ORDER
S. Kalyanam, Vice-President
1. Vice-President–Since we take up reference application itself for disposal today, the stay application is dismissed.
2. The above reference application is by the Department and directed against the order of the Tribunal dated 8.6.1994.
3. The following question of law has been set out in the reference application:
(i) Whether the bona fides of the importer, as relied upon by the Hon’ble CEGAT, are alone sufficient to release the goods when the importation clearly fails to meet the well laid down criteria in the Import Policy, 1992-97, viz., (i) that the date of shipment be prior to the date of any restriction/regulation, or (ii) that the date of shipment be within 45 days of imposition of such restriction/regulation, provided the shipment is covered by a firm order backed by an irrevocable Letter of Credit established before the date of restriction/regulation.
(ii) Whether the importer has not violated the import conditions in view of the fact that the invoices covering the shipments clearly stipulate the payment terms as “Sight D/P” and no Letter of Credit had been opened by the importer in favour of his foreign supplier?
(iii) Whether there is any estoppel in fiscal matters and ignorance of law is pardonable?
(iv) Whether a clarification of law is not to be treated as only explaining an existing position in law and, accordingly, the import subject goods was always restricted?
4. Sh. Jeyaseelan, the learned DR contended that whatever may be the practice of the department in permitting clearances of such goods under OGL either for the same party or for others under the same policy in respect of identical goods, since there is no estoppel against law and in the light of the ruling of the Hon’ble Supreme Court in the case of Darshan Oils Pvt. Ltd. v. UOI a question of law would arise meriting reference. He submitted that even if the department had been consistently committing series of errors that should not serve as a precedent.
5. Heard Ms. Hema, the learned Counsel for the respondents.
6. We have considered the submissions made before us. On going through the records, we find that pursuant to the order of the High Court, which directed the Tribunal to go into the issue as to whether the goods were permissible for import under OGL and whether clarification by the licensing authority dated 14.9.1993 was communicated to the public or whether the respondents could be taken to have knowledge about the same and they imported the goods despite such knowledge and in the light of the aforesaid directions of the High Court, the Tribunal after hearing both parties went into the whole issue and gave a considered finding on evidence which is in para 5 of the impugned order. The Tribunal also found that the goods were allowed import under OGL by the department right through till the clarification by the licensing authority dated 14.9.1993 was given and the same was implemented by the Customs department only after 3.11.1993. We also find that this factual position was not disputed by the department. The Tribunal has further found on evidence that there was absolutely no evidence either direct or circumstantial to show that the clarification by the licensing authority was either communicated to the public in general or to the party respondents in particular. The Tribunal has also referred to the earlier practice of the department for allowing clearance of such goods under OGL and further has referred to the clarification of the licensing authority dated 14.9.1993 as mentioned in the note dated 3.11.1993.
7. The Tribunal has further observed as under:
We also take note of the fact that the same Assistant Collector for the same petitioner and also others in respect of similar goods has permitted clearance of the goods under same policy and for the purpose of convenience we extract below the particulars as given by the petitioner as per notice to Department:
B. EARLIER IMPORT BY THE APPELLANT THRO’ MADRAS PORT (SYNTHETIC CAMPHOR POWDER)
(Allowed under OGL – not in the negative list in Policy 1992-97)
a) Bill of Entry No. 26077 dt. 23.7.1993: goods cleared on 18.8.1993
b) Bill of Entry No. 37539 dt. 8.10.1993 : goods cleared on 12.10.1993
c) Bill of Entry No. 38068 dt. 12.10.1993: Goods cleared on 21.10.1993 (Note: (b and c) above are after clarification dated 14.9.1993).
C. IMPORT OF SYNTHETIC CAMPHOR – ALLOWED UNDER OGL AFTER 14.9.1993 BY MADRAS CUSTOMS.
___________________________________________________________
Bill of Entry No. Bill of LC Date Party Name
Lading No. (Importer)
____________________________________________________________
a) 39904/26.10.1993 26.9.1993 16.8.1993 Shanthi Chemicals,
Madras
b) 39518/22.10.1993 28.9.1993 16.8.1993 Sha Karnajee
Juharma, Madras
D. IMPORT OF SYNTHETIC CAMPHOR - ALLOWED UNDER OGL AFTER 14.9.1993 BY OTHER COLLECTORATE:
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Bill of Lading No. Bill of Entry No. Party Name
95576728/10.10.1993 261/8.11.1993 Apex Silicate and
Chemical Industries
P. Ltd., Gali Hinga
Road, Delhi-110006
The above extract would show that similar goods were permitted clearance not only in respect of the petitioner but also in respect of others under O.G.L. by the Customs Department, not only in Madras, but also in Bombay. We particularly take note of the fact that such clearance was permitted even after the clarification of the licensing authority dated 14.9.1993, and in this regard we refer to the Bills of Entry i.e. B(b) & (c) above. We find that similar goods were allowed clearance in respect of the same petitioner by the same Assistant Collector without any LC having been opened subsequent to the date of clarification issued by the Licensing authority and the Assistant Collector decided the issue in favour of the petitioner and the learned SDR submitted the Department permitted clearance of the goods if the shipment is prior to the date of clarification given by the licensing authority or if the LC had been opened prior to the date of importation. Since the Department is contending that importation and clearance is permissible only on the basis of the clarification referred to above, if the clarification had not been communicated either to the Public or to the petitioner/appellant in question, the bona fide nature of the import cannot be called in question. In such a situation, the appellant/petitioner cannot be faulted and the goods cannot be confiscated. It is elementary and fundamental that where there is a change in the policy taking certain items out of the OGL list and bringing them in the prohibited/restricted list it is of paramount importance that such a change in policy should be communicated to the Public. In the absence of such communication, it would not be open to the Department to contend that the import is not permissible. As stated above, the Department had knowledge about the change in policy only from 3.11.1993 and in the present case, one consignment was shipped on 15.9.1993 and the other consignment was shipped on 28.9.1993, i.e. prior to the date of communication of the change in policy to the Department. Therefore, in the peculiar facts and circumstances of this case, bearing in mind the clear direction of the Madras High Court which found the pleas of the appellant/petitioner “merited acceptance” and for the reasons set out above, we set aside the impugned order, recall bur order dated 2.2.1994 and allow the appeals and applications of the petitioner.
8. We, therefore, in the light of the findings of the Tribunal in appreciation of the evidence and in the facts and circumstances, do not find any question of law arising for reference as contended by the learned DR. The reference application is therefore rejected.
(Pronounced in open Court).