M.KARPAGA VINAYAGAM,.J. - (1.) RANCHI Medical Research and Development Foundation Pvt. Ltd., the appellants herein, are the writ petitioners. Being aggrieved by the three orders - (1) order dated 4.11.1997 withdrawing the exemption certificates, (2) the order dated 18.12.1997 demanding for the payment of Custom Duty to the tune of Rs. 1,74,12,087/ - for importing medical equipments and (3) the order dated 23.1.1998 for seizure of the equipment so imported passed by the respondents under Section 111(1) of the Customs Act, the appellant filed writ petition for quashing the same before the learned Single Judge of this Court.
(2.) LEARNED Single Judge dismissed the said writ petition. Challenging the same, the petitioner -appellants filed the present Letters Patent Appeal. The brief facts of the case are as follows: (i) The appellants established Advanced Diagnostic Centre at Ranchi. Thereupon in the year 1986, they made an application for import of Whole Body C.T. Scanner and claimed exemptions from customs duty. (ii) The Health Secretary, Government of Bihar, recommended the case of the appellants on the ground that the appellants had fulfilled the criteria laid down for complete duty exemption as per the notification issued under the Customs Act, On such recommendation, the Government of Bihar issued exemption certificate in favour of the appellant on 1.12.1986 granting exemption from custom duty in respect of import of the Whole Body C.T. Scanner. On that basis, the C.T. Scanner was imported and no duty was paid. (iii) One Public Interest Litigation was filed before the Delhi High Court seeking for the quashing of the Custom Duty Exemption Certificates illegally issued by the Government in respect of huge quantities of medical equipments, which was alleged to have caused a loss of substantial revenue to the public exchequer. (iv) The Delhi High Court, having entertained the said PIL, issued various directions and passed orders constituting two committees to enquire into various aspects. One of the Committees called Rosha Committee was entrusted with the duty of inquiring as to whether Customs Duty Exemption Certificates have been issued by the Ministry of Health for individual importers/institutions in accordance with the terms and conditions laid down in the Notification No. 64/88 -Cus dated 1.3.1988 or not and also to inquire whether any such certificates have been issued to individual importers who were otherwise not entitled to receive and also to inquire whether the concerned institution has fulfilled the conditions subject to which the exemption was granted. (v) Accordingly the Rosha Committee issued notice dated 19.5.1997 to the appellants asking them to send the required particulars regarding the diagnostic centre of the appellants in the light of the order passed by the Delhi High Court. (vi) As required, necessary particulars were sent to the Rosha Committee by the appellants. In the meantime, the appellants received two show -cause notices dated 9.6.1997 by the Additional Deputy Director General (Medical), Health Services, Government of India, the respondent No. 3 asking the appellants to show -cause as to why exemption certificates granted to the appellants should not be withdrawn. (vii) The appellants gave a reply to the respondent No. 3 requesting that they may not continue the proceedings since the same issue is pending before the Rosha Committee, which issued notice to them, to which they already sent the suitable reply along with the required particulars. Despite this reply, the respondent No. 3, having felt that they did not send the reply to the show -cause notice, issued the order dated 4.11.1997 withdrawing the exemption certificate. (viii) Thereupon the appellant No. 1 sent a detailed representation to the respondents, giving out various circumstances to show that exemption certificate ought not to have been withdrawn, requested the respondents for recalling of the order dated 4.11.1997. (ix) In the meantime, the appellants received the office order dated 18.12.1997 issued by the Assistant Commissioner of Customs, Air Cargo Complex, Kolkata, respondent No. 6, directing the appellants to pay the amount of duty for import of medical equipments in view of the withdrawal of the exemption certificates. (x) Thereafter the appellants preferred a writ petition for quashing the office order dated 4.11.1997 and 18.12.1997 and for restraining the respondents from taking any steps as against the appellants. (xi) During the pendency of the writ petition, on 22.1.1998, the officials of the Customs Department had come to Ranchi and had demanded payment of amount. They also warned that in case of default, they would take steps for seizure of the M.R.I. machines for nonpayment. Next day. i.e. on 23.1.1998, they issued seizure notice on 23.1.1998. (xii) Therefore, appellants filed amendment petition seeking inclusion of additional prayer for quashing the office order dated 23.1.1998 intimating for the seizure in the default of the payment. Thus, they sought for quashing of all the three orders. (xiii) Learned Single Judge, having considered the matter, ultimately dismissed the writ petition by the order dated 11th July, 2006, rejecting all the prayers. Challenging the same, this LPA has been filed. Elaborate arguments were advanced by both the counsel for the parties. The main point that is being urged by the learned senior counsel for the petitioner -appellants is that the final order withdrawing the exemption certificates had been passed by the respondents on 4.11.1997 in pursuance of the show -cause notice dated 9.6.1997 without proper enquiry, without giving adequate opportunity to the appellants and without any material whatsoever; thereby the principles of natural justice has been violated, which would vitiate the orders in question.
(3.) REFUTING the above submission, the learned Counsel for the respondents strenuously contended that appropriate opportunity has been given by issuing show -cause notice dated 9.6.1997 asking the petitioner -appellants to give explanation and since the appellants did not send reply to the said show -cause notice, the final order had been passed withdrawing the exemption certificates on 4.11.1997 on the available materials and so it cannot be said that the principle of natural justice has been violated.;