[Order per : G.P. Agarwal, Member (J)]. - Through the application in hand the applicants pray for referring the following alleged questions of law said to have arisen out of Order No. 238/87, dated 15-4-1987 passed by this Tribunal in Appeal No. C/315/86-MAS to the High Court for determination :-
“A. Whether a Public Notice can have the effect of taking away the right to import vested in the licensee prior to the issue thereof.
B. Can a Public Notice affect the import of items against a licence issued prior thereto merely because the Letter of Credit was opened and/or shipment affected after the issue of Public Notice ?
C. When can a Public Notice be said to have retrospective effect ?
D. Whether the provisions of para 231 (3) of AM-83 Policy (contained in Chapter 22 titled) transitional arrangements thereof take within its ambit amendments to the policy make throughout the policy period ?
E. Whether a Licensee has a vested right to import items as per the import policy in force on the date of issue of the licence and/or the announcement of the new policy and/or the date of specific endorsement thereof ?"
2. Brief facts leading to the present application are :
The applicants imported 3 consignments of “Non Special Type Petroleum Jelly, White USP” and claimed clearance of the imported goods as Letter of Authority holders in respect of 2 Export House Non-transferrable REP Licences bearing Nos.(i) P/K/W/0468710, dated 24-3-1982 issued in the name of M/s. Kantilal Chhotalal, Bombay and (ii) P/K/W/0465938, dated 3-2-1982 issued in the name of M/s. Uni Gem (India) Limited, Bombay. These licences were issued under licence period AM-82 and were valid for 12 months from the date of issue. At the time of issue of these licences only “special types of Petroleum Jelly” alone was a canalised item and it continued to be like that till 14-8-1982, when, vide ITC Public Notice 41/82, dated 16-8-1982 the entry under canalised list was amended to read as “All types of Petroleum Jelly”. The Assistant Collector of Customs, Appraising (Imports) accepted these two licences as valid and allowed the clearances of the imported goods vide his order dated 19-7-1983 on the ground that on the date of issue of the said licences only special Petroleum Jelly was canalised and that all Petroleum Jelly became canalised only on 4-9-1982 and therefore restrictions and prohibitions imposed after the issue of the licences were not applicable to the goods imported. Against this order an application in terms of Sec. 129D (4) of the Customs Act, 1962 on the directives by Collector of Customs, Cochin under the provisions of Section 129D (2), ibid was filed before the Collector of Customs (Appeals), Madras on the ground that the licences should not have been accepted by the Assistant Collector as “Non-Special type Petroleum Jelly” also was an item canalised from 16-8-1982 onwards and at the time of placing the order and effecting the import by the Export House it continued to be an item canalised, not allowed for import against an REP Licence held by the Export House. The facility extended under para 183 of AM-82-83 policy to the Export Houses to import OGL item against REP Licences issued to them was an additional facility and the authorities who issued the Import Licences and allowed these facilities have power to impose any prohibition or restriction taking into consideration the interest of the Public. The Letter of Credit was opened on 28-2-1983, and the shipment was effected on 24-3-1983. Thus the importers have entered into this transaction quite some time after the canalisation and knowing fully well that the item they were ordering was an item canalised, by the licensing authorities. The argument that Non-special type of Petroleum was not a canalised item at the time of issue of the Import Licence does not hold good as the intention of the authorities to restrict the import of the item by canalising the same was made public well before the importation. There upon the applicants were called upon to submit their representation, if any, on the issues raised in the said application. In reply it was inter alia contended by the applicants that ITC Public Notices, amendments etc. could not be given effect to retrospectively. On this premises it was submitted that the decision taken by the Assistant Collector was sought to be reviewed in the light of ITC Public Notice No. 41/82 which was issued canalising all types of petroleum jelly and in so doing, the Collector was trying to give retrospective effect to the provisions of the ITC Public Notice. It was further submitted that as per the endorsements made on the Importers’ Licences, the same would be subject to the conditions laid down in the relevant ITC Policy during which the licences were issued or any amendments up to and including the dates of issue of the licences, unless otherwise specified. And further that these two licences were issued on 3-2-1982 and 24-3-1982. that is, prior to 16-8-1982 which was the date of issue of ITC P.N. 41/82 and were indorsed by ITC authorities for import of O.G.L. items and made transferrable on 26-4-1982, Letters of Credit were opened by the Importers on 28-2-1983; the goods were imported in terms of the provisions of Para 183, sub-para (4) of ITC. Policy 1981-82 dealing with special policy for Export Houses. It was also pleaded that ITC P.N. 41/82 did not say that amendments to Policy introduced therein were to be applied and/or would be applicable to licences already issued during the earlier policy period. The said application was treated as an appeal in terms of Sec. 129D (4) of the Customs Act, 1962. The Collector (Appeals), Madras after hearing the parties set aside the order passed by the Assistant Collector of Customs, Appraising (Imports) holding that the order passed by him (Assistant Collector) to the effect that the said licences were valid for the impugned goods is not correct and legally sound and remanded the case vide his order dated 27-3-1986 with the direction that it would be open to the authorities concerned to re-examine and decide whether the impugned goods are prohibited goods and also making it clear that fresh proceedings will be subject to the provisions to Section 124 of the Customs Act, 1962 and that the Importer (applicants herein) be given sufficient opportunity to put forth his case. Aggrieved with the said order of the Collector of Customs (Appeals), the applicants filed their appeal before this Tribunal.
3. During the course of the hearing of the appeal on merits by this Tribunal the main burden of the arguments or the applicants was that by his impugned order dated 27-3-1986 the Collector (Appeals) tried to give retrospective effect to the provisions of the ITC Public Notice 41/82 which was not permissible. This Tribunal agreed with the said contention of the applicants in principle and after agreeing so confined itself to examine as to whether the order of the Collector (Appeals) made the Public Notice work with retrospective force and ultimately on the facts found that the Collector (Appeals) has not given the retrospective effect to the said Public Notice and rejected the appeal vide its order No. 238/87, dated 15-4-1987 and directed the parties to attend the proceedings before the proper authorities who shall give their decision with due despatch and care in accordance with the remand order passed by the Collector (Appeals).
4. We have heard Shri S. D. Nankani, learned Counsel for the applicants and Shri D.K. Saha, learned J.D.R. for the respondent.
5. As regards question No.’A’-Shri Nankani, learned Counsel for the applicants submitted that no retrospective effect can be given to the Public Notice and therefore the Public Notice cannot have the effect of taking away the right to import vested in the licensee prior to the issue thereof and cited the following cases :-
1. M/s. Bharat Barrel & Drum Mfg. Co. (P) Ltd., v. Collector of Customs, Bombay, AIR 1971 SC704.
2. M/s. Patel fmpex Pvt. Ltd., Bombay v. Collector of Customs, Ahmedabad 1984 ECR3W.
3. HES Limited v. Collector of Customs, Bombay, .
4. Ashwin Vanaspati Industries Pvt. Ltd. v. Collector of Customs, Ahmedabad, 1987 ,(27) ELT 300.
5. Jayant Vegoils and Chemicals (P) Ltd. v. Union of India, 1987, (30) ELT 134.
6. In reply Shri Saha, learned JDR submitted that in the instant case the Tribunal agreed in principle that retrospective effect could not be given to the Public Notice 41/82 as can be seen from para 4 of the order dated 15-4-1987 passed by this Tribunal. He further submitted that the question framed by the applicants in fact does not arise out of the order passed by this Tribunal inasmuch as it was never argued at the time of hearing of the appeal that the importer had any vested right or it cannot be taken away by a Public Notice. Alternatively he submitted that this question is no longer res integra inasmuch as in the case of P. Ripalkumar and Company, Bombay v. UOI, 1987(32) ELT 668, the Hon’ble Bombay High Court after reviewing the entire case law on the point concluded that goods specifically banned under current policy cannot be imported even if permissible under earlier policy and that import must satisfy the requirements of earlier policy under which the licence was issued as well as of current policy.
7. We have considered the arguments and the case law cited by the parties and find that the proposed question so framed does notarise out of the order passed by this Tribunal inasmuch as at the time of hearing of the appeal on merits by the Tribunal it was never argued that the importer had a vested right or that the alleged vested right cannot be taken away by a ITC Public Notice. As regards the contention of the applicants in the main appeal that retrospective effect could not be given to the Public Notice, the Tribunal agreed in principle with them and on the facts of the case found that no such retrospective effect was given by the Collector (Appeals). Even otherwise this question is longer res integra as replied by the learned JDR. In the case of P. Ripalkumar, Supra, the Hon’ble Bombay High Court after reviewing the entire case law on the point unequivocally held that the import of any item must firstly comply with the requirement of earlier policy and at the same time it must also satisfy the requirement of current policy and if the current policy does not permit for an import of OGL items by virtue of an endorsement made on the imprest licence, the wisdom of the current policy cannot be questioned. In the case of S.S. International v. UOI, 1987 (14) ECC 77 an order No. 49/85-88 was issued in exercise of the powers conferred by Sec. 3 of the Imports and Exports (Control) Act, 1947 by the Central Government on 1st April, 1986 whereby general permission (OGL 15/86) was given to import into India from any country except the union of South Africa/South West Africa goods of the description specified in the Schedule Annexed to the order subject to the conditions mentioned therein. The Schedule contains the items cinnamon/cassia and cloves. On the same date, another Order No. 40/85-88 under the heading Open General Licence No. 6/86 was issued under Section 3 of the Imports and Exports (Control) Act, 1947 by the Central Government which gave general permission to import into India from any country except the union of South Africa and South West Africa the goods of the description specified in Appendix 5 of Import and Export Policy, 1985-88 (Volume I) by designated public sector (canalising) agencies mentioned in the Appendix. It was noticed that the said Appendix before the amendment made therein did not cover the spices cinnamoft and cloves. Under these circumstances it was contended by the importer in that case that the Government could only have made an amendment in order No. 40/85-88 by issuing an order under Section 3 and since there is no order under Section 3 amending Appendix 5, the addition of the items of cloves and cinnamons in Appendix 5 by issuing a public notice is not valid. Repelling the contention the Division Bench of the Delhi High Court after reproducing para 2 of Chapter I of the Imports and Exports Poticy for April, 1985 to March, 1988 Volume I held that from the said para it is clear that the Government can make amendments in the Import Policy for the years 1985-88 by issuing public notices amendment orders, etc. Hence this question is not referrabfe firstly because it does not arise out of the order passed by this Tribunal and secondly because it is no longer res integra.
8. As regards question ‘B’ - This question in fact does not arise out of the order passed by this Tribunal inasmuch as it was never argued nor considered by this Tribunal in the way in which the present question is couched. Even otherwise it relates to the appreciation of the evidence on record. While considering as to whether the Collector (Appeals) applied the ITC Public Notice 41/82 in question retrospectively the circumstances that after a good 6 months of the issuance of the Public Notice 41/82 the importer opened his letter of credit and effected the shipment were taken into consideration. Hence this question is also not referrable.
9. As regards question ‘C’ - This question is neither a question of law nor arises out of the order passed by this Tribunal. In the instant case the Tribunal, in the facts and circumstances of the case had concluded that no retrospective effect was given to the public notice. Thus the proposed question though It may arise on the findings recorded by it, certainly is not a question of law arising out of the order passed by this Tribunal as held by the Hon’ble Supreme Court in the case of I.T. Commr. v S.S. Navigation Co. Ltd., AIR 1961 SC 1633 in that case it was held as follows:-
"(31)..,.................................................... .
(4) When a question of law is neither raised before the Tribunal nor considered by it, it will not be a question arising out of its order notwithstanding that it may arise on the findings given by it" (emphasis supplied).
The same view was reiterated by the Hon’ble Supreme Court in the case of Keshav Mills Co. Ltd v. Commr. Of I.T, AIR 1965 SC 1636. Hence this question is also not referrable.
10. As regards question ‘D’- Shri Nankani learned Counsel for the applicants submitted that this question is a question of law and arises out of the order passed by this Tribunal and cited the case of Mangla Bros V. Collector of Customs, AIR 1985 Cal 122, wherein it was held that clearance of goods imported under licence covered by Import Policy of a particular year is not barred on the ground that when goods had arrived at Port, Import Policy bad been amended, making the imported goods a canalised Item. In reply Shri Saha submitted that this question was not raised at the time of hearing of the appeal on merits. While elaborating his reply Shri Saha submitted that reference to para 231 (3) of AM-83 policy was made by the learned Counsel for the applicants at the time of hearing of the main appeal only to show that the Collector (Appeals), Madras had given the retrospective effect to the said ITC Public Notice 41/82 and this limited aspect was examined by this Tribunal in para 6 of the order dated 15-4-1987.
11. We have considered the arguments and the case law cited by the learned Counsel for the applicants. The case of Mangla Bros. v. Collector of Customs, supra is distinguishable on the facts of the case. In that case Import Policy was amended after the arrival of goods at the Port. Whereas in the instant case admittedly after a good 6 months of the issuance of the ITC Public Notice 41/82, the letter of credit was opened and the impugned goods were shipped. How para 231 (3) of AM-83 was invoked by the applicant and ultimately disposed of by this Tribunal can be seen from para 6 of the order passed by this Tribunal. From this para it can also be seen that the question as to whether the provisions of para 231 (3) of AM-83 policy can take within its ambit amendments to the policy made throughout the policy period was never argued. Hence this question also does not arise out of the order passed by this Tribunal.
12. As regards question ‘E’ - Arguing on this question the learned Counsel submitted that a importer had a vested right to import items as per the import policy in force of the date of the licence and/or the announcement of the policy and/or the date of a specific endorsement thereof. When pointed out by the Bench that this question as to whether an importer had a vested right to import was never argued at the time of hearing of appeal on merits, Shri Nankani, learned Counsel for the applicants with his usual fairness admitted that this question that the importer had a vested right was never argued but submitted that the proposed question arises on the finding given by the Tribunal.
13. We have considered the arguments and find that in view of the decision rendered by the Hon’ble Supreme Court in the case of I.T. Commr. v. S..S. Navigation Co. Ltd. Supra this question does not arise out of the order passed ty this Tribunal, notwithstanding that it may arise on the finding given by the Tribunal.,Hence this question is also not referrable.
14. In the result the reference application is rejected as no question of law meriting reference arises out of the order passed by this Tribunal.