W.A. No. 6 of 2016 and W.A. Nos. 496, 637, 639 of 2015, Contempt Appeal No. 1 of 2016. Case: All India Steel Re-Rollers Association Vs Union of India. High Court of Madhya Pradesh (India)

Case NumberW.A. No. 6 of 2016 and W.A. Nos. 496, 637, 639 of 2015, Contempt Appeal No. 1 of 2016
CounselFor Appellant: Shri Deepak Rawal, ASG, Naman Nagarath, SC S.C. Bagadiya, Sr. Advocate, H. Thakur, Prasanna Prasad and V.K. Jain, Advocates
JudgesP.K. Jaiswal and Vivek Rusia, JJ.
IssueConstitution of India - Article 226
Citation2017 (347) ELT 52 (MP)
Judgement DateJune 14, 2016
CourtHigh Court of Madhya Pradesh (India)

Judgment:

P.K. Jaiswal, J.

  1. By these intra court appeal, the intervenor of W.P. No. 8501/2014 and the respondents are challenging the order dated 19-10-2015 passed in W.P. No. 8501/2014 and 13-9-2015 passed in W.P. No. 9169/2014 [2015 (325) E.L.T. 860 (M.P.)] whereby the learned Writ Court allowed the writ petition and directed that the Commissioner of Customs (Import) shall allow clearance of goods covered by commercial invoice dated 4-9-2014 and 18-9-2014 and the consignment of Alloy Steel and Deformed Bars also forthwith lying in the ports of Mumbai and Chennai. Para 14 of order dated 13-9-2015 passed in W.P. No. 9169/2014 reads as under:-

    "14. Consequently the petition is partly allowed and it is directed that the respondent No. 3 shall allow clearance of the goods covered by commercial invoice dated 4th September, 2014 and consignments of Alloy Steel Deformed Bars also forthwith lying in the port of Chennai. However, it is made clear that this Court is not making any observation regarding the application of the BIS Standards in accordance with the impugned Circular dated 7-11-2014. Even after release of the goods, if the respondent Department is still of the opinion that the consignment is not of the Bureau of Indian Standards, it is free to take action in accordance with the provisions of law and that the petitioner shall co-operate fully with the respondent in the investigation of the same."

    and last para of order dated 19-10-2015 passed in W.P. No. 8501/2014 reads as under:-

    At the outset, it has been argued before this Court that the Co-ordinate Bench of this Court vide order dated 30th September, 2015 passed in W.P. No. 9169/2014 (Anik Industries Limited v. The Union of India and others) has allowed the identical writ petition. Following order has been passed by this Court.

    This writ petition has been filed under Article 226 of Constitution of India, challenging the Circular No. 450/176/2014-Cus-IV, dated 7-11-2014, restricting the petitioner from importing Alloy Steel Deformed Bars falling under Chapter Heading 7228 of the CTA.

  2. Briefly stated the facts of the case are that the petitioner Anik Industries Limited is a private company, incorporated under the Companies Act and engaged in the business of import of Alloy Steel deformed reinforcement bars. In the course of normal business the petitioner has placed an order for import of the goods Alloy Steel reformed bars as per the contract bearing No. HL1415142-S, dated 24-6-2014, by M/s. Hebei Taigang Iron & Steel Rolling Company Limited, China. The said manufacturer is a registered manufacturer of goods in accordance with the British Standards. The goods were shipped under the Commercial Invoice dated 4-9-2014. The Chinese manufacturer also issued product quality certificate known as MTC. However, the goods were refused clearance by Respondent No. 3 by placing reliance on a circular issued by the Central Board of Excise and Customs, New Delhi. Circular No. 450/176/2014-Cus-IV, dated 7-11-2014 (hereinafter referred to as the "impugned Circular") the goods imported by petitioner had arrived in India at the port of Mumbai. Counsel for the petitioner vehemently urged the fact that this was much before the Steel Products (Quality Control) Second Amendment Order has been made effective. However, respondent No. 3 the Commissioner of Customs disregarded the past practice and refused to clear the goods. Hence, the present petition.

  3. Counsel for the petitioner has raised the following grounds challenging the impugned circular dated 7-11-2014. Firstly, Counsel urged that the goods had arrived at the port of Chennai much before the steel products quality control order. The second amendment order has been made after the circular impugned dated 7-11-2014 was in force w.e.f. 4-12-2014. The contract between the parties is dated 24th June, 2014. The schedule of the standing order issued by the Central Government for Steel Quality Control order dated 12-3-2012 was amended vide order dated 31-3-2014 and the goods of the petitioner are covered at Sr. No. 5 of the amended schedule column No. 4. However, local manufacturers of steel protested against the import of alloy steel by filing representations to indicate that alloy steel products were not covered under Serial No. 5 of the amended schedule to the Steel Quality Control Order. Counsel vehemently urged that the consignments of 25 M.M., 12 M.M., 16 M.M. & 2 M.M. imported deferred bars aggregating 4426.280 MT covered by the commercial invoice dated 4th September, 2014 were not answerable to the 2nd Amendment of 2014 which came into effect from 4th December, 2014 and the respondents were wrongly not clearing the goods of the petitioner.

  4. Secondly, Counsel also urged that the impugned Circular was also challenged by this petition to be arbitrary, unreasonable and perverse since it does not satisfy the dual test as the items mentioned under the relevant B.I.S. (Bureau of Indian Standards) and its corresponding heading of ITC (HS) Indian Trade Classification (Harmonised Systems) Column No. 3. The goods under Sr. No. 5 aforementioned cover only one heading/sub-heading 72/31090 and 72/42090 and are goods pertaining to non-alloy steel, whereas the goods of the present petitioner are alloy steel and not covered under Column No. 3 of the amended schedule. The mere fact that the corresponding BIS 1786 covers both alloy steel as well as non-alloy steel is not sufficient to atttract the provisions of the Steel Quality Control Order. And as such, Counsel urged that the impugned Circular is arbitrary, unreasonable and violative of Article 14 of the Constitution of India.

  5. Counsel for the petitioner has vehemently urged that the impugned Circular has been issued with a mala fide intention to favour some of the manufacturers and/or re-rollers of steel, who have vested interests and discriminate against persons like the petitioners. The impugned Circular is a clear case of bias against the petitioners and reveals the case of nepotism in relation to some of the manufacturers and/or re-rollers of steel. The impugned Circular, is therefore, arbitrary, unreasonable and violative of Article 14 and Article 19(1)(g) of the Constitution of India.

  6. Counsel for the petitioner also urged that this Court clothed with the jurisdiction to decide the petition primarily because the petitioner Anik Industries Limited has its registered office at Indore and conducted its business therefrom is sufficient ground to grant jurisdiction to this Court and no question should be raised regarding the application of the Circular which was published at Delhi; to the cause of the respondent as impugned in the writ appeal/petition. It is also submitted that the imported goods are intended for sale within the jurisdiction of this Court, therefore, Indore Court is having jurisdiction to try the case and, therefore, the writ petition is maintainable. Counsel for the petitioner has vehemently urged the fact that Circulars issued by the Central Government can be challenged anywhere in the whole of the country. Moreover, the Circular has also been considered by the Bombay High Court as relied on by the respondent and therefore no question regarding the jurisdiction of this Court in this regard can be raised by the respondent.

  7. Per contra Counsel for the respondent has submitted that the constitutionality and legality of the Circular No. 450/176/2014-Cus-IV, dated 7-11-2014, raised by the petitioner is without jurisdiction and would be a matter to be decided by the Division Bench. Moreover, Counsel submitted that the Circular had been issued from New Delhi and the bill of the goods imported by the petitioner dated 13-9-2014 had reached the port in October, 2014 and that the Central Government by the order dated 12-3-2012 had categorically stated that the product imported by the petitioner was included in the schedule and therefore the petitioner was not entitled to release of his goods as being claimed. More importantly Counsel submitted that petition was not maintainable and Indore High Court did not have the jurisdiction to try the writ petition. Counsel relied on Global Tradex Ltd. v. Union of India & ors. along with other connected matters i.e. W.P. No. 2909/14 (Magnum Steels v. Union of India & ors.), W.P. No. 2962/2014 (Steel Mart India Private Limited v. Union of India & ors. and W.P. No. (L) No. 2963/2014 (Sri Jagannath Steel Co. v. Union of India & ors., wherein the Bombay High Court in the matter of Global Tradex Limited (supra) has held thus:

    "In the above circumstances we do not find any basis to hold that the Circular issued on 7th November, 2014 is ultra vires Article 14 of the Constitution of India.

    We are of the opinion that the Circular in no way prohibits the petitioners from importing the goods. The...

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT