T.M. Nambiar, Member (J)

1. This is an appeal filed by the appellants against the orders passed by the learned Collector (Appeals) in Order No. Cal/Cus/2573/84 dated 31-7-1984. In terms of that order the claim of the appellants was rejected.

2. The brief facts of the case are that the appellants imported into India 30000 pieces of Steel Top Compression Rings containing in six cases. Out of these cases Case No. 556281/03 landed at Haldia Port and was appraised by the Customs appraisers on 25-4-1980 and could not be taken delivery of from the port authorities on the same date due to dock-labour strike. When the strike was called off the appellants approached the dock staff on 10-5-1980 to take delivery of the cargo in question, but the same could not be traced out anywhere in the docks.

3. The appellants lodged a claim with the Assistant Collector (MCD) vide their letter No. Cal/Clm/4005/70/80/1314 dated 8/10-7-1980. The Calcutta Port Trust in their letter No. NTO/S/233/895 dated 12-1-1981 finally informed that the case in question was landed from the vessel on 12-4-1980 and was reported to be missing on 10-5-1980. The Report No. GCB/PR/9 dated 10-5-1980 was issued on the officer-in-charge, Haldia Police Station. The police enquired of the matter, but could not find any clue. Accordingly, the officer-in-charge of Haldia Police Station in their letter dated 3-2-1983 being the letter No. GCB/IMP/22 addressed to the Manager, Traffic Operations, Haldia Dock Complex, Haldia confirmed this view. Meanwhile the learned Assistant Collector rejected the claim of the appellants as unsubstantiated, by an order S10(1)855/80M dated 10-6-1982 on the ground that the appellants could not produce the police report. Being aggrieved by that order they have filed an appeal to the Collector (Appeals) Calcutta along with the police report. The Collector (Appeals) remanded the cases for de novo examination by an order No. Cal-Cus/259/83 dated 5-2-83. The de novo examination of the claim was dealt with by the Assistant Collector (A.R.S.). He rejected the claim of the appellants vide his order dated 6-2-84/16-2-84 ,and No. S10(1)855/80M S52030/82CAP/ARS/MCD S103-112/83ARS on the ground that the goods in question were cleared out of Customs control. The appellants filed another appeal to the Collector (Appeals), Calcutta and the Collector by his impugned Order dated 31-7-84 in Order No. Cal/Cus/2573/84 dismissed the appeal against which order, the present appeal is directed.

4. The learned Advocate, Shri D.K. Dhar contended on behalf of the appellants, that the goods were cleared for home consumption and therefore, the case should have been dealt with under Section-23 of the Customs Act,1962 and Section 13 is not applicable to the facts and circumstances of this case. It was, therefore, contended that the goods were pilfered before the clearance of home consumption, that is, while they were in the custody of the Port Trust Authorities and hence Section 23 is applicable. In support of his contention he relied on the following decisions :

(i) 1979 (4) ELT (J 329) in the case of Sialkot Industrial Corporation, Meerut v. Union of India and Anr.;

(ii) : 1985 (21) ELT 881 (Tribunal) in the case of Indian Oil Corporation v. Collector of Customs, Bombay;

(iii) : 1984 (18) ELT 358 (Tribunal) in the case of Hindustan Petroleum Corporation Limited v. Collector of Customs, Bombay;

(iv) : 1990 (45) ELT 667 (Tribunal) in the case of B.R. T. Limited v. Collector of Customs.

5. The learned Senior Departmental Representative, Shri M.N. Biswas contended that the appellants had delayed for taking delivery of the goods in question from the Docks. In fact, it was his contention that the Docks Strike was at a later date and the appellants could have taken possession of the same even much earlier. The appellants went on postponing the same. He also contended that Section 13 is applicable to the facts of this case and no relief can be granted under Section 23 of the Customs Act, 1962. He also justified the orders passed by the lower authorities and stated that the appeal may be dismissed.

6. We have heard both the sides and considered the respective arguments. The point that arises for our determination is whether the appellants are entitled for the remission of duty on the goods in question and whether Section 23 of the Customs Act, 1962 is applicable to the facts and circumstances of the case. In the decision reported in 1979 (4) ELT (J 329) the Honble Delhi High Court had held that the expression - lost or destroyed - in Section 23 of the Customs Act, 1962 is not to be interpreted in any narrow or a particular sense, but in a proper sense and includes loss or destruction caused by whatsoever reason. It was also held that Section 13 of the Customs Act,1962 applies only when the goods are pilfered before any order for home consumption has been passed. But if the goods are pilfered after the passing of the order but before the goods are actually cleared then Section 23 applies and there is no valid reason for drawing a distinction that the duty will be liable to be remitted if the goods are cleared after the payments of the duty and before their actual clearance, lost or destroyed in any other manner excepting their theft. Their Lordships held that the expression - lost or destroyed - is used in the generic and comprehensive sense and includes within it the loss to the party by pilferage. This decision was followed by the Tribunal in : 1984 (18) ELT 358 (Tribunal). In that decision at para-21 the Tribunal held as follows :

"21. It is thus clear that only with the amendment effected by the Finance Bill, 1983, Section 23(1) of theexcluded from its purview goods pilfered before their clearance for home consumption, the implication being that in respect of pilferage of imported goods Section 13 alone and not Section 23 is applicable. It would be reasonable to infer that prior to the amendment, Section 23(1) did not exclude from its purview goods pilfered before their clearance for home consumption. In this view of the matter, I agree with the conclusion reached by Shri Hegde and allow the appeal."

This decision was followed by the Tribunal by another decision reported in : 1985 (21) ELT 881 (Tri.). In that decision the Honble Tribunal at para-17 of page-889 had held as follows :-

17. The question whether Section 23(1) would be attracted in cases of pilferage of goods occurring before their physical clearance from Customs control was considered at length by the West Regional Bench in Hindustan Petroleum Corporation Ltd. v. Collector of Customs, Bombay - 1984 ECR 2119 ( not cited before us). Amongst the reasons given in support of the conclusion that Section 23(1) applied in such cases was one concerning the effect of the amendment made by the Finance Bill, 1983 to the wording of Section 23(1) of the. Section 23(1) of thewas amended by clause 48 of the Finance Bill, 1983, which read as follows:

"48. In Section 23 of the Customs Act, in Sub-section (1),

(a) for the words "where it is shown", the words and figures "Without prejudice to the provisions of Section 13, where it is shown" shall be substituted;

(b) after the words "have been lost", the brackets and words "(otherwise than as a result of pilferage)" shall be inserted."

The amended provision reads thus :

"Without prejudice to the provisions of Section 13, where it is shown to the satisfaction of the Assistant Collector of Customs that any imported goods have been lost (otherwise than as a result of pilferage) or destroyed, at any time before clearance for home consumption, the Assistant Collector of Customs shall remit the duty on such goods."

The note on Clause 48 of the Finance Bill, 1983 read as follows :

"Clause 48 seeks to amend Section 23 of the Customs Act, 1962 to exclude from its purview goods pilfered before their clearance for home consumption." It is thus clear that only with the amendment effected by the Finance Bill, 1983, Section 23(1) of theexcluded from its purview, goods pilfered before their clearance for home consumption, the implication being that in respect of pilferage of imported goods, Section 13 alone, and not Section 23, is applicable. It would be reasonable to infer that, prior to the amendment, Section 23(1) did not exclude from its purview goods pilfered before their clearance for home consumption as in the present case."

In view of the above decisions the law is now well-settled that it would be reasonable to infer that, prior to the amendment, Section 23(1) did not exclude from its purview goods pilfered before their clearance for home consumption. In this case also, the goods were pilfered prior to the amendment and therefore, Section 23(1) did not exclude the goods pilfered in this case before their clearance for home consumption. There is no allegation in the proceedings before us that the goods were not lost or destroyed but were clandestinely removed by the appellants. The police report also establishes that the goods were not traceable inspite of the investigation in this behalf. This decision was again re-iterated by the Tribunal in the latest decision reported in : 1990 (45) ELT 667. Accordingly, we hold that the appellants are entitled for the remission of duty paid by them in respect of the goods in question and we allow the appeal and direct the concerned authorities to grant consequential relief to the appellants within four months from the date of communication of this order.