Full Judgment Text
IN THE HIGH COURT OF JUDICATURE AT BOMBAY IN THE HIGH COURT OF JUDICATURE AT BOMBAY IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION ORDINARY ORIGINAL CIVIL JURISDICTION ORDINARY ORIGINAL CIVIL JURISDICTION
WRIT PETITION NO.1108 OF 2007 WRIT PETITION NO.1108 OF 2007 WRIT PETITION NO.1108 OF 2007
2007:BHC-OS:6927-DB
Legrand (India) Private Limited .. Petitioner
V/s.
The Union of India & Ors.. Respondents.
Mr.Prakash Shah i/b P.D.S.Legal for Petitioner.
Mr.A.J.Rana,Sr.Counsel with Mr.R.V.Desai,Sr.Counsel
with Mr.P.S.Jetley for Respondents.
CORAM : DR.S.RADHAKRISHNAN CORAM : DR.S.RADHAKRISHNAN CORAM : DR.S.RADHAKRISHNAN
and V.C.DAGA, JJ. and V.C.DAGA, JJ. and V.C.DAGA, JJ.
DATED : 21st June 2007.
DATED : 21st June 2007. DATED : 21st June 2007.
JUDGMENT (Vijay Daga, J) JUDGMENT (Vijay Daga, J) JUDGMENT (Vijay Daga, J)
Rule returnable forthwith.
1. Heard finally by consent of parties.
2. Perused petition and counter affidavits.
3. The petitioner, through this petition filed under
Article 226 of the Constitution of India, has brought
to our notice prima facie, wilful and deliberate
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( 2 )
disobedience on the part of the Assistant Commissioner
of Customs (Import) to the law laid down by this Court
in the case of Mahindra and Mahindra Ltd vs.Union of
India 1992 (59) ELT 505 (Bom), Ocean Centres vs Union
of India 2005 (180) OLT 313 (Bom); and in the case of
Noble Society vs Union of India 2005 (187) ELT 438
(Bom) wherein this Court has laid down and followed
from time to time that during the period of limitation
available for filing an appeal, no coercive action
should be taken to enforce the order. The Assistant
Commissioner of Customs (Import) in breach of the law
laid down by this Court, which was specifically
brought to its notice, encashed bank guarantee worth
Rs.14,33,000/- (before expiry of the appeal period)
which was furnished by the petitioner by way of
security pending adjudication of dispute.
4. When the aforesaid prima facie and willful
disobedience was brought to our notice, by an interim
order dated 26th April, 2007 respondents were directed
to deposit Rs.14,33,000/- with this Court with a
further order issuing show cause notice to the
Assistant Commissioner of Customs (Imports) as to why
action under the provisions of the Contempt of Court
Act should not be initiated for prima facie wilful
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( 3 )
disobedience of the law laid down by this Court in the
judgment referred to hereinabove and that the conduct
of the Assistant Commissioner of Customs (Import) in
not following the decisions of was calculated to
undermine the dignity and majesty of the court and
impair the constitutional authority of High Court.
5. The legal position regarding the binding nature of
judgments delivered by High Court was clearly
explained as far back as 1962 by the Supreme Court.
In East India Commercial Co. Ltd v Collector of
Customs, Calcutta, AIR 1962 SC 1893, Subba Rao, J (as
he then was) speaking for himself and Mudholkar, J has
explained, though A.K.Sarkar, J (the Third Member of
the Bench) did not fully agree with this aspect of the
legal position, the law laid down (para 29 of thereof)
reads as under:
. " This raises the question whether an
administrative tribunal can ignore the law
declared by the highest Court in the State and
intiate proceedings in direct violation of the
law so declared under Art. 215, every High
Court shall be a Court of record and shall
have all the powers of such a court including
the power to punish for contempt of itself.
Under Art. 226, it has plenary power to issue
orders or writs for the enforcement of the
fundamental rights and for any other purpose
to any person or authority including
inappropriate cases any Govt. within its
territorial jurisdiction. Under Art. 227 it
has jurisdiction over all Courts and tribunals
throughout the territories in relation to
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( 4 )
which it exercises jurisdiction. It would be
anomalous to suggest that a tribunal over
which the High court has superintendence can
ignore the law declared by that Court and
start proceedings in direct violation of it.
If a tribunal can do so, all the subordinate
courts can equally do so, for there is no
specific provision, just like in the case of
Supreme Court, making the law declared by the
High Court binding on subordinate courts. It
is implicit in the power of supervision
conferred on a superior tribunal that all the
tribunals subject to its supervision should
conform to the law laid down by it. Such
obedience would also be conducive to their
smooth working ;otherwise there would be
confusion in the adminstration of law and
respect for law would irretrieably suffer.
We, therefore, hold that the law declared by
the highest court in the State is binding on
authorities, or tribunals under its
superintendence, and that they cannot ignore
it either in initiating a proceeding or
deciding on the rights involved in such a
proceeding. If that be so, the notice issued
by the authority signifying the launching of
proceedings, contrary to the law laid down by
the High Court would be invalid and the
proceedings themselves would be without
jurisdiction."
(Emphasis supplied by us)
6. The above legal position was reiterated in Makhan
Lal vs State of Jammu and Kashmir AIR 1971 SC 2206.
It was in the context of the law declared by the
Supreme Court that the decision laid down to that
effect so far as Art. 141 of the Constitution was
concerned, but what has been observed in para 5 at
p.2209 by Grover, J speaking for the Supreme Court has
equal application so far as pronouncements by the High
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( 5 )
Courts are concerned. Grover, J observed (at page
2209)-
" The judgment which was delivered did not
merely declare the promotions granted to the
respondents in the writ petition filed at the
previous stage as unconstitutional but also
laid down in clear and unequivocal terms that
the distribution of appointments, posts or
promotions made in the implementation of the
communal policy was contrary to the
constitutional guarantee of Article 16. The
law so declared by this court was binding on
the respondent State and its officers and they
were bound to follow it whether a majority of
the present respondents were parties or not in
the previous petition.
(Emphasis supplied)
It cannot therefore be contended by anyone
that since Acharya, the petitioner in Special
Civil Application No.2215 of 1979, was not a
party to Special Civil Application No.806 of
1975, that the law laid down by D.A.Desai, J
in his judgment in that case on Aug, 7, 1975
was not applicable to the case of Acharya.
Whether the law is declared by the Supreme
Court or whether the law is declared by the
High Court, the legal position as regards
authorities and tribunals subordinate to the
Supreme Court and High Courts respectively is
the same as pointed out by Subba Rao, J in
East India Commercial Co’s case (AIR 1962 SC
1803) (supra).
7. In Baradakanta Mishra vs Bhimsen Dixit, AIR 1972
2466 : (1973 Cri.L.J. 19) the legal position
regarding binding nature of the High Court’s decision
was once again reiterated by the Supreme Court and
after quoting the above passage which we have
extracted from the judgment of Subba Rao, J in East
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( 6 )
India Commercial Co’s case (AIR 1962 sc 1893) (supra)
in paras 15 and 16 of the judgment. Dwivedi, J
speaking for the Supreme Court observed at page 2469
(of AIR) : (at pp.22,23 of Cr.L.J.)
" The conduct of the appellant in not
following the previous decision of the High
Court is calculated to create confusion in the
administration of law. It will undermine
respect for law laid down by the High Court
and impair the constitutional authority of the
High Court. His conduct is therefore,
comprehended by the principles underlying the
law of contempt. The analogy of the inferior
court’s disobedience to the specific order of
a superior court also suggests that his
conduct falls within the purview of the law of
contempt. Just as the disobedience to a
specific order of the court undermines the
authority and dignity of the court in a
particular case, similarly any deliberate and
malafide conduct of not following the law laid
down in the previous decision undermines the
constitutional authority and respect of the
High Court. Indeed, while the former conduct
has repercussions on an individual case and on
a limited number of persons, the latter
conduct has a much wider and more disastrous
impact. It is calculated not only to
undermine the constitutional authority and
respect of the High Court generally, but it is
also likely to subvert the Rule of Law and
engender harassing uncertainty and confusion
in the administration of law. "
8. In Hasmukhlal C.Shah vs State of Gujrat, (1978) 19
Guj LR 378, a Division Bench of Gujrat High Court
consisting of J.B.Mehta and P.D.Desai, JJ after
examining several decisions on the point, observed :
" In a Government which is ruled by laws,
::: Downloaded on - 26/06/2024 07:32:50 :::
( 7 )
there must be complete awareness to carry out
faithfully and honestly lawful orders passed
by a Court of law after impartial
adjudication. Then only will private
individuals, organisations and institutions
learn to respect the decisions of Court. In
absence of such attitude on the part of all
concerned, chaotic conditions might arise and
the function assigned to the courts of law
under the Constitution might be rendered a
futile exercise. "
9. From the above four decisions, the following
propositions emerge :
(a) It is immaterial that in a previous
litigation the particular petitioner before
the Court was or was not a party, but if a law
on a particular point has been laid down by
the High Court, it must be followed by all
authorities and tribunals in the State ;
(b) The law laid down by the High Court must
be followed by all authorities and subordinate
tribunals when it has been declared by the
highest Court in the State and they cannot
ignore it either in initiating proceedings or
deciding on the rights involved in such a
proceeding;
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(c) If inspite of the earlier expositiion of
law by the High Court having been pointed out
and attention being pointedly drawn to that
legal position, in utter disregard of that
position, proceedings are initiated, it must
be held to be a wilful disregard of the law
laid down by the High Court and would amount
to civil contempt as defined in S. 2 (b) of
the Contempt of Courts Act, 1971.
10. The respondents as directed by us have deposited
amount of Rs.14,33,000/- with the Prothonotary and
Senior Master of this Court and also filed an
affidavit duly affirmed by Ms.Reena Shetty, Assistant
Commissioner of Customs (Imports) tendering her
unconditional apology along with copy of the standing
order No.7967 dated 26th April, 2007 with covering
letter issued by the Commissioner of Customs (Imports)
the text of which are as under :
OFFICE OF THE COMMISSIONER OF CUSTOMS (IMPORTS)
NEW CUSTOM HOUSE, BALLARD ESTATE, MUMBAI-01.
F.No.S/26-89/2007/Apprg (General) Date 26.4.2007
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( 9 )
To,
1. The Commissioner of Customs (General)
New Custom House,
Ballard Estate, Mumbai-400 001.
2. The Commissioner of Customs (Export)
New Custom
House, Ballard Estate,
Mumbai-400 001.
Sir,
Subject:Enforcement/encashment of Bank
Guarantee during pendency of
appeal-reg.
I am enclosing herewith a Standing Order
No.7967/2007 dated 26.4.2007 on the above
subject.
2. The Hon’ble Mumbai High Court has taken a
serious view in cases where the department has
invoked the Bank Guarantee within the
statutory period of appeal. You may like to
bring this Standing Order to the notice of all
the officers working under you to ensure that
the Hon’ble High Court’s directions are
strictly complied with.
Yours Faithfully,
sd/ (A.K.PRASAD)
Commissioner of Customs (Import)
Tel.No.2262 0845
Encl: As above
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( 10 )
OFFICE OF THE COMMISSIONER OF CUSTOMS (IMPORT)
NEW CUSTOM HOUSE, BALLARD ESTATE,MUMBAI-01.
F.No.S/26-89/2007 Apprg.(General) Date:26.4.2007
STANDING ORDER 7967/2007
Subject: Enforcement/encashment of
Bank Guarantee during pendency
of appeal - reg.
As per Board’s Circular No.788/21/2004-Cx,
dated 25.5.2004 coercive measures should not
be initiated during the period prescribed in
the said circular. It is observed that some
officers are enforcing the Bank Guarantees
within the appeal period. This matter had
come before the Hon’ble Mumbai High Court in
the case of Ocean Driving Center Ltd vs Union
of India - 2005 (180) E.L.T. 313 (Bom), Noble
Asset Company Ltd vs Union of India - 2005
(187) E.L.T. 438 (Bom) and M/s Mahindra &
Mahindra Ltd vs Union of India - 1992 (59) ELT
505 (Bom) wherein it has been held that
encashment/enforcement of Bank Guarantee
tantamount to resorting to coercive measures
and this should not be done within the appeal
period.
2. This instructions should be strictly
complied with. Any deviation would be viewed
seriously.
S/d (A.K.Prasad)
Commissioner of Customs (Import)
Mumbai.
11. In view of the unconditional apology tendered by
Ms.Reena Shetty, Assistant Commissioner of Customs
(Import) Apprising Group B,the directions issued by
the Commissioner of Customs (Import) and the specific
assurance given to us by Mr.Rana, learned senior
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( 11 )
counsel appearing for the Union of India that in
future adequate care would be taken to scrupulously
follow the law laid down by this Court, we think it
fit to discharge Show cause notice issued to the
Assistant Commissioner of Customs (Import).
Accordingly, notice stands discharged.
12. Since petitioner has withdrawn the amount
deposited by the Revenue, after renewal of the bank
guarantee, as such cause of action to proceed with the
petition does not survive.
13. Petition accordingly stands disposed of with no
order as to costs.
(V.C.Daga, J) (Dr.Radhakrishnan, J) (V.C.Daga, J) (Dr.Radhakrishnan, J) (V.C.Daga, J) (Dr.Radhakrishnan, J)
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ORDINARY ORIGINAL CIVIL JURISDICTION ORDINARY ORIGINAL CIVIL JURISDICTION ORDINARY ORIGINAL CIVIL JURISDICTION
WRIT PETITION NO.1108 OF 2007 WRIT PETITION NO.1108 OF 2007 WRIT PETITION NO.1108 OF 2007
2007:BHC-OS:6927-DB
Legrand (India) Private Limited .. Petitioner
V/s.
The Union of India & Ors.. Respondents.
Mr.Prakash Shah i/b P.D.S.Legal for Petitioner.
Mr.A.J.Rana,Sr.Counsel with Mr.R.V.Desai,Sr.Counsel
with Mr.P.S.Jetley for Respondents.
CORAM : DR.S.RADHAKRISHNAN CORAM : DR.S.RADHAKRISHNAN CORAM : DR.S.RADHAKRISHNAN
and V.C.DAGA, JJ. and V.C.DAGA, JJ. and V.C.DAGA, JJ.
DATED : 21st June 2007.
DATED : 21st June 2007. DATED : 21st June 2007.
JUDGMENT (Vijay Daga, J) JUDGMENT (Vijay Daga, J) JUDGMENT (Vijay Daga, J)
Rule returnable forthwith.
1. Heard finally by consent of parties.
2. Perused petition and counter affidavits.
3. The petitioner, through this petition filed under
Article 226 of the Constitution of India, has brought
to our notice prima facie, wilful and deliberate
::: Downloaded on - 26/06/2024 07:32:50 :::
( 2 )
disobedience on the part of the Assistant Commissioner
of Customs (Import) to the law laid down by this Court
in the case of Mahindra and Mahindra Ltd vs.Union of
India 1992 (59) ELT 505 (Bom), Ocean Centres vs Union
of India 2005 (180) OLT 313 (Bom); and in the case of
Noble Society vs Union of India 2005 (187) ELT 438
(Bom) wherein this Court has laid down and followed
from time to time that during the period of limitation
available for filing an appeal, no coercive action
should be taken to enforce the order. The Assistant
Commissioner of Customs (Import) in breach of the law
laid down by this Court, which was specifically
brought to its notice, encashed bank guarantee worth
Rs.14,33,000/- (before expiry of the appeal period)
which was furnished by the petitioner by way of
security pending adjudication of dispute.
4. When the aforesaid prima facie and willful
disobedience was brought to our notice, by an interim
order dated 26th April, 2007 respondents were directed
to deposit Rs.14,33,000/- with this Court with a
further order issuing show cause notice to the
Assistant Commissioner of Customs (Imports) as to why
action under the provisions of the Contempt of Court
Act should not be initiated for prima facie wilful
::: Downloaded on - 26/06/2024 07:32:50 :::
( 3 )
disobedience of the law laid down by this Court in the
judgment referred to hereinabove and that the conduct
of the Assistant Commissioner of Customs (Import) in
not following the decisions of was calculated to
undermine the dignity and majesty of the court and
impair the constitutional authority of High Court.
5. The legal position regarding the binding nature of
judgments delivered by High Court was clearly
explained as far back as 1962 by the Supreme Court.
In East India Commercial Co. Ltd v Collector of
Customs, Calcutta, AIR 1962 SC 1893, Subba Rao, J (as
he then was) speaking for himself and Mudholkar, J has
explained, though A.K.Sarkar, J (the Third Member of
the Bench) did not fully agree with this aspect of the
legal position, the law laid down (para 29 of thereof)
reads as under:
. " This raises the question whether an
administrative tribunal can ignore the law
declared by the highest Court in the State and
intiate proceedings in direct violation of the
law so declared under Art. 215, every High
Court shall be a Court of record and shall
have all the powers of such a court including
the power to punish for contempt of itself.
Under Art. 226, it has plenary power to issue
orders or writs for the enforcement of the
fundamental rights and for any other purpose
to any person or authority including
inappropriate cases any Govt. within its
territorial jurisdiction. Under Art. 227 it
has jurisdiction over all Courts and tribunals
throughout the territories in relation to
::: Downloaded on - 26/06/2024 07:32:50 :::
( 4 )
which it exercises jurisdiction. It would be
anomalous to suggest that a tribunal over
which the High court has superintendence can
ignore the law declared by that Court and
start proceedings in direct violation of it.
If a tribunal can do so, all the subordinate
courts can equally do so, for there is no
specific provision, just like in the case of
Supreme Court, making the law declared by the
High Court binding on subordinate courts. It
is implicit in the power of supervision
conferred on a superior tribunal that all the
tribunals subject to its supervision should
conform to the law laid down by it. Such
obedience would also be conducive to their
smooth working ;otherwise there would be
confusion in the adminstration of law and
respect for law would irretrieably suffer.
We, therefore, hold that the law declared by
the highest court in the State is binding on
authorities, or tribunals under its
superintendence, and that they cannot ignore
it either in initiating a proceeding or
deciding on the rights involved in such a
proceeding. If that be so, the notice issued
by the authority signifying the launching of
proceedings, contrary to the law laid down by
the High Court would be invalid and the
proceedings themselves would be without
jurisdiction."
(Emphasis supplied by us)
6. The above legal position was reiterated in Makhan
Lal vs State of Jammu and Kashmir AIR 1971 SC 2206.
It was in the context of the law declared by the
Supreme Court that the decision laid down to that
effect so far as Art. 141 of the Constitution was
concerned, but what has been observed in para 5 at
p.2209 by Grover, J speaking for the Supreme Court has
equal application so far as pronouncements by the High
::: Downloaded on - 26/06/2024 07:32:50 :::
( 5 )
Courts are concerned. Grover, J observed (at page
2209)-
" The judgment which was delivered did not
merely declare the promotions granted to the
respondents in the writ petition filed at the
previous stage as unconstitutional but also
laid down in clear and unequivocal terms that
the distribution of appointments, posts or
promotions made in the implementation of the
communal policy was contrary to the
constitutional guarantee of Article 16. The
law so declared by this court was binding on
the respondent State and its officers and they
were bound to follow it whether a majority of
the present respondents were parties or not in
the previous petition.
(Emphasis supplied)
It cannot therefore be contended by anyone
that since Acharya, the petitioner in Special
Civil Application No.2215 of 1979, was not a
party to Special Civil Application No.806 of
1975, that the law laid down by D.A.Desai, J
in his judgment in that case on Aug, 7, 1975
was not applicable to the case of Acharya.
Whether the law is declared by the Supreme
Court or whether the law is declared by the
High Court, the legal position as regards
authorities and tribunals subordinate to the
Supreme Court and High Courts respectively is
the same as pointed out by Subba Rao, J in
East India Commercial Co’s case (AIR 1962 SC
1803) (supra).
7. In Baradakanta Mishra vs Bhimsen Dixit, AIR 1972
2466 : (1973 Cri.L.J. 19) the legal position
regarding binding nature of the High Court’s decision
was once again reiterated by the Supreme Court and
after quoting the above passage which we have
extracted from the judgment of Subba Rao, J in East
::: Downloaded on - 26/06/2024 07:32:50 :::
( 6 )
India Commercial Co’s case (AIR 1962 sc 1893) (supra)
in paras 15 and 16 of the judgment. Dwivedi, J
speaking for the Supreme Court observed at page 2469
(of AIR) : (at pp.22,23 of Cr.L.J.)
" The conduct of the appellant in not
following the previous decision of the High
Court is calculated to create confusion in the
administration of law. It will undermine
respect for law laid down by the High Court
and impair the constitutional authority of the
High Court. His conduct is therefore,
comprehended by the principles underlying the
law of contempt. The analogy of the inferior
court’s disobedience to the specific order of
a superior court also suggests that his
conduct falls within the purview of the law of
contempt. Just as the disobedience to a
specific order of the court undermines the
authority and dignity of the court in a
particular case, similarly any deliberate and
malafide conduct of not following the law laid
down in the previous decision undermines the
constitutional authority and respect of the
High Court. Indeed, while the former conduct
has repercussions on an individual case and on
a limited number of persons, the latter
conduct has a much wider and more disastrous
impact. It is calculated not only to
undermine the constitutional authority and
respect of the High Court generally, but it is
also likely to subvert the Rule of Law and
engender harassing uncertainty and confusion
in the administration of law. "
8. In Hasmukhlal C.Shah vs State of Gujrat, (1978) 19
Guj LR 378, a Division Bench of Gujrat High Court
consisting of J.B.Mehta and P.D.Desai, JJ after
examining several decisions on the point, observed :
" In a Government which is ruled by laws,
::: Downloaded on - 26/06/2024 07:32:50 :::
( 7 )
there must be complete awareness to carry out
faithfully and honestly lawful orders passed
by a Court of law after impartial
adjudication. Then only will private
individuals, organisations and institutions
learn to respect the decisions of Court. In
absence of such attitude on the part of all
concerned, chaotic conditions might arise and
the function assigned to the courts of law
under the Constitution might be rendered a
futile exercise. "
9. From the above four decisions, the following
propositions emerge :
(a) It is immaterial that in a previous
litigation the particular petitioner before
the Court was or was not a party, but if a law
on a particular point has been laid down by
the High Court, it must be followed by all
authorities and tribunals in the State ;
(b) The law laid down by the High Court must
be followed by all authorities and subordinate
tribunals when it has been declared by the
highest Court in the State and they cannot
ignore it either in initiating proceedings or
deciding on the rights involved in such a
proceeding;
::: Downloaded on - 26/06/2024 07:32:50 :::
( 8 )
(c) If inspite of the earlier expositiion of
law by the High Court having been pointed out
and attention being pointedly drawn to that
legal position, in utter disregard of that
position, proceedings are initiated, it must
be held to be a wilful disregard of the law
laid down by the High Court and would amount
to civil contempt as defined in S. 2 (b) of
the Contempt of Courts Act, 1971.
10. The respondents as directed by us have deposited
amount of Rs.14,33,000/- with the Prothonotary and
Senior Master of this Court and also filed an
affidavit duly affirmed by Ms.Reena Shetty, Assistant
Commissioner of Customs (Imports) tendering her
unconditional apology along with copy of the standing
order No.7967 dated 26th April, 2007 with covering
letter issued by the Commissioner of Customs (Imports)
the text of which are as under :
OFFICE OF THE COMMISSIONER OF CUSTOMS (IMPORTS)
NEW CUSTOM HOUSE, BALLARD ESTATE, MUMBAI-01.
F.No.S/26-89/2007/Apprg (General) Date 26.4.2007
::: Downloaded on - 26/06/2024 07:32:50 :::
( 9 )
To,
1. The Commissioner of Customs (General)
New Custom House,
Ballard Estate, Mumbai-400 001.
2. The Commissioner of Customs (Export)
New Custom
House, Ballard Estate,
Mumbai-400 001.
Sir,
Subject:Enforcement/encashment of Bank
Guarantee during pendency of
appeal-reg.
I am enclosing herewith a Standing Order
No.7967/2007 dated 26.4.2007 on the above
subject.
2. The Hon’ble Mumbai High Court has taken a
serious view in cases where the department has
invoked the Bank Guarantee within the
statutory period of appeal. You may like to
bring this Standing Order to the notice of all
the officers working under you to ensure that
the Hon’ble High Court’s directions are
strictly complied with.
Yours Faithfully,
sd/ (A.K.PRASAD)
Commissioner of Customs (Import)
Tel.No.2262 0845
Encl: As above
::: Downloaded on - 26/06/2024 07:32:50 :::
( 10 )
OFFICE OF THE COMMISSIONER OF CUSTOMS (IMPORT)
NEW CUSTOM HOUSE, BALLARD ESTATE,MUMBAI-01.
F.No.S/26-89/2007 Apprg.(General) Date:26.4.2007
STANDING ORDER 7967/2007
Subject: Enforcement/encashment of
Bank Guarantee during pendency
of appeal - reg.
As per Board’s Circular No.788/21/2004-Cx,
dated 25.5.2004 coercive measures should not
be initiated during the period prescribed in
the said circular. It is observed that some
officers are enforcing the Bank Guarantees
within the appeal period. This matter had
come before the Hon’ble Mumbai High Court in
the case of Ocean Driving Center Ltd vs Union
of India - 2005 (180) E.L.T. 313 (Bom), Noble
Asset Company Ltd vs Union of India - 2005
(187) E.L.T. 438 (Bom) and M/s Mahindra &
Mahindra Ltd vs Union of India - 1992 (59) ELT
505 (Bom) wherein it has been held that
encashment/enforcement of Bank Guarantee
tantamount to resorting to coercive measures
and this should not be done within the appeal
period.
2. This instructions should be strictly
complied with. Any deviation would be viewed
seriously.
S/d (A.K.Prasad)
Commissioner of Customs (Import)
Mumbai.
11. In view of the unconditional apology tendered by
Ms.Reena Shetty, Assistant Commissioner of Customs
(Import) Apprising Group B,the directions issued by
the Commissioner of Customs (Import) and the specific
assurance given to us by Mr.Rana, learned senior
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counsel appearing for the Union of India that in
future adequate care would be taken to scrupulously
follow the law laid down by this Court, we think it
fit to discharge Show cause notice issued to the
Assistant Commissioner of Customs (Import).
Accordingly, notice stands discharged.
12. Since petitioner has withdrawn the amount
deposited by the Revenue, after renewal of the bank
guarantee, as such cause of action to proceed with the
petition does not survive.
13. Petition accordingly stands disposed of with no
order as to costs.
(V.C.Daga, J) (Dr.Radhakrishnan, J) (V.C.Daga, J) (Dr.Radhakrishnan, J) (V.C.Daga, J) (Dr.Radhakrishnan, J)
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