal, J.
20. The Supreme Court in Assistant Collector of Central Excise, Chandannagar, West Bengal v. Dunlop India Ltd. and Ors. deprecated the practice of granting interim order which practically gives the principal relief sought in the petition for the mere reason that a prima facie case has been made out, without being concerned about the balance of convenience, the public interest and a host of other relevant considerations.
The Supreme Court found that an unwarranted tendency to grant interim orders with a great potential for public mischief for the mere asking by the High Courts has developed while entertaining writ petitions under Article 226 of the Constitution. There are of course cases which demand that interim orders should be made for the interests of justice, where gross violation of law and injustices are perpetrated or are about to be perpetrated. But since the law presumes that public authorities function properly and bona fide with regard to the public interest, the court must be circumspect in granting interim orders of far-reaching dimensions or orders causing administrative burdensome inconvenience or orders preventing collection of public revenue for no better reasons than that the parties have come to the court alleging prejudice, inconvenience or harm and that a prima facie case has been shown. Indeed there are no hard and fast rules. Apart from the question of existence of a prima facie case, there are the other vital questions regarding balance of convenience, irreparable injury and/or of public interest. The granting of interim order restraining the Customs authorities from levy and collection of duty merely on furnishing personal indemnity bond or bank guarantee by the petitioner company was also held to be unjustified in very many cases. Where matters of public revenue are concerned, it is of utmost importance to realise that interim orders ought not to be granted merely because of a prima facie case having been shown. Something more is required. The balance of convenience must be clear in making for an interim order and there should not be slightest indication of a likelihood of prejudice to the public interest. The Supreme Court took a judicial notice of the fact that the vast majority of the petitions under Article 226 of the Constitution are filed solely for the purpose of obtaining interim orders and therefore, only to prolong the proceedings by one device or the other. This practice needed strong discouragement.
21. In State of West Bengal and Ors. v. Calcutta Hardware Stores and Ors. it was observed by the Supreme Court that an ad interim order should be used with circumspection having regard to the larger public interest and should not be issued on the mere asking of the parties. The Judges have a constructive role and therefore there is always the need to use such extensive powers with due circumspection. There has to be in the larger public interest an element of self-ordained restraint. In the facts of the said case a Division Bench of the High Court set aside an interlocutory order and passed an ad interim order directing release of the seized goods without affording an opportunity to the State Government to file an affidavit-in-opposition to the writ petitioner observing inter alia that the confiscation notice was issued without any basis. The release of the goods [was] subject to the furnishing of bank guarantee of Rs. 5 lacs in the form of fixed deposit receipts and also on furnishing security of immovable property being .71 acres of land. The legality and propriety of the ad interim order of the Division Bench of the High Court having been questioned the Supreme Court held by way of setting aside the impugned ad interim order and directing the High Court to take immediate steps to recover the seized property from the respondent that the ad interim order of the Division Bench of the High Court was illegal and invalid. Taking into consideration all these observations of the Supreme Court and keeping in view the fact that there was an attempt on the part of the writ petitioners to grossly undervalue the goods and according to the opinion formed by the appropriate authorities of the Customs Department, there is an attempt to evade duty to the extent of Rs. 22,90,001 /-, since the undervaluation is to the extent of Rs. 16,57,001.70, this Court of appeal must also be circumspect in approving the terms of an order for release of the goods pending final assessment.
22. A provisional assessment indeed merges into the final assessment. Nothing prevented the Customs Authorities to expedite a final assessment in accordance with law on the available materials in their hands. They now contend that the necessary information about the exact price of the articles not being available at the time of provisional assessment and the provisional assessment being made under an outdated rule, if the goods are allowed to be taken away on the basis of provisional assessment merely on the undertaking given by the respondent writ petitioners that they would pay the dues on the basis of the duty as would appear to be payable on the final assessment, the security for the customs duty in the shape of goods, already passes hands and the chances of the recovery of the duty becomes remote. It is to be borne in mind that the attempted evasion is to such an extent as of Rs. 22,90,001/-. I cannot in the facts and circumstances justify the release of the articles merely on the undertaking given by the writ petitioners respondents by way of giving merely an appropriate bond for the sum alleged to be due on account of the customs duty in the show cause notice. I think in the facts and circumstances of the present case the writ petitioners respondents could only secure release of the goods on furnishing an appropriate bank guarantee covering the sum of Rs. 22,90,001/-. In case the respondent writ petitioners are unable to secure the release of such goods on furnishing such bank guarantee within a fortnight they have to wait till the final assessment is made, which I direct the [appellate] authorities to complete within a period of one month from this date.
ORDER
Hence Ordered.
Sd/-
(Mukul Gopal Mukherjee, J.]
23. In view of the difference between ourselves, however much minor the point of difference may be, we should direct the matter to be placed before the Hon’ble Chief Justice for assignment of this matter before a learned third Judge. Let a xerox copy of this judgment be made available to the learned advocates on record for both the parties on usual undertaking.