- (1.) The principal judgment was delivered by a division bench of the High court of Karnataka in the case of M/s Kamath Packaging Limited (Civilno. 1 153 of 1992. In the other matters the High court followed the aforesaid judgment.
(2.) A writ petition was filed by M/s Kamath Packaging Ltd. before the High court seeking a writ of prohibition restraining the Customs authorities from proceeding with search and seizure operations in their premises. The writ petition was dismissed by a learned Single Judge and the appeal therefrom by the division bench. The writ petition was filed upon the basis that the Customs authorities had no right or authority nor did the Customs Act, 1962 empower them to go into questions relating to the utilisation of the raw materials that had been imported by the appellants under advance licences granted to them under the Duty Exemption Scheme. It was the case of the Customs authorities that the raw materials had been imported by the appellants without payment of duty by availing of the benefit of an Exemption Notification dated 30/4/1988 (No. 1 16 of 1988. The terms and conditions thereof had been violated by the appellants. Search and seizure operations in this behalf were, therefore, within their powers,
(3.) The said exemption notification was issued in exercise of powers conferred by Section 25 (1 of the Customs Act and one of the conditions thereof was that the materials exempted thereunder would not "be sold, loaned, transferred or disposed of in any other manner".;