Amiya Kumar Mookerji, J. - (1.) A consignment of 25' drums declared to contain Chinchona Fabrifuge belonging to the petitioner Eurasian Equipment and Chemicals Limited, was exported from Dum Dum Air Port to Amsterdam (Holand) by K. L. M. Flight No. 861 on October 12, 1970. The Customs Authority allowed the consignment to be loaded in the Aircraft after drawing representative samples from drums Nos. 10 and 18 in presence of one Hardip Singh. a representative of the Carrier KLM Royal Dutch Air Liners. On request of the Customs Officer at the Air Port, the said Hardip Singh telephoned two Directors of the petitioners' Company, Shri Lachmi Prosad Jajodia and Shri Manik Chand Jajodia to come over to the Air Port immediately to be present at the time of drawing samples from the consignment and furnishing guarantee bonds as required by the Customs Authority. The said two directors informed Hardip Singh that they would come over to the Air Port but insisted that the shipment must go on the same date and asked Hardip Singh to attend the Customs examination and drawing samples from shipment. As there was not much time for the Plane to touch down at the Air Port, samples were drawn from the shipment and sealed by the Customs Authority in presence of the said Hardip Singh. The two Directors of the Petitioner's company arrived at the Air Port when the Aircraft left carrying the consignment, As requested by the Assistant Collector (Custom), Export, respondent No. 3, the said two directors of the petitioners' company executed a bond in the prescribed form, by which the petitioners undertook to accept the result of test of the representative samples drawn, to pay such duty, fine and penalty as might be imposed on them, and demanded by the Assistant Collector Custom. At the time of signing the guarantee, a remark "the sample was not drawn in our presence" was noted in ink.
(2.) Thereafter the sample was tested in the Central Drug Laboratory, Calcutta, and it was found to be Quinine Sulphate and not Chinchona Fabrifuge as declared in the shipping bills. The price of Quinine Sulphate is Rs. 318/- per kg. and for 500 kgs. net weight, the exporter should have declared a price of Rs. 1,59,000/- while they have declared the price in the Shipping Bills as Rs. 21,500/-only. So they have misdeclared the description of the goods and the value to the extent of Rs. 1,37,500/- in respect of the consignment of Quinine Sulphate exported by them. On 4-9-1971 a show-cause notice was issued calling upon the petitioners to show cause why penal action in terms of guarantee bond should not be taken against them. In the show-cause notice it was stated that the petitioners should be given opportunity of being heard in person. The samples were tested thrice; once in the Custom Laboratory and twice 'in the Central Drug Laboratory. The test report was duly sent, to the petitioners in course of personal hearing on 27-12-1971 before the Collector of Customs. Calcutta clarifications were sought for by the petitioners' lawyer in connection with second test report. A copy of the clarification made by the Central Drug Laboratory was sent to the petitioners on February 26, 1972. The petitioners through their Advocate's letter dated 27-5-1972 to the respondent No. 2, prayed for cross-examination of said Hardip Singh in connection with the letter written by him on 19-7-1972 (19-5-72?). The respondent No. 2 did not accede to the prayer of cross-examination. The petitioners thereafter did not participate in the personal hearing held on May 31, 1973 (1972?). The Collector of Customs by his order dated 3rd of January, 1972 (1973?), imposed a penalty of Rs. 1,37,000/- on the petitioners in terms of the guarantee bond executed by it. The petitioner being aggrieved by the said orders moved this Court under Section 226 of the Constitution and obtained the present Rule.
(3.) Mr. Bagchi, appearing on behalf of the petitioner, in support of the Rule, contended that in the present case samples were drawn not in accordance with Section 144 of the Customs Act, 1962. Admittedly, samples were not taken in presence of the owner as provided in the said section.;