ORDER
Jyoti Balasundaram, Member (J)
1. The brief facts necessary for a proper understanding of the case are summed up as under :
The appellants imported cold rolled stainless steel strips and sought clearance duty free under the DEEC Scheme in accordance with the provisions of Notification 116/88-Cus. against two Import Advance Licences, one dated 10-3-1987 and the other dated 30-3-1987, both valid till 30-9-1988. A query memo was issued by the Customs authorities asking for the complete itinerary of the Vessel ‘Frontier Wind’ (the ship on which the goods arrived) for the period 1-9-1988 to 1-11-1988 and it was seen from the schedule of the said vessel that it arrived in Kobe Port, Japan on 2-10-1988 and departed from that Port on 5-10-1988. Since the appellants produced,a copy of Bill of lading showing that the goods were loaded on 30-9-1988 whereas the ship arrived at Kobe Port on 2-10-1988, the department was of the view that the Bill of lading did not reflect the correct date of loading of the goods. Since by the time the ship arrived at Kobe Port (on 2-10-1988), both the above mentioned import licences had expired, the import of the goods was unauthorised.
2. The Adjudicating authority confiscated the goods in terms of Section 111 of the Customs Act, 1962 for the reason that they were liable to confiscation under Section 111(d) of the Customs Act read with Section 3 of the Imports and Exports (Control) Act, 1947. He however, extended the option to the importers of redeeming the goods on payment of a fine of Rs. 74,000/~. In addition, he also ordered that the goods be charged to duty at the appropriate rate, denying the benefit of duty free clearance under Notification 116/88 and also imposed a penalty of Rs. 20,000/- upon the appellants herein. Hence this appeal.
3. We have heard Shri R. Subramanian, learned Advocate and Shri K.K. Jha, learned DR. The principal contention of the appellants is that it is the date on the Bill of lading which is relevant in the cases of shipment made by sea in terms of Para 82 of the Handbook of Procedures April 1988 to March 1991 and since the date on the Bill of lading is 30-9-1988, licences were valid to cover the imports and therefore, the goods had been validly imported and there was no warrant either for confiscation or penalty or for refusing the benefit of duty free clearance under the DEEC Scheme. This contention is not tenable. As per para 86 of the Handbook of Procedures, the validity of import licence is decided with reference to the date of actual shipment/despatch of goods from the supplying country and not the date of arrival of the goods at an Indian Port. The argument of the learned Counsel that Para 82 alone will govern the present case and it cannot be read along with Para 86, is not correct, as Para 86 deals with the question of validity of import licence and therefore, Para 82 has to be read along with Para 86. While the learned Advocate is correct in submitting that once the carrier has received the goods into his charge, even though he may keep them in a warehouse or store for some days before actually putting them on board, the shipper is entitled to receive his Bill of lading on demand the matter does not end there. After the goods are loaded, the Bill of lading to be issued by the carrier must be a shipped Bill of lading. At the option of the carrier, some documents can be utilised for noting the date of the vessel and also the date of shipment. See (Halsbury’s Laws of England 4th Edition Vol. 43 Para 769 at page 533 & Para 774 at page 535). This clearly shows that shipped Bill of leading shall show the actual date of shipment. Construing Para 86 in harmony with Para 82 of the Handbook of Procedures, the validity of import is to be determined with reference to the date of actual shipment. There is no dispute that the vessel ‘Frontier Wind’ arrived in Kobe Port only on 2-10-1988 and therefore, the goods in question could not have been shipped on board prior to that date. Both import licences had already expired on 30th September 1988 i.e. prior to the date of actual shipment of goods which is the crucial date for determining the validity of the import. Therefore, the goods are not covered by a valid import licence and hence have rightly been confiscated. We are fortified in our view by the Tribunal’s order in the case of Metraco (India) Ltd. v. Collector of Customs reported in 1990 (49) E.L.T. 207 in which it has been held that the validity of the licence is to be determined with reference to the date of actual shipment and in that case, since the goods were loaded on 19-12-1988 after the issue of a Public Notice dated 29-11-1988 prohibiting import of the goods (Cassia) – the Tribunal held that the goods could not be allowed under OGL and required a valid licence. The appellants had no licence and the goods were liable for confiscation. The Tribunal rejected the plea of the importers that the date of issue of Bill of lading viz. 29-11-1988 should be taken as the date of shipment.
4. The judgment of the Hon’ble Delhi High Court cited by the learned Counsel in the case of Ahmed Ocmerbhoy (Exports) Pvt. Ltd. v. Union of India reported in 1989 (42) E.L.T 556 is distinguishable. As seen from the order of the High Court, the only point for consideration was whether the date of export was (sic) taken as 5-6-1976 which is the date of mate receipt or 22-5-1976 which is the date of Bill of lading. Para 33 of the Import Trade Control Policy for the year April 1976 to March 1977 as it existed at the relevant time, provided that for the purpose of considering applications for import replenishment under the Import Policy for Registered exporters, the relevant date of export will be determined in the case of shipment by sea by the date on the relevant Bill of lading which generally shows the date on which the goods have actually been loaded on the ship. This provision was amended by a Public Notice issued on 14-1-1977 which substituted the provision in existing Para 33 by providing that the relevant date of export in the case of shipments by sea would be determined by the date on the relevant Bill of lading or the date of mate receipt, whichever is later. The High Court held that a Bill of lading can be issued a t any prior point of time (sic) the mate receipt having regard to the Public Notice issued on 14-1-1977 and according to Halsbury’s Laws of England, 4th Edition, Volume 43, Page 533, Para 769. The Court therefore, held that the petitioners were entitled to the benefit of the provisions of Para 33(a) of the Import Trade Control Policy, as it existed at the relevant time i.e. the date of export was to be [determined] in accordance with the date of Bill of lading and not the date of the mate receipt.
5. For the reasons recorded above, we hold that the goods are not covered by valid licence and were liable to confiscation. Having regard to the value of the goods i.e. Rs. 74,159/- CIF, the redemption fine of Rs. 74,000/- is excessive and requires to be reduced. We accordingly reduce the fine to Rs. 35,000/-.
6. Penalty has been imposed on the appellants as the Adjudicating authority has held that the Bill of lading has been pre-dated so as to give the impression that the goods are covered by licence in respect of validity period and since only the DEEC holder would be benefitted by such predating, it was done at the instance of the DEEC holder. We find that neither before the Adjudicating authority nor even before us, have the appellants established the date of actual shipment. Therefore, the Addl. Collector’s finding that the Bill of lading was deliberately pre-dated, is correct. We are of the view that penalty has also been rightly imposed upon the appellants. In the result, we uphold the impugned order and reject the appeal.