Padma Khastgir, J. - (1.) Being aggrieved by a show cause notice dated 14th August, 1981, the writ petitioner moved the writ jurisdiction of this Court for issuance of necessary Rule and interim order enabling the petitioner to clear the goods against the import licence on payment of duty at the rate of 45% per invoice value together with a direction upon the Port Trust Authorities for clearance of the goods without any charge of demurrage from the date of the arrival of the goods at Calcutta till its release.
(2.) The petitioners carrying on business as manufacturers of steel tubes and importers of raw materials for such use. The petitioners have been issued requisite industrial licence by the Customs Authorities for manufacture of steel pipes under the provisions of the Industries (Development & Regulation) Act, 1951. The Controller of Import & Export issued import licence dated 25th February, 1980 and revalidated upto 31st of May, 1981 by endorsement in the licence, thus authorising the petitioner to import goods described therein as "Seconds/Secondary G.R.S.S. Sheets in continuous coils of specification A.I.S.I. 304, 304L, 316 and 316L "for 200 mt. tonnes of appropriate C.I.F. value of Rs. 24,75,000. Pursuant to the said licence the petitioner placed an order dated 5th of January, 1981 on a Japanese company at Tokyo through M/s. Shanti Kumar P. Merchant of Bombay for supply of Japanese origin stainless steel sheets in continuous coils second grade material A.I.S.I. 304 width 500 m.m. and wider and thickness 0.7 m.m. to 0.5 m.m. about 66 tons. The said order had been confirmed by the foreign supplier. The value of the goods C.I.F. Bombay was U.S. Dollar 1650 per mt. tonnes. The petitioner also opened an irrevocable letter of credit through the State Bank of India Bombay on 28th February, 1981 in favour of the foreign supplier at Tokyo. The goods were sent on 28th February, 1981 from Port Yokohama to Calcutta as per S.S. Johnevrett measuring 90.396 mt. tonnes as per bill of lading dated 28th of February, 1981. The description of the goods was given as "secondary stainless steel sheet in continuous coil as specification A.I.S.I. 304, thickness 0.7 m.m. and thinner to 0.5 m.m.". A packing list was also sent along with the said goods. The petitioner filed necessary bill of entry on 18th of June, 1981 together with all the relevant documents. On 31st of July, 1981 the goods were examined by the appraiser and metal expert. On 14th August, 1981 the Collector of Customs issued a notice upon the petitioner intimating that on physical examination the goods so imported by the petitioner were found to be of prima quality which being a canalised item can be imported through Mineral & Metal Corporation of India. Therefore importation of such goods was prohibited in terms of Section 11 of the Customs Act read with import trade control order. The goods being of prima quality its C.I.F. value was taken by the Customs at U.S. Dollar 1978 per mt. tonnes. Hence the petitioners were guilty of making mis-description of the goods as a result the said goods are liable to be confiscated under Section 111 Sub-section (m) of the Customs Act. Hence, the respondents have issued a show cause notice as to why the said goods should not be confiscated and the penalty imposed. The petitioner sent their reply to such show cause notice on 27th August, 1981. Under the licence the petitioner can import secondary steel sheets. But the Manager of the Petitioner No. 1 K.C. Poddar, was told by the Customs Authorities that the Customs Tariff at the rate of 225% of the C.I.F. value on the goods so imported will be the chargeable duty in the instant case and not 45% of the value, that is 35% of the Customs Duty and 10% of the Auxiliary duty. The petitioners contended that the duty chargeable on the import of stainless steel item as provided in Chapter 73.15 of the Customs Tariff Act. The Secondary Stainless Steel Sheets in coils is covered under Sub-heading 1 of Heading 73.15 which provides for imposition of duty of 45% and not under Sub-heading 2 of Heading 73.15 which provides for duty of 225% which is applicable to prima quality and not Secondary Stainless Steel Sheets. The petitioners contended that the goods so imported by the petitioners do not fall within the definition of strips as given under Heading No. 73.15. Under Chapter 73 of the Customs Tariff Act Coils for j-e-rolling has been defined to mean coils semi-finished not rolled products of rectangular section not less than 1.05 m.m. thick of which existing 500 m.m. and of a weight of not less than 500 Kg. per piece. The description of Sheets and Plates under the Heading 73.15 also does not attract the goods imported by the petitioner. Inasmuch. as the coils imported by them are not for re-rolling but according to Customs Authorities themselves they are cold rolled with thickness ranging to 0.69 to 0.72 m.m. which would be supported by the Customs Inspection Report. The petitioners further contended that the difference between the prima and secondary quality as understood by the people in ordinary commerce conversant with the articles, should be adhered to. Hence under the Customs Tariff Act and/or the Notification should be read, interpreted and applied as they are understood by the people in the trade. Hence, the Sub-heading 2 of Heading 73.15 of the Customs Act relate to Prima Quality Stainless Steel and nothing else. Hence defective/secondary/quality stainless steel would be outside the Heading 73.15 Sub-section (2) and would be drawn within the ambit of residuary Sub-heading (1). The petitioners contended that the question involved for determination is whether defective and secondary stainless steel is different from stainless steel as such. Hence any construction given by the Customs Authorities that defective and secondary quality of stainless steel were the same as primary stainless steel is erroneous. The petitioners contended that the goods in question were coils of secondary quality which are used as raw materials for production of commercial tubes whereas prima quality stainless steel is used for manufacturing sophisticated industrial tubes. The Assistant Collector of Customs Bombay in another consignment of the petitioner held that normally when the width of primary material is 914 m.m., 1000 m.m. and 1250 m.m. as well as 1220 m.m. and since the materials imported by the petitioners are other than the mentioned figures therefore they could be considered as secondary. Hence the action on the part of the respondent authorities is classifying the said imported items under the Heading 73.15 (2) was arbitrary and done capriciously. Hence, the imposition of duty at the rate of 22596 rather than 45% was contrary to the law and the Rules framed thereunder. In view of certain consignments having been realised by the Assistant Collector of Customs, Bombay and relying upon the report given by the All India Stainless Steel Tubes Markets Association, Bombay submitted that the materials imported by the petitioner were not of prima material but secondary. The petitioner also relied upon a report given by Professor M.K. Dasai. The materials being the secondary type as contemplated and/or provided in the petitioner's licence the importation of the said goods by the petitioner was in accordance with the law.
(3.) The petitioners instead of preferring an appeal and availing of the alternative remedy as provided in the Customs Act itself had chosen to move the writ jurisdiction of this Court. There had been no challenge of any assessment of duty on the question of any law. The construction given by the Customs Authority in respect if an entry in favour of the revenue merely on the allegations that some other construction can be given which may appeal more to Court cannot be a ground for interference under the writ jurisdiction. Until and unless the Court came to the conclusion that such construction given by the respondent authorities was mala fide or was perverse. The grounds taken in the petition are not sufficient to interfere under its writ jurisdiction with the interpretation and/or assessment made by the Customs Authorities. The goods as per examination by the Customs Authorities were of prima quality without any defects as to width, thickness or tolerance limits. Even the goods had been examined by an independent metal expert being the Chief Inspector of Alloy Steel Plant who by his report dated 2nd September, 1981 also confirmed that the goods are of prima quality and free from any defects. The factual contention of the petitioner as to the quality of the goods had been totally denied by the respondent authorities. Importation of such goods being the prima quality is only permissible through the canalysing agent of Mineral and Metal Trading Corporation. Hence, the importation of the same by the petitioner is not legal. In any event the petitioner have come before this Court being aggrieved by the issuance of a show cause notice only. The two classification of Stainless Steel, i.e. Prima Quality and/or Secondary or defective quality for the purpose of assessment of all these qualities and sizes will attract the same percentage of ad valorem duty under Heading 73.15 Sub-heading (2) at 220% plus 5% Auxiliary Duty. Although the import policy as differentiated between prima quality/seconds/secondary/defective quality but in fact the petitioners have imported only prima quality stainless steel. Hence, deliberation over the fine distinction is of no consequence. Under Item No. 73.15(2) irrespective of prima or secondary/defective quality the same rate of duty has been prescribed. Hence the Customs Tariff Act being the statutory provision will take precedents over the import policy statements. Assessments will have to be made either in the Subheading No. 73.15(1) or 74.15(2). Prima Quality Stainless Steel are canalysed and are to be imported through Mineral & Metal Trading Corporation. Hence importation of the said goods becomes prohibited in terms of Section 11 of the Customs Act, 1962 read with Import Control Order 1955 as amended from time to time and liability to be confiscated under Section 111(d)(m) of the Customs Act. Hence, the question of sufferance of heavy loss or hardship in the shape of demurrage of bank charges are of no consequence. The petitioners having violated of the provisions of importation of such goods will have to suffer the consequences. Moreover it had been contended that pursuant to the order of the Court passed by Mr. Justice Borooah (as he then was), the question of any sufferance of further demurrage and/or bank charges does not arise.;