Secretary, Ministry of Energy Vs. Q.C. Petroleum Limited and others

Appellate Division Cases

(Civil)

PARTIES

Secretary, Ministry of Energy and Mineral Resources, Government of Bangladesh,

Bangladesh Secretariat, Dhaka and others……………………. Appellants

-Vs-

Q.C. Petroleum Limited and others……………. Respondents.

JUSTICES

Mohammad Fazlul Karim J

Md. Joynul Abedin J

Md. Hassan Amen J

Judgment Dated: 2nd October 2007

The Bangladesh Petroleum Act, 1974, Section 2,4, 4(2)

Due to the unreasonable and illegal order of the aforesaid authorities discharge of the said consignment is being held up and the vessel in question is incurring demurrage…………………….. (2)

The High Court Division took the view that there was no legal basis for stopping the discharge of the cargo in question on the plea of non-production of “No Objection Letter” from the said Ministry of Bangladesh Petroleum Corporation. The High Court Division found no substance in the contention of the learned Attorney General that a ‘petroleum agreement’ as envisaged in section 4 of the Bangladesh Petroleum Act, 1974 is a pre-condition for import of petroleum after interpreting the provisions of sections 2 and 4 of the said Act ……………………..(4)

The question that calls for determination whether the import of the consignment in question as well as its clearance by the customs on payment of necessary duties turns on the interpretation of section 4 as well as section 2(e) of the Bangladesh Petroleum Act, 1974. In other words, whether the respondents were required in law to have a prior petroleum agreement with the concerned authority for importation of the consignment in question. We have carefully considered the impugned judgment and have noted that the High Court Division has arrived at a correct decision on a sound principle of law relating to interpretation of statute that section 4 read with section 2(e) of the said Act, 1974 did not require of any petroleum agreement to be entered into and made with the Government of the Bangladesh Petroleum Corporation by any importer at the time of importation of the consignment in question, namely High Speed Diesel. The expression “Petroleum Operation” as found in section 4(2) and defined in section 2(e) of the said Act, 1974 has not stipulated for any kind of petroleum agreement with the Government of the Bangladesh Petroleum Corporation as a pre-condition to importing such Petroleum Product. But such agreement is required to be in place at the time and in course of exploration, extraction of the Petroleum Product, its development, exploitation, production, refining, processing or marketing. In other words, once the Petroleum product is found inside the country on import at the instance of any one except the

Government or the Bangladesh Petroleum Corporation, Petroleum agreement is a condition precedent to dealing with such product. In the absence of any restriction imposed either in the Imports and Exports Control Act or in the Import Policy Order, the Customs or the National Board of Revenue would not be competent to refuse clearance of any imported high speed diesel ………………….(7)

Sal ah Uddln Mahmud, Additional Attorney General, instructed by ASK4 Khalequzzaman, Advocate-on-Record…………………… For the appellants.

Mvi. Md. Wahidullah, Advocate-on-Record ………….For Respondent Nos. 1 & 2.

Tonjib-ul-Alam, Advocate, instructed by Md. Aftab Hossain, Advocate-on-Record.

For Respondent No.3.

A.S.M. Khalequzzaman, Advocate-on-Record……………. For Respondent No. 5.

For Respondent No. 4 ……………………..Not Represented.

Civil Appeal No. 125 of 2000

(From the judgment and order dated 1.3.1994 passed by the High Court Division in Writ Petition No. 279 of 1994.)

JUDGMENT

Md. Joynul Abedin J : This appeal by leave arises out of the judgment and order dated 1.3.1994 passed by a Division Bench of the High Court Division in Writ Petition No. 279 of 1994 making the rule absolute.

2. Respondent as writ petitioners filed the aforesaid writ petition challenging Memo No. 357/AP/GROUP-10/93-94/10762CUS dated 5.1.1994 issued on behalf of the Collector of Customs in pursuance of Memo No. 7(1) CUSTOM-1/19/09 dated 5.1.1994 issued by the National Board of Revenue refusing to discharge their consignment of High Speed Diesel till production of no objection letter issued either by the Energy and Mineral Resources Division or by the Bangladesh Petroleum Corporation. Their case, in short, is that in pursuance of the import policy announced by the Government they imported 16,315,565 metric tons of High Speed Diesel from Singapore. The said consignment arrived at the Chittagong port on 28.12.1993 and duties were assessed by the Customs authority on submission of the bills of entry and other import documents Part of the assessed duty was paid on 1.1.1994. But the discharge of the said consignment was refused by the customs

till no objection letter for such discharge was obtained and produced from the above authority. Their further case is that restriction on import of petroleum was withdrawn in the Import Policy Orders 1991-1993 and 1993-1995 and the petroleum products were placed in the free list after it was withdrawn from the control list. So there was no restriction for import of the High Speed Diesel by the respondent Nos.l and 2. The respondents therefore imported the said consignment on prior intimation to the government and on observance of all necessary formalities in this regard and the relevant Ministry did not raise any objection. Due to the unreasonable and illegal order of the aforesaid authorities discharge of the said consignment is being held up and the vessel in

question is incurring demurrage.

3. The Ministry of Energy and Mineral Resources and the Bangladesh Petroleum Corporation contested the rule issued in the writ petition mainly relying on the provision

of section 4 of the Bangladesh Petroleum Act, 1974 asserting that the writ petitioners were debarred from importing the said consignment without entering into any petroleum agreement with the Government as envisaged under section 4(2) of the said Act inasmuch as, according to them, the expression “Petroleum Operation” in section 4(2) also includes

importation of Petroleum Product.

4. The High Court Division took the view that there was no legal basis for stopping the discharge of the cargo in question on the plea of non-production of “No Objection Letter” from the said Ministry of Bangladesh Petroleum Corporation. The High Court Division found no substance in the contention of the learned Attorney General that a ‘petroleum agreement’ as envisaged in section 4 of the Bangladesh Petroleum Act, 1974 is a precondition for import of petroleum after interpreting the provisions of sections 2 and 4 of the said Act.

5. Leave was granted to consider the submission that ‘petroleum operation’ has been defined in clause (e) of section 2 of the Bangladesh Petroleum Act 1974 but the High Court Division failed to properly interpret the said provision overlooking the word “or” before the words ‘marketing of petroleum’ in the said provision and by misconstructing the provision of section 4(2) of the Act arrived at the wrong conclusion that ‘import of petroleum does not come within the purview of petroleum operation’ and as such there is no question of entering into a petroleum agreement with the Government of import of any

petroleum product when such import is for the purpose of marketing and further submission that High Court Division failed to notice and consider that import policy

being delegated legislation cannot override the provision of the Act and also the next submission that if the wrong interpretation give by the High Court Division remains then it may create complications in the future and as such leave should be granted.

6. Mr. Salah Uddin Mahmud, the learned Additional Attorney-General reiterates the same submissions adding that relevant provisions of law should be interpreted to enable the relevant authority in the Government to retain control over the petroleum product not only during its exploration, development, exploitation, production, processing, refining or marketing but also in its importation. Further, according to him, such interpretation would also absolve the Government from being liable for any demurrage claim by the respondents.

7. The question that calls for determination whether the import of the consignment in question as well as its clearance by the customs on payment of necessary duties turns on the interpretation of section 4 as well as section 2(e) of the Bangladesh Petroleum Act, 1974. In other words, whether the respondents were required in law to have a prior petroleum agreement with the concerned authority for importation of the consignment in

question. We have carefully considered the impugned judgment and have noted that the High Court Division has arrived at a correct decision on a sound principle of law relating to interpretation of statute that section 4 read with section 2(e) of the said Act, 1974 did not require of any petroleum agreement to be entered into and made with the Government of the Bangladesh Petroleum Corporation by any importer at the time of importation of the consignment in question, namely High Speed Diesel. The expression “Petroleum

Operation” as found in section 4(2) and defined in section 2(e) of the said Act, 1974 has not stipulated for any kind of petroleum agreement with the Government of the Bangladesh Petroleum Corporation as a pre-condition to importing such Petroleum Product. But such agreement is required to be in place at the time and in course of exploration, extraction of the Petroleum Product, its development, exploitation, production, refining, processing or marketing/In other words, once the Petroleum product is found inside the country on import at the instance of any one except the Government or the Bangladesh Petroleum Corporation, Petroleum agreement is a condition precedent to dealing with such product. In the absence of any restriction imposed either in the Imports and Exports Control Act or in the Import Policy Order, the Customs or the National Board of Revenue would not be competent to refuse clearance of any imported high speed diesel. In the circumstances, the Customs as well as the National Board of Revenue

acted without any lawful authority in passing the orders impugned in the writ petition refusing to discharge the consignment in question

8. The appeal is accordingly dismissed without any order as to costs.

Source : V ADC (2008), 205

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