Fathima Beevi, J. - (1.) The appellant is a federation of glass manufacturers in India. The Federation entered into a contract with M/s. Magadi Soda Company Ltd., Kenya, for supply of 5000 metric tonnes of soda ash dense at the rate of US $ 155 per metric tonne c.i.f. Bombay. The consignment arrived from Mombasa, Kenya on 28-12-1981. The goods were cleared on payment of customs duty of Rs. 32, 15,904.21 from Bombay. The appellant on distribution of the goods to various members of the federation, received complaints that the soda ash which had been supplied was of sub-standard quality. The seller M/s. Crescent Dyes and Chemicals as well as their agents were approached. They sent a team of experts to examine the goods. The inspection confirmed that the goods were defective. As per agreement dated 9-2-1982, M/ s. Crescent Dyes and Chemical sent a credit note of US $ 2,40,000/- as compensation on account of the defective goods sent by M/s. Magadi Soda Company Ltd. The amount remitted on account of the import made was only US $ 5,35,000/-as against the earlier contracted amount of US $ 7,75,000/-.
(2.) In view of such reduction, the appellant filed a refund application before the Customs Department to the tune of Rs. 9,95,892.65. The Assistant Collector was not satisfied as to the extent of deterioration of the goods before clearance as provided by S. 22 of the Customs Act and rejected the refund application vide order dated 19-7-1982.
(3.) The appeal preferred against the order dated 19-7-1982,was rejected by the Collector of Customs on 23-12-1982 on the reasoning that the damage was discovered after the goods were out of customs control. The further appeal to the Tribunal was also unsuccessful. The Tribunal by the order dated 26-10-1989 held that the alleged inferior nature of goods was discovered after clearance.;