2022-TIOL-1045-HC-AHM-CUS
N D Timbers Vs UoI
Cus - The petitioners are dealing with the import of timber wood and have to treat such wood with fumigation process for pest control - The petitioners filed the present petitions against the action of demand of additional fine/ charge/ penalty 5 times of regular fees by the Revenue from the petitioners purportedly under Clause 14 (2) of Chapter VI of the Plant Quarantine Order (Regulation of Import into India), 2003 (hereinafter referred to as 'the PQ Order, 2003) - The petitioners also seek to challenge the condition/s imposed by the Revenue by way of Office Memorandum No. 8-131/2016-PP.II dated 28.06.2017 and Office Memorandum No. 8-131/2016-PP II dated 27.12.2018, thereby demanding the above referred penalty/ additional charges - The Office Memorandums refer to the fumigation process undertaken for the imports of timber by using Methyl Bromide (with 48 g/ m3 for 24 hours at 21 degree Celsius) - Admittedly, all the petitioners have the requisite certificate of fumigation issued by the officials of the exporting country, but the respondent authority treat the same as invalid for the reason that they do not meet with the standards or parameters as prescribed by India. Hence, the petitioners are asked again to treat the timber with fumigation by Methyl Bromide as per the Indian standards, and accordingly are issued such certificates - In view of such objection, the petitioners are asked to pay the charge of fumigation and the penalty also.
Held - It is the case of the petitioners, that imposition of penalty will amount to restricting their trade and is in violation of Article 19(1)(g) of the Constitution of India, hence the provision, which enables the authority to levy penalty may be quashed - The petitioners are being penalised for the act of the exporting countries in issuing phytosantory certificates which are not in rhyme with the Indian standards - It is in the absolute realm of the executive to take a policy decision, and such policy decision can only be interfered with if it is ultimately found that the policy suffers from the vice of mala fide, unreasonableness, arbitrariness and unfairness, in addition to violation of fundamental rights or exercise of power beyond the legal limits - It is the solemn and constitutional obligation of the Court to examine that in framing of policy no law is violated and people's fundamental rights are not transgressed upon except to the extent permissible under the Constitution - but concurrently in wake of the actual scenario which is prevailing as on today and in absence of any other alternative to the petitioners coupled with the fact that relaxation is granted to them to import timber; the levy of penalty on imports is intrinsically prejudicial to their trade and business. Either the respondents should not grant any relaxation of import of such timber or if they are allowing the same no penalty should be imposed: SC
+ facts indicate that the petitioners have to process their timber twice, once in the exporting country and again in India. The first process is undertaken by the exporting country and accordingly a phytosanitory certificate is issued. Regulation 9(1) (ii) of Plant Quarantine (Regulation of Import into India) order, 2003 provides that the consignment of import of wood and timber shall be fumigated as stated therein;
+ Thus, after granting relaxation of imports from those countries who have discontinued the use of Methyl Bromide as a fumigation chemical, the petitioners on getting the timber fumigated by equivalent chemical are being imposed penal fees in respect of such consignment. It is not the case of the respondents that the petitioners import the goods without any phytosanitory certificates. The petitioners are also paying the charge and if not they are ready and willing to pay the charges for fumigation as per the Indian parameters. After undertaking all the exercise and obtaining permission and relaxation, the are being levied penalty in the form of five times of the charges of fumigation. The entire action of imposing the penalty stems out of the phytosanitory certificates issued by the exporting country. The petitioners are being penalised for the action of the officials of the NPPO of the exporting country who are fumigating the timber as per their standards. Regulation 9 of the PQ, 2003 deals with the fumigation of timber/wood by Methyl Bromide or by "any equivalent" chemical treatment duly approved by the Plant Protection Adviser which shall be endorsed on the Phytosanitory Certificates issued thereof at the country of export or reexport. Thus, the Regulation itself stipulates of an "equivalent chemical" to be used for fumigation of timber. The respondents have not yet decided or prescribed under any regulation directing any use of "equivalent chemical" to Methyl Bromide. Thus, the action of the respondents of levy of penal fees in these circumstances appears to be arbitrary;
+ A plain and simple reading of the aforesaid Articles of the ISPM-12, will clarify that a phytosanitory certificate is required to be issued by the NPPO of the country of origin. As per Article 3 the NPPOs of importing countries may require phytosanitory certificates for regulated articles. In the present cases, timber is recognised as a regulated article. It is also prescribed that for certain plant produces the importing countries should not require such certificate if the products are processed to the point where they have no potential for introducing regulated pest. Article 3 further clarifies that "NPPOs should consult bilaterally when there are differences between their views regarding the technical justification for requiring phytosanitory certificates, and requirement for such certificates should respect the principles of transparency, non-discrimination, necessity and technical justification". Article 3.1 prohibits the acceptance of phytosanitory certificate, if the importing countries determine them as invalid or fraudulent and the NPPO of the declaring country should be notified at the earliest regarding unacceptability or suspect phytosanitory certificates. The Article further cautions that if the NPPO of the importing country suspects that phytosanitary certificates may be unacceptable, it may require the prompt cooperation of the NPPO of the exporting or re-exporting country in determining the validity or non-validity of the phytosanitary certificates. The NPPO of the exporting or re-exporting country should take corrective action where necessary and review systems for the issuance of phytosanitary certificates so as to ensure that a high level of confidence is associated with its phytosanitary certificates. (Para 29)
+ Nothing is brought on record to remotely suggest that whether the respondent authority has followed the procedure prescribed in ISPM-12. It is the case of the respondents that the phytosanitory certificate issued to the petitioners by the NPPOs of exporting country is invalid. In this background, the respondents are required to intimate the NPPOs of the exporting country, who are issuing such certificate. They should have resolved the entire issue with regard to technical requirements by bilateral consultation. Nothing is pointed out to this Court, that the respondents have notified the NPPO of the declaring country which has issued the certificates. Article 3.1 prescribes of prompt action with the exporting country to determine the validity or non-validity of such certificates. Instead of following such procedure, the petitioners are being imposed the penalty for the phytosanitory certificates issued by the country of origin. Such action of the respondent defies logic and is difficult to fathom. (Para 30)
+ the action of the respondents conflates two different scenario. On one hand relaxation is granted to import timber with phytosanitory certificate and on the other hand, they are being penalised for obtaining such certificates. Similarly, the use of Methyl Bromide is considered to be harmful for environment, and on the other hand such chemical is being used for exports and imports. The petitioners are penalised for importing consignments of timber, which is subjected to fumigation by different chemical equivalent to Methyl Bromide or by Methyl Bromide on payment of necessary charge. Simultaneously, a penalty is being imposed upon them for importing the timber which is fumigated by the exporting countries as per their standards. There cannot be any scintilla of doubt that the respondents have all the power and authority to regulate, classify and impose reasonable restrictions on the trade on the articles or goods which are imported in India keeping in mind the principles, as mentioned by the Apex Court, but concurrently in wake of the actual scenario which is prevailing as on today and in absence of any other alternative to the petitioners coupled with the fact that relaxation is granted to them to import timber; the levy of penalty on imports is intrinsically prejudicial to their trade and business. Either the respondents should not grant any relaxation of import of such timber or if they are allowing the same no penalty should be imposed. Thus, the action of the respondents in levying fine or penalty will amount to reasonable restrictions having direct impact on their right guaranteed under Article 19(1)(g) of the Constitution of India, since the petitioners cannot carry on with their trade unless they pay such fine or penalty. The respondents before imposing fine or penalty should have deliberated on the issue and the adversity faced by the petitioners, since the issuance of phytosanitory certificate is beyond their sphere or ambit. They cannot insist the exporting country to issue phytosanitory certificate as per the requirement of Indian parameters. Without resolving the issue at the ends of NPPOs of each country, the petitioners are being penalised. Thus, such an action of the respondents is arbitrary and invades their right to trade, hence the same calls for interference; (Para 38)
+ It can be distinctly inferred from the aforementioned observations that it is in the absolute realm of the executive to take a policy decision, and such policy decision can only be interfered with if it is ultimately found that the policy suffers from the vice of mala fide, unreasonableness, arbitrariness and unfairness, in addition to violation of fundamental rights or exercise of power beyond the legal limits. It is the solemn and constitutional obligation of the Court to examine that in framing of policy no law is violated and people's fundamental rights are not transgressed upon except to the extent permissible under the Constitution. Unquestionably, in the present case, the impugned Regulation and the subsequent OMs do not satisfy the principles of rationality and they infract the fundamental rights of the petitioners guaranteed under Article 19(g) of the Constitution of India, hence this Court, in exercise of powers conferred under Article 226, has the explicit authority to set aside the same.
- Writ petitions allowed: GUJARAT HIGH COURT
2022-TIOL-1044-HC-DEL-CUS
Acme Heergarh Powertech Pvt Ltd Vs CBIC
Cus - This is an application moved on behalf of petitioner seeking amendment of writ petition - Revenue insists that he wishes to file a reply - Accordingly, notice issued - As regards to another issue, perusal of SCN shows that revenue is hurtling towards cancellation of subject licenses, which if done at this stage, would impair petitioner's interest, even while the issue is being examined by Court - Accordingly, operation of subject SCN is stayed till the next date of hearing: HC
- Matter listed: DELHI HIGH COURT
2022-TIOL-1043-HC-MUM-CUS
Pride Agro Fresh LLP Vs UoI
Cus - Petitioner submits that impugned order is passed without adhering to principles of natural justice - No opportunity of hearing was extended to petitioner - It transpires from SCN that petitioner was to be given an opportunity of being heard through video conferencing - The date and time along with video conferencing link was to be intimated to petitioner in due course - The Petitioner has filed Reply within stipulated time, however, he was not provided with a video conferencing link nor was given hearing - Same is not in consonance with SCN, so also the provisions of FTDR Act, 1992 - As opportunity of hearing was not given as mandated under Statute and SCN, court have entertained present petition - The opportunity of hearing be extended by Authority and fresh decision shall be arrived at - It is for the Petitioner to make submission before Authority as is permissible under law: HC
- Writ petition disposed of: BOMBAY HIGH COURT
