Sylvania And Laxman Ltd. vs Union Of India And Another
1987 Latest Caselaw 188 Del

JUDGMENT

1. The petitioner is a limited company engaged in the manufacture of fluorescent tubes and electric bulbs. The challenge in this petition is to the non-extension of a notification whereby certain percentage of customs duty was exempted.

2. The petitioner had placed orders for the import of glass shells for the manufacture of bulbs. At that time a notification dated 8th June, 1983, was in operation which had been issued under Section 25(1) of the Customs Act. According to this notification Customs duty in excess of 10% ad valorem was exempted. Paragraph 2 of this notification stipulated that "This notification shall be in force up to and inclusive of the 31st day of March, 1984."

3. The petitioner and some other manufacturers had placed orders for the import of glass shells in such a way that the goods were scheduled to arrive in India prior to 31st March, 1984.

4. On 15th March, 1984 the dock workers all over India went on strike. This strike was withdrawn only on 10th April, 1984. According to the petitioner two of its shipments were effected on 15th February, 1984 and 29th February, 1984 respectively. The ships were expected to arrive at Bombay by 1st March, 1984 and 14th March, 1984 respectively. Due to the aforesaid strike, however, it is contended, the ships were diverted to other ports. The result of this was that the ships arrived at Bombay only after the strike was called off. In the instant case bills of entry were filed by the petitioner on 19th April, 1984. The two ships arrived on 19th April, 1984 and 23rd April, 1984. The goods were cleared on 26th April, 1984.

5. According to the petitioner even before the commencement of the dock strike on 15th March, 1984, they along with the other manufacturers, approached the Government to extend the validity of the aforesaid notification dated 8th June, 1983. The Government did not take any action on the said representation by the time the petitioner cleared the goods on 26th April, 1984.

6. The Government, however, issued a notification dated 15th September, 1984 wherein exemption was granted, in exercise of its powers under Section 25(1) of the Customs Act, for the levy of Customs duty in excess of 10% ad valorem. It was stated in this notification that the same was to be in force up to and inclusive of 30th September, 1984. A copy of this notification was forwarded to the petitioner and four other manufacturers by the Government of India by its letter dated 19th September, 1984. In the said letter it was stated that it was pursuant to their representation for suitable exemption from Customs duty that the notification dated 15th September, 1984 had been issued. It is possibly for this reason that only fifteen days' time was granted in this notification for clearance of goods.

7. The petitioner having already cleared its goods on 26th April, 1984 could not, therefore, avail itself of the benefit of the notification dated 15th September, 1984. The petitioner again represented to the Central Government submitting that the said benefit should be extended to it also. It also filed applications for refund of the excess amount of Customs duty paid by it. The Government of India wrote back to the petitioner on 11th January, 1985 in which it was stated that the representation of the petitioner had been examined but it was regretted that the request could not be acceded to "as Government have no authority to grant exemption with retrospective effect." It is this communication which is challenged in the present writ petition.

8. From the perusal of the facts stated hereinabove it is evident that the Government did consider the request of manufacturers, like the petitioner, for the extension of exemption to be a genuine request. The letter of 19th September, 1984 leaves no manner of doubt that the notification dated 15th September, 1984 was issued solely to enable the said manufactures to get their goods cleared at a concessional rate of duty. If the petitioner had not cleared the goods, it would have been entitled to this benefit. It is true that no importer can claim as a right that the Government should exercise its powers under Section 25 and grant exemption. It is for the Government to decide whether the conditions are such that exemption under Section 25 should be granted or not. In the present case the only reason which has been given in given in rejecting the request of the petitioner for extending to it the benefit of the exemption is that the Government has no authority to grant exemption with retrospective effect. The Government apparently must have been advised that it was now not open to them to issue a fresh notification granting exemption with retrospective effect. The Government, however, if it was inclined to give benefit to the petitioner, need not have issued any notification with retrospective effect. Under Section 21 of the General Clauses Act when any statute or enactment gives power to the Government to issue any notification, then the Government also has the power to amend such a notification. In the present case a notification dated 8th June, 1983 had already been issued in which it was stated that it was to be in force up to 31st March, 1984. All that the Government had to do, in order to give the benefit to the petitioner of that exemption, was to exercise its power under Section 21 of the General Clauses Act and amend the notification dated 8th June, 1983 so that in paragraph 2 of the said notification, instead of saying that the said notification is to be in force up to 31st March, 1984, it could have been said that it would be in force till a later point of time. There is no prohibition in law in the Government exercising its powers under Section 21 of the General Clauses Act in amending a notification already issued at any point of time. Such an amendment could not be regarded as a retrospective amendment. There is still considerable force in the contention of the learned counsel for the petitioner that there is no prohibition in the Government issuing a notification with retrospective effect whereby benefit is given to a citizen. It may be that a notification with retrospective effect cannot be issued withdrawing a concession already given, but there is no prohibition in law whereby a benefit cannot be extended with retrospective effect. In this view of the matter, the decision of the Central Government in not extending the benefit for the reason that it did not have the power to issue such a notification is not correct.

9. For the aforesaid reasons, the decision of the respondents contained in letter dated 11th January, 1985 is quashed. A writ of mandamus is issued to the respondents to consider the petitioner's application dated 30th November, 1984 afresh in the light of the observations made in this judgment. There will be no order as to costs.