1. These writ petitions are preferred by a partnership firm praying for a writ of certiorari to quash the order of detention of raw materials dated 10.1.1992 and 11.1.1992 in respect of the factory at No. 17, Devaki Ammal Street, Shenoy Nagar, Madras-30 and also in respect of Godown at No. 41, Gajapathy Street, Shenoy Nagar, Madras-30 and also praying for the issue of a writ of mandamus forbearing the respondents from proceeding further pursuant to the seizure and detention effected on 10.1.1992 and 11.1.1992.

2. The petitioner in all these writ petitions is a Small Scale Industrial Unit engaged in the manufacture of Electronic Toys, Chargeable Lamps, Video Games and Electronic Chiming Devices and Other allied products and has its factory at No. 17, Devaki-Ammal Street. Shenoy Nagar, Madras-30 and Godown at No. 41, Gajapathy Street, Shenoy Nagar, Madras-30, It seems that most of the components required for the manufacture of the above said items are imported by the petitioner through the Madras Port and cleared after necessary assessment and payment of duty. On 9.1,1992, at about 5-30 p.m. the Officers of the Central Excise, Head Quarters, Preventing Unit visited the factory of the petitioner checked the bills of entry relating to the clearance of the imported components meant for manufacturing the above mentioned items. Again on 10.1.1992 at about 1.00 p.m. it seems the factory of the petitioner was inspected and the officers of the Central Excise Department seized all the Finished Touch lamps numbering 42, Optic Fibre Lamps numbering 25, Walkie L.C.D. Games numbering 14 and Train Key Chain numbering 34 and an order of detention was passed in respect of the raw materials in the factory which are shown in paragraph 4 of the affidavit filed in support of the writ petition No. 876 of 1992. It seems that the Officers of the Central Excise Department also detained the raw materials in the godown of the petitioner on 11.1.1992, and also seized the finished products kept there on the same day. The finished goods seized by the Officers of the Central Excise Department were taken away by them to the office of the third respondent. On 23.1.1992, the Superintendent of Centra! Excise, Head Quarters., Madras-34, the third respondent herein issued summons under Section 108 of the Customs Act to the partners of the firm to appear before him on 27.1.92 along with the documents specified therein. Aggrieved by the seizure of the finished goods and the detention of raw materials and the issue of summons under Section 108 of the Customs Act, the petitioner firm is before me.

3. It is alleged in the affidavits filed in support of the writ petitions that the petitioner engaged in the manufacture of Fan Lamp, Emergency Lamp, Touch Lamp, Video Games and Train Key Chain with imported components duly assessed and cleared under proper bill of entry, in the absence of any reason to believe on the part of the authorities concerned that the goods are liable to confiscation, the exercise of the power of seizure and detention is wholly without jurisdiction. It is also alleged that all the bills of entry under which clearance of the imported items was made, were perused by the authorities concerned, that the goods are not liable to confiscation, the exercise of the power of seizure and detention is wholly without jurisdiction. It is also alleged that all the bills of entry under which clearance of the imported items was made were taken away by the officers who visited the office on 10.1.1992. It is also stated that the said bills of entry vouch for the valid import and that there is absolutely no basis and circumstances for entertaining a reasonable belief that the goods seized are liable to be confiscated or to be proceeded against. It is further alleged that on the face of the documents available in the factory and in the office, it cannot be said that the goods are tainted goods. It is also stated that the Toys were imported in SKD condition and the case was adjudicated by the Collector of Customs by imposing redemption fine and penalty by order dated 25.1.92. It is also alleged that if the authorities had any material to show that the petitioner had crossed exemption limit in the manufacture of the items referred to above, they could have issued a show cause notice calling upon to file a declaration as to the quantity and value of the items manufactured and also to obtain a licence if necessary. It is further alleged in the affidavit that the officers did not scrutinise any accounts or ledgers to arrive at any reasonable belief that the finished goods are liable to confiscation, that after release for home Consumption, the goods imported ceased to be imported goods and thereafter there is no burden cast on the petitioner-firm under Section 125 of the Customs Act. It is also alleged that the petitioner firm is an assessee under Sales Tax and Income Tax Act and that they are maintaining Ledgers, Day Books and Bill Books etc. and that all the documents were taken away by the authorities concerned. It is further stated that the case on hand is not a case where the petitioner has ever avoided any show cause notice and that the circumstances of the case do not warrant such a drastic step of seizure. It is also alleged in the affidavit that the seizure and detention is wholly without jurisdiction. With these allegations, the petitioner firm is before me.

4. Notice of motion has been ordered on 28.1.1992.

5. A common counter-affidavit has been filed by the respondents. Mr. K. Jayachandran the learned Additional Central Government Standing Counsel appears on behalf of the respondents. It is claimed in the counter-affidavit that on the basis of reliable information the officers belonging to the Head-quarters Preventive Unit, Central Excise, Madras visited the premises at No. 17, Devaki Ammal Street, Madras and the shop at Kasi Chetty Lane, Madras on 10.1.1992. It is further claimed in the counter affidavit that the concerned officer found foreign marked goods such as Touch Lamp, Fibre Lamp, Walkie L.C.D. Games and their parts ready for marketing and for sale, that the officers on the reasonable belief that they are smuggled, improperly imported and they are goods to be confiscated and seized the goods under Customs Act, that the authorities recovered documents from the shop of the petitioner at No. 41, Gajapathy Street, Shenoy Nagar, Madras, that at the time of the said visit on 10.1.1992 the officers found that it was locked, that as the petitioner did not provide the key of the said premises on 10.1.1992, it was sealed and that the search was conducted on 11.1.1992 in the presence of the petitioner and independent witnesses. It is further claimed in the counter-affidavit that the said premises consisted of one hall without partition, a toilet and a bathroom without any furniture, equipment, machinery or tools that only card board boxes were stored and that on opening of the boxes, the following items were found:

1. Chargeable blower with sunken rechargeable battery,

2. Supersonic key chains with button cells,

3. 635 Nos. of Touch Lamps

4. 1130 Nos. of Outer Space Toys with "made in Taiwan" markings in 22 boxes

5. 1080 pieces of re-chargeable emergency lights with fan

6. 4104 pieces of chimming key chains with Button Cells in 57 boxes....

It is further claimed in the counter-affidavit that no documents have been noticed or produced, that all the goods were detained on the reasonable belief that they were smuggled goods and that they were detained under the Customs Act and kept secreted under their guise and camouflage of indigenous goods. It is further claimed in the counter-affidavit that certain documents were recovered on 11.1.1992, that summons dated 23.1.1992 under Section 108 of the Customs Act was issued to the petitioner to appear on 27.1.1992, and that the petitioner was required to produce the documents such as licence copies for all imports of M.M. Toys Industries, all bills of entry of M.M. Toys Industries and all purchase invoices of M.M. Toys Industries. It is claimed in the counter-affidavit that though the petitioner appeared on 27.1.1992 he did not cooperate with the Department, that on 3.2.1992 also the petitioner did not appear. It seems a medical certificate was sent with a request to adjourn the matter for his appearance for another ten days. At this stage, the writ petition came to be filed before this Court. It is also claimed in the counter-affidavit that to support the claim of the petitioner, he had not produced the copies of licenses for import, copies of bill of entry and other purchase bills, that the petitioner has to produce all the documents and has to correlate the same with available seized goods, with payment of duty particulars and that in the absence of it, the petitioner cannot simply say that all the items are imported and cleared after necessary assessment and payment of duty. It is further claimed in the counter-affidavit that prima facie, the case on hand is a case of receipt and disposal of smuggled Touch Lamps, re-chargeable emergency lights and toys and concealing them among the imported parts, to camouflage the smuggling activities, that the investigation in the case on hand is still in progress, that to arrive at the finality, the petitioner has to be thoroughly enquired, that some vital documents have to be obtained from the petitioner to complete the investigation and that summons under Section 108 of the Customs Act was issued to the petitioner. It is also claimed in the counter-affidavit that all the bills of entry and purchase invoices pertaining to the seized goods were not handed over to the officers, and that the petitioner was bound over to appear on 3.2.1992 to complete the process of enquiry. It is also claimed in the counter affidavit that as per Section 110 and 124 of the Customs Act, 1962 a show cause notice was issued and that after receiving a reply from the petitioner, the case would be adjudicated by the adjudicating authorities concerned. It is also claimed in the counter-affidavit that the case is still under investigation. It is also claimed in the counter-affidavit that a perusal of the three bills of entry relating to the so-called import of the components of the emergency lamps would show that the petitioner has imported re-chargeable emergency lamps in C.K. D. condition, that the seizure and detention are valid. It is further claimed in the counter affidavit that only after finalization of investigation, the extent of customs duty evasion could be quantified, and that it is not correct to say that all bills of entry of the petitioner's factory were perused and taken away. It is also claimed in the counter affidavit that prime facie, there is reason to believe that there is a case under the Customs Act, that the goods are liable to confiscation under Section 111 of the Customs Act, 1962 and that unless the case is fully investigated and departmental proceedings are allowed to continue it will cause irreparable damage to the Government by way of loss of revenue and violation of prohibitions. It is also claimed in the counter- affidavit that only to circumvent the restriction, the goods were misdeclared, under-valued and imported as components and that the petitioner had not produced all the copies of bill of entry. It is pointed out in the counter affidavit that it is the duty of the petitioner to correlate the available goods with that of relevant entries in the bill of entry, and if already adjudicated, with the adjudication order and purchase bills and the earlier bills.

6. After hearing the cases on hand for some time, I directed learned Counsel on both sides to sit together and try to correlate with the articles seized by the respondent department by my order dated 10.2.1992. When the case was taken up on 14.2.1992, a report has been filed by the respondents, stating that the petitioner produced various documents like licenses, invoices for correlation in the evening of 12.2.1992 and also in the evening of 13.2.1992. It is stated in the report that after perusing the documents mentioned therein, it is found that front the inception, the petitioner firm has imported assemblies and sub-assemblies as components for emergency lamps with fan, touch lamps, optic fibre lamps, rechargeable torch lights, LCD games, Chiming devices (Key chains) in SKD condition as shown in the Annexure I to IV enclosed in the said report. It is also stated in the said report that from a perusal of the above said facts, it is very clear that the petitioner had deliberately made phased imports of the goods mentioned therein to circumvent the policy restriction under Appendix 2B of the Import policy. The details of imports relating to the seized goods were shown in the said report. It is also pointed out in the said report that the petitioner was not having any licence in specific description for the import of goods seized issued under Appendix 2B of the Import and Export Policy and that therefore the seized goods are liable for confiscation under Sections 111(d) and (m) of the Customs Act read with Section 3(2) of the Import and Export (Control) Act, 1947. It is also pointed out in the said report that the petitioner had crossed the exemption limit and therefore liable to pay excise duty. The duty evaded by the petitioner for the years 1990-91 and 1991--92 is also shown in the said report.

7. Mr. R. Thiagarajan, the learned Senior Counsel appearing for the petitioner contends that the seizure made in this case is bad in law. He further contends that the respondents' action in exercising the power of seizure of goods, particularly when the goods are suffered duty in view of Section 47 of the Customs Act is bad in law. The learned Senior Counsel further contends that the components are imported from three different countries and that all the bills of entry were assessed and only after an order has been made the goods were released and as such once goods imported are adjudicated and bills of entry are assessed it is not open to the Department to exercise its power under Sections 110 and 111 of the Customs Act. He further contends that it cannot be said that the goods are smuggled goods. The learned Senior Counsel relies upon a judgment of the Division Bench of the Bombay High Court in M.G. Abrol v, Amichand AIR 1961 Bombay 227; CFC (Bom) 5 for the proposition as to what procedure has to be followed for exercising the power of seizure under Customs Act, The learned Senior Counsel further relies upon a judgment of the Division Bench of this Court in Collector of Customs v. H.S. Mehra AIR 1962 Madras 504 and contends that the seizure made in this case is bad in law on the facts and circumstances of this case. The learned Senior Counsel further refers to the decisions in Jain Shudh Vanaspaii Ltd. v. Union of India 1982(1) ELT 43, in Ajay Exports v. Collector of Customs Madras. 26 ELT 873, in Ghanshyam Chejra v. Collector of Customs 44 ELT 202 and in Mandanlal Steel Industries Ltd v. Union of India for the proposition that just because goods are in C.K. D. condition the power of seizure cannot be exercised, simply because if they are assembled that will become prohibited. Section 28 of the Customs Act provides for taking action for unfinished goods when any duty has not been levied or has been short levied or erroneously refunded. The learned Senior Counsel relies upon heavily Section 47 of the Customs Act, 1962 and argues that once bills of entry are assessed, no question of re-assessing arises and the respondents Department cannot invoke the power under Section 110 of the Customs Act thereafter.

8. Per contra, Mr. K. Jayachandran, the learned Additional Central Government Standing counsel appearing for the respondents contends that even through the goods are allowed by assessing the bills of entry, still it is open to the Department to come to a reasonable belief that the goods are smuggled. Learned Counsel points out the decisions in Giridharilal Bansidhar v. Union of India and in Madanlal Steel Industries Ltd. v. Union of India for this proposition. The learned Counsel also points out that the petitioner's licence to import goods appears in Appendix 3 whereas it imported goods in Appendix 2 of the Policy and as such an action can be taken for mis-declaration and improper importation. The learned Counsel relies upon an unreported decision of this Court in Bheena Pharma Japadar, Nanid Dawan, India Others v. Union of India (Writ Petition No. 15974 of 1991 etc. dated 6.12.1991) for the proposition that this Court should not interfere in such matters under Articles 226 of the Constitution of India at this stage. He further contends that summons had been issued under Section 108 of the Customs Act and that petitioner did not appear. He also argues that pending adjudication there cannot be a release of goods.

9. Replying this argument, Mr. R. Thiagarajan, the learned Senior Counsel relies upon the decision in Joint Chief Controller of Imports and Exports, Madras v. Aminchand Mutha etc. for the proposition that the item are not banned items and that no power vests with the Department to invoke the power of seizure and detention under the Customs Act.

10. I have considered the arguments of Mr. R. Thiagarajan, the Senior learned Counsel appearing for the petitioner and of Mr. K. Jayachandran, the learned Additional Central Government Standing Counsel appearing for the respondents-Department. To consider the issue raised in this case, it is necessary to refer to certain provisions of the Customs Act. Section 47 of the Customs Act reads as follows:

Clearance of goods for home consumption:--Where the proper officer is satisfied that any goods entered for home consumption are not prohibited goods and the importer had 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.-

Section 110 of the Customs Act reads as follows:

Seizure of goods, documents and things:--(1) If the proper officer has reason to believe that any goods are liable to confiscation under this Act, he may seize such goods:

Provided that where it is not practicable to seize any such goods, the proper officer may serve on the owner of the goods an order that he shall not remove, part with, or otherwise deal with the goods except with the previous permission of such officer.

(1A) The Central Government may, having regard to the perishable or hazardous nature of any goods, depreciation in the value of the goods with passage of time, constraints of storage space for the goods or any other relevant considerations, by notification in the Official Gazette, specify the goods or class of goods which shall, as soon as may be after its seizure under Sub-section (1), be disposed of by the proper officer in such manner as the Central Government may, from time to time, determine after following the procedure hereinafter specified.

(1B) where any goods, being goods specified under Sub-section (1A), have been seized by a proper officer under Sub-section (1), he shall prepare an inventory of such goods containing such details relating to their description, quality, quantity, mark, numbers, country of origin and other particulars as the proper officer may consider relevant to the identity of the goods in any proceeding under this Act and shall make an application to a Magistrate for the purpose of

(a) certifying the correctness of the inventory so prepared; or

(b) taking, in the presence of the Magistrate, photographs of such goods, and certifying such photographs as true; or

(c) allowing to draw representative samples of such goods, in the presence of the Magistrate, and certifying the correctness of any list of samples so drawn.

(1C) Where an application is made under Sub-section (1B), the Magistrate shall, as soon as may be, allow the application, (2) Where any goods are sized under Sub-section (1) and no notice is respect thereof is given under clause (a) of Section 124 within six months of the seizure of the goods, the goods shall be returned to the person from whose possession they were seized:

Provided that the aforesaid period of six months may, on sufficient cause being shown, be extended by the Collector of Customs for a period not exceeding six months.

(3) The proper officer may seize any documents or things which, in his opinion, will be useful for or relevant to, any proceeding under this Act.

(4) The person from whose custody, any documents are seized under Sub-section (3) shall be entitled to make copies thereof or take extracts therefrom in the presence of an officer of customs....

Sub-sections (d) and (m) of Section 111 of the Act reads as follows:

(d) any goods which are imported or attempted to be imported or are brought within the Indian customs waters for the purpose of being imported, contrary to any prohibition imposed by or under this Act or any other law for the time being in force;

(m) any goods which do not correspond in respect of value or in any other particular with the entry made under this Act or in the case of baggage with the declaration made under Section 77 in respect thereof....

It cannot be disputed that an order under Section 47 of the Customs Act is a quasi judicial order. In my view, this order will be a good evidence to show that the imported goods were for home consumption and were not prohibited goods and the importer had paid the import duty, if any as well as any other charges payable under the Act in respect of the same. A division Bench of this Court in Madanlal Steel Industries Limited v. Union of India observed as follows:

...The language in Section 110 of the Act, however, should not be mistaken to give some sort of an administrative power to the proper officer to seize any goods because the words therein are 'has reason to believe that any goods are liable to confiscation under this Act'. Unless the goods are liable to confiscation and there is some basis to believe that such goods liable to confiscation under the Act were in the hands of some one or some where, it is obvious that there can be no seizure....

In the above-mentioned case, the scope of Section 47 of the Customs Act has been considered and it has been observed at p.716 page 336 of 38 ECC as follows:

Courts which have taken the view that an order under Section 47 of the Act is final and on the face of such an order in favour of the importer action to confiscate the goods cleared for home consumption cannot be taken, have also taken notice of the exceptions that may arise and even goods cleared in such circumstances can be subjected to confiscation. The Delhi Court's judgment supra has taken notice of these exceptional circumstances saying "The finality cannot be disturbed unless the Department successfully shows that there was fraud or deliberate suppression'. Both the Bombay Court and the Delhi Court in the cases of Union of India v. Popular Dyechem and Jain Shudh Vanaspathi Ltd. and Ors. v. Union of India supra, however, have not taken notice that the seizure and confiscation are acts in rem unlike any penal action under the Act itself being one in relation to the goods rather than in relation to the person and such proceedings, however, depend not on anything else, but the reasonable belief of the proper officer that the goods are liable to confiscation, whether for the reason of being improperly imported goods or for the reason of improper export. Such a belief may be found to be reasonable for the reason of fraud or suppression, as noticed by the Delhi High Court in Jain Shudh Vanaspati Ltd. v. Union of India supra, or such other reasons or such other grounds which render the import or the export illegal and liable to confiscation. It would be Only in the notice under Section 124 of the Act that grounds would be disclosed and then only it would be possible to know whether there has been any fraud, suppression of fact and/or any other invalidity in the import or export, or not.

Both the Bombay Court judgment in the case of Union of India v. Popular Dyechem and the Delhi Court judgment in the case of Jain Shudh Vanaspathi Ltd. and Ors. v. Union of India and Ors. , on their peculiar facts, are good for taking notice of the order under Section 47 of the Act and saying accordingly that unless that order was set aside, no proceeding for confiscation should have been taken. It is difficult, however, to accept this as a law as once there is a clearance under Section 47 and/or Section 51 of the Act is ordered, unless that order is set aside, the proper officer cannot act on his reasonable belief under Section 110, 111 or 113 of the Act. The Calcutta Full Bench judgment in the case of Euresian Equipments and Chemicals v. Collector of Customs has, in substance, pronounced that such proper officer's satisfaction for confiscation proceedings shall remain unaffected by the order of the proper officer permitting the clearance of goods under Section 51 of the Act. That view is in consonance with the basis of the belief that goods have been improperly imported or exported and such belief being in relation to the goods and in rem, it will not be correct to read in the orders under Section 47 or Section 51 of the Act any inhibition upon the jurisdiction of the proper officer to act under Sections 110, 111 and 113 of the Act. The petitioner/appellant came to this Court challenging the seizure without waiting for the notice under Section 124 of the Act. Such materials upon which it will be possible to predicate whether there are reasons for misrepresentation or fraud in importing or exporting of any prohibited goods or dutiable goods in violation of the conditions under which such import or export is permissible, will be available only in the notice, which, as we have already noticed, has to contain the grounds on which the proposal to confiscate is based, to afford an opportunity to the importer or the exporter or any other person from whose custody such goods are seized, to make a representation in writing and thereafter heard. We thus find that it is not a fit case in which this Court can declare the seizure invalid....

So, the contention of Mr. R. Thiyagarajan, the learned Senior Counsel reliance upon judgments of various Courts, cited supra, cannot help him to the effect that once an order has been passed under Section 47 of the Act, it became final. So, in may view, it cannot be taken as a proposition of law that once a clearance under Section 47 of the Act is ordered, unless that order is set aside the proper officer cannot act on his reasonable belief under Sections 110, 111 or 113 of the Customs Act. As pointed out in the report that after verification, it is for the petitioner to appear before the authorities and convince them and produce all the records that there is no violation of any of the provisions of the Customs Act. When an allegation is made that the petitioner has deliberately made phased imports of the above mentioned goods to circumvent the policy restriction under Appendix 2 8 of the Import Policy, I do not think it is possible for this Court to issue a writ of certiorarified mandamus as asked for by the petitioner directly setting aside the impugned order and also a writ of mandamus to the respondents not to take any action based on the detention order. I have taken a similar view that in such matters, a writ should not issue ordinarily. See: Bheena Pharma Japadar, Nani Damman v. Union of India (Writ Petition No. 15974 of 1991 etc. dated 6.12.1991) I am of the view that various decisions of different High Courts have been analyzed by a Division Bench of this Court in Madanlal Steel Industries Limited v. Union of India and I am bound by the same.

11. Mr. K. Jayachandran, the learned Additional Central Government Standing Counsel appearing for the department contends that the goods imported though at different times in the nature of components would, if assembled result in items which are stated above as "consumer goods" which would squarely come within the item of Appendix 2 Part B of the Import of Export Policy. Item 172 reads as follows:

All consumer goods, however described, of industrial, agricultural or animal origin, not appearing individually in Appendices 3 Part A and 5 or specifically listed for import under Open General Licence.

According to the learned Counsel for the respondents Department the petitioner tries to do indirectly what it cannot do directly, by importing the goods in C.K.D. condition. Mr. R. Thiagarajan, the learned Senior Counsel appearing for the petitioner, per contra, contends relying upon the decision in Union of India v. Tarachand Gupta and Brothers that the ratio of the Supreme Court in the above mentioned case will squarely apply to the facts of the case on hand. In the above mentioned case, the Supreme Court had to construe the scope of Entry 295 and Entry 294, that Entry 295 dealt with import of motor cycles and scooters in CKD condition and Entry 295 dealt with articles for use as parts and accessories of motor cycles and scooters. In the above mentioned case, the Supreme Court repelled the contention of the Department that by importing parts of motor cycles and scooters in CKD condition the importer had contravened Entry 295 and also the argument that the importer had done indirectly what was prohibited to be done directly. The only question arose before the authorities concerned in that case was whether the petitioner's licence covered the goods imported by them. It has been held in Union of India v. Tarachand Gupta And Brothers that the Collector of Customs, while examining the goods imported under the licence covered by an entry, has only to ascertain whether the goods are of the description in that entry. So, the contention of Mr. R. Thiagarajan, the learned Counsel appearing for the petitioner on this aspect has to be accepcted that the petitioner has not violated Entry 172 of Appendix 2. At any rate, it is for the petitioner now to respond to the summons issued by the respondents Department and convince the authorities that each and every bill of entry is assessed and no person can arrive at a finding that the goods are smuggled goods. In my view, it cannot be said that the Department has no jurisdiction at all to invoke the power under Section 110 read with Section 111 of the Customs Act on the facts of this case. I am not able to accept the extreme contention put forth by Mr. R. Thiagarajan, the learned Senior counsel appearing for the petitioner, in view of the Principle laid down by the judgment of the Division Bench of this Court cited supra.

12. Since the respondent Department has already filed a report before this Court, in the interests of justice, 1 direct the respondents. Department to complete the adjudication proceedings on or before 15-3 1992 and I do hope that the petitioner will cooperate with the Department in its interest. I make it clear that I give this direction since I have already stated that no question of issuing a writ of certiorarified mandamus and no question of issuing a writ of mandamus directing the respondents not to take any action against the seizure or detention can arise. With this direction, the writ petitions are disposed of though I reject the prayer as such for. However, there will be no order as to costs.