Maimunal Islam and others Vs. The Collector of Customs and others.

Maimunal Islam and others

 Vs.

The Collector of Customs and others.

Supreme Court

Appellate Division

(Civil)

Present:

Md. Abdul Matin J

ABM Khairul Haque J

Md. Muzammel Hossain J

Maimunal Islam……………..Appellant (In Civil Appeal Nos. 102-103 of 2000)

Mahbub Alam…………………..Appellant (In Civil Appeal No. 104 of 2000)

M.A. Wadud……………………Appellant (In Civil Appeal No. 105 of 2000)

M/S. Shapla Traders…………….Appellant (In Civil Appeal No.106 of 2000)

Maimunal Islam……………Appellant (In Civil Appeal No.107 of 2000)

M/S. S. Traders……………Appellant (In Civil Appeal No. 108 of 2000)

M/S. Shapla Traders………Appellant (In Civil Appeal Nos. 109-110 of 2000)

M/S. C.H. International a Proprietor Firm……….Appellant (In Civil Appeal No. 111 of 2000)

M/S. Karnafully Traders……Appellant (In Civil Appeal No. 112 of 2000)

M/S. Nishu Enterprise……Appellant (In Civil Appeal Nos. 113 of 2000)

M/S. J. K. Enterprise………Appellant (In Civil Appeal No.114 of 2000)

Maimunal Islam…………Appellant (In Civil Appeal Nos. 115-116 of 2000)

M/S. M. Islam Traders…………..Appellant (In Civil Appeal No. 117 of 2000)

M/S. Islam Traders………Appellant (In Civil Appeal Nos. 118-119 of 2000).

M/S. M. Jessee Trading…… Appellant (In Civil Appeal No.120 of 2000).

Suda Kar Chakma…………Appellant (In Civil Appeal Nos. 121-122 of 2000)

Vs.

The Collector of Customs and others………Respondents (In all the appeals).

Judgment

March 10, 2010.

Lawyers Involved:

Humayun Hossain Khan, Senior Advocate instructed by Md. Nawab Ali, Advocate-on-Record- For the Appellants. (In all the appeals)

Mrs. Nahid Yesmin, Deputy-Attorney General (Appeared with the leave of the Court)-For the Respondents. (In all the appeals)

Civil Appeal Nos.102-122 of 2000.

(From the judgment and order dated 03.06.1998 and 12.01.1998 passed by the High Court Division in Writ Petition Nos.1015, 1016, 1042, 1022, 1650, 1512, 1960, 1845, 1598, 1964, 1836, 1743, 1265 and 1249 of 1993 and 229, 1613, 1614 1900,1997, 2310 and 2610 of 1994.)

Judgment

Md. Abdul Matin J. – These 21 appeals are directed against the judgments and orders dated 03.06.1998 and 12.01.1998 passed by the High Court Division in Writ Petition Nos.1015, 1016, 1042, 1022, 1650, 1512, 1960, 1845, 1598, 1964, 1836, 1743, 1265 and 1249 of 1993 and 229, 1613, 1614, 1900, 1997, 2310, and 2610 of 1994 heard analogously and discharging the Rules by two separate judgments.

2. The facts, in short, are that in all those writ petitions two S.R.Os. of Customs dated 02.02.1993 and 28.10.1993 were challenged as illegal and unlawful on the ground that Collector of Customs-respondent claimed customs duty and tariff value at an enhanced rate of U.S. $ 3.50 per Kg. on secondary quality Tyre cord fabrics. The respective writ-petitioners main contention are that they opened letters of credit for import of secondary quality Tyre cord fabrics and as such enhancement of customs duty directing to declare tariff value on the basis of invoice value is illegal and unlawful.

3. The writ-petitioners in all these writ petitions have further stated in common that respondent No.1, the Collector of Customs, is charged with the responsibility of levying and collecting customs duty/under Customs Act, 1969, value added tax under the Value Added Tax Act, 1991 and collect development surcharge on permissible import cargo. The secondary quality Tyre cord fabrics, used for the purpose of manufacturing fishing nets is of much inferior quality than prime quality Tyre cord fabrics used in cars, trucks, buses and all other automobile vehicles. S.R.O. No.227-Law/91, being the import policy order for the period running from July, 1991 to June, 1993 was promulgated on 28.07.1991 and was published in the Bangladesh Gazette Extra-ordinary on 30.07.1991 providing in respect of import of secondary quality Tyre cord fabrics on a commercial basis. Subsequently the import policy order (Revised), 1991-93 was promulgated on 08.06.1992 and came into force on 04.02.1993 and would remain valid till June 1993 providing for unrestricted import of secondary quality Tyre cord fabrics. By S.R.O. No. 224-Law/90/ 1302/Customs dated 14.06.1990 respondent No.2 fixed tariff value of secondary quality Tyre cord fabrics at Tk.10/-per Kg. and that of prime quality Tyre cord fabrics at Tk.175/- per Kg. The petitioners accordingly applied for L.C. authorization for import of secondary quality Tyre cord fabrics and open L.C. The petitioners are entitled to be assessed with customs duty on the basis of the invoice value and section 25(1) Customs Act. But the respondents directed the petitioners to declare tariff value on the basis of the S.R.Os. dated 02.02.1993 and 28.10.1993 respectively which are not applicable to the petitioners.

4. The learned Judges of the High Court Division discharged all the Rules holding that the importer-petitioners are liable to be assessed with customs duties and VAT on the basis of S.R.O. operative on the date of opening of letters of credit and as such the claim of the importers to be assessed on the basis of invoice value which was prevalent prior to their opening of the letters of credit is untenable in law.

5. The learned Advocate appearing for the petitioner, submitted first, that the High Court Division failed to appreciate that the fixation of tariff value under said notification No. 20 dated 02.02.1993 on the said goods is arbitrary inasmuch as the petitioner is entitled to pay duties and taxes on the said imported goods at a value which would reflect the fair price of the goods in the international market and not at a grossly inflated and arbitrarily determined value which would have no nexus with the price charged ordinarily in the course of international trade. He next submitted that the High Court Division failed to appreciate that the respondents had fixed tariff value at Tk.70.00 per Kg. in respect of “Tyre Cord Fabrics Secondary Quality” and at Tk.175/- per Kg. in respect of “Tyre Cord Fabrics Prime Quality” under the notification being SRO No. 224 dated 14.06.1990, the respondents re-fixed the tariff value of “Tyre Cord Fabrics” at US$ 3.50 per Kg. under the impugned notification, amalgamating and mixing up two different types of goods, that the respondents failed to apply their minds judiciously in determining the value of primary and secondary quality of tyre cord fabrics at US$ 3.50 per Kg. and thus the impugned notification is liable to declare to have been issued without lawful authority.

6. Leave was granted in all the cases to consider the above submissions.

Heard Mr. Humayun Hossain Khan, the learned Counsel appearing for the appellants and Mrs. Nahid Yesmin, the learned Deputy Attorney General (appeared with the leave of the Court) appearing for the respondents and perused the petition and the impugned judgment and order of the High Court Division and other papers on record.

7. The precise questions in all the cases ( is whether the importer appellants are liable to be assessed with customs duties and VAT on the basis of S.R.O. operative on the date of opening of letters of credit or on the basis of invoice value which was prevalent prior to their opening of the letters of credit.

8. It appears that after hearing parties the High Court Division held as under:-

“In the instant cases we find that there is guideline and basis for fixation of the tariff value for the import in questions in the absence of any rule over and above, the petitioners knowing about the tariff value have opened the letters of credit for import of the goods in question when the impugned notifications fixing tariff value was in force and the fixation of tariff value having basis as aforesaid, it cannot now lie in the mouth of the petitioners that the same was arbitrary or the same was inflated one based on fictitious basis.”

9. The High Court Division further held:-

“Thus in the above matter the importer petitioners are liable to be assessed with customs duty and vat on the basis of S.R.O. operative on the date of opening of the letters of credit and the respondents having directed the petitioners to declare their goods on the basis of the existing S.R.O. on the date of opening of letter of credit has not acted illegally. Accordingly neither the impugned S.R.O. nor the impugned orders of the respondents are liable to be interfered with.”

10. Since the S.R.O. in question was in force on the date of opening of the letter of credit by the appellants within the full knowledge of the appellants the High Court Division rightly held that they are to be assessed with customs duty and Vat on the basis of such S.R.O.

We find no substance in these appeals which are accordingly dismissed.

Ed.

Source: 15 MLR (AD) (2010) 227

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