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2018 DIGILAW 247 (ORI)

Dhamra Port Company Limited v. Union of India

2018-03-13

BISWAJIT MOHANTY, INDRAJIT MAHANTY

body2018
JUDGMENT : I. Mahanty, J. The petitioner-M/s. Dhamra Port Company Limited (hereinafter referred to as ‘DPCL’) has filed this writ petition with the following prayer: “(i) Issue a writ in the nature of certiorari, quashing the order dated 11.08.2017 of the Ld. Commissioner of Customs, Bhubaneswar. AND (ii) Issue an order, directing the Commissioner of Customs, Bhubaneswar to pass an order/public notice under proviso to para 10 of the customs notification no. 16/2015, dated 01.04.2015, permitting DPCL to clear the imported 3 GTSUs’ through Dhamra Port and the spares under the EPCG scheme. AND (iii) Issue an order, directing opposite party no.3 to extend the validity of EPCG Licenses, which remained unutilized due to inaction of Customs Authorities.” 2. The essence of the contentions made by the petitioner-company through Mr. Asok Mohanty, learned Senior Counsel is that the petitioner-company sought to import three Grab Type Ship Unloaders (GTSU) from Shanghai Zhenhua Heavy Industries Co. Ltd., China for installation at its port located at the mouth of river Dhamra in the State of Odisha. It is averred that the intent behind import was to provide import facility for import of lime stone and thermal coal and various other cargo which require deep draught berths, equipped with mechanized handling and for such purpose, the essential sophisticated handling equipments like ship loaders, unloaders were required for the purpose. Accordingly, the petitioner sought for authorization under the Export Promotion Capital Goods (EPCG) Scheme and the Foreign Trade Policy (FTP) 2015-20. Necessary certification/ authorization for import of capital goods and spares were issued in terms of the Foreign Trade Policy (FTP) 2015-20. The said Export Promotion Capital Goods (EPCG) Scheme was introduced to facilitate import of capital goods and services in order to enhance the country’s export competitiveness. Consequently, the Export Promotion Capital Goods (EPCG) Scheme allows for import of Capital Goods for preproduction, production and post production, at “zero” customs duty. Chapter 5.01(c) of the Foreign Trade Policy (FTP) 2015-20, also states that Import under EPCG Scheme shall be subject to an export obligation equivalent to 6 (six) times of duty saved on capital goods, to be fulfilled in six years reckoned from date of issue of Authorization. 3. It is further averred that the petitioner-company on being authorized to import three Grab Type Ship Unloaders (GTSU) materials along with spares, placed orders with Shanghai Zhenhua Heavy Industries Co. 3. It is further averred that the petitioner-company on being authorized to import three Grab Type Ship Unloaders (GTSU) materials along with spares, placed orders with Shanghai Zhenhua Heavy Industries Co. Ltd., China for supply of the same. It appears that the Deputy Director General of Foreign Trade, Cuttack (O.P.No.3) on receipt of application from the petitioner, granted necessary certification on 13.05.2016 for importing the aforesaid items indicating the “port of registration” as Paradeep Port. The petitioner made an application for issue of necessary license under the Export Promotion Capital Goods (EPCG) Scheme on 28.04.2016. 4. The goods in question were brought by sea-vessel, for which docking permission was sought for on 02.05.2016 from the Deputy General of Foreign Trade, Cuttack under section 30 of the Customs Act (by the person incharge of the Vessel). The Assistant Commissioner, Customs, Dhamra accepted the Import General Manifest (IGM) on 03.05.2016 and the vessel namely, MV Zhen Hua 8 arrived at port/anchorage of Dhamra Port on 05.05.2016. 5. Thereafter basing on the IGM filed by the person incharge of the vessel, the vessel berthed at Dhamra Port and unloaded the goods in question i.e. the three Grab Type Ship Unloaders (GTSU) commenced unloading on 09.05.2016 from the vessel, after necessary “inward entry permission” were obtained from the Customs Authorities at Dhamra port. On the date of arrival of the vessel at Dhamra Port, the petitioner applied to the Commissioner of Customs, Bhubaneswar for permission to unload the goods under the EPCG Scheme on the same day i.e. on 09.05.2016 as contemplated under the Proviso to Paragraph-10 of notification No.16/2015 of Central Board of Excise and Customs dated 01.04.2015 which is quoted herein below : “GOVERNMENT OF INDIA, MINISTY OF FINANCE (DEPARTMENT OF REVENUE) Notification No.16/2015-Customs New Delhi, the 1st April, 2015 G.S.R. 252(E)-In exercise of the powers conferred by sub-section (1) of section 25 of the Customs Act, 1962 (52 of 1962), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts goods specified in the Table 1 annexed hereto, from (i) xxx xxx xxx (ii) xxx xxx xxx 2. The exemption under the notification shall be subject to the following conditions, namely – xxx xxx xxx (10) that the imports and exports are undertaken through the seaports, airports or through the inland container depots or through the land customs stations as mentioned in the Table 2 annexed hereto or a Special Economic Zone notified under section 4 of the Special Economic Zones Act, 2005(28 of 2005); Provided that the Commissioner of Customs may, by special order or a public notice and subject to such conditions as may be specified by him, permit import and export through any other sea-port, airport, inland container depot or through a land customs station within his jurisdiction. xxx xxx xxx” 6. It appears from the records produced at the time of hearing, that the petitioner applied for EPCG authorization on 2.5.2016 and was granted the necessary EPCG authorization on 13.05.2016. It further appears that the IGM required certain amendments, for which the agent of the vessel sought for such amendment with the Assistant Commissioner, Dhamra which was accordingly allowed. At this stage, it would also be relevant to note here that in terms of the notification dated 01.04.2015 under Annexure-P3, admittedly, the port of Dhamra is not a sea-port which finds mention at Table (2) under the said notification. But the port of Paradeep (Odisha) has been mentioned in Table (2). Since, Dhamra port was not a “notified port”; in terms of the Handbook of Procedures stipulated by the Government of India, Ministry of Commerce and Industry, Department of Commerce goods being imported had to be registered obtaining Transfer Release Advice, for short, “TRA” at the nearest notified port. The relevant portion is quoted herein below: “4.37 Port of Registration (a) Advance Authorisation shall be issued for purpose of import and export through one of sea ports or airports or ICDs or LCS specified below. Authorisation holder shall register authorization at the port specified in authorisation and thereafter all imports against said authorization shall be made only through that port, unless the authorization holder obtains permission from customs authority concerned to import through any other specified port. However, exports may be made through any of the specified ports. (c) For imports from Airport/Seaport/ ICD/LCS other than port of registration, a TRA shall be issued by the customs authority at the port of registration to customs authority at port of import. However, exports may be made through any of the specified ports. (c) For imports from Airport/Seaport/ ICD/LCS other than port of registration, a TRA shall be issued by the customs authority at the port of registration to customs authority at port of import. However, this requirement of TRA shall not be required if the port of registration and port(s) of imports are EDI enabled and the authorization holder has registered its authorization.” 7. It is submitted that in terms of the aforesaid guidelines, issued by the Government of India, petitioner Port not being a ICD or LCS port, had sought for registration at Paradeep Port (being a notified port) as the port of registration, for the purpose of issue of the TRA. Accordingly, it appears that necessary application was moved before the Assistant Commissioner, Paradeep Customs seeking issue of TRA and the said permission was granted by the Assistant Commissioner, Customs Paradeep Port on 07.06.2016. 8. While the situation stood thus, it appears that the Commissioner of Customs, before whom petitioner had applied for exercise of power under the Proviso to Paragraph-10 of notification No.16/2015 of Central Board of Excise and Customs dated 01.04.2015, ultimately rejected such a prayer after a period of 1 year 3 months vide the impugned order vide letter dated 11.08.2017 under Annexure-1. The relevant portion thereof is quoted herein below: “GOVERNMENT OF INDIA COMMISSIONERATE OF CUSTOMS (PREVENTIVE), BHUBABNESWAR, CENTRAL REVENUE BUILDING, RAJASWA VIHAR, BHUBANESWAR-751007 Phone No.0674-2589082, Fax No. 0674-2589612, Email Id-cusbbsr1@gmail.com C.No. VIII(48)53/CUS(P)/BBSR/2016 Dated 11.08.2017 To M/s. Dhamra Port Company Limited At-Dosinga, P.O. Dhamra District: Bhadrak Odisha-756171 Sub: Import of Capital Goods under EPCG Scheme in terms of Chapter-5 of the Foreign Trade Policy (2015-20), import of Goods at Zero Customs Duty at Dhamra Port Company Ltd (DPCL)-Regarding. xxx xxx xxx DISCUSSION & FINDINGS 5. I have gone through the records of the following two files-(i) Current importation File No.VIII(48)53/CUS(P)/ BBSR/2016 and (ii) Earlier importation File No.VIII(43)I/Cus/B-I/2007. On perusal of the documents, correspondences and note-sheets of the file number VIII (48) 53/CUS(P)/BBSR/2016, I find that the Commissioner of Customs (Preventive) made reference to Board twice, on 05.01.2017 and 27.03.2017, to clarify as to whether he can by a Special Order/Public Notice declare Dhamra Port as notified port retrospectively in terms of proviso to Para 10 of Notification 16/2015-Cus dated 01.04.2015. The Board did not clarify the issue in as many words and instead directed the Commissioner to pass a reasoned order after giving opportunity of Personal Hearing following Principles of Natural Justice to the importer. Accordingly Personal Hearing was given on 08.05.2017. But due to change of adjudicating authority, another Personal Hearing was given on 31.05.2017. 6. In terms of the aforesaid proviso to Para 10 of Notification 16/2015-Cus dated 01.04.2015, the Commissioner can issue Public Notice (PN)/Special Order declaring any port, other than those listed in the Notification, as eligible Port for EPCG Scheme. It is viewed that a Public Notice can be issued under proviso to Para 10 of Notification 16/2015-Cus dated 01.04.2015 only on a prospective basis. There can not be a Standing Public Notice to the effect that Dhamra Port has been notified as eligible Port for EPCG Scheme for all times. Otherwise a Standing Public Notice, declaring a non-eligible port as eligible Port for EPCG purposes, shall tantamount to circumventing the Customs Notification No.16/2015-Cus dated 01.04.2015, which has clearly specified the name of eligible ports therein. Reading contextually, the Special Order, to be issued by the Commissioner should also be prospective from the date of arrival of goods. It is felt that it is not possible for the Special Order to be retrospective, when the Public Notice will be prospective in nature. Both should have prospective operation only and not be contradictory to each other. 7. Thus in my view, the Public Notice/Special Order to be issued by the Commissioner in exercise of power under Para 10 of Notification No.16/2015-Cus dated 01.04.2015 should have been issued prior to the date of arrival of goods in India. In the instant case, I find that M/s. Dhamra Port Company Limited (DPCL) applied to Jt. DGFT, Cuttack on 30.04.2016 for EPCG Licence, but no intimation was given to Customs Department requesting for issue of Public Notice/Special Order in anticipation of getting the EPCG License. The vessel, MV ZHEN HUA 8, arrived in Dhamra on 5/5/2016, but the Customs Department was informed only on 9/5/2016, even though 5th & 6th May, 2016 were working days in Commissionerate Headquarters. I also find that the EPCG license (issued by DGFT on 13.05.2016) was registered in Paradeep Customs House on 06.06.2016, which is a notified port under Notification No.16/2015-Cus dated 01.04.2015. I also find that the EPCG license (issued by DGFT on 13.05.2016) was registered in Paradeep Customs House on 06.06.2016, which is a notified port under Notification No.16/2015-Cus dated 01.04.2015. However, the action of Assistant Commissioner, Paradeep Customs House in issuing RA for entire consignment in favour of Dhamra Customs (a non-specified port for EPCG Scheme) on 07.06.2016 is entirely wrong, as the Commissioner had not accorded the Special Order declaring Dhamra to be eligible for EPCG Scheme till such time and the RA should be cancelled forthwith. 8. In terms of Para 2.13 of the Foreign Trade Policy (2015-20), the DGFT can issue EPCG License in respect of goods which have been imported/shipped/arrived in advance, but not cleared from Customs. It implies that EPCG License can be issued with retrospective effect. However, the same aspect of retrospective nature is not mentioned in Notification No.16/2015-Cus dated 01.04.2015. As stated earlier, reference to the Board by the Commissioner, Customs (Preventive) were also not answered affirmatively in favour of M/s. DPCL. 9. M/s. DPCL has referred to similar importation done earlier in the year, 2009. On perusal of the relevant File No. VIII(43)1/Cus/B-I/2007, I find that M/s. DPCL had kept the Customs Department informed about the importation and clearance under EPCG Scheme before the arrival of the imported goods. Thus the earlier importation reference given by DPCL also does not help their cause this time.” 9. Challenging the aforesaid order passed by the Commissioner, the present writ petition has come to be filed on various grounds stated in the writ petition. The customs authorities came to file counter-affidavit sworn to by Sri Jayanta Baidyamajumder, Assistant Commissioner under the Commissioner, Customs (Preventive), Bhubaneswar dated 25.10.2017 and further additional counter affidavit dated 04.12.2017 has come to be filed on behalf of Customs pursuant to our direction issued on 27.11.2017 appending thereto certain communication made by the Commissioner, Customs(Preventive), Bhubaneswar with the Central Board of Excise and Customs. 10. The essential stand taken in the counter affidavit filed by the Customs Authorities dated 25.10.2017 is quoted hereunder: “3. That the brief facts of the case are that the petitioner-company has imported goods Grab Type Ship Unloader (GTSU) under the EPCG scheme for development of Port Project. The petitioner has been issued EPCG Authorization letter dated 13.05.2016 for importation of goods from the Jt. That the brief facts of the case are that the petitioner-company has imported goods Grab Type Ship Unloader (GTSU) under the EPCG scheme for development of Port Project. The petitioner has been issued EPCG Authorization letter dated 13.05.2016 for importation of goods from the Jt. DGFT, Cuttack with Port Registration at Paradip Port, but subsequently on the request of the petitioner, the Assistant Commissioner, Custom Division, Paradip allowed the clearance and requested the Assistant Commissioner of Customs, Dhamra Port to verify all the aspect for assessment of goods under the Release Advice and Exemption Notification. It is worthwhile to mention here that the petitioner’s Port has been allowed to unloading of imported goods and loading of export goods or any class of such goods vide Notification No.44/2017 Customs (NT) dated 11.04.2017, but before this Notification, the project imports were restricted to be imported in the petitioner’s port vide Notification No.16/2012-Customs (N.T.) dated 29.02.2012. Therefore, the present importation of goods without prior permission by the Customs authority is irregular and illegal. Photocopy of Notification No.16/2012-Customs (N.T.) is annexed herewith and marked as Annexure-B/2 for kind perusal of this Hon’ble Court. The petitioner’s company is aware of the facts that their port has not been notified by the Government for exemption of Customs Duty under EPCG Scheme. In the year 2009, in a similar situation the Customs authority had allowed the goods to be imported under the EPCG Scheme as the petitioner’s company had filed application for special Notification and got the order for clearance before entering the goods in the territorial jurisdiction of India. xxx xxx xxx 4. That the averments made in paragraph-1 of the writ application, it is humbly submitted that the petitioner submitted a letter on 09.05.2016 to the Commissionerate of Customs (Preventive), Central Revenue Building, Rajaswa Vihar, Bhubaneswar with the request to issue Public Notice/ Special Order under Proviso to Para 10 of Notification No.16/2015 Cus. dated 01.04.2015 to notify Dhamra port as the notified EPCG port with retrospective effect in respect of importation of 3 GSTUs, which were already unloaded at Dhamra Port, a non-EPCG notified port for availing exemption of Customs duty leviable on imported goods. dated 01.04.2015 to notify Dhamra port as the notified EPCG port with retrospective effect in respect of importation of 3 GSTUs, which were already unloaded at Dhamra Port, a non-EPCG notified port for availing exemption of Customs duty leviable on imported goods. The opposite party No.2, vide his Order communicated under C.No.VIII(48)53/CUS/(P)/ BBSR/2016/635A dated 11.08.17, clarified that the request of the petitioner is unacceptable, as there is no provision in Notification No.16/2015-Cus dated 01.04.15 to notify any port with retrospective effect (after unloading of the imported goods). In addition to that, the opposite party No.2 has also discussed various irregularities for non-issuance of order in favour of the petitioner-company in his Order dated 11.08.2017. The petitioner states, inter alia, that they submitted the letter dated 06.05.16 requesting the authority to issue Public Notice/Special Order to notify Dhamra Port for exemption of Customs duty in pursuance of Para 10 of Notification No.16/2015-Cus dated 01.04.15. But the fact remains that the said letter was actually received in the office of the authority only on 09.05.16 and by that time, the subject goods had been unloaded in Dhamra Port, which has been specifically observed and mentioned in the Order dated 11.08.17.” 11. A further affidavit came to be filed by the Customs Authorities dated 04.12.2017 annexing thereto communication issued by the Commissioner of Customs, Bhubaneswar to various authorities in the CBEC seeking clarification and their responses thereto. 12. Although, notices were also issued to the Deputy Director General of Foreign Trade (Respondent No.3) as well as Union of India represented through Chairman of Central Board of Excise and Customs (Respondent No.1) and they were represented through Mr. A.K. Bose, learned Assistant Solicitor General, no counter affidavit has been filed by respondent No.3 and counter affidavit has only been filed by the Respondents No.1 & 2. 13. Heard Mr. A. Mohanty, learned Senior Advocate for the petitioner, Mr. A.K. Bose, learned Assistant Solicitor General and Mr. T.K. Satpathy, learned Senior Standing Counsel for the Revenue. 14. In the light of the circumstances that arise in the fact situation narrated hereinabove, it is necessary for us to deal with the essential reasons cited by the Commissioner, Customs for rejecting the petitioner’s communication dated 06.05.2016 for import of goods at zero customs duty at Dhamra port under the EPCG Scheme. 15. 14. In the light of the circumstances that arise in the fact situation narrated hereinabove, it is necessary for us to deal with the essential reasons cited by the Commissioner, Customs for rejecting the petitioner’s communication dated 06.05.2016 for import of goods at zero customs duty at Dhamra port under the EPCG Scheme. 15. On perusal of the counter affidavits and stand of the Customs Authorities, it appears that the Commissioner, Customs had sought for clarification from the Central Board of Excise and Customs but, “the Board did not clarify the issue in as many words and instead directed the Commissioner to pass a reasoned order” and accordingly, the impugned order which has been passed by the Commissioner dated 11.08.2017 is subject matter of challenge here. 16. In the said order, (i) the Commissioner has proceeded on his understanding that when an application is made under the Proviso to Para-10 of Notification No.16/2015-Cus dated 01.04.2015 seeking a “Special Order” for declaring any other port, other than those listed in the Notification as eligible Port for EPCG Scheme, it is noted in the impugned order that such a Public Notice can be issued under the Proviso to Para-10 only on a “prospective basis”. (ii) He has felt that it is not possible for the “Special Order” to be retrospective, when the Public Notice is prospective in nature. (iii) Although, the import vessel arrived at Dhamra on 05.05.2016, the Customs Department was informed only on 09.05.2016. (iv) The EPCG license issued by DGFT on 13.05.2016 was registered with Paradeep Customs House on 06.06.2016 and the issue of TRA in favour of the petitioner by the Assistant Commissioner, Paradeep Customs House on 07.06.2016 was entirely wrong as by the said date, the Commissioner had not accorded the “Special Order” declaring Dhamra Port to be eligible for EPCG Scheme. (v) Para-2.13 of the Foreign Trade Policy (2015-2020) authorizes the DGFT to issue EPCG License in respect of goods which have been imported/shipped/ arrived in advance but not cleared from the Customs. Therefore, it implies that EPCG License can be issued with retrospective effect. Whether the same would also authorize the Customs Authority was not answered affirmatively by the CBEC and, consequently, the Customs Authority could not grant a retrospective “Special Order”. Therefore, it implies that EPCG License can be issued with retrospective effect. Whether the same would also authorize the Customs Authority was not answered affirmatively by the CBEC and, consequently, the Customs Authority could not grant a retrospective “Special Order”. (vi) Insofar as a similar importation done by the petitioners in the year 2009 was concerned, the Commissioner, Customs was of the view that in the earlier transaction, the Customs Department had been informed about the importation and clearance under the EPCG Scheme “before the arrival” of the imported goods unlike in the present case. 17. The most important issue that arises for consideration in the present case is, as to whether the Commissioner of Customs was right in rejecting the petitioner’s-company application under Proviso to Para-10 of the Notification No.16/2015-Cus dated 01.04.2015. In this respect, the learned Commissioner has expressed his views, that the public notice or the “Special Order” conceived of in Proviso to Para-10 would only operate on a “prospective basis” and that no “Special Order” could be issued by him in effect having retrospective effect. At the very outset, the aforesaid basic conclusion by the learned Commissioner appears to be based on a misunderstanding of the provisions of the Customs Act, 1962 and the Foreign Trade Policy (FTP) of 2015-20 and the Notification No.16/2015-Cus dated 01.04.2015. It is clear from the Notification as well as the Customs Act that any “Special Order” issued by the Commissioner would only, obviously be prospective and cannot be retrospective, in any event. Therefore, in the present case, it appears that the learned Commissioner has acted on an understanding that since the goods in question being imported under the EPCG Scheme had already been “unloaded” at Dhamra Port, the “Special Order” that he would issue would have to be retrospective to cover the date of unloading. This in our considered view is not consistent with the requirements of the Customs Act, 1962 nor with the relevant Notification No.16/2015- Cus dated 01.04.2015. The Notification No.16/2015-Cus dated 01.04.2015 has been issued by the Government of India in the Ministry of Finance (Department of Revenue) and the Central Board of Excise and Customs. This in our considered view is not consistent with the requirements of the Customs Act, 1962 nor with the relevant Notification No.16/2015- Cus dated 01.04.2015. The Notification No.16/2015-Cus dated 01.04.2015 has been issued by the Government of India in the Ministry of Finance (Department of Revenue) and the Central Board of Excise and Customs. It would be very important to take note of the fact that the said notification was issued by the CBEC in exercise of powers conferred by sub-Section (1) of Section 25 of the Customs Act, 1962 and the relevant Section is quoted hereunder: “Section 25. Power to grant exemption from duty.-(1) If the Central Government is satisfied that it is necessary in the public interest so to do, it may, by notification in the Official Gazette, exempt generally either absolutely or subject to such conditions (to be fulfilled before or after clearance) as may be specified in the notification goods of any specified description from the whole or any part of duty of customs leviable thereon.” It is exercising such power vested in the CBEC under Section 25(1) that the Notification No.16/2015-Cus came to be issued on 01.04.2015 and further the Proviso to Para-10 to the said Notification is quoted hereunder: “(10) that the imports and exports are undertaken through the seaports, airports or through the inland container depots or through the land customs stations as mentioned in the Table 2 annexed hereto or a Special Economic Zone notified under section 4 of the Special Economic Zones Act, 2005 (28 of 2005): Provided that the Commissioner of Customs may, by special order or a public notice and subject to such conditions as may be specified by him, permit import and export through any other sea-port, airport, inland container depot or through a land customs station within his jurisdiction;” There can be no doubt that the Commissioner of Customs has been vested with the necessary authority under the Proviso to Para-10 above to permit import through any other sea-port within his jurisdiction not covered under Table-2. In other words, the Commissioner of Customs, Odisha has the necessary jurisdiction to issue “special order” for permitting import through any other sea-port (other than though sea-port mentioned in Table 2) subject to such sea-port being within his territorial jurisdiction. 18. In other words, the Commissioner of Customs, Odisha has the necessary jurisdiction to issue “special order” for permitting import through any other sea-port (other than though sea-port mentioned in Table 2) subject to such sea-port being within his territorial jurisdiction. 18. It would be also relevant to note herein that while the petitioner’s-company operates Dhamra port, the said port is a “customs port” as defined under sub-Section (12) of Section 2 of the Customs Act, 1962 but, admittedly, is not a port mentioned in Table-2 of the aforesaid Notification. It would be relevant to take into consideration the definition of the term “customs area” from Section 2(11) of the Customs Act, 1962 which is quoted hereunder: “Section 2(11)-“customs area” means the area of a customs station and includes any area in which imported goods or export goods are ordinarily kept before clearance by Customs Authorities.” Since the aforesaid definition of a “customs area” includes any area in which imported goods are ordinarily kept before clearance by Customs Authorities, consequently, the fact that the goods being imported by the petitioner under the EPCG Scheme, even as on date, remain within the “customs area” of the “customs port”. Admittedly, no “clearance” has been granted yet by the Customs Authorities and, therefore, the goods remain (as on date) within the lawful custody of the Customs Authorities, the import journey cannot be stated to have been completed. In view of the aforesaid facts, even though the petitioner’s imported goods have been unloaded at Dhamra port, any “special order” by the Commissioner of Customs would obviously be effective from the date of such grant of permission, since it is only after the Commissioner grants such “special order”, that the petitioner can seek customs clearance of the goods and until such clearance is sought for and granted, the goods remain “in course of import” though physically located at Dhamra port but without obtaining the necessary clearances from the Customs Authorities as mandated under the Customs Act. In this context, we refer to the case of Indian Tourist Development Corporation Ltd. Vrs. Assistant Commissioner of Commercial Taxes & Another, (2012) 3 SCC 204 as rendered by the Hon’ble Supreme Court on the issue of “Customs frontier”. In the said case, the appellant was selling foreign goods through its duty-free shops at various international airports directly to customers before clearing customs frontier in international airports. Assistant Commissioner of Commercial Taxes & Another, (2012) 3 SCC 204 as rendered by the Hon’ble Supreme Court on the issue of “Customs frontier”. In the said case, the appellant was selling foreign goods through its duty-free shops at various international airports directly to customers before clearing customs frontier in international airports. Since the revenue imposed VAT on such sales, the appellant sought to challenge the said levy as it claimed that goods sold by the appellant was before the same crossed the customs frontier of India and consequently, are deemed to have been kept outside India and VAT/Sales Tax could not be levied on any sale or purchase taken place in course of import or export of goods which remain outside the territory of India. It was further contended that when transaction such as sale at duty-free shops at Airport takes place, the same was outside the customs frontier of India and therefore, VAT could not be imposed on such transaction. Hon’ble Supreme Court accepted the appellant’s contentions and came to conclude that duty-free shops are deemed to be outside the territory of India and hence, the goods sold in duty-free shops are deemed as not entering the territory of India. Further, in the case of Kiran Spinning Mills Vrs. Collector of Customs, (2000) 10 SCC 228 it has been made clear that the import of goods is completed only when the goods cross the custom barriers. Applying the aforesaid ratio decidendi as laid down by the Hon’ble Supreme Court to the facts situation of the present case, it may be seen that admittedly, the goods in question though physically unloaded at Dhamra port, remains in the course of import since no clearance of the said goods have yet been granted. Consequently, the Commissioner of Customs ought to have granted the prayer made by the petitioner instead of rejecting the same on an erroneous conclusion that the goods have already been imported/technically imported. The Customs Act, 1962 does not conceive of any technical import. The import of goods is not possible without necessary clearance being given by the Customs authority. Consequently, the finding of the Commissioner, in this regard, is wholly erroneous and not in accordance with law. The Customs Act, 1962 does not conceive of any technical import. The import of goods is not possible without necessary clearance being given by the Customs authority. Consequently, the finding of the Commissioner, in this regard, is wholly erroneous and not in accordance with law. As the goods remain in course of import, the Commissioner was duty bound to grant “special order” as contemplated in the Proviso to Para-10 of the Notification No.16/2015-Cus dated 01.04.2015 since admittedly the goods being imported even as on date remain in course of import awaiting necessary clearance from the Customs Authority. 19. We are of the considered view that the Commissioner of Customs has erroneously come to a finding that in the event he grants the petitioner’s permission by issue of “special order” for import of the goods under the EPCG Scheme, in effect his order would be retrospective in operation. We reiterate that this fundamental basis is wholly erroneous and not in consonance with law. No doubt, the goods have been unloaded and that too after necessary permission was granted by the Dhamra Customs Authorities for berthing of the vessel. Further permission was granted by the Dhamra Customs Authorities for unloading of the cargo and it would be relevant also to take note of the fact that the Customs Authorities of Paradeep Port (port of registration) have also granted the petitioner with the necessary TRA requiring the petitioner and the Customs Authorities at Dhamra port to ensure due compliance of all terms and conditions under the EPCG Scheme and to report compliance thereof to the Customs Authorities at Paradeep. 20. In the case at hand, the Commissioner of Customs has also referred to, in the impugned order dated 11.08.2017 under Annexure-1, to the fact that the petitioner-company had earlier made similar import in the year 2009 and the Customs Department had permitted such import, but, such a prior example was distinguished by the Commissioner of Customs on a factual basis by noting that in the said transaction the petitioner-company had kept the Customs Department informed about the importation and clearances under the EPCG Scheme “before the arrival” of the imported goods. In the order of rejection under Annexure-1 and in para-7, it is stated by the Commissioner that “…….. In the order of rejection under Annexure-1 and in para-7, it is stated by the Commissioner that “…….. no intimation was given to the Customs Department requesting for issue of Public Notice/Special Order in anticipation of getting the EPCG License.” We are afraid while we take note of the aforesaid finding of the Commissioner, the learned counsel for Customs could not point out any requirement either under the Customs Act nor under the Foreign Trade Policy of 2015-20 where an applicant for an EPCG licensee was required to intimate the Customs Department “(in anticipation of getting the EPCG License)”. In other words, on perusing the conditions stipulated under the EPCG Scheme and under the Notification No.16/2015-Cus dated 01.04.2015, there appears to be no such requirement of a licensee to inform the Customs Authorities in advance and that to “in anticipation of getting the EPCG License”. 21. In the case at hand, as noted hereinabove, it appears that though the petitioner-company claims to have submitted its application to the Commissioner on 06.05.2016 for issue of “special order” under proviso to Para-10 of Notification No.16/2015-Cus dated 01.04.2015 but, the Customs Authorities claimed that they received such an application on 09.05.2016. Admittedly, the commencement of unloading of the goods covered under the EPCG License commenced only on 09.05.2016 (evening) and that too, after the import manifest as well as permission of unloading was granted by the Customs Authorities at Dhamra port. In other words, it cannot be asserted by the Customs Authorities that the unloading took place either without the knowledge of the Customs and, on the contrary, the berthing of the vessel and unloading of the cargo was done by following all customs procedure and after getting express permission for berthing of vessel as well as unloading of cargo from the authorities vested with the necessary power of the Customs Department. 22. Apart from the above, no sooner the vessel sought for berthing, the petitioner-company “registered the cargo” under the EPCG Scheme with Paradeep Authorities (registering Port) who granted the petitioner-company with a TRA for unloading at Dhamra Port. Consequently, the finding of the Commissioner of Customs to the effect, that the vessel had arrived in the territorial waters and had been berthed at Dhamra port and goods have been unloaded, without necessary lawful sanction by the Customs Authorities, is factually wholly incorrect. Consequently, the finding of the Commissioner of Customs to the effect, that the vessel had arrived in the territorial waters and had been berthed at Dhamra port and goods have been unloaded, without necessary lawful sanction by the Customs Authorities, is factually wholly incorrect. Even if the date of 09.05.2016 is accepted as the date on which the petitioner’s application for issue of “special order” by the Commissioner was received at its office, all that had happened by the date of receiving such an application was that, the vessel had been permitted to berth at Dhamra port, the import manifest of the goods sought to be unloaded had been processed by the Customs Authorities at Dhamra port, the petitioner had take a necessary steps for registering the imported goods with the port of registration i.e. port of Paradeep (as required by the EPCG License) and Paradeep Port Customs Authority had granted TRA on 07.06.2016 to the petitioner-company with a further direction to its counter-parts at Dhamra port to ensure compliance by the petitioner of all conditions imposed in the EPCG License. Consequently, we have no hesitation in coming to hold that the mere factum of the vessel arriving at Dhamra port or unloading of the imported cargo at Dhamra and all such actions having been taken only after the necessary permissions being granted by the appropriate Customs Authorities, at various levels, no objections can be raised by the Commissioner on the aforesaid account for refusal for grant of “special order” under the EPCG Scheme. 23. It further appears from the impugned order that although the Commissioner had sought for clarification from the CBEC, it appears that the CBEC did not give any clarification as sought for and left it to the Commissioner to exercise his quasi-judicial authority. In our considered view, the CBECs response was absolutely apt in the circumstances, since any suggestion either way may have amounted to interfering in the exercise of quasi judicial authority by the Commissioner, who alone is vested with the authority for considering any application for issue of any “special order” under the Proviso to Para-10 of the Notification No.16/2015-Cus dated 01.04.2015. But, the alleged failure on the part of the CBEC to give any clarification as sought for, it appears has been taken as a negative indication by the Commissioner. But, the alleged failure on the part of the CBEC to give any clarification as sought for, it appears has been taken as a negative indication by the Commissioner. We have perused the various communications issued by the Commissioner from time to time on the issue of clarification. It appears that by a letter dated 05.01.2017, the Commissioner had addressed the letter to the CBEC requesting the Board may like to consider their request i.e. declaring Dhamra port (petitioner) as an eligible port (on one-time basis) for the import of 3 (three) grab-unloaders under the EPCG Scheme. 24. At the outset, we are of the considered view that such clarification ought not to have been sought for by the Commissioner, since in terms of the Notification No.16/2015-Cus dated 01.04.2015, it is the Commissioner who is vested with the necessary authority and jurisdiction to pass such order and there was no scope for the Commissioner to seek the advice of the CBEC in such matters since the same would have tantamounted to abdicating its own quasi judicial authority and jurisdiction. 25. It further appears that a further communication dated 27.03.2017 was issued by the Commissioner addressed to the Under Secretary where he has made suggestion to the statutory authority to include Dhamra sea-port in Table-2 annexed to the Notification No.16/2015 Customs dtd.01.04.2015. In the said letter, the Commissioner has requested the Board to consider including Dhamra port (petitioner) in Table-2. In the said communication, the Commissioner has noted as follows in para-4 that “xxx xxx xxx In the present case, it is seen that technically the import has already taken place xxx xxx xxx.” He also refers to the definition of the term “import” contained in Section 2(23) of the Customs Act, 1962 which is quoted hereunder: “Section 2(23)-“import”, with its grammatical variations and cognate expressions, means bringing into India from a place outside India.” But clearly he has omitted to take into consideration the definition of the term “customs area” as contemplated under Section 2(11) and “customs port” as defined under Section 2(12). The “import” as contemplated under Section 2(23) meaning bringing into India from a place outside India cannot be said to be even “technically complete” bereft of there being “clearance” by the Customs Authorities. The “import” as contemplated under Section 2(23) meaning bringing into India from a place outside India cannot be said to be even “technically complete” bereft of there being “clearance” by the Customs Authorities. Merely unloading of the imported goods at a port does not complete an act of import, without the Customs Authorities granting the necessary statutory clearances for bringing the goods beyond the customs area and/or permission for utilizing the same by the petitioner. Consequently, in the present case, the understanding of the Commissioner that the imported goods have “technically” already been imported is wholly erroneous in law for the reasons as noted hereinabove and is not in consonance with the judgment rendered by Hon’ble Supreme Court in the case of Indian Tourist Development Corporation Ltd. Vrs. Assistant Commissioner of Commercial Taxes & Another (supra). 26. We further find that in response to the queries of the Commissioner, the Under Secretary in the Ministry of Finance, Government of India responded to the request on 28.04.2017, reiterating that Clause 2(10) under Notification No.16/2015-Cus dated 01.04.2015 empowers the Commissioner to permit import and export through any other sea-port within his jurisdiction and left the matter to the Commissioner to apply the principles in the said Notification to the fact situations that arise in the said case. Consequently, the failure on the part of either the Government of India in the Ministry of Finance or the CBEC to render any assistance/clarification to the Commissioner cannot form the foundation or basis for denying the petitioner-company the relief that it sought for, without reasonable cause. In the case at hand, we find that the Commissioner has failed to exercise its jurisdiction as vested in it under the Customs Act, 1962 as well as the Customs Notification No.16/2015-Cus dated 01.04.2015 and has also without necessary jurisdiction directed quashing of the TRA issued by the Paradeep Port Customs Authorities on 07.06.2016 while being wholly without jurisdiction is not inconsonance with law. 27. In the light of the aforesaid fact situation that arise, we are of the considered view that the petitioner-company i.e. Dhamra Port is admittedly a “customs port”, at the relevant time through the Dhamra Port did not find mention in Table-2 to the Notification dated 01.04.2015 and, consequently, even in its EPCG License had mentioned Paradeep Port (as the port of registration). Accordingly, when the imported goods under the EPCG License arrived at the outer harbour of Dhamra port, necessary permission were sought for from the Customs Authority for berthing of the vessel and necessary permissions were obtained. Thereafter, the “import manifest” was placed with the Dhamra Customs Authorities and necessary permission was granted. In the meantime, the Customs Authorities at the port of registration i.e. Paradeep had granted the necessary TRA for the imported cargo and the cargo commenced unloading on 09.05.2016 (evening) i.e. admittedly, the very same day the Commissioner of Customs claims to have received the petitioner’s application for grant of “special order” as contemplated under Proviso to Para-10 of the notification No.16/2015-Cus dated 01.04.2015. 28. It appears from the impugned order that in similar circumstances, the petitioner had imported goods in the year 2009 and has sought to distinguish the fact situation then by merely recording the fact that, whereas in 2009 the Customs had been informed before the goods been unloaded, in the present case, on the selfsame day the goods, in fact, have been unloaded. We are of the considered view that this fact is of no legal consequence, since irrespective of the fact whether a vessel carrying the goods either had not unloaded its cargo or unloaded its cargo, the fact remains that such cargo was unloaded with the necessary permission of the Customs Authorities at the customs port i.e. Dhamra port and irrespective of this fact also even though the goods were unloaded at Dhamra port the goods remained within the jurisdiction of the Customs Authority and within the customs area as defined under the Customs Act and while such goods remain in the customs area prior to clearance by the Customs Authorities, the goods remain “in course of import”, until the bill of entry of goods is passed and duly cleared by the Customs Authorities. 29. Consequently, we are of the considered view that this fact also i.e. the factum of unloading of the goods at the port and the possible grant of a “special order” by the Commissioner in terms of the Proviso to Para-10 would not make the order retrospective in effect. In other words, the order of the Commissioner granting “special order” would only be prospective and it is only after such order is issued, can the petitioner seek for necessary clearance of goods from the Customs Authorities at Dhamra. In other words, the order of the Commissioner granting “special order” would only be prospective and it is only after such order is issued, can the petitioner seek for necessary clearance of goods from the Customs Authorities at Dhamra. In other words, as on date of passing of the impugned order dated 11.08.2017 under Annexure-1 by the Commissioner of Customs, the goods were and still remain within their lawful custody, since no clearance of the goods has been sought for nor granted in favour of the petitioner. Therefore, the assumption on the part of the Commissioner that granting of a “special order” would be retrospective in effect is wholly without sanction of law. Any order passed by the Commissioner will only be prospective and, consequently, grant of a “special order” by the Commissioner would only operate prospectively and it is only after such an order is passed can the importer (petitioner) seek for customs clearance of the goods in question. 30. Admittedly, in the present case, the petitioner has averred and which has not been denied by the Customs Authorities that the nature of the goods i.e. Grab Type Ship Unloader, being imported from China and the dimensions thereof are so huge that it is not feasible to transfer it from any other port to Dhamra. In other words, it would not be possible to get this huge Giant cranes, which are so huge in dimension to be unloaded in any other port and then transported by any means i.e road/rail or otherwise to the site in view of its gigantic structure. Such type of cargo/equipment could only be delivered by ship and that too only at the port where such large size equipment would be finally installed. It appears also that the petitioner-company had already paid a sum of more than Rs.230 crores to purchase such equipment and although, the application for issue of “special order” was received by the Commissioner of Customs on 09.05.2016, the goods remain at the port, without any order being passed for more than a year and four months until the impugned order dated 11.08.2017 under Annexure-1 came to be passed. 31. 31. It would be relevant herein to note that the Government of India has prepared the EPCG Scheme with the avowed objective of encouraging creation of infrastructural needs of the nation and while allowing exemption of “zero percent” customs duty at the time of import, requiring such importer to ensure revenue generation of six (6) times of the customs duty concession given within the coming six (6) years. In other words, the importer has to not only guarantee but also give an undertaking/bond to the Customs Authorities that the importer would comply with the export obligations and export obligations which would be equal to six (6) times the value of customs duty exempted at the time of import. In this regard, it is most relevant to note Para-2.13 of the Foreign Trade Policy issued by the Government of India in the Ministry of Commerce and Industry which is as follows: “2.13 Clearance of Goods from Customs against Authorization Goods already imported/shipped/arrived, in advance, but not cleared from Customs may also be cleared against an Authorisation issued subsequently. This facility will however be not available to “restricted” items or items traded through STEs.” The Foreign Trade Policy clearly indicates that the said Policy applies to goods which had already been imported/shipped/arrived in advance but not cleared from Customs. Consequently, there can be no doubt that the aforesaid facts would indicate that the Customs Authority are also duty bound to honour the directions of the Ministry of Commerce and Industry and the terms of the Foreign Trade Policy as formulated by the Government of India and cannot act in a manner to frustrate achieving such objectives. 32. This Court is very concerned that the impugned order came to be passed nearly fifteen (15) months after the necessary application was made and till date in the absence of the “special order” as required under the Proviso to Para-10 of Notification No.16/2015-Cus dated 01.04.2015 the goods valued at over Rs.230 crores, remain unutilized and continue to lay at the dock within the customs area of Dhamra port. We are constrained to note that such delay does not serve any purpose either to the Union of India or to the State, since such a huge investment has not been allowed to be utilized for such a long period of time. 33. We are constrained to note that such delay does not serve any purpose either to the Union of India or to the State, since such a huge investment has not been allowed to be utilized for such a long period of time. 33. We are of the considered view that the Union of India should issue necessary guidelines to the Authorities vested with such quasi judicial power to take decisions on such applications within a minimum period which the Government of India would consider appropriate. Since in the case at hand, the petitioner-importer having been saddled with such huge financial liability has not been granted permission to clear the goods and utilize in any manner, which this Court is of the considered view is nothing less than national waste by itself, whereas, the goods lie at the port site and have not been utilized by the petitioner, in the absence of a “special order” as contemplated as noted hereinabove. The situation remains in limbo for more than fifteen (15) months and now at this belated stage there is no way in which the petitioner can be compensated. Therefore, this Court calls upon the Finance Ministry of the Union of India to take note of the fact situation that arises in the present case and pass necessary instructions/guidelines either through the Ministry or the CBEC as it may deem appropriate, in order to ensure that such large scale wastage of time and public money does not occur in future cases. 34. At the closure of hearing, Mr. Bose, learned Assistant Solicitor General was asked by the Court to enquire from the Director General of Foreign Trade as to whether the necessary licenses granted by then required to be revalidated. But on instruction, he submitted before this Court that since the goods had already arrived at Dharma Port, within the period specified in the license, there possibly would be no requirement of any further extension of time of the EPCG Licenses. In any event, he submitted that the DGFT have no objections to the prayer made by the petitioner and, in the event, any formal correction/extension is required in the licenses, the DGFT would grant any such extension, if any required, to comply with the directions of this Court. 35. In any event, he submitted that the DGFT have no objections to the prayer made by the petitioner and, in the event, any formal correction/extension is required in the licenses, the DGFT would grant any such extension, if any required, to comply with the directions of this Court. 35. Accordingly, the impugned order dated 11.08.2017 under Annexure-1 stands quashed with a further direction to the Commissioner of Customs to issue the necessary “special order” in favour of the petitioner forthwith. We hope and trust that the Authorities concerned would look at such issues in a pragmatic manner, of course, always being vigilant to ensure no loss of revenue occurs to the State. The writ application is allowed in terms of the directions issued hereinabove.