Judgment :- This petition is filed by a dealer in Pondicherry doing import business under Article 226 of the Constitution for the issue of a Writ of Certiorari quashing the order of the Appellate Collector of Customs who confirmed the order of the Assistant Collector of Cusoms confiscating under Section 167(8) of the Sea Customs Act certain goods imported by the petitioner. The prior facts necessary for a consideration of this Writ petition are briefly the following. 2.The petitioner was granted a licence for the licensing period October 1961 to March 1962 for the import of certain goods which were covered by Serial No. 78(vii) of Part V of the Import Trade Control Schedule, This Serial number refers to electrical instruments, apparatus appliances and accessories etc. The licence was issued on 29-11-1961 and was valid for one year, that is upto 28-11-1962. The petitioner placed on 22-9-1962 an indent through a dealer in New Delhi, with a Western Germany firm for the supply of four numbers of appliances called Earth Testers and the goods arrived by post parcel. When they had to be cleared through the Customs the Assistant Collector, on a scrutiny of the goods, came to the conclusion that the aforesaid goods did not fall under Serial No 78(vii) of Part V but fell really under Serial No. 39(b) (i) of Part 11 of the Import Trade Control Schedule. This letter Serial No. refers to portable Instruments, insulation Testers and Accessories, Fault Locating Sets etc. After issuing a notice to the petitioner to show cause against confiscation of the goods in question as having been imported in contravention of the licence and therefore liable to confiscation under Section 167(8) of the Sea Customs Act, the Assistant Collector of Customs imposed an order of confiscation giving the petitioner however liberty to clear the goods without confiscation on payment of penalty of Rs. 4, 500. The petitioner appealed to the Respondent, the Appellate Collector of Customs who confirmed the Assistant Collector's order but reduced the aforesaid penalty from Rs. 4, 500 to Rs. 4, 000. 4, 500. The petitioner appealed to the Respondent, the Appellate Collector of Customs who confirmed the Assistant Collector's order but reduced the aforesaid penalty from Rs. 4, 500 to Rs. 4, 000. 3.The petitioner contended before the Customs Authorities that apart from the question of their having a discretion in deciding upon the correct classification of goods which fall under the appropriate serial numbers of the Import Policy Book, so far as the particular article now claimed by the petitioner, as following under Serial No. 78(vii) of Part V, is concerned, namely Earth Testers, it was identical with the goods which after import by certain other dealers in Pondicherry, had been cleared without levy of penalty during the relevant period but when the petitioner had confirmed to this trade practice he was treated in a discriminatory manner, when a heavy penalty of Rs. 4, 000 had been levied for clearing the goods valued at only Rs. 998. 4.In answer to this contention of unfair discrimination, in the counter affidavit of the Department and before the Assistant Collector as well as the Appellate Collector of Customs, it was admitted that similar consignments had been cleared by some other dealers in Pondicherry without penalty. But the Department claims to have issued on 12-9-1962 a warning to a Pondicherry dealer by name M/s. Colomboni Imports and Exports Limited, who had effected such an import, and since there was reason to believe that Pondicherry merchants were having some kind of unity among themselves in making such imports, the Department was of the opinion that the petitioner, after having come to know of the warning issued to M/s. Colomboni Imports and Exports Limited on 12-9-1962, had nevertheless placed the indent in the present case on 22-9-1962. Therefore the Department was entitled to deal with the petitioner as one who had deliberately contravened the provisions of the Import Control Order, after having come to know that the Department had taken the view, in regard to classification of the article in question, that it did not fall under Serial No. 78(vii) of Part V of the Import Policy Book. 5.The contention of the Department in justification of their action in dealing with the petitioner in a different way from other importers like M/s. Colomboni Imports and Exports Limited, was challenged by the petitioner who contended that there was no written warning given to the M/s. Colomboni Imports and Exports Limited, but only an oral warning, and that the petiitioner had no reason to be aware at the time he placed the indent on 22-9-1962, of the Department's change of view in the matter of classification of the article in question by reason of an oral warning to M/s. Colomboni Imports and Exports Limited. His learned Counsel also argued that there was no basis for the Department's assumption that all the merchants in Pondicherry would be in communication in so far as warnings issued by the Department to one or more of them were concerned, especially if the warning happened to be oral. It would be a different thing if the Department had issued a notification to all merchants clarifying the position regarding the proper classification of the goods hitherto imported under a wrong serial number of the goods. But the Department claims that by an oral warning given to one merchant they must be deemed to have communicated to other merchants also, their change of view about the trade practice followed, regarding the import of the article under Serial No. 78(vii) Part V, and that it is a proper exercise of judicial discretion vested in the Department, when they proceeded to levy a penalty of Rs. 4, 000 in view of compensation under Section 167(8) in the case of the petitioner, after letting off previously another firm similarly situated, with a warning and allowing it to clear the goods without any penalty. 6.Learned Counsel for the petitioner referred to the decision of a Division Bench of this Court consisting of Rajamannar. C.J. and Kailasam in Rikabdoss Bhavarlal v. Collector of Customs 1961 II MLJ 443 at 448 where it is observed: "The Collector of Customs when acting under Section 167 is obviously acting as a quasi-judicial tribunal such discretion must be exercised judicially and not arbitrarily. The Collector of Customs must decide in each particular case if there were circumstances which would call for the drastic punishment of confiscation. The Collector of Customs must decide in each particular case if there were circumstances which would call for the drastic punishment of confiscation. The appellants had placed the order and the goods had arrived when admittedly the practice prevailing both with the merchants and with the Customs Authorities permitted goods of the category which the appellants imported under a licence such as the appellants held. The Collector does not appear to have dealt with the case as if he was vested with judicial discretion, because he has not given any reason why the drastic punishment of confiscation should have been imposed on the appellant whereas two other similar merchants who had committed the same offence had been let off with a warning." * Learned Counsel appearing for the Department seeks to draw a distinction in the present case from the facts in the decision cited above. First of all he referred to the warning administered to the firm of M/s. Colomboni on 12-9-1962, and the indent placed by the petitioner ten days later on 22-9-1962. It appears to me that there was no justification for the Customs Authorities to assume that the warning (which is claimed by the petitioner to be an oral one and which claim has not been challenged by the Department) should have been communicated automatically by the dealer M/s. Colomboni to the other dealers in Pondicherry. There is no evidence that the dealers in Pondicherry were in the practice of communicating such information among themselves. On the other hand, it is more likely that the warning being an adverse reflection on the dealer he would have kept the fact secret, without disclosing it to other dealers. 7.It was next argued by Learned Counsel for the respondent, that since the licence in the case of M/s. Colomboni Imports and Exports Limited, related to the immediately preceding half year, namely, April to September 1961, whereas the petitioner's licence covered the next half year October 1961 to March 1962 their position could not be considered identical. But it is common ground that both the licences are valid for one year after the dates of issue and therefore the licences of M/s. Colomboni and the petitioner will have a clear overlapping period of six months therefore the licensees would be acting more or less under identical conditions regarding the placing of indents for import of the articles from abroad. Therefore there is no point in trying to make a distinction between M/s. Colomboni Imports and Exports Limited and the petitioner because the former's licence period was six months anterior to the latter's licence period. 8.Therefore it should be informed that the present case is one where the Customs Authorities have dealt with two importers placed in identical situations, differently. Even though one might agree with the view that the question of the correct classification of items imported, with reference to the headings found in the Import Policy Book is one within the Customs Authorities exclusive jurisdiction and the correctness of their decision cannot be interfered with ordinarily in writ proceedings vide Gridharilal v. Union of India, cited by learned Counsel for the Respondent nevertheless this is a case where there has been a discriminatory treatment between two dealers similarly placed in the application of a trade practice, recognised by the merchants as well as the Customs Authorities, without particulars being made available to the petitioner about a subsequent change of view of the departments regarding the correct classification of an item of goods for the purpose of complying with the import licence. This led to the imposition of a heavy penalty on the petitioner, while another merchant similarly placed was not so treated but was only warned amounting to a case of unfair discrimination. Adopting the principles laid down by this Court in Rikabdoss Bhavarlal v. Collector of Customs 1961 II MLJ 433 at 448, I allow the writ petition and the Rule Nisi is made absolute. The penalty amount if paid will be refunded to the petitioner.