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Judgment
S. Ramachandra Iyer, C.J.—This is an appeal from the judgment of Rajagopala Aiyangar, J. quashing the order of the Collector of
Customs, Madras, who adjudged u/s 182 of the Sea Customs Act that the 46 cases of electrical bulbs imported by the respondent in the first
week of June 1957 were liable to be confiscated as being in contravention of the Imports and Exports (Control) Act, but giving an option to the
respondent to pay a fine of Rs. 18,500 in lieu of confiscation. The fine has been paid and the goods cleared.
The respondent on whom the fine was imposed is a merchant at Madras doing business in electrical goods. He held a licence under the Imports
and Exports (Control) Act, 1947, for the import of goods falling under Serial No. 38-A(f) of the Import Trade Control Policy for the licencing
period, July-December 1956. On 29-1-1957 the respondent placed an order with a firm in Japan for 8350 dozens of miniature cap bulbs and the
goods which were consigned in 46 cases arrived at Madras on 5-6-1957. The Collector of Customs who inspected the consignments found that
the cases contained auto bulbs, that is those used for automobile lights which came under Serial No. 38-A(e) of the Import Trade Control Policy
book for the period from July to December 1956 and that it was not covered by the licence granted to the respondent which enabled him to
import only goods coming under Serial No. 38-A (f) which was in these terms:
Remarks
(f) other lamps (ii) The undermentioned types of lamps can be imported upto 15 % of the face value of the basis quota licence or upto Rs. 500
which is higher:
(a) All types of filament lamps from 24 volts to 250 volts (having standard caps of G. L. S. type) of wattages lower than 15 including ''0'' candle
power ''0'' Watt and ''night lamps'' but excluding Neon Glow lamps.
(b) Carbon filament lamps upto 50 candle power.
(c) All types of coloured and natural coloured lamps (from 24 volts to 250 volts with standard caps of C.L.S. type)
(d) Candle and pigmy lamps
(e) Reinforced construction lamps (vibration proof)
(f) C. L. S. lamps between 500 and 1000 watts in all finishes including frosted, inside white opel and daylight blue.
(g) Radio dial lamps and bulbs for cycle dynamo lamps.
(iii) Torch bulbs falling u/s No. 250/IV cannot be imported against this Sub-item.
The Collector of Customs thereupon issued a notice to the respondent to show cause why the goods should not be confiscated. After giving the
respondent due hearing the sufficiency of which is not disputed in these proceedings, and after a proper enquiry the Collector of Customs came to
the conclusion that the goods which were the subject-matter of the import were not covered by the licence, they being motor car lamp bulbs and
not decorative and transformer bulbs as contended for on behalf of the respondents. He, therefore, passed an order holding that there was a
contravention of the Import and Export Control Act which attracted the provisions of Section 167(8) of the Sea Customs Act, 1878. He directed
confiscation of the goods; but gave an option to the importer (respondent) to clear the goods on payment of a fine of Rs. 18500.
The respondent thereupon filed an application out of which this appeal arises for the issue of a writ of certiorari to quash the order of the
Collector of Customs. The application was opposed by the appellant substantially on the ground that the import was not in accordance with the
terms of the licence granted to the respondent and that there was no error apparent on the face of the record to warrant interference under Article
226 of the Constitution. The only question in the case related to the proper classification of the goods that were imported by the respondent among
the several heads contained in the Import Control Schedule, namely, whether the goods came under Serial No. 38-A(f) or whether they came
under some other heading.
A decision on the question as to what precisely was the nature of the goods imported would prima facie be one on a question of fact. No attempt
was made, by the respondent to have the goods imported tested to demonstrate that the goods were decorative bulbs as he called them and not
motor ear lamps or auto bulbs. It is stated before us by the learned counsel appearing for the respondent that the goods which were cleared had
been promptly sold away to third parties even without retaining any sample bulb for the purpose of challenging the correctness of the order of
confiscation before any appellate authority. The respondent did not even produced documents which would have shown the nature of the goods
ordered by him. He did not file any appeal to the statutory authority against the order of the Collector of Customs. He has challenged the
correctness of the order of confiscation on the main ground that in respect of a similar consignment of electrical bulbs imported in 1956, the Chief
Controller of Imports had given his opinion that they would come under the category of Serial No. 38-A (f) of Section II of the Policy Statement.
The Import policy schedule itself makes a distinction between the several types of bulbs. To mention only a few instances, Serial No. 38-A (e)
refers to motor car lamp (auto bulbs) while Clause (f) (iii) refers to other bulbs, namely, torch bulbs not falling under S. N. 250. S. No. 250 refers
to electric bulbs for torches--bulbs of voltage upto 3.8 and prefocused bulbs above a certain voltage. Whether a particular consignment of goods
belongs to one category or another can, if at all, be satisfactorily determined only on inspection of the goods themselves and not by mere similarity
thereof to the goods imported by the respondent sometime earlier.
Rajagopala Aiyangar, J. did not consider it necessary to ascertain whether the imported goods came under a category different from that under
which the Collector of Customs classified them as the learned Judge was of the opinion that the matter had to be considered in the light of the
previous history of the goods. This is plain from the following passage in the judgment of the learned judge:
Whatever might have been the position, if the matter rested merely on the interpretation of the rival entries which arose for the first time, it assumes
a different complexion, in view of certain previous history to which I shall immediately advert.
In the light of the above observation the learned Judge proceeded to consider the correspondence that ensued between the respondent and the
Chief Controller of Imports in respect of the import of similar goods during the previous years and as such correspondence showed that the
respondent had imported only goods which came under S. No. 38-A (f), the goods imported i.e., the bulbs which formed the subject-matter of
import in June 1957 should also be regarded as coming under the same category. The learned Judge also found two errors in the order of the
Collector of Customs which were sufficient in his opinion to call for interference under Article 226 of the Constitution"". The order of confiscation
passed by the Collector of Customs was therefore quashed. Hence this appeal.
With great respect to the learned Judge we are of opinion that the matter to be considered in the present case is only as to under what category
the goods in question could be classified. That in respect of similar goods imported by the respondent in the previous year, the Controller of.
Imports considered them as coming under S. No. 38-A (f) cannot help us in determining the category under which the goods imported now could
be brought. On that question we have only the finding of the Collector of Customs who had an opportunity of inspecting the goods. No further
material of any kind is available to us on the record to show that the goods belonged to a different category than the one found by the Collector.
This should be sufficient to allow this appeal. But we shall for the sake of completeness consider the previous history in the case as well long before
the respondent placed an order for the import of the goods now in question, he addressed a communication to the Chief Controller of Imports on
10-6-1955, requesting for clarification as to whether the import of transformer electric bulbs of miniature cap, colour, or clean bulbs, would come
under the classification under S. No. 38-A (f) or under any other category. He later forwarded to the Chief Controller catalogues from the
factories from which he intended to import the goods. He also sent to the officer some samples of bulbs describing them as being useful in series
and for transformers. The Chief Controller by his letter dated 14-10-1955, gave the information that the transformer electric bulbs will also come
under S. No. 38-A (f) (ii) of the Import Trade Control schedule.
The respondent thereupon placed an order with the foreign merchant for the bulbs which arrived in Madras in the first week of January 1956. The
imported goods on arrival were checked by the customs authorities. They were not satisfied that the bulbs came under the category of S. No. 38-
A (f) for importing which alone the respondent held a licence. They were however prepared to allow clearance of the goods as a special case; but
at the same time they issued a warning to the respondent that he should not in future import such goods unless he were authorised to do so by a
licence for that purpose. During the period of investigation, the goods had to be detained in the port trust premises and the respondent was obliged
to pay additional transit charges to that authority. The respondent did not file any formal appeal against the order of the Assistant Collector issuing
a warning but he brought up the matter before the Collector of Customs, the authority immediately above the Assistant Collector who issued the
warning.
Simultaneously he also appears to have sent samples of bulbs to the Chief Controller of Imports for his opinion as to whether they were motor car
lamp bulbs as contended for by the Customs authorities or bulbs of the variety specified in S. No. 38-A (f). It is contended on behalf of the
appellant that the Customs authorities were not aware of this move on the part of the respondent or of the correspondence that passed between
the respondent and the Chief Controller of Imports; nor are they sure that the sample bulbs sent by the respondent to the latter authority were
really those taken from the consignment received by the respondent in 1956 (i.e. those in respect of which warning was issued). But it is not
necessary to consider whether this contention of the appellant is well founded or not. There is nothing, in our opinion, to show that the samples sent
on that occasion were similar to the bulbs imported in June 1957, which form the subject-matter of these proceedings.
But to proceed with the narrative, after testing the samples sent the Chief Controller wrote to the respondent stating that they could not be
classified as torch bulbs; he opined that the import of them could be allowed u/s 38-A (f) subject to the 15 per cent. face value restrictions. It will
be noticed that the Chief Controller did not say that the samples sent were motor car lamp bulbs or not From what we have stated we can take it
as his opinion that the sample bulbs sent to him would come u/s No.38.A (f) (ii) as he specifically refers to an importation of 15 per cent. of the
face value of the quota allowed.
In the meanwhile the respondent pursued his request to the authorities for the refund of excess transit dues collected from him by the Port Trust
authorities on the ground that the assessment of the bill of entry had been delayed by the customs authorities themselves and that he was not in any
way responsible for the same. As the authorities had allowed clearance of the goods as a special case it was certainly unjust to ask the respondents
to bear the transit dues occasioned by the delay of the Customs department. The Port Trust accordingly granted refund of the amounts collected
from the respondent by way of transit charges. All that related to the previous year''s import. As stated earlier, the goods which forms the subject-
matter of these proceedings arrived, at Madras in the first week of June 1957 and the customs authorities held that the import licence held by the
respondent did not cover them. From the facts set out above, it is apparent that there is really nothing in the previous history to show that the
present consignment contained bulbs similar to the samples tested by the Chief Controller of Imports.
Rajagopala Aiyangar, J. has found two errors in the order of the Collector of Customs directing confiscation, which in the learned Judge''s
opinion justify interference under Article 226. The first is a statement in the order that a warning had been administered to the respondent by the
Assistant Collector of Customs in the previous year which had not been appealed against by the respondent. The learned Judge treated this
statement as a clear error. But it must be recognised that technically speaking there was no appeal; but there were of course representations by the
respondent to the Collector of Customs against the impropriety of the warning issued to him. It cannot be held that an error of this kind is such a
substantial one as to be treated as an error apparent on the face of the record. The real question that has to be decided is whether the goods
imported by the respondent were covered by the licence held by him or not and not whether the respondent deliberately repeated any offence
previously committed. It may be as the learned Judge has pointed out that the respondent not unnaturally believed that the warning issued in the
previous year had been withdrawn. That will not mean that the goods covered by the present import licence were identical with the samples sent
by the respondent to the Chief Controller of Imports in the previous year.
One cannot, however, forget the significant fact that even the opinion of the Chief Controller in respect of the samples sent to him for test was that
they came u/s 38-A (f) (ii) and that the respondent could import such bulbs only upto 15 per cent. of the face value of the quota. But the
respondent did not follow that advice but he actually imported the full quota. That would show that the goods that he ordered did not come u/s 38-
A (f) (ii). It is contended on behalf of the respondent that the 15 per cent. restriction applied only to certain types of bulbs and that what he
imported were goods covered by Section No. 38-A (f) (iii) that is, torch bulbs coming under S. No. 250/IV. There is no support for this
contention either in the letter of the Chief Controller of Imports or in any other material in the case. It must, therefore, be held that the Collector of
Customs had sufficient jurisdiction to decide the exact classification of the imported bulbs untransmitted by the view expressed by the Chief
Controller.
The other error in the order of the Collector of Customs relates to his construction of the order of the Chief Controller of Imports. The
Collector of Customs has stated that the Chief Controller had not negatived that the bulbs imported were not auto bulbs. We cannot see any error
in that statement. The letter of the Chief Controller of Imports to the respondent related to the samples sent to him and he stated that they were not
torch bulbs but that they came under the category of Section No. 38-A (f) (ii).
It is true that the respondent had sent to the Chief Controller of Imports catalogues of the two factories which manufactured the bulbs imported by
him. But the question in the present case is not so much as to what he could have ordered but what he ordered and imported. The order books
were not even produced before the authorities. We are unable to see any error apparent in the order of the Collector of Customs, in regard to this
matter either. Even apart from that circumstance we cannot see how the opinion of the Chief Controller of imports in regard to the previous year''s
import could at all be decisive of the content of the consignment imported in the following year. The Chief Controller of imports no doubt had the
authority to determine the beading or entry under which a particular commodity could be brought. But what is the commodity that has been actually
imported is the question that has got to be and perhaps, can be determined by the Customs authorities alone. In paragraph 17 of Ch. IV of the
Handbook of Rules and Procedure, 1956, issued by the Government of India it is stated:
It is within the power of the Customs authorities to determine whether the goods imported are in conformity with the description given in the
import licence and they will be the final arbiters in the matter.
This we consider is a correct statement of the position.
If, however, such a determination is perverse or mala fide or demonstrably wrong, the Court will have the jurisdiction to decide whether the
confiscation order was within the jurisdiction of the Collector of Customs or not. None of those considerations exist in the present case where the
attempt has not been so much as to show that the bulbs were not auto bulbs as determined by the Collector of Customs, but that they were torch
bulbs coming u/s 38-A (f) (iii) because the Chief Controller of Imports stated so on the basis of the catalogues and the sample bulbs sent to him
during the previous year. As we have said more than once the circumstance that in the previous year an import was proper and in accordance with
the licence, would not prove that it would be so in the subsequent year. We can therefore see no error in the order of the Collector of Customs
which would justify interference by this Court under Article 226 of the Constitution. The appeal will, therefore, be allowed. The respondent will
pay the costs of the appellant.