# M/S. NORTHERN PLASTICS L'[D v. HINDUSTAN PHOTO FILMS MFG. CO. LTD. AND ORS

- **Citation:** [1997] 2 S.C.R. 252
- **Court:** Supreme Court of India
- **Decided:** 1997-02-20
- **Bench:** S.P. Bharucha, S.B. Majmudar
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/m-s-northern-plastics-l-d-v-hindustan-photo-films-mfg-co-ltd-and-ors-15371
- **Pages:** 28

## Headnote

Customs Act 1962:-S. 129-D, Chapter XV.
Maintainability of a11 appeal under the Customs Act-011ly parties to
C the proceedings can appeal to CEGAT-'Locus Standi' to 'person aggrieved'
which tenn includes third parties who have direct legal interest but not those
merely wanti11g to appeal in general public interest or due to business rivalry-Appeal is a creature of Statute-The wider concept of 'Locus standi'
applicable to PIL cannot be earned to statutes-Union of India, in wider
D public interest, can challenge an order of the collector under Artcile 226
though not before CEGAT~blic Interest litigation-Locus standi.
Customs Tariff Act 1975-Chapter 37 of !st Schedule-Industrial
(Development & Regulation) Act 1951-S. 25(1), Item 20 of !st Schedule.
E
The Appellant obtained Small Scale Industries registration, under
the Industries (Development & Regulation) Act 1951, for slitting and confectioning of jumbo rolls of various types of films. They had for this pur·
pose imported X-ray films and graphic art films which arrived at the Port
of Bombay. While the Appellant claimed concessional rates of duty based .
on a notification by the Central Govt. on the said imported goods, the same
F was refused by the Assesstant Collector of Customs. The Appellant thereon
filed a Writ Petition before the High Court at Delhi werein the Respondent
HPF who was not originally a party, was made a party on he direction of
the Court and tht Single Judge passed an interim order for release of the'
goods at the concessional duty. This order was set aside by the Division
G Bench of the same High Court. However on an application by the Appellant
to the Collector of Customs, permission for clearance of the goods on
payment of the full duty was given and this order was also approved by the
Additional Collector. On learning of this order the Respondent HP1'' prayed
for stay or the order of the collector for premitting clearnace and removal
of the imported goods, before the Delhi High Court in the plending petition
H of the Appellant, which was eventually dismissed HPF also filed a Writ
252
NORTHERN PLASTICS LID. v. HINDUSfAN PHOTO FILMS MFG. CO. LID. 253
Petition with a similar prayer for an interim order before the Bombay High A
Court which was not granted, and HPF withdrew the petition later. A
Special Leave Petition filed by HPF against the order of the Delhi High
Court vacating ex-paJte stay against release of imported goods to Appellant
was dismissed as withdrawn.
A Writ Appeal was filed before the Division Bench of the Bombay B
High Court. However no interim order was passed was by the said Division
Bench. So HPF filed an appeal before the CEGAT which granted an
ex-parte interim order to operate for a week on which HPF withdrew its Writ
petition before the Bombay High Court. When this :nterim order of the
CEGAT expired and was not extended, HPF filed a Writ Petition appe11ling C
against the order of CEGAT on which the Division Bench of the Delhi High
Court directed the CEGAT to dispose off the appeal of HPF and to grant
a stay till final disposal of the case. While the appeal was pending disposal
before CEGAT, the Ministry of Industries also filed an appeal before the
same forum against the same of the order of the Additional Collector. The
CEGAT held that HPF, a business rival was not a Person aggrieved as D
contemplated under Section 129-A of the Customs Act and hence the
appeal was not maintainable. The appeal of the Industries Ministry was
also dismissed on the same grounds.
Aggrieved by the order of CEGAT, HPF filed a Writ Petition before E
the High Court at Delhi. The Division Bench of the High Court stayed the
clearance of the goods till disposal of the Writ Petition. Ministry of
Industries was also made a party to the said Writ Petition. The Union of
India also filed a separate Writ Petition against the very same order of the
GEGAT. By a common order the High Court disposed off the Petitions
holding that the Appeals before the CEGAT by HPF and th

## Text

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A
B
M/S. NORTHERN PLASTICS L'[D.
v.
HINDUSTAN PHOTO FILMS MFG. CO. LTD. AND ORS.
FEBRUARY 20, 1997
(S.P. BHARUCHA AND S.B. MAJMUDAR, JJ.]
Customs Act 1962:-S. 129-D, Chapter XV.
Maintainability of a11 appeal under the Customs Act-011ly parties to
C the proceedings can appeal to CEGAT-'Locus Standi' to 'person aggrieved'
which tenn includes third parties who have direct legal interest but not those
merely wanti11g to appeal in general public interest or due to business rivalry-Appeal is a creature of Statute-The wider concept of 'Locus standi'
applicable to PIL cannot be earned to statutes-Union of India, in wider
D public interest, can challenge an order of the collector under Artcile 226
though not before CEGAT~blic Interest litigation-Locus standi.
Customs Tariff Act 1975-Chapter 37 of !st Schedule-Industrial
(Development & Regulation) Act 1951-S. 25(1), Item 20 of !st Schedule.
E
The Appellant obtained Small Scale Industries registration, under
the Industries (Development & Regulation) Act 1951, for slitting and confectioning of jumbo rolls of various types of films. They had for this pur·
pose imported X-ray films and graphic art films which arrived at the Port
of Bombay. While the Appellant claimed concessional rates of duty based .
on a notification by the Central Govt. on the said imported goods, the same
F was refused by the Assesstant Collector of Customs. The Appellant thereon
filed a Writ Petition before the High Court at Delhi werein the Respondent
HPF who was not originally a party, was made a party on he direction of
the Court and tht Single Judge passed an interim order for release of the'
goods at the concessional duty. This order was set aside by the Division
G Bench of the same High Court. However on an application by the Appellant
to the Collector of Customs, permission for clearance of the goods on
payment of the full duty was given and this order was also approved by the
Additional Collector. On learning of this order the Respondent HP1'' prayed
for stay or the order of the collector for premitting clearnace and removal
of the imported goods, before the Delhi High Court in the plending petition
H of the Appellant, which was eventually dismissed HPF also filed a Writ
252
NORTHERN PLASTICS LID. v. HINDUSfAN PHOTO FILMS MFG. CO. LID. 253
Petition with a similar prayer for an interim order before the Bombay High A
Court which was not granted, and HPF withdrew the petition later. A
Special Leave Petition filed by HPF against the order of the Delhi High
Court vacating ex-paJte stay against release of imported goods to Appellant
was dismissed as withdrawn.
A Writ Appeal was filed before the Division Bench of the Bombay B
High Court. However no interim order was passed was by the said Division
Bench. So HPF filed an appeal before the CEGAT which granted an
ex-parte interim order to operate for a week on which HPF withdrew its Writ
petition before the Bombay High Court. When this :nterim order of the
CEGAT expired and was not extended, HPF filed a Writ Petition appe11ling C
against the order of CEGAT on which the Division Bench of the Delhi High
Court directed the CEGAT to dispose off the appeal of HPF and to grant
a stay till final disposal of the case. While the appeal was pending disposal
before CEGAT, the Ministry of Industries also filed an appeal before the
same forum against the same of the order of the Additional Collector. The
CEGAT held that HPF, a business rival was not a Person aggrieved as D
contemplated under Section 129-A of the Customs Act and hence the
appeal was not maintainable. The appeal of the Industries Ministry was
also dismissed on the same grounds.
Aggrieved by the order of CEGAT, HPF filed a Writ Petition before E
the High Court at Delhi. The Division Bench of the High Court stayed the
clearance of the goods till disposal of the Writ Petition. Ministry of
Industries was also made a party to the said Writ Petition. The Union of
India also filed a separate Writ Petition against the very same order of the
GEGAT. By a common order the High Court disposed off the Petitions
holding that the Appeals before the CEGAT by HPF and the Union of India F
are maintainable as they are 'aggrieved persons' within the meaning of S
129-A of the Customs Act and that they had Locus S(andi in public interest.
Against the order of the Delhi High Court, the Appellant filed an SLP.
This Court granted Leave and the Chief Controller of Imports and Exports
was appointed as Receiver to dispose off the goods in question and deposit G
the sale proceeds in the Court. The sale was completed and the proceeds
were deposited in Court. It was submitted by the Appellant inter alia, that
the High Court was in error and that only the parties before the Collector
could appeal to the CEGAT; that the Relevant provisions of the Statue have
to be looked into to find out if third parties could appeal; that S 129-A of H
254
SUPREME COURT REPORTS
(1997) 2 S.C.R.
A the Act did not provide for such appeal; that an expanded concept of 'Locus
Sta11di' as applicable to l>IL preferred under Articles 226 and 32 is not
applicable to statutory right of appeal; that neither of the Respondents was
aggrieved by the order.
'
On behalf of the Union of India it was submitted that the High Court
B was right in its decision; that the Union of India and HPF were 'persons
aggrieved' within the meaning of S 129-A; that the order was illegal and the
goods were liable to confiscation; that the Union of India represented
Public interest, and in this case large amount of revenue was also involved.
On behalf of HPF it was pointed out that large sums were invested by the
C Govt. in HPF and therefore it cannot be said that there was no public
interest involved; that such import would flood the market and would
prejudice HPF's interests.
Allowing the Appeals, this Court
D
HELD : 1. Appeal is a creature of statute. The right to appeal has to
be exercised by persons permitted by the statute to prefer appeals subject
to the conditions regarding the filing of such appeals. The wider concept of
locus standi in public interest litigation moved before this Court under
Articie 32 of the Constitution of India which itself is a fundamental right
E or under Article 226 before the High Court which also offers a constitutional remedy cannot be imported for deciding the right of appeal under the
statutory provisions contained in the Customs Act. Whether any right of
appeal is conferred on anyone against the orders passed under the Act in
the hierarchy of proceedings before the authorities has to be judged from
the statutory settings of the Act and not dehors them. Therefore, the High
F Court in the impugned judgment had erred in drawing the analogy from
the more elastic concept of locus standi under Article 32 or Article 226
evolved by this Court by its decisions on the subject. For judging the
competence and locus standi of the Union of India or the HPF for moving
appeals before CEGAT against the order of Additional Collector of Customs passed under Section 122 of the Act the answer must be found within
G the four corners of the Act itself, The High Court had committed a patent
error of law in taking the view that the concerned writ ·petitioners before it
had sufficient locus standi to prefer appeals before CEGAT. The decision
of CEGAT that they had no such locus standi was perfectly justified on the
scheme of the Act and it was wrongly set aside by the High Court.
H
[267-D, 268-E-G, 277-G]
-
NORIBERN PLASTICS LTD. v. HINDUSTAN PHOTO FILMS MFG. CO. LTD. 255
. Anant Mills Co. Ltd. Etc. Etc. v. State of Gujarat & Others Etc. Etc., A
AIR (1975) SC 1234 = [1975] 2 SCC 175, followed.
-
Bar Council of Maharashtra v. M. V. Dabholkar Etc. Etc.,· AIR (1975)
SC 2092, distinguished.
2. S 129 deals with Appeals to Collector (Appeals) and S 128-A deals B
with 'procedure in ·appeal'. The Appellate 'Tribunal is constituted as per
S 129 of the Act, Section 129-DA gives powers of revision to Board or
Collector of Custom in certain cases. Similarly S 129-DD gives powers of
revision to Central Govt. to entertain revision petitions against certain
orders of Collector (Appeals). The aforesaid provisions of the Act leave no c
room for doubt that they represent a complete scheme or code for cha!-
lenging the orders passed by the Collector (Customs) in exercise of his
statutory powers. It is axiomatic that the importer against whom the
Collector bas passed the impugned order of adjudication and who is called
upon to pay the customs duty which, according to him, is not payable is . D
certainly an 'aggrieved person' who can prefer an appeal under S 129-A
(1) of the Act. So far as departmental authorities themselves are concerned
including the Collector of Customs no direct right of appeal is conferred
on Collector to prefer appeal against his own order before CEGAT. However there is sufficient safeguard made available to the Revenue by the Act E
for placing in challenge erroneous orders of adjudication as passed by the
Collector of Customs by moving the Central Board of Excise and Customs
under S 129-D (1) for a direction to the Collector to apply to the CEGAT
for determination of such point arising out of the decision or order as may
be specified by the Board of Revenue in this connection. Similarly ·a F
statutory remedy is provided to the Collector of Customs in connection
with orders of Appellate Collector of Customs passed immediately before
the appointed day and also in connection with the orders passed by
Collector of Customs under S 128-A, to direct proper officer to appeal on
:;
his behalf as laid down by S 129-A (2). Revisional powers are also con-
'
G
__,
ferred on the Central Board of Excise and Customs against the orders of
Collectors of Customs as provided by S 129-DA (1) as well as on the
Central Govt. under contingencies contemplated by S 129-DD(l). These
are the only statutory modes contemplated by the Act by resort to which
the orders of Collector (customs) could be brought in challenge before
higher statutory authorities including the CEGAT. In the light of this H
256
SUPREME COURT REPORTS
[1997] 2 S.C.R.
A statutory scheme, therefore, it is not possible to agree with the contention
of the Ld counsel for the respondents that sub-section (1) of section 129-A
entitles any and every person feeling aggrieved by the decision or order of
the Collector of Customs as an adjudicating authority, to prefer statutory
appeal to the Appellate Tribunal. Neither the Central Govermnent through
B the Industries Department, nor the rival Company or industry operating
in the same field as the importer can as a matter of right prefer.an appeal
as 'person aggrieved'. (271-D-H, 272-A-C]
3. It is true that the phrase 'person aggrieved' is wider than the
phrase 'party aggrieved'. But in the entire context of the statutory scheme
C specially sub-section (2) of Section 129-A it has to be held that only the
parties to the proceedings before the adjudicating authority, Collector of
Customs could prefer such an appeal to the CEGAT and the adjudicating
authority under S 122 can prefer such an appeal only when directed by
Board under S 129-D(l) and not otherwise. It is easy to visualise that even
D a third party may get legitimately aggrieved by the order of the Collector of
Customs being the adjudicating authority if it is contended by such third
party that the goods imported really belong to it and not to the purported
importer or that he had financed the same and, therefore, in substance he
was interested in the goods and consequently the release order in favour of
the purported importer was prone to create a legal injury to such a third
E party which is not actually arraigned as a party before the adjudicating
authority and was not heard by it. Under the circumstances such a third
pary might perhaps be treated to be legally aggrieved by the order of the
Collector of Customs as an adjudication authority and may legitimately
prefer an appeal to the CEGAT as 'person aggrieved'. That is the reason
F why the Legislature in its wisdom has used the phrase 'Any person
aggrieved' by the order of Collector of Customs as adjudicating authority
in S 129-A(l). But in order to earn a locus standi as 'person aggrieved' other
than the arraigned party before the Collector of Customs as an adjudicating authority it must be shown that such person aggrieved being a third
party has a direct legal interest in the goods involved in the adjudication
G process. Itcannot be a general public interest or interest of a business rival
as is being projected by the contesting respondents. (272-C-H]
Adi Pherozshah Gandhi v. H.M. Seervai, Advocate General of
Maharashtra, Bombay, (1970) 2 SCC 484 and Jasbhai Motibhai Desai v.
H Roshan Kumar Haji Bashir Ahmed and Others, (1976) 1 SCC 671, follow~d.
-
, .
-
--
NORTIIERNPLASTICS L1D. v. HINDUSTAN PHOTO FILMS MFG. CO. L1D. 257
4. So far as the Union of India is concerned, it may have to subserve A
a larger public interest by raising the.present dispute and may legitimately
feel aggrieved by the order of the Additional Collector of Customs. But
even if it is so, the statutory procedure laid down by the Parliament in its
wisdom for enabling the challenge to the adjudication order of the Collector of Customs by 'way of Appeals or revisions as per the aforesaid relevant B
statutory provisions has got to be followed in such an eventuality. Bypassing the said statutory procedure, a direct frog leap to GEGAT is contraindicated by the statutory scheme of the Act. If such direct appeals are
permitted the very scheme of S 129-D(l) would get stultified. It must,
therefore, be held that direct appeal filed by the Union of India through
Industries Ministry to CEGAT under S 129-A (1) was clearly incompetent. C
It may be added that the Union of India could have used the mode set out
in S 129-D but it did not do so. (275-H, 276-A-C]
S. So far as the appeal filed by the HPF is concerned it is still on a
weaker footing even though HPF may be a public limited Company wholly D
owned by the Central Govt. and even if the Central Govt. might have sunk
more than Rs. 400 crores in constituting it, its function would still remain
in the domain of commercial enterprise. It may be a limb of the Central
Govt. or its alter ego so far as Article 12 of the Constitution is concerned
and may be. treated as a State so that it can be at the receiving end to answer E
challenges about violation of constitutional guarantees or statutory
provisions under which it may be acting, but that would not clothe it with
a legal locus standi to prefer a statutory appeal before CEGAT under S
129-A(l). From the point of view of that provision it is no more than a
business rival and cannot be said to be a 'persen aggrieved' by the adjudicatory order of the Collector of Customs releasing imported goods to F
the appellant on payment of full customs duty. It has also to be noted that
the Customs Act nowhere provides for any special interest of such public
concerns which may be operating as rivals.in the same commercial field in
which the importer may be operating. In the absence of any special
statutory provision for protecting the interest of such Govt. concerns or G
Publ!c sector undertakings no statutory locus standi can be culled out in
their favour on the express language of the relevant provisions of the Act.
It must therefore be held that HPF was a mere business rival operating in
the same commercial field and carrying on the same commercial activities
as the appellant. Its locus standi to challenge the order of Additional Collector of Customs in favour of the appellant, therefore, gets squarely ruled H
258
SUPREME COURT REPORTS
[1997) 2 S.C.R.
A out. Counsel for the HPF in this connection submitted that if imported
goods of the appellant were allowed to enter the market HPF's commercial
interest would be materially prejudiced and by now it has already become
a sick unit. That is neither here nor there. The said grievance would still be
in the realm of damnum sine injuria. Consequently the appeal filed before
the CEGAT also must be treated to be incompetent and could not be
B covered by the sweep of S 129-A (1) of the Act. (276-D-H, 277-A-B]
Jasbhai Motibhai Desai v. Roshan Kumar Haji Bashir Ahmed And
Others, (1976) 1 SCC 671, relied on.
C
K Ramdas Shenoy v. The Chief Officers Town Municipal Council
Udipi and Others, · (1975) 1 SCR 680, referred to.
6. As the High Court has noted in the impugned judgment, the other
contentions in the writ petitions filed by the contesting respondents were
D not considered by it in view of its decision on the right of appeal which was
made available to the concerned writ petitioners before the CEGAT. The
High Court was not at all justified in presuming what it should do in case
the appellant's appeal succeeded before this Court. Proper direction in
that connection should have been given by this Court in such an eventuality. High Court could not have pre-empted the same by the impugned
E judgment. However in view of the fact that other contentions in the writ
petitions were not examined by the High Court in any case they will now
have to be examined by it. As the decision on the right to appeal to CEGAT
made available to the contesting respondents by the High Court is being
set aside, the question remains as to what further appropriate orders can
F
be passed in this connection. So far as this question is concerned it may
be noted that two writ petitions were moved, one by Union of India being
Civil Writ Petition No. 3083 of 1989 and another by HPF being Civil Writ
Petition No. 2286of1989. HPF being a business rival of the appellant has
no right to challenge the order of the Additional Collector of Customs,
Bombay passed in favour of the appellant its writ petition being Civil Writ
G Petition No. 2286 of 1989 filed before the High Court will stand dismissed.
However Writ petition filed by the Union of India being Civil Writ Petition
No. 3023 of 1989 will have to be permitted to proceed further on remaining
controversy before the High Court in so far as Union of India seeks to
challenge the order of the Collector Customs, Bombay dated l 51/51h June
H 1989. Union of India could legitimately challenge the s~id order before
--
--
NORTiillRN PLASTICS LID. v. HINDUSTAN PHOTO FILMS MFG. CO. LID. (S.B. MAJMUDAR, J.] 259
appropriate forum in public interest and as it has wider locus standi at A
least in proceedings under Article 226 of the Constitution of India if not
before CEGAT, its challenge in the writ petition under Article.226 against
the said order cannot be told off the gates. That challenge will have to be
examined by the High Court under Article 226 on its own merits. It is
obvious that it will be open to the appellant as contesting respondent to B
try_ to support the impugned order of the Assistant Collector/Collector of
Customs on all legally permissible grounds. In short the said controversy
between the Union of India on the one hand and the appellant on the other
in Union of India's writ petitian No. 3023 of 1989 will have to be examined
by the Division Bench of the High Court on its own merits. [278-A-H]
CML APPELLATE JURISDICfION : Civil Appeal Nos. 2035-36
of 1990.
From the Judgment and Order dated 9.3.90 of the Delhi High Court
in C.W.P. No. 3023 and 2286 of 1989.
c
D
D.A. Dave, Parag Tripathi, A:T. Patra, Gautam Khaitan for O.P.
Khaitan & Co. for the Appellant.
Dhruv Mehta, S.K. Mehta and Fazlin Anam for the Respondent.
A. Subba Rao, S.A. Matto, V.K. Verma for the Union of India.
E
The Judgment of the Court was delivered by
S.B. MAJMUDAR, J. M/s. Northern Plastics Ltd. is the common
appellant in these two appeals moved by it after obtaining special leave to
appeal from this Court against a common judgment dated 9th March 1990 F
passed by the High Court of Delhi in two Civil Writ Petitions, one moved
by M/s. Hindustan Photo Films Mfg. Co. Ltd. ('HPF' for short), respondent
No. 1 in C.A. No. 2035 of 1990, and the other the Union of the India,
respondent No. 1 in the companion Civil Appeal No. 2036 of 1990. The
question posed for our consideration is as to whether 1st respondents in
these civil writ appeals could be said to be 'persons aggrieved' within the G
meaning of Section 129-A of the Customs Act, 1962 (hereinafter referred
to as 'the Act') so that they could challenge before be Customs, Excise and
Gold (Control) Appellate Tribunal ('CEGAT' for short) the order passed
by the Additional Collector of Customs, Bombay dated 5th June 1989
agreeing with the notings made by the Assistant Collector of Customs H
260
SUPREME COURT REPORTS
[1997) 2 S.C.R.
A dated 31st May 1989 recommending release of the imported goods to the
common appellant on payment of full customs duty. The CEGAT took the
view that respondent No. 1 in both these appeals had no locus standi to
prefer appeals against the said order. The High Court of Delhi by the
Impugned judgment has taken a contrary view and has ruled in favour of
B the locus standi of these respective respondents.
·
Before we deal with the aforesaid question it will be necessary to
note the relevant background facts leading to the present controversy
between the parties. They project a chequered history. The common
appellant, Northern Plastics Ltd., which will hereinafter be referred to as
C the appellant' for the sake for convenience, is said to have obtained Small
Scale Industries Registration (SSI Registration) on 24th August 1985 for
slitting and confectioning of jumbo rolls of various types of films. The said
registration, according to the appellant, was obtained under. the Industries
(Development & Regulation) Act, 1951 ('IDR Act for short). A notification was issued by the competent authority under the said Act on 18th July
D 1986 effectively taking away the exemption from requirement of licence in
respect of Item 20 of 1st Schedule to the IDR Act thus making it obligatory
for owner of industrial undertaking to have licence within six months. It is
the case of the appellant that although it was not the owner of industrial
undertaking as defined by the IDR Act, under a mistaken belief it applied
E for COB licence on 8th December 1986. On 7th July 1988 a notification
was issued by the Central Government in exercise of its powers under
sub-section (1) of Section 25 of the Act exempting jumbo rolls of graphic
art films and jumbo rolls of photographic colour paper, of width 1 metre
or more of length 600 metres or more, falling within Chapter 37 of the First
F Schedule to the Customs Tariff Act, 1975 (51 of 1975), when imported into
India, from so much of that portion of the duty of customs leviable thereon
under the said First Schedule as was in excess of the amount calculated at
the rate of 60 per cent ad valorem, subject to the following conditions :
(i) the importer undertakes conversion of the said jumbo rolls by
G
slitting or confectioning into finished products;
(ii) the importer holds an industrial licence under the Industries
(Development and Regulation) Act, 1951 (65 of 1951), for slitting
and confectioning of photo-sensitised materials from jumbo rolls.
H According to the appellant the benefit of this concession in import duty on
1
-
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NORTHERN PLASTICS LTD. v. HINDUSTAN PHOTO FILMS MFG. CO. LTD. (S.S. MAJMUDAR, J.] 261
the jumbo rolls of various types of films which were being imported by the A
appellant was available to it. The appellant had imported various consignments of articles of X-Ray films and graphic art films through the port at
Bombay between January 1989 and May 1989. The shipments concerned
for the same consignments were made in favour of the appellant by the
foreign exporter~ ·between 15th December 1988 and 20th April 1989. B .
According to die Appellant the goods were .worth Rs. 246 lacs approximately in foreign exchange. That the appellant had paid customs duty
amounting to Rs. 196 lacs on these consignments and the additional duty
if the exemption was not available to the appellant on these consignments
would have becomes payable to the extent of Rs. 130 lac. The total value
of the goods imported at Bombay port by the appellant during the C
aforesaid period worked up to Rs. 572 lacs according to the appellant. The
Assistant Collector of Customs (Bombay) had not granted the requisite
relief of concessional import duty payable for the imported consignments
of the appellant. Hence a writ petition being Civil Writ Petition No. 2021
of 1988 was moved by the appellant in the High Court of Deihl where D
principal relief sought was for the grant of benefit of the aforesaid customs
exemption notification. A prayer was also made for issuance of COB
licence by ~tl!e competent authorities under the IDR Act. Initially the
appellant haJ not joined M/s. 'HPF', a public sector undertaking in the
said writ petition as a respondent as it was merely a business rival of the E
appellant. However oli ·an application by the HPF a Division Bench of the
High Court by its order dated St)l May 1989 allowed it to be a party-respondent in the appellant's petition. In the aforesaid writ petition filed by the
appellant before High Court of Delhi initially an order was passed by a
learned Single Judge directing removal and release of the jumbo rolls F
imported by the appellant at Bombay at concessional rate of customs duty.
However this interim order was set aside by a Division Bench of the High
Court by its order 8th May 1989. Pending ,this writ petition in the Delhi
High Court, upon an appellaht by the appellant, an order was proposed to
be passed by the Assistant Collector of Customs (Bombay) on 31st May
1989 permitting the clearance of the imported consignment of the appellant G
upon payment of full rate of c,ustoms duty. The said proposed order was
placed for approval before the-Additional Collector of Customs (Bombay).
Below the said proposal the
1
Addition~ Collector of Customs (Bombay)
put his endorsement agreeing to the said proposal on 1st June 1989. The
said order which came to be communicated to the appellant on 5th June H
262
SUPREME COURT REPORTS
(1997) 2 S.C.R.
A 1989 entitled the appellant to clear the imported goods on payment of full
customs duty without availing of the benefit of the concessional rate of
import duty pursuant to the earlier referred notification dated 7th July
1988.
B
Having come to know about this order of the Additional Collector
of CustoJllS, HPF which is a public sector undertaking wholly owned by
Government of India, which was already joined as a party, at its own
request, to the appellant's pending petition, moved an interim relief application in that petition for staying the clearance and removal of the goods
imported by the appellant. The High Court by its order dated 9th June
C 1989 in vacation granted ex-parte stay of the Collector's order. The interim
relief application of HPF was subsequently heard by another Vacation
Judge in the High Court on 21st June 1989 and after completion of the
arguments on behalf of the HPF on 26th June 1989 a request was made
for not pronouncing the judgment in the said interim relief application.
D However the said request was not granted and the interim relief application
of HPF was dismissed on 26th June 1989 by the High Court. That thereafter HPF filed a writ petition in the High Court of Bombay on that very
day, that is, 26th June 1989 praying for similar interim relief against release
of the imported goods to the appellant. The High Court rejected the
request for a parte interim relief. A Special Leave Petition was also moved
E by the HPF before this Court against the Delhi High Court order dated
26th June 1989 vacating the ex parte stay granted against the release of
imported goods in favour of the appellant. The said Special Leave Petition
was dismissed as withdrawn by this Court. After HPF's Special Leave
Petition was dismissed as withdrawn by this Court on 27th June 1989 a writ
F appeal was moved by th HPF before a Division Bench of the Bombay High
Court against the order of learned Single Judge refusing to grant ex parte
stay in writ petition of HPF, but no interim relief was granted by the High
Court even in this writ appeal. Under these circumstance HPF filed an
appeal to CEGAT on 28th June 1989 against the order of Additional
G Collector of Customs (Bombay) dated 5th June 1989. An ex parte interim
order was obtained from CEGAT for a week up to 6th July 1989. HPF
then withdrew the writ petition before the Bombay High Court. In the
meantime the status quo order granted by CEGAT expired on 6th July
1989 and it was not extended. HPF then filed a writ petition before the
High Court of Delhi being Writ Petition No. 1932 of 1989 against the order
H dated 7.7.1989 passed by CEGAT and the Division Bench of the High
-
-
-
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NORTHERN PLASTICS LTD. v. HINDUSTAN PHOTO FILMS MFG. CO. LTD. [S.B. MAlMUDAR, J.] 263
Court passed an ex parte stay of the order of the Additional Collector of A
Customs dated 5th June 1989 on 12th July 1989. The High Court of Delhi
by its order dated 17th July 1989 disposed of Writ Petition No. 1932 of
1989 moved by the HPF against the Additional Collector's order and
directed CEGAT to dispose of the appeal of the HPF. The High Court,
·however, further directed that till the final disposal of the appeal by the B
CEGAT the stay granted on .12th July 1989 would continue. Before HPF's
appeal could be h.eard by the CEGAT an appeal being No. 2072 of 1989
was field by the Ministry of Industries, New Delhi before CEGAT under
Section 129- A of the Act against the very same order of Additional
Collector dated 5th June 1989. A Bench of CEGAT by its order dated 31st
July 1989 dismissed the appeal of HPF against Collector of Customs on C
the ground that HPF being a business rival of the appellant was not 'person
aggrieved' as contemplated by Section 129-A of the Act and hence the
appeal was not maintainable. Thereafter on 8th August 1989 the other
appeal filed by Ministry of Industries against the very same order of
Additional Collector of Customs was also dismissed as not maintainable, D
the Ministry of Industries being held not an 'aggrieved person' within the
meaning of Section 129-A of the Act. Under these circumstances HPF filed
another Writ Petition No. 2286 ·of 1989 in the Delhi High Court on 9th
August 1989 challenging two orders - (i) the order of CEGA T dated 31st
July 1989 holding its appeal as not maintainable; and (ii) the order of
Additional Collector of Customs (Bombay) ordering release of the imE
ported goods to the appellant. A Division Bench of the High Court while
admitting the writ petition restrained clearance of the goods in favour of
the appellant pending the writ petition. In the said writ petition Ministry
of Industries was also permitted on its application to be impleaded as
party-respondent. The Union of India representing Ministry of Industries F
in its turn filed another writ petition being Civil Writ Petition No. 3023 of
1989 on 24th October 1989 before the High Court of Delhi against the
order dated 8th August 1989 passed by CEGA T against it. That petition
was also admitted by the High Court of Delhi. Both these writ petitions .
were heard together and by a common order dated 9th March 1990 a
Division Bench of the High Court took the view that the appeals filed by G
the respective first respondents in these appeals were maintainable before
the CEGAT as they could be said to be 'persons aggrieved' within the
meaning of Section 129-A of the Act and that they had sufficient locus
standi in public interest to maintain their appeals. In the result the Division
H
e
264
SUPREME COURT REPORTS
[1997] 2 S.C.R.
A Bench of the High Court partly allowed the writ petitions of both the first
respondents in these appeals moved by the Union of India as well as HPF
and passed the following order :
B
c
D
E
"We have held that the Union of India and M/s. Hindustan Photo
Films Ltd. are 'aggrieved persons' and can maintain an appeal
under Section 129-A of the Customs Act. The main question in
the writ petition at the root of the entire controversy between the
parties is whether the said importation of the photo-sensitized
material at Bombay was legal or not would now be decided by the
Appellate Tribunal. But assuming that M/s. Northern Plastics Ltd.
takes an appeal against our order to the Supreme Court and our
decision is reversed, still the question of the legality of the importation would be open to the parties to be argiled in this writ petition
before us. Thus, till the main question of legality of importation is
finally disposed of, in the interests of justice, it is necessary that
the subject-matter of the controversy, viz. the imported goods, are
preserved in the custody of the Customs Authorities and are not
released. Since the goods are now stored under the suitable conditions of storage with M/s. Northern Plastics Ltd. there is no
likelihood of their deteriorating. No variation in our order dated
9.8.89 in regard to the release of goods is, therefore, called for.
The writ petition is partly allowed to the extent indicated
above."
As already noted the aforesaid common order of the Division Bench of the
F High Court of Delhi has resulted in present two appeals on grant of special
leave by this Court. Pending these appeals it was felt by this Court that the
imported goods in question were likely to deteriorate with passage of time
and if that happened the contesting parties would stand to suffer irretrievably. Consequently by an order dated 25th April 1990 a Bench of
G two learned judges of this Court was pleased to direct that Chief Controller
of Imports and Exports may be appointed as Court Receiver for disposing
of the goods in question by sale in auction as expeditiously as possible and
at the maximum price they will fetch in the market. It was further directed
that the amount of the sale proceeds of the auction shall forthwith be
deposited by the receiver in this Court to the credit of these appeals.
H Accordingly the goods were auctioned. By a further order dated 21st
j
NOR111BRN PLASTICS LID.'· HINDUSTAN PHOTO FILMS MFG. CO. LID. [S.B. MAJMUDAR, J.] 265
September 1990 another Bench of two learned Judges of this Court acA
cepted the offer of four purchasers who had offered to purchase all the
disputed goods for a total sum of Rs. 1,40,00,000. Four auction sales were
confirmed in favour of the concerned auction purchasers. By the same
order it was directed that the auction amount shall be deposited by this
Court in a Fixed Deposit Account and the amount so deposited shall B
remain in the custody of the Court and shall be disposed of in accordance.
.
with the final judgment in the appeals pending before the Customs, Excise .
, . ...-
and Gold (Control) Appellate Tribunal. The aforesaid order was passed
for the obvious reason that by that time under the common judgment under
"
appeal CEGAT was directed by the High Court to disposed of the appeals
of Union of India as well as HPF pursuant to its judgment. However as c
--
these appeals are being disposed of finally by us by the present judgment
appropriate orders will have to be passed by us in connection with this
deposited amount. We shall do so after considering the main question
involved in controversy between the parties in these appeals.
For the purpose of these appeals we shall assume that the order of D
Assistant Collector of Customs (Bombay), as approved by the Additional
Collector of Customs (Bombay), of 1st June 1989 was in itself appealable
to CEGAT under Section 129-A of the Act being a decision and order
passed by an adjudicating authority under Section 122 of the Act. We
assume as aforesaid for the simple reason that Shri Dave, learned senior E
counsel for the appellant has vehemently contended that the said endorsement of the Additional Collector of Customs was of an administrative
nature and was not appealable. Neither CEGAT nor the High Court of
Delhi has considered that question and as that question strictly does not
arise for our consideration in the present appeals for deciding the conF
troversy between the parties we have assumed as aforesaid.
.
.
Rival Contentions
I
Shri Dave, learned senior counsel for the appellant has vehemently G
contended that the Division Bench of the High Court had patently erred
.__
in taking the view in the impugned common judgment that HPF as well as
.....
Industries Ministry of the Union of India were 'aggrieved person' within
the meaning of Section 129-A of the Act. According to Shri Dave, the only
parties which could prefer appeal to CEGAT could be either the aggrieved
importer or the Collector of Customs after following the procedure of H
266
SUPREME COURT REPORTS
(1997] 2 S.C.R.
A Section 129-D of the Act. That save and except these two parties no third
party had a right to appeal under the Act. That right of appeal under the
Act is a creature of statute. Therefore, we have to took at the relevant
provisions of the statute with a view to finding out whether an appeal lies
at the instance of any third parties like the present first respondents in both
B these appeals. Shri Dave in this connection placed strong reliance on
Section 129-A sub-section (1) as well as sub-section (3) thereof. In support
of his submission he placed reliance on judgments of this Court to which
we will make a reference at an appropriate stage. Shri Dave submitted that
the concept or locus standi as expanded by decisions of this Court in
connection with public interest litigations moved before this Court under
C Article 32 or before the High Courts, under Article 226 of the Constitution
of India had no application to the statutory right of appeal to be culled out
from the express language of the statute creating the appellate forum and
also confirming the right of appeal to the parties mentioned therein. In the
alternative, submitted Shri Dave, neither the Industries Ministry nor the
D HPF, which is a rival commercial concern, can be said to be aggrieved by
the order of the Assistant Collector of Customs (Bombay) directing release
of the imported goods in favour of the appellant on payment of full customs
duty. Shri Dave also tried to submit that it could not be urged by the
contesting· respondents that the import of the goods in question was
unauthorised as for additional import licence purchased by the appellant
E actual user test was not applicable. For resolving the present controversy
it is not necessary to consider this alternative contention of Shri Dave. We
will confine our decision to the limited question whether appeals moved
by each of the first respondents in these appeals before CEGAT were
maintainable or not.
F
Learned counsel Shri Subba Rao appearing for the Union of India
as well as· learned counsel appearing for HPF on the other hand tried to
support the decision rendered by the High Court of Delhi and submitted
that on the express language of Section 129-A sub- section (1) of the Act
G the Industries Ministry of the Union of India as well as HPF could be said
to be 'persons aggrieved'. That according to the Industries Ministry of
Union of India the appellant had imported goods which were liable to
confiscation under the Act and, therefore, the order of the Additional
Collector of Customs (Bombay) was patently erroneous. That it affected
the public revenue as well as the effective implementation of IDR Act and,
H therefore, it could not be said that the Industries Ministry did not represent
NORTHERN PLASTICS LTD.'· HINDUSTAN PHOTO FILMS MFG. CO. LTD. (S.B. MAJMUDAR, J.) U,7
sufficient public interest to maintain the appeal before CEGAT. Learned A
counsel for HPF in his turn submitted that HPF which is wholly owr,ed
Government company where more than Rs.