1 WP 1495/97
lgc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
WRIT PETITION NO.1495 OF 1997
Batliboi Limited, a joint ]
stock company incorporated ]
under the Indian Companies ]
Act, 1913 having their ]
registered office at Bharat ]
House, 5th Floor, 104, B. S. ]
Mumbai - 400 001 ].... Petitioner
versus
1. Municipal Corporation for
Greater Bombay, through
]
]
Municipal Commissioner, ]
having his office at ]
Opposite C. S. T., Fort, ]
Mumbai - 400 001 ]
]
2. Municipal Octroi Inspector ]
at Dahisar Check Naka ]
Dahisar (East), Mumbai 400 065 ]
]
3. Assistant Assessor and ]
Collector (Octroi), Assessor ]
& Collectors Vigilance Cell ]
4th Floor, Shree Chatrapati ]
Shivaji Maharaj Market ]
Building, Mata Ramabai ]
Ambedkar Marg, Mumbai-400 001 ].... Respondents.
Mr.Mayur Khandeparkar i/by Kanga & Co. for the Petitioner.
Ms. V S Gharpure for the Respondent/MCGM
CORAM : P B MAJMUDAR &
R M SAVANT, JJ.
DATE : 17th August 2011
::: Downloaded on - 09/06/2013 17:39:16 :::
2 WP 1495/97
ORAL JUDGMENT : [PER R M SAVANT, J]
1 The Petitioner-Company is a manufacturer of Industrial Package
Air-Conditioners. The cause of filing the above Petition was detention of
consignment of its air-conditioners which arrived at Dahisar Check Naka in
three different trucks. The said trucks carrying assessable goods were detained
as the goods were undervalued by classifying the goods under Entry No. 52 of
the Octroi Rules which attracts rate at 4%, the invoice value of the goods being
Rs.1,64,000/-though the goods had passed the octroi limit and part of the
consignment was already delivered to one Precision Components Pvt. Ltd. for
whom they were meant. However, a part of the said consignment was
detained by the Respondents. A Stop Delivery Memo was issued under Rules
15 and 16 of the Octroi Rules 1965 and the Petitioner was called upon to
produce relevant documents octroi receipt/import invoice/goods consignment
notes. On receipt of the said stop delivery memo dated 3.9.1997, the
Petitioner placed before the concerned officer of the Respondent No.1-
Corporation i.e Respondent No.3 herein the relevant documents. The Petitioner
also simultaneously offered to pay on the invoice value of the seven package
air-conditioners, the octroi payable at the rate of 2%, since the said
consignment is covered under Item 50 of Schedule-H of the Bombay Municipal
Corporation Act, 1888. Since the Respondents did not accede to the request of
the Petitioner to release the part of consignment which was detained, the
::: Downloaded on – 09/06/2013 17:39:16 :::
3 WP 1495/97
Petitioner-Company was constrained to file the above Petition invoking the writ
jurisdiction of this Court.
2 The Petitioner in the above writ petition has inter alia sought the
following reliefs :-
(a) That this Hon’ble Court be pleased to
exercise jurisdiction vested in it under Article 226 of
the Constitution of India, and be pleased to declare that
the detention of the Petitioners’ part of the assessable
goods described in Exhibit “A” by the Respondents as
illegal, null, void, arbitrary and unconstitutional and
contrary to law;
(b) That this Hon’ble Court may be pleased to
declare that the refusal by the Respondents to accept
Petitioners payment of octroi at the rate of 2% on the
invoice value inclusive of excise duty on the said
consignment of goods described in Exhibit “A” hereto is
illegal, null, void, unconstitutional and contrary to
law ;
(c) That this Hon’ble Court further be pleased
to permanently restrain the Respondents, their officers,
servants and agents by a permanent order and
injunction from in any manner interfering with the
Petitioners clearing the said assessable goods described
in Exhibit “A” hereto upon payment by the Petitioners of
octroi at the rate of 2% on the invoice value inclusive of
the excise duty in respect of the said consignment of
goods described in “A” hereto;
(c)(i) That this Hon’ble Court be pleased to issue
a Writ of Mandamus or a writ in the nature of
mandamus or any other appropriate writ, order or
direction restraining the Respondents their officers,
servants and agents from in any manner levying octroi
duty in respect of the Petitioners package type air
conditioners in excess of the rate prescribed for Entry
50 of Schedule-H of the Bombay Municipal Corporation
Act, 1888, and further directing the Respondents, their
officers, servants and agents to forthwith withdraw
::: Downloaded on – 09/06/2013 17:39:16 :::
4 WP 1495/97
and/or cancel the said notice dated 17/18th September
1997 (Exhibit “N” hereto).”
3 The above Petition had come for admission on 25th September
1997 on which day an interim order came to be passed by a Division Bench of
this Court. By the said interim order the Respondents were directed to
forthwith release the goods seized by them on the condition that the Petitioner
would be pay the octroi duty due and payable on the basis of the original
invoices. It was further directed that the Petitioner should fully co-operate
during the investigation which is sought to be carried out by the Respondents
with regard to the alleged acts committed by the Petitioner-Company or by its
agent.
4 In the context of the reliefs sought in the above Petition, as also in
the context of the allegations made by the Respondents qua the Petitioner-
Company it would be apposite to reproduce Paragraph-9 of the affidavit in
reply filed by the Respondents herein. The same is reproduced as under :-
“9 From the above, it will be clear that the
petitioners and/or their agents, knowingly fully well
and consciously deviced the fraudulent documents with
malafide intention to evade the payment of octroi in all
the abovementioned 3 cases by fraudulently producing
faked documents showing value of the goods imported
in the City on the lower side and having brought into
the City the materials/goods on different names. I say
that, this being clear case of deliberate intention to
evade the octroi, these respondents are entitled to
investigate the matter thoroughly in order to ascertain
the persons involved in this particular racket and the
::: Downloaded on – 09/06/2013 17:39:16 :::
5 WP 1495/97
quantum of evasion of octroi. These respondents are
not in issue on the rate at which octroi is to be
collected. I say that if these respondents are not
permitted to thoroughly investigate the matter and
ascertain the persons responsible in the evasion of
payment of octroi, it will set bad precedent. These
respondents are further entitled to prosecute the
persons involved in deliberate and intentional evasion
of payment of octroi u/s.478-1A and 478-1B of the
B.M.C. Act. The petitioners’ contention that his regular
agent was not available, is also after thought and
statement made in petition is false statement in as
much as the petitioners’ regular agent i.e. Kamal
Agency had in fact cleared consignment of other parties
on 2.9.1997 as evident from the records maintained by
these respondents. Act of the petitioners in approaching
some other agent in clearing their consignment, has
been done with clear intention to evade the payment of
octroi. The petitioners are not even revealing the
names of the agents to whom they have engaged in
clearing the consignment imported into this City.”
5 Reading of Para-9 of the affidavit in reply of the Respondents
therefore discloses that in so far as rate at which the octroi was due in respect
of the goods in question, the Respondents had no issue. The issue was only as
regards the alleged fraudulent documents produced by the Petitioner on the
basis of which it is the case of the Respondents that the goods were
undervalued.
6 During the course of hearing of the above Petition, Shri
Khandeparkar, the learned counsel appearing for the Petitioner, fairly conceded
that in view of the interim order dated 25th September 1997, except prayer
clause (c)(i), all the other prayers have worked themselves out, since the goods
were directed to be released by this Court.
::: Downloaded on – 09/06/2013 17:39:16 :::
6 WP 1495/97
7 In so far as prayer clause (c)(i) is concerned, the said prayer is
referable to the document dated 17th September 1997 which has been annexed
to the Petitioner later on as Exhibit “N” by way of amendment. The author of
the said document is the Assessor & Collector Vigilance Cell (Octroi) of the
Respondent No.1-Corporation. In the said letter dated 17th September 1997, it
is stated that it is prima facie noticed that octroi has been paid less due to
wrong classification of the consignments. Therefore the Petitioner was
requested to furnish the certified copies of Excise Gate Passes, Import Invoices,
Challans and Lorry Receipts for confirmation of value declared at the time of
import and confirmation of the correctness of payment of octroi. By the said
letter the Petitioner was requested to pay the difference of Rs.81,473/-
provisionally as mentioned in the accompanying statement pending verification
of the documents called for.
8 In so far as the said letter dated 17th September 1997 is concerned,
it is contended by Shri Khandeparkar, the learned counsel appearing for the
Petitioner, that since in the affidavit in reply the Respondents have stated that
since there is no issue as regards the rate at which the duty is payable in
respect of the goods in question, the said issue of classification therefore does
not survive for consideration in respect of the goods in question.
::: Downloaded on – 09/06/2013 17:39:16 :::
7 WP 1495/97
9 The interim order dated 25th September 1997 permitting the
Respondents to clear the goods was passed on the basis of the document dated
17th September 1997 and it is the case of the Respondents that there was an
undervaluation of goods in question and the gravamen of the allegations of the
Respondents was that the Petitioner had produced fraudulent documents.
10 The learned counsel appearing for the Respondent-Corporation
Ms.Gharpure stated that no investigation has been carried out pursuant to the
said interim order dated 25th September 1997. In view of what is stated by the
Respondents in their affidavit in reply we do not deem it necessary to go into
the aspect of the classification of the goods in question. However, we permit
the Respondents to carry out the investigation in terms of the said interim
order dated 25th September 1997 within a period of three months from date.
This is in view of the fact that there is an allegation of fraudulent documents
being produced by the Petitioner. If the said investigation is not completed
within the aforesaid period, the Respondents would thereafter not be entitled
to carry out such investigation and the classification as made by the Petitioner
at the time of payment of octroi under Entry 50 of the Octroi Rules would be
final and conclusive. In so far as the investigation is concerned, the
contentions of the Petitioner are explicitly kept open and the Petitioner would
also be entitled to rely upon the pronouncements of this Court in that regard.
::: Downloaded on – 09/06/2013 17:39:16 :::
8 WP 1495/97
11 Since it is the case of the Petitioner that all the relevant documents
have already been submitted to the Respondents, the averment to that effect is
found in Para-10 of the Petition, the Respondents would, therefore, carry out
investigation on the basis of the said documents which have been already
submitted to the Respondents.
12 Rule is accordingly disposed of in the aforesaid terms with parties
to bear their respective costs.
[R.M.SAVANT, J] [P.B.MAJMUDAR, J]
::: Downloaded on - 09/06/2013 17:39:16 :::