RAI SAHIB SETH GOPIKISHEN AGARWAL Vs. COLLECTOR OF CUSTOMS VISAKHAPATNAM

JUDGEMENT

(1.) These appeals are filed against the judgment of Seshachelacati, J. in Writ Petitions Nos. 1210 and 1211 of 1958 declining to issue a writ of mandamus to restrain the respondent from collecting the amount of the difference in duty in pursuance of the final assessment notice served upon the appellants with reference to the various concerns. Both the appeals though the parties are not the same, raise common questions and could therefore be dealt with in one judgment.

(2.) The appellants are leading exporters of Manganese ore to overseas buyers from Visakhapatnam. They entered into contracts with some foreign companies in 1950 agreeing to sell large quantities of Manganese ore. The price fixed per ton of 2,240 1bs. of dry weight Manganese ore f.o.b. steamer, Visakhapatnam, India, was 28 dollars inclusive of all Indian taxes payable by the seller. The contracts contained a stipulation that this price was based upon the metallic Manganese content of 46 per cent and for each 1 per cent content about 46 per cent or below 46 per cent down to 44 per cent the price should be increased or decreased respectively by 0.50 per ton (fractions) pro rata. The seller guaranteed that the ore contained metallic Manganese minimum of 44 per cent when dried at 212 degrees. We are unconcerned here with the other terms of the contract. The appellants, after obtaining the requisite licence for the export of Manganese ore through their agents, produced before the Customs Authorities the shipping bills for certain quantities of Manganese ore with 46 per cent. Manganese content. The value was declared to be Rs. 115 per ton. On this basis, the total cost of the Manganese ore was calculated and ad valorem duty was levied provisionally representing customs duties at 15 per cent on the value of the ore to be exported. Before the duty was imposed a letter was written to the Collector of Customs, Visakhapatnam by or on behalf of the appellants, requesting the former to assess the export duty provisionally at 15 per cent ad valorem as per the circulars of the Government, dated 25th September, 1950. This request was complied with and the duty was provisionally fixed subject to finalisation. The provisional duty having been paid, the goods were duly exported to the consignee in the United Slates. A few years later, i.e., in 1958, the Customs Authorities issued a demand under section 39 of the Sea Customs Act alleging that the customs duty paid on certain consignments of Manganese was found to have been short levied and that the deficiency should be made up.

(3.) For the purpose of this enquiry, it is unnecessary to advert to the antecedent corredpondence passed between the, appellants and the proper authorities. The appellants were told by a letter, dated 28th August, 1958, by the Collector of Customs that the assessments on the relevant shipments were finalised and it was found that the correct price prevailing at the time of the delivery of shipping bills at Visakhapatriam was Rs. 150 per ton ex-duty on the be sis of 48 per cent. Manganese content and adopting the declared Manganese content of 46 per cent the correct assessable value worked out at a figure higher than that declared by the appellants and consequently a higher duty was leviable thereon. Credit was given to the sum already paid as provisional assessment and the balance stated to have been short levied was demanded to be paid.