JAIN D.K., J. - (1.) THESE appeals, by grant of leave, are directed against the judgments and orders dated 3rd April, 2006 delivered by the High Court of Bombay, whereby the High Court has dismissed the two writ petitions (Nos. 775 and 4173 of 1999) reported in, (SBEC Sugar Ltd. Vs. Union of India)1, 2006(4) Bom.C.R. 177(O.S.) filed by the appellants herein, and has directed the Assistant Commissioner of Customs, Bond Department to finally assess the customs duty and other charges payable by the appellants in respect of the goods covered under the subject bills of entry. The High Court has further directed that if the payment of customs duty, interest and other charges is not made by the appellant company within two weeks from the date of such determination and communication thereof, the customs authorities shall enforce the bond executed by the company, pursuant to the interim order passed by the Court.
(2.) AS a common question of law is involved in the appeals and in fact the latter order is based on the former, these are being disposed of by this common judgment. However, in order to appreciate the controversy involved, for the sake of convenience, the facts emerging from C.A. No. 2899/2006 are being adverted to. These are: Appellant No. 1 (hereinafter referred to as "the importer") a body corporate, is engaged in the manufacture of sugar. Appellant No. 2 is the Vice-President of the first appellant. With a view to set up a sugar manufacturing unit, the importer imported certain capital goods. Instead of getting the goods released for home consumption, the importer opted for getting these goods warehoused under Bond. The present appeal is confined to three consignments under Bond No. CW-20-4732 dated 26th December, 1995; CW-20-4733 dated 26th December, 1995 and CW-20-4842 dated 2nd January, 1996, which were to expire respectively on 25th December, 1996, 25th December, 1996 and 1st January, 1997. It is pertinent to note that on the original bonds and the bills of entry, the ASsistant Commissioner of Customs made an endorsement for payment of interest @ 20% per annum from the date of expiry of the bond. On 19th December, 1996, the importer made an application for extension of the bond period by six months in respect of all the afore-mentioned consignments. However, the said request was rejected by the Assistant Commissioner of Customs vide letter dated 13th January, 1997 on the ground that the application was not received in the Bond department at least 15 days before the expiry of the current period of bond and was also not accompanied by an examination certificate by the Customs Officer/staff of the ware-house, the mandatory terms and conditions stipulated in para 2(i)(iii) of the Public Notice No. 102/96 dated 5th June, 1996. Notwithstanding, rejection of prayer for extension of Bond period, the importer continued making representations dated 21st January, 1997; 21st April, 1997; 20th May, 1997,26th May, 1997 and 27th May, 1997 to the respondents, requesting for re-consideration of their request for extension of bond period and not to issue notice for auction of the goods. In the meantime, vide notification No. 29/97 dated 1st April, 1997, issued under section 25(1) of the Customs Act, 1962 (for short "the Act"), the Central Government extended the Export Promotion Capital Goods Scheme (for short "the EPCG Scheme") for the period 1997-2002 to Agro based Industries. The effect of the notification was that the capital goods used in the manufacture of agro-products, like sugar and covered under EPCG licence, were exempted from the payment of whole of the customs duty, and additional duty leviable in terms of section 3 of the Act, w.e.f. 1st April, 1997. Para 6.6 of Chapter 6 of the Exim Policy, containing the EPCG Scheme provided that: "The licence issued under this scheme shall be valid for the goods already shipped/arrived provided customs duty has not been paid and the goods have not been cleared from Customs."
(3.) ON 22nd August, 1997, a licence under the EPCG Scheme, allowing concessional duty at the rate of 10% was issued to the importer. ON an application by the importer, the said licence was rectified and endorsed as "zero duty." Vide order dated 26th September, 1997, issued under section 72(1) of the Act, the Superintendent of Customs directed the importer to clear the goods covered under Bond No. CW-20-4842 dated 2nd January, 1996 on payment of full duty of customs and other charges within a period of 15 days.;