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Judgment
P.S. Patankar, J.—The Petitioners sought to import 5,000 Metric Tonnes white cement. The goods arrived at Port of Bombay on or about 17.11.1984. The Petitioners filed bills of entry for house consumption and sought clearance of the said goods claiming as an OGL item under Appendix 6, List 8, Part III, Serial No. 33 of Import Policy for April 1984/March 1985 (hereafter referred as ''Import Policy). However, clearance was not permitted. Respondent No. 1 issued a show cause notice to the Petitioners. In the said show cause notice it was alleged that item cement including clinker is canalised and import thereof is only permitted to be made by STC under Open General Licence as per the conditions laid down at Sr. No. 8, Part A, Appendix 5 of AM-1985 Policy and it cannot be covered under OGL Appendix 6, List 8, Part III as that only covers goods which are not restricted or banned specifically in any other portion of the policy. The price shown was also disputed. However, we are not concerned with the same in this petition.
Petitioners challenged the said show cause notice by filling this Writ Petition. At the time of admission, this Court passed an interim order and also granted liberty to the Respondents to proceed with the adjudication according to the impugned show cause notice though in the meantime the goods were allowed to be cleared on the terms and conditions set out in the said order.
In view of the liberty granted by this Court the Respondent No. 5 proceeded to adjudicate the matter and passed the order on 13.1.1986. He came to the conclusion that white cement is covered under the definition ''Cement'' including clinker appearing at Sr. No. 8 of Appendix 5, Part B of the Import Export Policy. Cement is a generic entry which includes white cement. He therefore held that white cement imported under O.G.L. was not authorised and as such import without an import licence was liable for a confiscation u/s 111(d) of Customs Act, 1962 read with Section 3 of Import (Control) Order 1955. However, he passed the final order of imposing penalty of Rs. 29,57,000/- and directed that the Bond/B.G. executed shall be enforced forthwith as the goods were already cleared and were not available for confiscation.
The question involved in this petition is whether white cement falls under Appendix 6, List 8, Part II, Item 33 or Appendix 5, List No. 8, Part B of the Import Policy. Item No. 33 is as follows:
All other items permitted under Open General Licence in terms of the Import Policy in force, other than these covered by Parts I & II above.
and appendix 5, List No. 8, Part B is as follows:
Cement including Clinker:
In the case of cement including clinker, the import will be made only by the State Trading Corporation of India (STC), under Open General Licence on the basis of foreign exchange released by the Government in its favour. Imports, distribution, and pricing will be made by the STC as per the connected policy of Government in the Ministry of Industry.
The earned Counsel appearing for the Petitioners submitted that cement used for construction purposes is only canalised through STC and covered under Appendix 5, Part 6--No. 8 of Import Policy and not the white cement. It is not possible to accept this submission for 2 reasons. First there is nothing to show that white cement is not used for construction purpose and secondly use of cement for any particular purpose is immaterial as the same is not indicated by the Import Policy. The Import Policy does not define cement or indicate any user. Therefore, test of user is irrelevant. Similarly there is no reason to apply the test of marketability as the phrase cement includes all varieties of cement and obviously therefore would include white cement.
The earned Counsel for the Petitioners then relied upon the definition or description of cement given in (i) Cement Control Order, 1967, (ii) Imported Cement Control Order 1978, and (iii) Press Note issued by Government of India dated 27th February, 1982. However, it is not possible to rely upon the same for finding out what is covered by phrase cement in the Import Policy and come to the conclusion that white cement is excluded. The said definition or description of cement is to be understood in the context of object and purpose of the said Order or Press Note. The Cement Control Order, 1967 has been issued u/s 25 of the Industries (Development and Regulation) Act, 1951 (65 of 1951). Obviously therefore, it is for development and regulation of the cement industries in the country and some industries manufacturing particular type of cement are chosen. The Imported Cement Control Order 1978 has been issued under Essential Commodities Act, 1955 (10 of 1955). It was for distribution and fixing of whole-sale and retail price of the cement. The Press Note dated 27.2.1982 was issued for the purpose of rationalisation of the pricing and distribution policy in regard to cement industry. It was for the scheme of partial decontrol of the existing cement units and for giving momentum for establishment of new cement factories so as to boost indigenous production. While the object of canalisation in the Import Policy is to restrict and regulate the import of cement in the interest of Indian industries and public. Therefore, the definition or description contained in those Orders or the Press Note cannot be applied while finding out the meaning of cement contained in the Import Policy. It is not possible to say that only a particular type or kind of cement is covered under the Import Policy and certain other or others are excluded. The phrase cement is used in generic sense and would cover all types of cement, including white cement.
The earned Counsel appearing for the Petitioners sought to rely upon the judgment delivered by Single Judge of Calcutta High Court reported in In Re: Purbachal International and Another, . No doubt the said judgment dealt with Appendix 5 Part B Sr. No. VIII of Import Trade Control Policy of 1984-85 and cement including clinker was for consideration. The learned Judge proceeded on the footing that white cement and ordinary cement are two different commercial commodities. He applied the test of what a purchaser would purchase in the market as white cement or ordinary cement are different and there is difference in prices of those two types of cement. He held that in the commercial world, they are two different commodities, and hence came to the conclusion that importation of white cement was clearly valid and cannot be said to be in violation of the provisions of Section 3 of the Imports Cements (Control) Order, 1947. However, it is not possible for us to accept the said conclusion. There is no dispute on the point that white cement and ordinary cement are two different commodities and types of cement. White cement is a different variety of cement. But from this it is not possible to jump to the conclusion that phrase ''cement'' does not cover ''white cement'' in this case. The Import Policy uses the phrase cement and obviously therefore embraces all types of cement. It is a normal rule that whenever generic phrase is used, it covers all types or kinds of species unless any one is excluded specifically. Under the Import Policy no type of cement has been excluded and therefore it cannot be said that white cement is not covered by appendix 5 Part B, Sr. No. VIII of Import Policy.
The earned Counsel for the Petitioners then invited our attention to that part of Sr. No. VIII appendix 5 Part B which says ''Imports, distribution and pricing will be made by the STC as per the connected policy of Government in the Ministry of Industry''. He submitted that the Cement Control Order, 1967 and Imported Cement Control Order, 1978 are therefore material for consideration of phrase cement contained in Import Policy. However, it is not possible to accept this. This only deals with method or mode of import, distribution and pricing which is to be done by STC and directs that the same shall be done as per the policy of Government in the Ministry of Industry. This has nothing to do with definition or meaning of word cement as contained in the Import Policy on what it should cover. This cannot help the Petitioner in any manner. In our view white cement cannot fall under Item 33 of Appendix 6 Part III List 8.
The earned Counsel appearing for the Petitioners then drew our attention to the final impugned order which mentions imposition of personal penalty of Rs. 29,57,000/-. It is really redemption fine and not personal penalty. As the goods were already cleared by Petitioners pursuant to the interim order passed by this Court, this came to be mentioned.
Hence the following order:
Rule is discharged with costs.
The Respondents shall be entitled to recover the amount along with interest on the said amount at the rate of 15% per annum as provided by Interim Order passed by this Court on 19.12.1984.
Writ Petition No. 15 of 1985 is a companion Petition. In view of the conclusions reached in Writ Petition No. 2516 of 1984, Rule is discharged in this petition also, but with no order as to costs.