judgement:
vil Appeal Nos.
2403 05 of 1989 From Orders Nos.
568 to 570/88 A dated 31.10.1988 of the Customs Excise and Gold (Control) Appellate Tribunal, New Delhi in Appeal No. C/A. No. 808 to 810 of 1987 A and C/Misc.
No. 390 of 1987 A. S.K. Dholakia and S.K. Kulkarni for the Appellant.
Kapil Sibal, Additional Solicitor General, P. Parmeswa ran and Mrs. R. Rangaswamy for the Respondent.
The Judgment of the Court was delivered by KASLIWAL, J.
All these appeals under Sec.
130(e) of the (hereinafter referred to as the Act) are directed against the common order made by the Customs, Excise and Gold (Control) Appellate Tribunal, New Delhi dated 31.10.88 in C.A. Nos.
808 to 8 10/87 A. Brief facts of the case are that M/s. Sharp Business Machines (Pvt.) Ltd., Bangalore (hereinafter referred to as the company) is a small scale manufacturing unit duly regis tered as such since 1984.
The company had started the phased manufacture of plain paper copiers and obtained a licence in this regard dated 25.11.86 for Rs.4,94,500 from the licens ing authority.
The company imported components and consuma bles in SKD/CKD for plain paper copiers.
Three consignments were imported from M/s. Paralax Industrial Corp., Hongkong under airways bill numbers 098, 4960, 3120; 098, 4960, 3116; and 098, 4960, 3105 all dated 21.1.87.
The goods were re ceived at the air cargo complex, Bangalore.
The company sought the clearance of the imported goods under bills of entry Nos.
2044, 2045 and 2046 all dated 3.2.87.
Similarly, the goods were also imported from M/s. Alpha Papyrus Trading Co. Pvt. Ltd., Singapore under airway bill No. 098 4925 4914 dated 19.2.87.
the clearance for this consignment was sought under bill of entry No. 4993 dated 11.3.87.
The company had declared the value of each of the consignments at Rs.32,182 Rs.43.359), Rs.5,412 and Rs.18,659 respectively in respect of the above mentioned bills of entry Nos. 2044, 2045.
2046 and 4993.
The total value declared was Rs.99,612 under all the four bills.
32 Proceedings were held before the Appraiser of Customs air cargo complex Bangalore for verification of the goods and their valuation etc.
and the statements of the company 's Managing Director Sh.
Sadanand were also recorded on 11.2.87.10.3.87 and 18.3.87 under Sec.
108 of the Act.
The Collector of Customs issued a notice to the company under Sec.
124 of the Act on 4.3.87 relating to the first consign ment.
In the said notice it was stated that 4 items were not covered by the licence and the same were liable for confis cation.
However.
on 30.3.87 the Collector issued another notice in supersession of the earlier notice dated 4.3.87.
Notice was also issued on the same date in respect of bill of entry dated 11.3.87.
By the said notices the Collector proposed to enhance the value of the goods imported and further proposed to confiscate the entire goods imported and also to levy a fine and other penalties.
The company was accused of misdescription of the goods, misdeclaration of value, suppression of the relationship with the suppliers, suppression of the place of origin of goods etc.
The Collector by his order dated 13.4.87 decided all the points against the company.
The Collector held that the quotations given by M/s. Shun Hing Technology Ltd. along with the application for approval of their PMP during July 1986 should be taken as the correct value of the goods imported.
and the plea of the company that it had received a special discount in view of the bulk purchases and promise of future purchases was not accepted.
The Collector in these circumstances determined the price of the goods at Rs.7,15,485 for the purposes of Sec.
14(1) of the Act.
The Collector thus held that there was a misdeclaration of the value to the tune of Rs.6,15,873 and the duty payable there on would be Rs.10.96,228.20p.
The Collector further held that the entire goods imported were liable to confiscation under Sec.
111(m) of the Act.
The Collector also held that the goods imported were fully finished copiers in SKD/CKD form and as such there was a misdeclaration that the import ed goods were only parts of the copiers.
The Collector also held that description of most of the items in the invoices had been deliberately manipulated to suit the description in the licence.
The goods covered by three bills 2044, 2045 and 2046 were held to be one consignment and one AWB and thus viewed as one consignment, it amounted to the import of ten copiers.
The goods imported under the 4th bill No. 4993 were four fully finished copiers in SKD/CKD form.
The Collector further held that in terms of note (i) to Imports Control Order.
1955 and Customs Tarrif Act, 1975, these goods will be deemed to be filly assembled copiers for the purpose of valuation and licence.
Thus the goods imported as 33 fully assembled copiers were not permissible to be imported and this was a clear violation of the Act and the terms of the licence.
It was also held in the alternative that even if all the parts imported were viewed individually, none of the items tally with the licence.
The Collector in this regard gave detailed reasons for arriving at this conclu sion.
The Collector also held that the value of the parts imported for the purposes of Sec.
14(1) of the Act would be Rs.5,63,332 whereas the importers were permitted to import goods worth Rs.4,94,500.
There was thus an excess of Rs.68,832 and as such the goods were liable to confiscation under Sec.
III(d) of the Act.
The Collector in these circum stances passed an order for confiscation of the entire goods with an option to the company to redeem them on payment of a fine of Rs.3 lacs.
The Collector also imposed a fine of Rs.1 lac on the company and Rs. 1 lac on Sh.
Sadanand the Manag ing Director of the Company.
The company filed two appeals aggrieved against the common order of the Collector relating to both the notices and a separate third appeal was preferred by the Managing Director before the Customs, Excise and Gold (Control) Appellate Tribunal.
The Tribunal dismissed all the three appeals by a common order dated 31.10.88.
The company and the Managing Director aggrieved against the order of the Tribunal have filed the above mentioned three appeals before this Court.
One of the arguments raised before the Tribunal was that the Collector erred in treating SKD/CKD parts of the copiers imported, as assembled copiers, for the purpose of Schedule I to the Imports (Control) Order.
1955 and the case Union of India vs Tarachand Gupta & Bros., ; applied on all force to the instant case.
The Tribunal in this regard set aside the finding recorded by the Collector and placing reliance on a decision of the Calcutta High Court in Collector of Customs, Calcutta vs Misuny Electronic Works, held that one has to look into the re spective licence and not to the fact that if all the con signments covered by all the bills of entry are assembled together, there will be complete machines.
The Tribunal, however, upheld the other findings recorded by the Collector to the effect that even if all the imported parts contained in SKD/CKD packs of copiers were viewed individually the licence produced was not valid for any of the items import ed.
Tribunal thus held that the Collector was right in holding that the imported goods were not covered by the valid licence.
The Tribunal also held that the Collector was right in rejecting the price shown by the company in the invoices.
The Tribunal also rejected the contention made by the counsel for the 34 company that the valuation made by the Collector was exorbitant.
As regards the question of imposing fine and penalty also the Tribunal found the order of the Collector as correct.
and did not find any cogent reason to interfere in the order of the Collector.
We have heard Mr. Dholakia for the appellants and Mr. Kapil Sibley learned Addl.
Solicitor General for the re spondents.
It was argued by Mr. Dholakia that the Tribunal commit ted a serious error in holding that the invoices submitted by the company were undervalued and could not be relied upon for determining the correct value of the goods imported.
It was contended that the Collector Customs was not correct in determining the value of the imported goods on the basis of the quotations of M/s. Shun Hing Technology Ltd., Hongkong.
The quotation of Shun Hing indicated prices at Hongkong and not the place of importation.
There was no other material on record to determine the value of the imported goods.
It was thus contended that in the absence of any other relevant material, the invoice price has to be taken as the basis for valuation.
It was also submitted that there was no justifi cation in discarding the price shown in the invoices which contained the correct value of the goods imported and in case of Customs authorities were not placing reliance on such prices mentioned in the invoices.
then the burden lay on the Customs department to find out the correct value of the goods by collecting material and other adequate evidence before enhancing the value of the imported goods.
The onus to prove the charge of undervaluation against the company was on the Customs department and the evidence relied upon by them, as contained in the adjudication order.
is not at all sufficient to discharge that onus.
It was further argued that any reliance placed on the quotations furnished at the time of submitting the application for grant of licence was wholly erroneous.
At the time of submitting the application for grant of licence the prices are quoted for fixing the upper limit of the value of the licence.
When the actual purchase transactions were entered into, the company negoti ated for the price and having regard to the quantum of purchase and the prospects of future sales, the company was given 25% , ' count by the suppliers.
It was also submitted that the prices quoted by M/s. Shun Hing Technology Ltd., Hongkong were not the value of the components imported by the company in SKD/CKD form of plain paper copiers.
Thus any price quoted by M/s. Shun Hing can never form any basis for arriving at a proper and correct valuation of the goods imported by the company in the present case.
35 On the other hand it was submitted by the learned Addl.
Solicitor General that it has been admitted by Sh.
P.N. Sadanand, Managing Director of the company in his statement dated 10.3.87 that the goods imported in the present case by the company were of Japanese origin and manufactured by M/s. Matushita Electric Company Ltd., Japan.
M/s. Shun Hing Technology Ltd., Hongkong were the authorised agents of M/s.
Matushita Electric Co. Ltd., Japan, who are the manufactur ers of Panasonic copies.
He further admitted that normally the Panasonic copies were supplied to Hongkong in fully assembled form and then they were dismantled in Hongkong by the agents and thus supplied in India in SKD/CKD form.
Sadanand admitted to have visited Hongkong during January, 1987 alongwith his Engineer Sh.
K.S. Radhakrishan for pur chase of 10 copiers 6 Nos.
Model EP 1300 and 4 Nos.
Model EP 2625 and that he alongwith the Engineer dismantled the fully assembled copiers.
It was submitted that the goods contained in the cartons comprised of all the parts required for full and complete assembly of copiers.
At the time of examination of the goods covered by Bill of Entry No. 4993 dated 11.3.87, it was found that out of the six cartons, four cartons were the original cartons used for packing fully finished/assembled copiers Model EP 2625.
The descrip tion, model number, brand, manufacturer and country of origin/manufacture of the copier (viz.
Plain Paper Copier EP 2625 Panasoni, Matushita Electric Co. Ltd. and Japan respec tively) were clearly marked on these four cartons, one set of cassettes, trays, covers, one drum, one developer unit and a bottle of developer.
It was thus argued that the original packing cartons used for packing fully finished copiers are normally supplied only if fully finished copiers are purchased.
It was submitted that the adjudicating au thority has given detailed reasons for showing that the goods imported were not components of plain paper copiers as declared.
In fact, the company had purchased 14 fully fin ished copiers 10 in Hongkong and 4 in Singapore and had then dismantled for importing the same in the guise of components of copiers.
The company had submitted application for ap proval of their phased manufacturing programme to the Devel opment Commissioner, Small Scale Industries Govt.
of India, New Delhi in July, 1986 and alongwith this application they had also submitted the quotations received by them from M/s. Shun Hing Technology Ltd., Hongkong which covered all the items imported except a few items like toner, drum and table for model FP 2625.
The company in the present case not only violated the terms and conditions of licence but also com mitted a complete fraud in importing fully finished copiers which was a totally prohibited item, in the guise of sepa rate components and accessories by dismantling the fully finished copiers.
In the above 36 circumstances the adjudicating authority was fully justified in not believing the value mentioned in the invoices and in placing reliance on the prices mentioned in the quotations given by M/s. Shun Hing Technology Ltd., Hongkong.
It was further argued by Mr. Sibbal that the prices quoted by M/s. Shun Hing were based on the prices given by the manufactur ers i.e. M/s.
Matushita Electric Co. Ltd., Japan and there was no question of supplying the components of the copiers on a lesser price than given by the manufacturers them selves.
The company had a special relationship with M/s. Shun Hing Technology Ltd., Hongkong as a sort of collabora tor with no formal agreement and that M/s. Paralax Industri al Corp., Hongkong were in turn agents of M/s. Shun Hing Technology Ltd., Hongkong.
We have considered the submissions made by learned counsel for the parties.
Section 14 of the Act provides for valuation of goods for the purpose of assessment.
Section 14(1) which is relevant for our purposes reads as under: 14.
"Valuation of goods for purposes of assessment: (1) For the purposes of the (51 of 1975), or any other law for the time being in force whereun der a duty of customs is chargeable on any goods by refer ence to their value, the value of such goods shall be deemed to be the price at which such or like goods are ordinarily sold, or offered for sale, for delivery at the time and place of importation or exportation, as the case may be, in the course of international trade, where the seller and the buyer have no interest in the business of each other and the price is the sole consideration for the sale or offer for sale: Provided that such price shall be calculated with reference to the rate of exchange as in force on the date on which a bill of entry is presented under Section 46, or a shipping bill or bill of export, as the case may be, is presented under Section 50." According to the above provision the value of the goods shall be deemed to be the price at which such or like goods are ordinarily sold, or offered for sale, for delivery at the time and place of importation, in the course of interna tional trade where the seller and the buyer have no interest in the business of each other and the price is the sole consideration for the sale or offer for sale.
In the present case the 37 company itself had produced a copy of the quotations re ceived by them from M/s. Shun Hing Technology Ltd., Hongkong in respect of the copiers and other items imported alongwith their application for approval of their phased manufacturing programme.
The company itself having produced these quota tions, they cannot dispute the correctness of the prices mentioned therein.
The company has not only not disputed the correctness of these quotations but has not produced any other material on record to show that the value mentioned in the invoices was the correct market value of the goods imported at the relevant time.
The adjudicating authority in these circumstances was perfectly justified in taking the prices mentioned in the quotations as a basis for determin ing the correct value of the imported goods.
Mr. Dholakia next contended that the Tribunal itself had set aside the finding of the adjudicating authority on the question of treating SKD/CKD packs of the copiers imported comprised of all the 100% components of copiers.
The company had tried to practice a fraud in defeating the import policy itself.
The intention and purpose of the import policy was to give incentive and encouragement to the new entrepreneurs establishing small scale industries and in the first phase to import 62% of the components of the copiers and the balance of 38% was to be manufactured by them indigenously.
According to the import policy this percentage of 62% was to be reduced in the subsequent years.
The import policy was not meant for such entrepreneurs who instead of importing 62% of the components, imported 100% of the components of a fully finished and complete goods manufactured by a foreign country.
It is an admitted position that fully finished plain paper copiers were a prohibited item for import and thus the device adopted by the company in the present case was a complete fraud on the import policy itself.
Apart from the above circumstances in our view the Tribunal was not right in setting aside the finding of the adjudicating authority and in taking the view that one has to look into the respective licence and not to the fact that if all the consignments covered by all the bills of entry assembled together, there will be a full and complete machinery.
It is an admitted position that goods covered by the three bills of entry Nos. 2044, 2045 and 2046 were all dated 3.2.87 and had been shipped from Hongkong on the same day i.e. on 21.1.87.
The entire goods had arrived on the same day and by the same flight on 30th January, 1987.
The goods covered under the three bills of entry have been supplied by the same supplier viz. M/s. Paralax Industrial Corp., Hong kong.
The goods covered by these bills of entry are ten numbers 38 copiers in SKD/CKD condition, accessories, spares, consuma bles and excess items.
The goods covered by the 4th bill of entry are four numbers copiers in SKD/CKD condition and consumables.
the licence produced is valid for certain components and is not valid for fully assembled copiers.
The fully assembled copiers are the end products of the import ers and hence cannot be imported by them.
Plain Paper Copi ers are electronic equipments.
The case Union of India vs Tara Chand Gupta & Bros. (supra) lends no assistance to the appellants in the facts and circumstances of the present case.
In the above case Tara Chand & Bros. held an import licence dated July 10, 1956 permitting them to import parts and accessories of motorcycles and scooters as per Appendix XXVI of the Import Policy Book for July December, 1956.
Under the said licence, the respondents in that case imported certain goods which arrived in two consignments, each containing 17 cases by two different ships.
According to the respondents, the goods so imported by them were motorcycle parts which their licence authorised them to import.
The Customs authorities, on the contrary held, on the examination of the goods, that they constituted 51 sets of "Rixe Mopeds complete in a knocked down condition".
After holding an inquiry the Deputy Collec tor directed confiscation of the said goods with an option to the respondents to pay certain sums in lieu of confisca tion and also personal penalties.
That order was passed on the basis that the goods imported were not parts and acces sories of motorcycles and scooters presumably under entry 295 of the Schedule to the Import (Control) Order but were motorcycles/scooters in completely knocked down conditions, prohibited under remark II against entry 294, a licence in respect of goods covered by it would authorise import of motorcycles and scooters.
The Deputy Collector held that though the goods were not in completely knocked down condi tion it made no difference as the tyres, tubes and saddles were easily obtainable in India and their absence did not prevent the machines being otherwise complete.
He also found that there was a trade practice under which traders were supplying motorcycles without tyres, tubes and saddles unless the purchaser specially asked for these parts.
Ac cording to him the goods could not be regarded as spare parts but were "Moped in disassembled condition.
" The re spondents in the above case filed a civil suit and the matter went in appeal to the High Court.
The Letters Patent Bench of the High Court held that the Collector 's jurisdic tion was limited to ascertain whether or not the goods imported by the respondents were spare parts and accessories covered by entry 295 in respect of which they undoubtedly held the licence, and therefore, he could not have 39 lumped together the two consignments which.
though imported under one licence, arrived separately and were received on different dates and could not have come to the conclusion that the plaintiffs had imported 51 "Rixe" Mopeds in com pletely knocked down condition.
The respondents were enti tled to import the said goods and therefore.
Section 167(8) of the Sea did not apply and the respondents consequently could not have been held guilty of breach either of that Section or Section 3 of the Imports & Exports (Control) Act.
It was further held that the decision of this Court in Girdhari Lal Bansi Dhar vs Union of India, ; did not over rule but only distinguished judgment in D.P. Anand vs Mls.
T.M, Thakore & Co., C.A. No. 4/1959 decided on August 17, 1960 (H.C.) and therefore, the binding force of that decision remained unshaken.
The Union of India came in appeal to this Court by grant of certificate.
This Court held as under: "Under entry 295, except for rubber tyres and tubes for whose import a separate licence could be obtained under entry 41 of Part V, there are no limitations as to the number or kind of parts or accessories which can be imported under a licence obtained in respect of the goods covered thereunder.
Prime facie, an importer could import all the parts and accessories of motor cycles and scooters and it would not be a ground to say that he has committed breach of entry 295 or the licence in respect of the goods described therein, that the parts and accessories imported.
if assem bled, would make motor cycles and scooters in CKD condition.
3There are no remarks against entry 295.
as there are against entry 294, that a licence in respect of goods cov ered by entry 295 would not be valid for import of spares and accessories which, if assembled, would make motor cycles and scooters in CKD condition.
Apart from that, the goods in question did not admittedly contain tyres.
tubes and sad dles, so that it was impossible to say that they constituted motor cycles and scooters in CKD condition.
The first two could not be imported and were in fact not imported because that could not be done under the licence in respect of goods covered by entry 295 which expressly prohibited their import and a separate licence under entry 41 of Part V would be necessary.
The third, namely.
saddles were not amongst the goods imported.
No doubt, there was, firstly, a finding by the Collector that a trade practice prevailed under which motor cycles and scooters 40 without tyres, tubes and saddles could be sold.
Secondly.
the tyres and tubes could be had in the market here and so also saddles, so that if an importer desired, he could have sold these goods as motor cycles and scooters in CKD condi tion.
The argument was that since there was a restriction in entry 294 against imports of motor cycles and scooters in CKD condition, the importer could not be allowed to do indirectly what he could not do directly.
The argument apparently looks attractive.
But the question is what have the respondents done indirectly what they could not have done directly.
In the absence of any restrictions in entry 295, namely, that a licence in respect of goods covered by entry 295 would not be valid for import of parts and accessories which.
when taken together.
would make them motor cycles and scooters in C.K.D. condition.
the respond ents could import under their licence all kinds and types of parts and accessories.
Therefore, the mere fact.
that the goods imported by them were so complete that when put to gether would make them motor cycles and scooters in C.K.D. condition.
would not amount to a breach of the licence or of entry 295.
Were that to be so, the position would be anoma lous as aptly described by the High Court.
Suppose that an importer were to import equal number of various parts from different countries under different indents and at different times, and the goods were to reach here in different con signments and on different dates instead of two consignments from the same country as in the present case.
If the conten tion urged before us were to be correct, the Collector can treat them together and say that they would constitute motor cycles and scooters in C.K.D. condition.
Such an approach would mean that there is in entry 295 a limitation against importation of all parts and accessories of motor cycles and scooters.
Under that contention, even if the importer had sold away the first consignment or part of it, it would still be possible for the Collector to say that had the importer desired it was possible for him to assemble all the parts and make motor cycles and scooters in C.K.D. condi tion.
Surely, such a meaning has not to be given to entry 295 unless there is in it or in the licenee a condition that a licensee is not to import parts in such a fashion that his consignments, different though they may be, when put togeth er would make motor cycles and 41 Scooters in C.K.D. condition.
Such a condition was advisedly not placed in entry 295 but was put in entry 294 only.
The reason was that import of both motor cycles and scooters as also parts and accessories thereof was permitted, of the first under entry 294 and of the other under entry 295.
A trader having a licence in respect of goods covered by entry 294 could import assembled motor cycles and scooters, but not those vehicles in C.K.D. condition, unless he was a manufacturer and had obtained a separate licence therefore from the Controller of Imports who, as aforesaid.
was autho rised to issue such a licence on an ad hoc basis.
Thus the restriction not to import motor cycles and scooters in C.K.D. condition was against an importer holding a licence in respect of goods covered by entry 294 under which he could import complete motor cycles and scooters and not against an importer had a licence to import parts and acces sories under entry 295.
If Dr. Syed Mohammad 's contention were to be right we would have to import remark (ii) against entry 294 into entry 295, a thing which obviously is not permissible while construing these entries.
further, such a condition, if one were to be implied in entry 295, would not fit in, as it is a restric tion against import of motor cycles and scooters in C.K.D. condition and not their parts and accessories.
There is, therefore, no question of a licensee under entry 295 doing indirectly what he was not allowed to do directly.
What he was not allowed to do directly was importing motor cycles and scooters in C.K.D. condition under a licence under which he could import complete motor cycles and scooters only.
That restriction, as already observed, ' applied to a licen see in respect of goods described in entry 294 and not a licensee in respect of goods covered by entry 295.
The result is that when the Collector examines goods import ed under a licence in respect of goods covered by entry 295 what he has to ascertain is whether the goods are parts and accessories, and not whether the goods, though parts and accessories, are so comprehensive that if put together would constitute motor cycles and scooters in C.K.D. condition.
Were he to adopt such an approach, he would be acting con trary to and beyond entry 295 under 42 which he had to find out whether the goods imported were of the description in that entry.
Such an approach would, in other words, be in non compliance of entry 295." This Court distinguished the case of Girdhari Lal Bansi Dhar (supra) by making the following observation: "It will be noticed that the Bombay decision in D.P. Anand 's case was not dissented from but only distinguished, and therefore, the High Court in the present case was justified in following it.
It is true, however, that counsel for the appellant there relied on that decision in support of his proposition that a ban on completed article cannot be read as a ban on the importation of its constituents, which, when assembled, would result in the prohibited article, and this Court pointed out in answer that in D.P. Anand 's case, the imported components could not have when assembled, made up the completed article because of the lack of certain essen tial parts which admittedly were not available in India and could not be imported.
The real distinction, however, be tween the two cases was that the decision of the Collector in D.P. Anand 's case was not, as was the decision in Gird bari Lal 's case under which of the two competing entries the imported goods fell but that the imported goods in question, if assembled together, would not be the goods covered by the entry, and therefore, not the goods in respect of which the licence was granted.
Further, the articles in question, even when assembled together, were not prohibited articles as in Girdhari Lal 's case.
Girdhari Lal case is clearly distin guishable because it is not as if motor cycles and scooters are prohibited articles as was the case there.
The restric tion is not against licensees importing motor cycles and scooters under entry 294 and parts and accessories under entry 295 but against the licensees under entry 294 import ing motor cycles and scooters in CKD condition.
The question in the instant case was not under which of the two entries, 294 or 295, the goods fell, but whether the goods were parts and accessories covered by entry 295.
" In our view the Tribunal was not correct in placing reliance on the case Union of India vs Tara Chand Gupta & Bros. (supra) in the facts and circumstances of the present case.
In the case before us the 43 import of fully assembled copiers was prohibited.
The appel lant was only entitled to import 62% of the components.
As already mentioned above, the device adopted by the appellant in the present case was a complete fraud on the Import Policy and the appellant was doing indirectly what he was not permitted to do directly.
We are further of the view that the facts in the present case are more akin and similar to the facts of the case Girdhari Lal Bansi Dhar vs Union of India, (supra) which was distinguished in the case of Union of India vs Tara Chand Gupta & Bros. (supra).
Mr. Dholakia also tried to assail the finding recorded by the Collector and upheld by the Tribunal and argued that the components imported by the appellant tallied with the parts which were permitted under the licence.
We do not find any force in this submission.
The Collector has given de tailed reasons for holding that the imported goods were not covered by the valid licence and the Tribunal having upheld such finding, the same cannot be challenged by the appellant before this Court.
Mr. Dholakia also submitted that in the facts and cir cumstances of the case the order confiscating the goods and imposing fine and penalty both on the company and Sh.
Sada nand, the Managing Director was too high and ought to be reduced.
We find no force in this submission as well.
This is a case where the appellant had not only violated the terms and conditions of the licence but also committed a fraud on the Import Policy itself.
Thus we find no ground or justifica tion to reduce the penalty or fine.
In the result we find no force in these appeals and the same are dismissed with one set of costs.
P.S.S. Appeals dismissed.

summary:
Section 14(1) of the provides that where a duty of customs is chargeable on any goods by refer ence to their value, the value of such goods shall be deemed to be the price at which such or like goods are ordinarily sold or offered for sale.
for delivery at the time and place of importation.
in the course of international trade.
The appellant company, a small scale manufacturer of plain paper copiers.
had submitted.
alongwith their applica tion for approval of the phased manufacturing programme, the quotations received by them from their foreign collaborators based in Hongkong in respect of the various components and obtained a licenee in this regard for Rs.4,94,500.
Subse quently, they imported three consignments of components and consumables in SKD/CKD form from suppliers at Hongkong and another consignment from Singapore.
The total value declared under the four bills of entry was Rs.99,612.
The Collector of Customs found that the invoices submit ted by the company were undervalued and determined the price of goods at Rs.7,15,485 with reference to the quotations, for the purposes of section 14(1) of the Act.
He thus held that there was a misdeclaration of value to the tune of Rs.6,15,873, that the duty payable thereon would be Rs.10,96,228.20 and that the entire goods were liable to confiscation under section 111(m) of the Act.
He also held that the goods imported were fully finished copiers in SKD/CKI) form and as such there was a misdeclaration that the import ed goods were only parts of the copiers, that description of most of the items in the invoices had been deliberately manipulated to suit the description in the licence, that fully assembled copiers were not permissible to be imported and this was a clear violation of the Act and the terms of the licence.
In the alternative he held that even if all the parts contained in SKD/CKD packs were 29 viewed individually, none of the items was covered by the licence.
He further held that the value of the parts import ed for the purposes of section 14(1) of the Act would be Rs.5,63,332, whereas the importers were permitted to import goods worth Rs.4,94,500, that there was thus an excess of Rs.68,832 and as such the goods were liable to confiscation under section 111(d) of the Act.
Consequently, he directed con fiscation of the entire goods with an option to the company to pay Rs.3 lakhs in lieu thereof and also Rs.2 lakhs in personal penalties.
The Customs, Excise and Gold (Control) Appellate Tribunal dismissed their appeals.
In these appeals under section 130(e) of the Act, it was contended for the appellants that the quotations had indi cated prices at Hongkong and not the place of importation, that at the time of submitting the application for grant of licence the prices were quoted for fixing the upper limit of the value of the licence, that when the actual purchase transactions were entered into the company negotiated for the price and having regard to the quantum of purchase and the prospects of future sales the company was given 25 per cent discount by the suppliers, and that in the absence of any other material on record the invoice price alone could form the basis of valuation of the imported goods.
For the respondents, it was contended that the prices quoted by the collaborators were based on the prices given by the manufac turers.
and there was no question of supplying the compo nents on a lesser price than given by the manufacturers themselves, that the goods imported were not components of plain paper copiers as declared, that the cartons in fact comprised of all the parts required for full and complete assembly of 14 copiers, that the company in importing them in the guise of separate components and accessories had not only violated the terms and conditions of the licence but also committed a complete fraud, that in the circumstances the adjudicating authority was fully justified in placing reliance on the prices mentioned in the quotations.
Dismissing the appeals under section 130(e) of the Act, the Court, HELD: 1.1 According to section 14(1) of the for purposes of assessment the value of the imported goods is to be deemed to be the price at which such or like goods are ordinarily sold, or offered for sale, for delivery at the time and place of importation, in the course of interna tional trade, where the seller and the buyer have no inter est in the business of each other and the price is the sole consideration for the sale or offer for sale.
[36G H] 1.2 In the instant case the appellant company itself had produced 30 a copy of the quotations received by them from their collab orators at Hongkong in respect of the copiers and other items imported, alongwith their application for approval of their phased manufacturing programme.
They, therefore.
could not dispute the correctness of the prices mentioned in the said quotations.
Not only that, they have also failed to produce any other material on record to show that the value mentioned in the invoices was the correct market value of the goods imported at the relevant time.
The adjudicating authority in these circumstances was perfectly justified in taking the prices mentioned in the quotations as a basis for determining the correct value of the imported goods.
[37A C] 2.1 The goods covered by the three bills of entry dated 3rd February, 1987 had been shipped from Hongkong on the same day i.e. on 21st January, 1987.
The entire goods had arrived on the same day and by the same flight on 30th January, 1987.
These goods had been supplied by the same supplier.
They comprised of ten numbers copiers in SKD/CKD condition, accessories, spares, consumables and excess items.
The goods covered by the 4th bill of entry were four numbers copiers in SKD/CKD condition and consumables.
If assembled together these would constitute full and complete copiers.
The licenee produced was valid for certain compo nents and was not valid for fully assembled copiers.
The appellant company was thus doing indirectly what they were not permitted to do directly under the licence.
[37H; 38A B] Girdbari Lal Bansi Dhar vs Union of India, ; referred to.
Union of India vs Tarachand Gupta & Bros., ; distinguished.
2.2 The intention and purpose of the import policy was to give incentive and encouragement to the new entrepreneurs establishing small scale industries and in the first phase to import 62% of the components of the copiers and the balance of 38% was to be manufactured by them indigenously.
This percentage of 62% was to be reduced in the subsequent years.
The import policy was not meant for such entrepre neurs who instead of importing 62% of the components, im ported 100% of the components of a fully finished and com plete goods manufactured by a foreign country.
Fully fin ished plain paper copiers were the end product of the im porters and hence could not be imported by them.
The device a, looted by the company in the instant case was thus a complete fraud on the import policy itself.
[37D F] 31 2.3 The order confiscating the goods and imposing fine was, therefore, rightly made.


judgement:
ivil Appeal No. 1422 of 1973 From the Judgment and Order dated 5.7.1971 of the Calcutta High Court in Civil Order No. 1826 of 1971.
T.C. Ray, G.S. Chatterjee and D.P. Mukherjee for the Appel lant.
P.K. Chatterjee, Ranjan Mukherjee, N.R. Choudhary, Somnath Mukherjee and P.K. Moitra for the Respondents.
The Judgment of the Court was delivered by K. RAMASWAMY, J.
This appeal by special leave under article 136 of the Constitution arises against the order dated July 5, 1971 made by the Calcutta High Court in Civil Order No. 1826 of 1971 dismissing the writ petition in limine.
The material facts are that the lands of Hal Plot Nos. 2202, 2204, 2206, 2209, 2210, 2212, 2214, 2219, 2220, 2225.
2226, 2228, 2229, 2232, 2233, 2234, 2236 and 2239 of Mouza Kisho rimohanpore, J.L. No. 168, P.S. Jaynagar were recorded in the final Khaitan Nos. 143 and 144 of J.L. No. 168 as "Tank Fishery" (being used for pisciculture) and by operation of section 6(1)(e) of West Bengal Estates Acquisition Act 1 of 1954, for short 'the Act ' stand excluded from its purview.
The Asstt.
Settlement Officer initiated suo moto proceedings on May 14, 1968 that they have not been properly classified and prima facie require correction of classifications of those lands.
Accordingly, he drew up the proceedings under s.44(2A) of the Act, issued notice to the respondents who are brothers, intermediaries.
They filed their written objections and 95 appeared through counsel.
They also filed the documents, examined three witnesses apart from themselves.
On behalf of the State one Mr. Ranjit Kumar Dutta, Revenue Officer.
Yadavpur Settlement was examined.
The objections raised by the respondents are that the lands originally belong to Smt.
Banodamayee Dasi, Superior Landlady, who granted to them dakhilas Nos. 9 and 10 in the year 1359 B.S. i.e. 1952 A.D.
Thereafter they have been cultivating pisciculture in the said lands.
They got embankment raised around the land.
They have been conducting fishery business.
In the fields survey the property was recorded in their name as the occupiers.
On account of the injunction issued 'by the High Court the attestation in the original settlement was not effected.
When they approached the Junior Land Revenue Officer for receipt of the rents, after due enquiry by endorsement dated April 30, 1958 A.D., the Tehsildar made an endorsement on the body of the receipt "for Pisciculture".
They were con ducting fishery in a large scale.
They had applied to the Chief Minister Dr. B.C. Roy for a loan of Rs.25,000.
An endorsement on the application was made by the concerned Secretary.
When the miscreants sought to disturb the embark ments, they made a complaint to the police, who initiated action in this regard.
Agricultural Income tax Department levied on them income tax relying on pisciculture being done by the respondents.
The Asstt.
Settlement Officer considered the entire evidence on record in great detail like Civil Court and held that the three witnesses examined in proof of the respond ents conducting pisciculture in the disputed plots of lands are interested and brought up witnesses for the detailed reasons given in support thereof; the respondents did not produce the report of the Junior Revenue Officer who direct ed to accept the rents from the respondents.
Admittedly, all the lands stood vested in the year 1955 56 in the State by operation of the notification issued under section 4(1) of the Act.
Though the settlement was stated to have been obtained from the Principal Landlady in the year 1952 (1359 B.S.), they did not produce any pre or post settlement records for the period upto 2955 56, the year of vesting, to establish that the disputed lands are recorded as tank fishery.
Mr. R.K. Dutta examined on behalf of the State stated that he made local inspection on April 11.
1968 A.D. and found recorded the class of land in 18 days (plots).
Serial Nos.
2202, 2204, 2206.
2209, 2210, 2212, 2214, 2219, 2220.2225.
2228, 2229, 2232, 2233, 2236 and 2239 within that Mouza.
The present Days (Plots) Nos. 2206, 2239, 2229, 2225, 2212, 2219, 2220 are small Dobas i.e. "ponds" and he did not find any sign of pisciculture in those plots.
Plot Nos.
22 10, 2209, 2233 and 2234 are blind canals.
There was no connection whatsoever of those plots with river or big canals.
96 He stated that there was water within those days (plots), but he did not find any sign of pisciculture therein.
He did not find any water in plot Nos. 2202, 2232, 2204, 2214, 2236, 2239, 2228 and 2226 either existing or drained in those plots.
Danga (elevated land) "Layek Jangal Bheter" (like jungle inside).
"Layek Jangal" (jungle outside) and there was no water at all.
He also made local enquiries from other persons in the neighbourhood and they testified to the same fact.
He admitted that adjacent to these plots there were two plots, namely, plot Nos. 2201 and 2235, but outside the disputed lands wherein pisciculture was being carried out in those plots at the time of inspection.
He also stated that the people examined by him have stated that till date the lands remained in the same condition.
In the settlement plan (map) the plots were not classified as pisciculture.
Only two plots i.e. 2201 and 2235 were classified as pisci culture.
It may be stated at this juncture that though Mr. Dutta was subjected to gruelling cross examination at great length on the nature of pisciculture and characterstics etc.
as regards the existence of the condition of the lands at the time of his inspection and that he did not find any trace of carrying pisciculture, no cross examination was directed nor was suggested to the contrary.
The Asstt.
Settlement Officer after consideration of the entire evidence found that the respondents claimed to have started fishery after obtaining settlement from landlady in the year 1952, they admitted that Khasra enquiry was conducted in the year 1954 (1361 B.S. ) in their presence and examined witnesses.
The Enquiry Officer did not enter in the Khasra record that any pisci culture was being carried on in any disputed plots except plot Nos. 2201 and 2235.
On the other hand he noted that there is no fishery in any of those plots except those two specified plots.
The vesting of plots under the Act took place in the year 1955 56.
Except the receipt issued by the Tehsildar, no documentary evidence of payment of rent has been produced.
The Tehsildar had no business to write on the receipt "for pisciculture", nor record of enquiry made by Junior Land Revenue Officer in this regard was produced.
It is, therefore, clear that in the Khasra enquiry it was not recorded that the suit plots are fishery and in none of the plots it was recorded that any pisciculture was being con ducted.
The attestation took place in July 1959, i.e. after seven years from 1359 B.S. (1952) the year so settlement and three years from the date of starting the so called fishery.
No documentary evidence except the solitary receipt which was rejected by the Asstt.
Settlement Officer was produced to show that any pisciculture was being conducted.
The receipt given by the Tehsildar is obviously to accommodate the respondents.
There is no sufficient 97 proof of laying any road to carry the fish from the said plots.
Sri Atul Kumar Sahoo, one of the respondents, when was examined as a witness admitted it.
Admittedly, fishery was carried out in plot Nos. 2201 and 2235 which are linked up with river Alian Khal with tide but they are not part of lands in dispute.
None of the plots which are subject matter of the suit is linked up with river or any big canal with tide.
With regard to making an application to the Chief Minis ter the copy has not been produced.
There is no evidence whether these plots of lands having been mentioned in that application.
Since, admittedly, the respondents are having fishery in plot Nos. 2201 and 2235, it was likely that the loan application would relate to those plots.
The total extent of the disputed land is about 550 Bighas.
Even ac count books showing income and expenditure of fishery were not produced, though time was allowed to produce the docu ments more than once.
Some lands are dry lands and some lands are with the shrubs inside river embankment and out side.
So the question of fishery over those plots does not arise.
Only to refute this factual situation the respondents tried to patch it up by saying that these plots were dried up for some months in every year.
But they have failed to prove the existence of any fishery over those plots by adducing sufficient and reliable evidence.
When there is no evidence to show the existence of fishery in any of the disputed plots, it is obvious that plots were wrongly re corded as fishery.
Primary authority considered the oral evidence and rejected it for valid reasons and ordered that the classification of plot Nos. 2202, 2239, 2225, 2232, 2204, 22 10, 2234, 22 14. 2236, 2228 and 2226 in.
Hal Kha tian Nos. 134 and 144 within Mouza Kishorimohanpore, J.L. No. 168, P.S. Jaynagar as recorded as "Ghert" and piscicul ture in column No. 23 should be deleted and instead the classification of plots Nos. 2202 and 2209 should be record ed as 'Layek Jungle Outside ' plot Nos.
2202, 2204, 2236 and 2228 should be recorded as 'Layek Jungle Outside '.
Plot Nos.
2201, 2234 should be recorded as 'pond ', 22 14 and 2226 should be recorded as 'Danga '.
Recording in column No. 23 to the effect 'pisciculture ' in plot Nos.
2209, 2229, 2206, 22 12, 22 19, 2233 and 2220 should be deleted.
Against this order an appeal was filed before the Tribu nal (IXth Addl.
District Judge, Alipore) under section 44(3) of the Act which by Judgment dated March 4, 1971 in E.A. No. 49 of 1968 in one paragraph with cryptic order assuming the role of an administrator reversed the order of the A.S.O. The conclusions, without discussing the evidence recorded by the Appellate Judge are that in the C.S. Khatain he found that these lands were recorded as Layek Jungle Vitar and 98 Bahir, doba pukur and Khal.
He had gone through the R.S. Map and from the map he found no sign of jungle as against the disputed lands.
One salt manufacturing company was in occu pation of the disputed land before the respondents took settlement from the original landlady.
The existence of salt manufacturing company shows that there was salt water on the disputed lands.
With a view to develop the land they applied for the loan to the Chief Minister on May 25, 1955.
That shows that there exists fishery in the disputed land.
The Junior Land Revenue Officer found on May 11, 1958 after inspection the existence of fishery.
Therefore, it shows that on the date of vesting there exists fishery in the lands.
Local witnesses who were examined support the exist ence of fishery for a pretty long time.
Against this there is no rebutting evidence adduced by the State.
Accordingly he set aside the order of the Asstt.
Settlement Officer and confirmed the original classification.
The State filed the writ petition and the High Court, as stated earlier, dis missed the writ petition in limine.
Shri Roy, the learned St. Counsel appearing for the State contended that the Asstt.
Settlement Officer has carefully assessed the evidence and recorded the findings.
The Appellate Tribunal has reversed the findings without considering the validity of the reasons recorded by the Asstt.
Settlement Officer.
It has taken irrelevant factors or non existing factors into account and thereby the find ings recorded by the Appellate District Judge is based on no evidence.
On the other hand it is beset with conjecture and surmises.
Shri Chatterji, the learned Sr. Counsel appearing for the respondent 's contended that the appellate authority has recorded the findings of fact that pisciculture was in existence as on the date of vesting.
This Court cannot interfere with the findings of fact recorded by the appel late court, in particular, when the High Court did not choose to interfere with the finding.
The record in the settlement refers that the lands are used for pisciculture.
It is open to the State to establish that the lands are not being used as pisciculture.
In its absence the findings recorded by the appellate court is one of fact and this Court cannot interfere with that finding.
Admittedly the High Court did not go into any of the questions raised by the appellant in the writ petition.
It summarily dismissed the writ petition.
Therefore, what we have to read is only the orders of the Appellate Tribunal and the Asstt.
Settlement Officer the primary authority together with the record of evidence.
Counsel took us through the evidence to show that the findings recorded by the appellate Judge are based on either no evidence or surmises and con 99 jectures.
We have given our anxious consideration to the respective contentions and considered the evidence on record once again.
It is indisputably true that it is a quasi judicial proceeding.
If the appellate authority had appreci ated the evidence on record and recorded the findings of fact, those findings are binding on this Court or the High Court.
By process of judicial review we cannot appreciate the evidence and record our own findings of fact.
If the findings are based on no evidence or based on conjectures or surmises and no reasonable man would on given facts and circumstances, come to the conclusion reached by the appel late authority on the basis of the evidence on record.
certainly this Court would oversee whether the findings recorded by the appellate authority is based on no evidence or beset with surmises or conjectures.
Giving of reasons is an essential element of administration of justice.
A right to reason is, therefore, an indispensable part of sound system of judicial review.
Reasoned decision is not only for the purpose of showing that the citizen is receiving jus tice, but also a valid discipline for the Tribunal itself.
Therefore, statement of reasons is one of the essentials of justice.
The appellate authority in particular a trained and experienced District Judge is bound to consider the entire material evidence adduced and relied on by the parties and to consider whether the reasons assigned by the primary authority is cogent, relevant to the point in issue and based on material evidence on record.
The District Judge has forsaken this salutary duty which the legislature obviously entrusted to him.
The question, therefore, is whether the reasons assigned by the appellate tribunal are based on no evidence on record or vitiated by conjectures or surmises.
For appreciating this point it is necessary to look into the purpose of the Act and relevant provisions therein.
The Act has been made to acquire the estates, all rights.
of inter mediaries therein and of certain rights of raiyats and trader raiyats of non agricultural tenants in occupation of the lands comprised in the State.
Section 4(1) empowers the State Government to issue notification under the Act from time to time declaring that with effect from the date men tioned in the notification all estates and all rights of every intermediary in each such estate situated in the district or a part of the district specified in the notifi cation "shall vest in the State" free from all incumbrances.
The procedure has been provided in this behalf in sub sec tion (2) to (6) of section 4 of the Act, the details of which are not relevant for the purpose of this case.
The effect of the notification as adumbrated in section 5 thereof is that all grants of, and confirmation of titles to, estates and rights therein, to which the declaration applies and which were made in favour of the intermediaries shall determine.
100 Thereby, by statutory operation the pre existing rights and all grants of and confirmation of the titles to the estate and the rights therein statutorily have been determined by issuance and publication of the notification under section 4(1) read with section 5 of the Act.
Section 6 of the Act employing non obstante clause carved out exceptions to the operation of sections 4 and 5 and preserve the right of intermediary to retain possession and title of certain land in certain circumstances.
Sub section (1) postulates thus: "Notwithstanding anything contained in Sections 4 and 5, an intermediary shall, except in the cases mentioned in the proviso to sub section (2) but subject to the other provi sions of that sub section be entitled to retain with effect from the date of vesting (e) tank fisheries; Explanation "tank fishery" means a reservoir or place for the storage of water, whether formed naturally or by excava tion or by construction of embankments, which is being used for pisciculture or for fishing, together with the subsoil and the banks of such reservoir or place, except such por tion of the banks as are included in a homestead or in a garden or orchard and includes any right of pisciculture or fishing in such reservoir or place.
" A reading of these provisions clearly indicates that notwithstanding the determination of pre existing rights, titles and interest of the holders of the estate in the notified estate, subject to proviso to subsection (2) and other provisions of sub section, sub section 1(c) retains the rights and possession of intermediary in respect of tank fisheries.
Tank fishery means the lands being used for pisciculture or any fishing in a reservoir or storage place whether formed naturally or by artificial contrivance as a permanent measure except such portion of embankment as are included in a homestead or in a garden or orchard to be tank fishery.
Such lands occupied by pisciculture or fishing stood preserved to the intermediary.
In Chamber 's 20th Century Dictionary at page 829.
the word 'pisciculture ' defined to mean "the rearing of fish by artificial methods".
In Webster Comprehensive Dictionary, Vol.
II 'pisciculture ' means hatching and rearing of fish.
In Stroud 's Judicial Dictionary, Vol.
II, 4th Edition at page 1051 the term 'several fishery ' 101 is sometimes said to be a right of fishing in public waters, which may be exercisable by many people.
Therefore, when by means of reservoir a place for storage of water whether formed naturally or by excavation or by construction of embankment, is being used for pisciculture or for fishing is obviously a continuous process as a source of livelihood.
would be 'tank fisheries ' within the meaning of section 6(1)(e).
Such tanks stand excluded from the operation of sections 4 and 5.
The question, therefore, emerges whether the disputed plots are tank fisheries.
Undoubtedly, as rightly contended by Shri Chatterji that if the findings recorded by the appellate tribunal that the disputed plots of land are tank fisheries, are based on evidence on record, after its due consideration in proper perspective certainly that finding is binding on this Court, as being a finding of fact.
The finding recorded by the appellate tribunal is based on five grounds, namely nonexistence of the forestry in the map; making application for loan ' revenue receipts produced by the respondent; previous salt cultivation and the oral evidence adduced on behalf of the respondents.
Yet another ground is absence of rebuttal evidence by the State.
We have already noted the findings recorded by the Asstt.
Settlement Officer.
They need no reiteration.
Mr. Dutta examined on behalf of the State made personal inspection.
The contention of Shri Chatterjee is that he inspected the land in the year 1968, but the relevant date is of the year 1952 and there is no evidence contrary to the existence of land in 1952 being used for pisciculture.
It is true that the crucial date for establishing, as a fact that the pisciculture was being carried on in the disputed land is the period of vesting, namely, 1955 56.
The existence of fishery subsequent to that period is not of any relevance.
Admittedly.
the respondents did not produce before the Asstt.
Settlement Officer either post or pre record till date of vesting to establish that from 1952 to 1955 56 i.e. from the date of obtaining settle ment till date of vesting, the lands were recorded in set tlement records as pisciculture or fishery.
Admittedly, in 1954 the Khasra enquiry was conducted in the presence of the respondents.
The findings recorded in the relevent columns are that no pisciculture or fishery was being carried on except in two plots i.e. 2201 and 2235 which are not subject matter of enquiry but are situated adjacent to these lands.
Those findings were not challenged at any time.
The report of the Tehsildar directing payment of the land revenue was not produced.
What was produced is only receipt on the body of which an endorsement "for pisciculture" was made by the Tehsildar.
The reason given by the Asstt.
Settlement Officer in rejecting the receipts was that there was no need for the Tehsildar to write "for pisciculture" and that was not the practice.
This finding was 102 not disputed by the appellate Judge.
Therefore, there is no documentary evidence to establish that the lands were being used, on the date of settlement or also on the date of vesting, as pisciculture or fishery.
The finding recorded by the Asstt.
Settlement Officer is based on the evidence given by Mr. Dutta, who on personal inspection, found that the lands remained in the same condition from the date of vest ing till date of his inspection in the year 1968.
This finding was also not contradicted in the cross examination of Mr. Dutta, though he was subjected to gruelling cross examination.
Therefore, the finding that the State has not produced any rebuttal evidence is palpably wrong on the face of the record.
The further findings that the map does not indicate that there exists any forestry, is also a conclu sion reached by the appellate authority without discussing the evidence of Mr. Dutta who had stated in his evidence that there are shrubs outside and inside the lands in dis pute.
It is the specific case of the respondents that they made embankment, but Mr. Dutta finds that there was no embankment to any of the plots.
That was also a finding recorded by the Asstt.
Settlement Officer.
There is no discussion by the appellate authority of the evidence given on that count.
Though written objections were filed and evidence was adduced by the respondents, neither in the objections nor in the oral evidence tendered by the two respondents or their witnesses it was shown that the lands were used earlier for salt cultivation by erstwhile land holder.
Therefore, this is an extraneous factor which the District Judge picked from his hat without any foundation.
The solitary revenue receipt produced by the respondents was rejected by the Asstt.
Settlement Officer for cogent rea sons.
The appellate authority being final authority on facts, is enjoined and incumbent upon it to appreciate the evidence; consider the reasoning of the primary authority and assign its own reasons as to why he disagrees with the reasons and findings of the primary authority.
Unless ade quate reasons are given merely because it is an appellate authority, it cannot brush aside the reasoning or findings recorded by the primary authority.
By mere recording that Dakhilas (rent receipts) show that lands are used as pisci culture is a finding without consideration of the relevant material on record.
The other finding that respondent ap plied to the Chief Minister for loan and that it would establish that the loan amount was utilised for developing fishery is also a surmise drawn by the appellate authority.
It is already seen that admittedly the respondents have plot Nos. 2201 and 2235 in which they have been carrying on fishery operations.
The application said to have been filed before the Chief Minister has not been produced.
The account books of the respondents have not been produced.
When the documentary evidence, which being the lust evidence, is 103 available but not produced an adverse inference has to be drawn by the Tribunal concerned against the respondents for non production and had it been produced, it would have gone against the respondents.
A police complaint was said to have been made concerning disturbance in the enjoyment of the lands in question.
No documentary evidence was produced or summoned.
Even if it is done it might be self serving one unless there is a record of finding of possession and enjoy ment by the respondents for fishery.
Even then also it is not binding on the State nor relevant in civil proceedings.
The contention of Shri Chatterjee that it is the duty of the appellant to produce the record to repudiate the find ings recorded by the appellate authority is without sub stance.
In a quasi judicial enquiry is for the parties who relied upon certain state of facts in their favour have to adduce evidence in proof thereof.
The proceedings under the Act is not like a trial in a Civil Court and the question of burden proof does not arise.
In the absence of abduction of the available documentary evidence, the necessary conclusion drawn by the Asstt.
Settlement Officer that the loan appli cation made might pertain to plot Nos. 2201 and 2235 is well justified.
The appellate authority is not justified in law to brush aside that finding.
The other finding that the witnesses examined on behalf of the respondents support the existence of the fishery for a pretty long time is also without discussing the evidence and assigning reasons in that regard.
The Asstt.
Settlement Officer extensively considered the evidence and has given cogent reasons which were neither discussed nor found to be untenable by the appellate authority.
Thus, we have no hesitation in coming to the conclusion that the Appellate Tribunal disregarded the material evidence on record, kept it aside, indulged in fishing expedition and crashed under the weight of conjec tures and surmises.
The appellate order is, therefore, vitiated by manifest and patent error of law apparent on the face of the record.
When so much is to be said and judicial review done, the High Court in our considered view, commit ted error of law in dismissing the writ petition in limine.
In the facts and circumstances of this case, in particular, when the litigation has taken well over 28 years till now, we find it not a fit case to remit to the High Court or Tribunal for fresh consideration.
It is contended that the respondents are entitled to the computation of holding under the Act, since they are pos sessed of some other lands.
We direct that if any determina tion of total holding of the lands including plot Nos. 2201 and 2235 and any other lands are to be made under the Act or any other Land Reform Law singly or conjointly it is 104 open to the appropriate authorities to determine the hold ing of the respondents in accordance with law after giving reasonable opportunity to the respondents and the State after excluding the plots of lands in dispute Shri Roy, learned counsel for the State repeatedly asserted that the lands no longer remain to be fishery land and became part of urban area around the Calcutta City and building operations are going on.
On the other hand the counsel for the respondents asserted to the contrary.
We have no definite evidence on record.
Therefore, if the lands are still found to be capable of using for fishery purpose and in case the State intends to lease it out for fishing operations, to any third party, as per rules in vogue, first preference may be given to the respondents.
subject to the usual terms.
as per the procedure prevalent in the State of West Bengal in this regard.
Accordingly, we quash the order of Appellate Tribunal dated March 4. 1971 and restore the order of the Asstt.
Settlement Officer elated July 12.
The appeal is allowed accordingly and the parties are directed to bear their respective costs.
T.N.A. Appeal allowed.

dataset_name: IN-Abs

summary:
The land belonging to the respondent intermediaries comprising of certain plots stood vested in the State of West Bengal by operation of a Notification issued under Section 4(1) of the West Bengal Estates Acquisition Act, 1953.
Since the plots were recorded as 'tank fisheries ' (used as pisciculture), they stood excluded from the purview of the vesting Notification under Section 6(1)(e) of the Act and preserved to the respondent intermediaries.
Subsequently the primary authority the Assistant Set tlement Officer initiated suo moto proceedings by issuing notice to the respon 92 dents under Section 44(2a) of the Act for correction of classification of lands on the ground that the plots were wrongly recorded as fishery plots.
The respondents objected to reclassification of the lands by contending that in 1952 they were granted Dakhilas to the said land by one `B ', the Principal landlady, and thereafter they have been cultivat ing pisciculture on the said plots of the land and conduct ing fishery business.
The Assistant Settlement Officer rejected the claim of the respondents and ordered reclassi fication of the plots.
The respondents filed an appeal before the Tribunal (District Judge) under section 44(3) of the Act.
The Appellate Tribunal reversed the order of the Assistant Settlement Officer and confirmed the original classification of the plots.
Against the decision of the Appellate Tribunal, the State filed a writ petition in the Calcutta High Court which dismissed the petition in limine.
In appeal to this Court it was contended on behalf of the State: (i) that the Appellate Tribunal had reversed the findings without considering the validity of the reasons recorded by the Assistant Settlement Officer; (ii) that the Appellate Tribunal had taken irrelevant factor or non exist ing factors into account and thereby its findings were based on no evidence and hence vitiated in law.
On behalf of the respondents it was contended that since the Appellate Authority has recorded the findings of fact that pisciculture was in existence as on the date of vesting the Supreme Court cannot interfere with the findings of fact recorded by the Appellate Court, particularly, when the High Court did not choose to interfere with the finding.
Allowing the Appeal, this Court, HELD: 1.
Giving of reasons is an essential element of administration of justice.
A right to reason is, therefore, an indispensable part of sound system of judicial review.
Reasoned decision is not only for the purpose of showing that the citizen is receiving justice, but also a valid discipline for the Tribunal itself.
Therefore, statement of reasons is one of the essentials of justice.
[99C D] 1.1 The appellate authority in particular a trained and experienced District Judge is bound to consider the entire material evidence adduced and relied on by the parties and to consider whether the reasons assigned by the primary authority is cogent, relevant to the 93 point in issue and based on material evidence on record.
The appellate authority being final authority on facts, is enjoined and incumbent upon it to appreciate the evidence; consider the reasoning of the primary authority and assign its own reasons as to why it disagrees with the reasons and findings of the primary authority.
Unless adequate reasons are given, merely because it is an appellate authority, it cannot brush aside the reasoning or findings recorded by the primary authority.
[99D; 102E F] 2.
If the appellate authority had appreciated the evi dence on record and recorded the findings of fact, those findings are binding on this Court or the High Court.
By process of judicial review this Court cannot appreciate the evidence and record its own findings of fact.
If the find ings are based on no evidence or based on conjectures or surmises and no reasonable man would, on given facts and circumstances, come to the conclusion reached by the appel late authority on the basis of the evidence on record, certainly this Court would oversee whether the findings recorded by the appellate authority is based on no evidence or beset with surmises or conjectures.
[99A C] 2.1 In the instant case the Appellate Tribunal disre garded the material evidence on record, kept it aside, indulged in fishing expedition and crashed under the weight of conjectures and surmises.
The appellate order is, there fore, vitiated by manifest and patent error of law apparent on the face of record.
The order of Appellate Tribunal is quashed and the order of Assistant Settlement Officer is restored.
[103F G; 104D] 3.
Tank fishery means the lands being used for piscicul ture or any fishing in a reservoir or storage place whether formed naturally or by artificial contrivance as a permanent measure except such portion of embankment as are included in a homestead or in a garden or orchard to be tank fishery.
Such lands occupied by pisciculture or fishing stand pre served to the intermediaries and thus stands excluded from the operation of sections 4 and 5 of the West Bengal Estates Acquisition Act, 1953.
But the crucial date for establish ing, as a fact that the pisciculture was being carried on in the disputed land is the period of vesting.
The existence of fishery subsequent to that period is not of any relevance.
[100G H; 101E] Chamber 's 20th Century Dictionary, page 829; Webster comprehensive Dictionary, Vol.
II and Stroud 's Judicial Dictionary, Vol.
II 4th Edn., page 1051, referred to.
94 3.1 In the instant case the respondents did not produce before the Assistant Settlement Officer either post or pre record till date of vesting to establish that from 1952 to 1955 56 i.e. from the date of obtaining settlement till date of vesting, the lands were recorded in settlement records as pisciculture of fishery.
Therefore, there is no documentary evidence to establish that the lands were being used, on the date of settlement or also on the date of vesting, as pisci culture or fishery.
[101F; 102A] 4.
Admittedly the High Court did not go into any of the questions raised by the appellant in the writ petition.
It summarily dismissed the writ petition.
The High Court com mitted error of law in dismissing the writ petition in limine.
[98G; 103F]


judgement:
IN Writ Petition Civil Nos. 348 352 of 1985.
(Under Article 32 of the Constitution of India).
Kapil Sibbal, Additional Solicitor General, Madan Lokur, Ms. Shobha Dikshit, Gopal Subramaniam and Ms. A. Subhashini (NP) for the appearing parties.
Pramod Swarup for the Intervener and R.K. Mehta (NP) for the State of Orissa.
The Judgment of the Court was delivered by RANGANATH MISRA, J.
This is an interlocutory application at the instant of the respondents in the writ petitions where the following directions of this Court have been asked for: (i) grant time to State of Uttar Pradesh for implementing judgment and order dated 25th September, 1987 and commence the session for post graduate education from 2nd May, 1990 in all the seven medical colleges; (ii) further permit the State of Uttar Pradesh to hold the competitive examination for admitting the post graduate students for the year 1990 through the University of Luc know; and (iii) pass such other and further orders as it may deem fit and proper in the interest of justice.
138 The main judgment of this Court was delivered on 22nd June, 1984, in Dr. Pradeep Jain etc.
vs Union of India & Ors.
, ; By a subsequent order made on 21st July, 1986, this Court directed that the total number of seats for admission to post graduate courses in each medical college or institution on the basis of All India Entrance Examination shall be limited to 25% and such examination would be held by the All India Institute of Medical Sciences at New Delhi.
By order dated September 25, 1987, this Court made clear directions for the sake of bringing about uniformity in post graduate medical teaching by requiring post graduate courses to be structured on a uniform basis; directing that diploma prevailing in Tamil Nadu may not be available for admission to a post graduate degree course; and ordering that provision in regard to super specialities like MD and other higher degrees need not be court controlled.
For doing so this Court allowed a five year period upto 1992 inclu sive.
With a view to bringing all the medical colleges and institutions subject to the scheme to one common discipline and for admissions beginning from 1993, the Court indicated that there should be only one pattern, namely, the three year degree course without any housemanship.
After having done so the Court proceeded to fix uniform schedule for inviting applications for having the selection examination, declaration of the result, admission of students to the post graduate courses and commencement of the sessional teaching.
The Court then desired that the discipline regarding holding of the selection examination, admission and commencement of courses should be effective from 1988.
In the penultimate paragraph of that order.
it was said: "All necessary directions for post graduate course are now complete.
We direct the Union of India, the Medical Council of India, the State Governments, Universities, Medical Institutions and all other authorities that may be involved in implementation of the scheme to give full effect to the orders and directions made by this Court in the proper spirit so that the scheme may become operative as directed.
We make it clear that no application for any modification of matters already covered by our order henceforth shall ordi narily be entertained.
A copy of this order shall be communicated forth with to the Chief Secretary of every State and Union Terri tory for compliance.
A copy of it be also sent to the Direc tor 139 Generals, All India ' Radio and Doordarshan for appropriate publicity of the order in general interest.
" We have ascertained from the Registry that there was due compliance of the direction contained in the last paragraph of the order.
A matter from Bihar forming subject of Civil Appeal No. 3589 of 1989 relating to admission in post graduate medical courses came before this Court.
This Civil Appeal was dis posed of by this Court on 15.11.89 (AIR 1990 SC 749).
Deal ing with the lapses on the part of the State of Bihar in the matter of compliance with the directions of 1987 which we have already referred to, this Court said: "Obviously the relevant directions have not been followed by the examining body for the current year.
Similarly, the State of Bihar did not follow the directions of this Court while drawing up its prospectus.
If the courses of study are to commence from May 2, the last qualifying date could not have been fixed as May 31, 1989.
It has been reiterated before us that several States have not been following.the directions.
Instead of issuing notice to the States and Union Territories for examining the correctness of the allegations of delay and non compliance of the directions, we have thought it appropriate to indicate that every one including the States, Union Territories and other authori ties running Medical Colleges with Post Graduate Courses are bound by our order and must strictly follow the time sched ule indicated in paragraph 6 of the order.
We have not proceeded against the defaulting authorities for violation of this Court 's order, hoping that there would be no recur rence of it but we would like to administer a warning to everyone that if it is brought to our notice at any time in future that there has been violation, a serious view of such default shall be taken.
We hope and trust that everyone concerned shall comply with the time frame strictly and there would be no lapse in this regard in future.
" This application is grounded upon the default which this Court has been anxious to eliminate and apprehensive of non compliance of directions wherein a serious threat of punishment had been held out.
Both the State of Uttar Pra desh and the seven medical colleges run by it are bound to implement the scheme in the main judgment as modified from time to time and were covered by the orders of 1987 and 140 1989.
We have read our order of 1987 again and find no scope for the stand of the respondents in the present petition for the position that there was scope for confusion relating to the directions in regard to uniform pattern of the courses and the time scheduled for the various aspects concerned with the selection examination, admission of students into the Post Graduate and commencement of sessional teaching.
These were two different matters and while in regard to items referred to in the order of 1987 a clear five year period was allowed to evolve the system of uniformity, time frame for every purpose like admission and teaching was intended to be brought into force from the year 1988.
Two distinct sets of directions were made one in regard to the requirement of change of the regulations and rules and the procedural aspects in operating the scheme, and the other for regulating admission and commencement of teaching.
We reject the plea of the Uttar Pradesh Government and the other respondents that there was scope for confusion and non compliance with the directions was relatable to a bona fide mistake.
This is a clear instance of either wilful default or total callous indifference to binding and lawful orders made by this Court.
Where the direction is clear and arising out of default of compliance, a further direction is made clarifying the position and warning defaulting parties of serious consequences we find no scope for any justifica tion for continued default.
More so when the State Govern ment and its officers obliged to give effect to our direc tions fail to take notice of the same and exhibit a conduct of noncooperation and callousness.
It was the obligation of the State of Uttar Pradesh in terms of the two orders referred to above to initiate action for admission in appropriate time so as to allow the com mencement of the course for the year 1990 with effect from May 2, 1990.
It is the respondents ' stand that for the year 1990 the Entrance Examination for the remaining seats (besides 25% controlled by the AllMS) was to be conducted by the University of Lucknow on 27th May, 1990.
This itself was contrary to the scheme and exhibited the same pattern of conduct as appeared in the Bihar case referred to above.
In fact on looking at the matter from every possible angle we have not been able to appreciate the submissions of Mrs. Dixit and are of the view that the performance of the State of U.P. and its public authorities is anything short of contumacy.
At one stage we were thinking of initiating contempt action against the State and the Principals of the seven medical colleges.
Such steps for disciplining the State and the public authorities concerned would result in multiplicity of proceedings; therefore, instead of undertak ing such an exercise we have thought it appropriate to impose 141 exemplary costs against the State of Uttar Pradesh as also the principal of each of the seven medical colleges.
We direct that the State of U.P. shall pay costs of Rs.20,000 (twenty thousand) while each of the Principals shall pay Rs.500 (five hundred) by way of costs.
So far as the State of Uttar Pradesh is concerned it has of course to come from the public fund of the State.
In regard to the principals of each of the seven medical colleges located at Lucknow, Agra, Kanpur, Jhansi, Meerut, Gorkhpur and Allahabad, the amount of costs shall be recovered personally from their salary and they would not be entitled to reimbursement of the same from the State exchequer.
These payments be made with the Regis try of this Court by 30th of September, 1990.
A copy of this order shall be made available to each of the principals of the seven medical colleges for compliance.
The State of U.P. is directed to hold the Selection Examination stipulated by it for May 27, 1990, by 30th of September, 1990 and the University of Lucknow is authorised to conduct it.
The result of the examination should be published within one week, that is, by 8th of October, 1990 and admissions should be completed on or before 26th of October, 1990, and classes shall commence on 1st of Novem ber, 1990.
The classes shall be deemed to have commenced from 2nd May, 1990, and each of the medical colleges shall undertake to provide additional teaching in course of the session so as to compensate the students for the days lost on the basis that the course begun on 2nd May, 1990.
Each of the principals of the medical colleges shall certify to the Registry of this Court by 15th November 1990, that this part of order has been implemented.
Before we part with the case we would like to again administer a warning to everyone associated with the scheme for implementing the directions contained in the main judg ment and the subsequent orders that a future default by anyone in any part of the country shall indeed be seriously viewed and drastically dealt with.
This Court has stated in the past and we would like now to reiterate that the direc tions of this Court are not intended to be brushed aside and overlooked or ignored.
Meticulous compliance is the only way to respond to directions of this Court.
P.S.S. Application disposed of.

summary:
In Dr. Pradeep Jain vs Union of India, ; the Court had laid down a scheme of admission to medical colleges in graduate and post graduate courses.
By its order dated September 1987 in a miscellaneous petition the Court made certain specific directions for the sake of bringing about uniformity in post graduate medical teaching and allowed a five year period upto 1992 for doing so.
In 6 of the said order it also fixed a uniform schedule for inviting applications for holding the selection examination, declara tion of the result, and admission of students to the post graduate courses.
11 was laid down therein that the courses of study shall commence in every institution throughout the country from May 2 every year.
The said time frame was intended to be brought into force from the year 1988, The Union of India, the Medical Council of India, the State Governments, Universities, medical institutions and all other authorities involved were required to give full effect to the orders and directions.
copy of the order was communi cated forthwith to the Chief Secretary every State and Union Territory for compliance.
In State of Bihar vs San jay Kumar, AIR 1990 SC 749 dealing with the lapse on the part of the State of Bihar in the matter of compliance with the directions of 1987 the Court had expressed the hope and trust that everyone con cerned would comply with the time frame strictly in future and held out a serious threat of punishment against the defaulting authorities.
In the instant interlocutory application the respondents sought grant of time to the State of Uttar Pradesh for implementing the reader dated September 25, 1987 and com mence the session for post graduate education from 2nd May, 1990 in all the seven medical colleges run by 136 it, and to hold the competitive examination for admitting the postgraduate students for the year 1990 through the University of Lucknow.
Their stand was that there was scope for confusion relating to the directions and non compliance was relatable to a bona fide mistake.
Disposing of the application, the Court, HELD: 1.
The directions of the Court are not intended to be brushed aside and overlooked or ignored.
Meticulous compliance is the only way to respond to them.
[141G] 2.1 In the instant case, two distinct sets of directions were made by the Court one in regard to requirement of change of the regulations and rules and the procedural aspects of the scheme, and the other for regulating admis sion and commencement of teaching.
There was no scope for confusion relating to them.
[140C D] 2.2 It was the obligation of the State of Uttar Pradesh in terms of the orders of 1987 and 1989 to initiate action for admission in appropriate time so as to allow the com mencement of the course for the year 1990 with effect from May 2, 1990.
The respondents ' stand that the entrance exami nation for the remaining seats (besides 25% controlled by the AllMS) was to be conducted by the University of Lucknow on 27th May, 1990 itself was contrary to the scheme.
[140E F] 2.3 Where the direction is clear and arising out of default of compliance, a further direction is made clarify ing the position and warning defaulting parties of serious consequences, there was no scope for any justification for continued default.
In failing to take notice of the Court 's directions the State Government and its officers have exhib ited a conduct of non cooperation and callousness.
In fact, their performance was nothing short of contumacy.
It is but appropriate, therefore, to impose exemplary costs against the State of Uttar Pradesh as also the Principal of each of the seven medical colleges.
[140D; G H] The State of U.P. shall pay costs of Rs.20,000 while each of the Principals of the seven medical colleges shall pay Rs.500 by way of the costs which shall be recovered personally from their salary, and they would not be entitled to reimbursement of the same from the State exchequer.
[141A] 3.
The State of U.P. to hold the selection examination stipulated by it for May 27, 1990, by 30th of September, 1990 and the University 137 of Lucknow is authorised to conduct it.
The result of the examination should be published within one week, that is, by 8th of October, 1990 and admissions should be completed on or before 26th of October 1990 and classes shall commence on 1st of November, 1990.
The classes shall be deemed to have commenced from 2nd May, 1990, and each of the medical col leges shall undertake to provide additional teaching to compensate the students for the days lost.
[141D E] 4.
A warning is administered to everyone associated with the scheme for implementing the directions contained in the main judgment and the subsequent orders that a future de fault by anyone in any part of the country shall be serious ly viewed and drastically dealt with.
[141F]