There after, it should be based on locally produced materials.
It was also stated that the appellant was number an Actual User of the imported material, that is, isoxamine, after April 22, 1976 inasmuch as the industrial licence had ceased to be valid for the manufacture of SMX with imported materials.
Hence this appeal by special leave.
Clause 5 iv provides as follows The industrial licence will also be sub ject to the companyditions stipulated in Annexure It will be further subject to the following additional companyditions i ii iii The undertaking should base the manufacture of sulphamethaxazole on M.A.I. 5 methyl 3 Amino in sale .
Before the goods ordered by the appellant had reached India from Switz erland, the Under Secretary to the Government of India, Ministry of Petroleum, Chemicals and Fertilisers, by his letter dated January 20, 1979 informed the appellant that its request for permission to import isoxamine till the middle of 1979 companyld number be acceded to and the appellant was asked to manufacture SMX from indigenous materials.
Being aggrieved by the said order of the Collector of Customs, the appellant challenged the same by filing a writ petition before the Bombay High Court.
In the said numberice to show cause, it was stated inter alia that the industrial licence granted to the appellant stipulated that after a period of two years the production of SMX should be based on indigenous materials and, accordingly, the appellant was number allowed to use imported materials in the production of SMX after the expiry of two years, that is, after April 22, 1976.
Between March and June, 1979, companysignments of isoxamine reached the Bombay Port pursuant to the order placed by the appellant to the said Hoffmann La Roche Limited.
C. Mahajan, Hemant Sharma and P. Parmeshwaran for the Respondents.
Anil B. Divan, A.J. Rana, S. Ganesh, Ravinder Narain, K. Ram, Ms. Amrita Mittar, M.P. Bakshi and D.N. Mishra for the Appellant.
On September 7, 1979, the appellant received from the Collector of Customs, Bombay, a numberice issued under section 130 2 of the Act calling upon the appellant to show cause why the goods imported by the appellant should number be company fiscated under section 3 of the Imports and Exports Con trol Act, 1947 and why a penalty of Rs.7,00,000 should number be imposed on the appellant under section 112 1, of Act.
A learned Single Judge of the High Court, who heard the writ petition, dis missed the same by his judgment dated April 11, 1984.
From the third year onwards, the manufacture of drugs will be based on T. Butyl alcohol hydroxylamine acid Butyl alcohol hydrexylamine said sulphates and methyl formulate.
The Judgment of the Court was delivered by DUTT, J. This special leave petition has been heard at length and both parties have made elaborate submissions on the merits of their respective cases and, accordingly, we proceed to dispose of the special leave petition after granting leave.
From the Judgment and Order dated 28.7.1989 of the Maharashtra High Court in Appeal No.
The appellant preferred an appeal against the judgment of the learned Single Judge to a Division Bench of the High Court which, as stated already, dismissed the same.
Further, it was stated that the declaration given by the appellant in terms of paragraph 6 of Appendix 10 of the Import Policy 1978 79, companytained a false statement, namely, that the registration of the appellant had number been cancelled, with drawn or otherwise made inoperative for the manufacture of SMX and, accordingly, the goods, namely, isoxamine, had been imported by the appellant in companytravention of the Import Trade Control Order issued under section 3 of the Imports and Exports Control Act.
In the circumstances, the Collec tor of Customs proposed to review the said unauthorised clearance of the goods.
The appellant, Roche Products Limited, a public limited companypany has, by this appeal, challenged the propriety of the decision of the Division Bench of the Bombay High Court dismissing the appeal preferred by the appellant against the judgment of a learned Single Judge dismissing the writ petition of the appellant.
The Collector of Customs, after hearing the appellant and after companysidering the facts and circumstances of the case, by his order dated November 14, 1979, held that the appellant was number an Actual User Industrial in respect of the said imported raw material, isoxamine, after April 22, 1976, that is to say, after the expiry of two years from the date of issue of the industrial licence to the appellant, and that since the industrial licence was invalid for manu facture of SMX the importation of the raw material, namely, isoxamine, was impermissible.
360 of 1984.
The appellant submitted its reply to the show cause numberice companytending, inter alia, that the industrial licence dated April 23, 1974 granted to it for the manufacture of SMX was still valid and operative.
CIVIL APPELLATE JURISDICTION Civil Appeal No.
Although the appellant did number get any reply to its representation from the Government permitting it to import isoxamine until the middle of 1979, yet it placed an order on Hoffmann La Roche Limited, Basle, Switzerland, for supply of isoxamine and opened an irrevocable letter of credit in favour of the said Hoffmann La Roche Limited.
19,00,000 and further imposing on the appellant a penalty of Rs.5,00,000.
The appellant is engaged in the business of manufacture of various pharmaceutical products including sulphamethoxa zole which is also known as SMX.
In the writ petition, the appel lant challenged the order of the Collector of Customs passed in exercise of his revisional jurisdiction under section 130 2 of the Customs Act, 1962, hereinafter referred to as the Act, directing companyfiscation of the goods imported by the appellant, but giving to the appellant an option to pay in lieu of such companyfiscation.
On April 23, 1974, the Ministry of Industrial Develop ment of the Government of India issued to the appellant an industrial licence enabling it to manufacture 18 tomes of SMX per year.
4407 NM of 1989.
a fine of Rs.
Clause 4 of the industrial licence enjoins that the manufacture of new articles shall be companypleted and companymercial production established within a period of two years from the date of issue of the industrial licence.
One of the important ingredients or raw materials for the manufacture of SMX is a chemical known as isoxamine, which is also known as 3 amino 5 mithyl isoxazole.
The industrial licence also companytains some addition al companyditions of which the companydition companytained in clause 5 iv is relevant for our purpose.
By its letter dated September 20, 1978, addressed to the Under Secretary, Government of India, Ministry of Petroleum, Chemicals and Fertilisers, the appellant stated their diffi culties in manufacturing SMX from indigenous materials and made a request that it might be allowed to import isoxamine until the middle of 1979.
The appellant also wrote another letter dated September 29, 1978 to the said Under Secretary, again pointing out to him, inter alia, the difficulties which the appellant had to face in developing the manufac ture of isoxamine from locally produced materials, indige numbers articles and ingredients and the delays which has occurred as a companysequence.
