Tuesday 24 March 2015

Whether foreign law is a question of fact?

 It is the pleaded case of the appellant that its legal
obligation as transporter ends on its delivering the goods
entrusted to it at Benapole Customs station. Unloading of
imported goods at any customs station in this country is also
regulated by the provisions of the Customs Act, 1962. We are

sure that it must be equally regulated by the law of
Bangladesh. What exactly the law of Bangladesh is in this
regard and how the factum of delivery of goods allegedly
carried and delivered by the appellant at Benapole is to be
proved are two distinct and different matters. It is a settled
principle of private international law that foreign law is always
a question of fact which is required to be pleaded and proved
by the party whose rights or obligations flow from such foreign
law. There is no pleading or proof in this regard in the instant
case.
Reportable
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 1427 OF 2007
M/s Transport Corporation of India Ltd. 
V
M/s Ganesh Polytex Ltd. 
Citation;AIR2015SC 826
Read original judgment here; click here


1. This is an appeal under Section 23 of the Consumer
Protection Act, 1986 against the order dated 20th December,
2006 of the National Consumer Disputes Redressal
Commission (for short “the National Commission”) in Original
Petition No. 341 of 1993. The opposite party/respondent in
the above-mentioned original petition is the appellant herein.
The sole respondent herein was the complainant before the
National Commission.
Page 2
2. By the impugned Order, the National Commission
allowed a complaint filed by the respondent herein and
directed the appellant herein to pay an amount of Rs.
29,74,321.45 with interest @ 12 per cent per annum from the
date of the filing of the complaint till the date of realization
apart from the cost quantified at Rs.25,000/-.
3. The substance of the complaint before the National
Commission is as follows:-
4. Both the parties to the complaint are public companies
under the Companies Act. The respondent is engaged in the
business of manufacturing and selling of yarn and export of
fabric of different specifications, whereas the appellant is
engaged in the business of transporting goods from one place
to the other for consideration.
5. In the year 1992, the respondent received an indent for
export of 100 per cent cotton yarn fabric specified therein, the
details of which are not necessary for the purpose of this
judgment. The said indent was placed by one M/s. Aleef
Enterprises (Trading), Dhaka calling upon the respondent to
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Page 3
export the goods specified in the indent to M/s. Azim
Garments Ltd. in Dhaka, Bangladesh.
6. According to the complaint, the respondent was required
to dispatch the entitled goods and “negotiate various
documents including invoice, consignment copy of the goods
received and consignment note bill of exchange etc.” through
M/s. Islami Bank Bangladesh Ltd., allegedly, the banker of
M/s. Azim Garments Ltd., Dhaka.1
7. The respondent averred in the complaint that it had
agreed to send the various documents to be negotiated with
the said Islami Bank and acceptance by the respondent’s
banker i.e. the American Express Bank Ltd. It is further
stated in the complaint that the said Islami Bank was entitled
to take delivery of the goods or endorse the consignee copy of
the goods receipt/consignment note in favour of M/s Azim
Garments Ltd.2
1 Para 3 of the Complaint: In terms of the said indent, the complainant was required to dispatch the
quantities of the said goods and to negotiate various documents including the invoice, consignee copy of
the goods receipt/consignment note, bill of exchange etc., and other documents of dispatch through M/s.
Islami Bank Bangladesh Ltd., the bank of the said M/s. Azim Garments Ltd.
2 Para 3 of the Complaint: The said documents were agreed to be sent to the said Islami Bank Bangladesh
Ltd., for negotiation and acceptance by American Express Bank ltd., the bank of the complainant. The
said Islamic Bank Bangladesh Ltd. upon acceptance for payment of the said documents including the bill of
exchange for the price of the goods consigned, was entitled to either take delivery of the consignment of the
said goods itself or endorse the consignee copy of the goods receipt/consignment note in favour of M/s
Azim Garments Ltd.
3
Page 4
8. The respondent entrusted five consignments of goods to
the appellant on various dates, the details of which are as
follows:-
Invoice
No.
Date Qty in Mtrs. Amount US $ Consignment
Note No.
Date
EXP/2 28.10.92 13982 18176.60 A 08465 28.10.92
EXP/3 05.11.92 25109 32641.70 A 08565 05.11.92
EXP/4 14.12.92 12208 15870.40 A 08658 16.11.92
EXP/5 30.01.93 16188 21044.60 A 98738 29.12.92
EXP/6 25.02.93 5447 7081.10 A 11351 15.02.93
94814.20
--- Para 4 of the complaint
9. Under the consignment note, the said goods were
required to be transported from Ahmedabad to Benapole in
Bangladesh. The CONSIGNEE COPIES of the consignment
notes of each of the five consignments mentioned above were
handed over to the respondent. It is admitted in the complaint
that the goods which are the subject matter of the abovementioned
five consignments are required to be delivered upon
the production of the consignee’s copy of the respective
consignment notes.3
3 Para 4 of the Complaint: The complainant from time to time entrusted the Respondent with various
quantities of the said goods for transportation from Ahmedabad to Benapole in Bangladesh. The
Respondent after colleting the freight, issued its consignment notes. The consignee copies of the
respective consignment notes were handed over to the complainant and the goods covered by each
consignment note were to be delivered and could be taken delivery of upon production of the consignee
copy of the respective consignment note only and not otherwise.
4
Page 5
10. According to the respondent, all the relevant documents
including the CONSIGNEE COPIES of the consignment notes
were duly communicated by the respondent through its
banker to the Islami Bank Bangladesh Ltd. It is specifically
averred in the complaint that the said transaction was
originally covered by letter of credit opened by the said Islami
Bank but the said letter of credit had expired. Therefore, the
documents mentioned above were sent to the said banker on
collection basis4.
11. It appears from the complaint that the Islami Bank
Bangladesh, though received all the documents sent by the
respondent, did not honour the same and made no payment
for a long time. In the said circumstances, the respondent
through its banker recalled all the documents “in order to reimport
the goods back to India”. Admittedly, the said
documents were returned unpaid by the Islami Bank
Bangladesh to the complainant’s banker5.
4 Para 5 of the Complaint: All the documents including, inter-alia, the invoice, the consignee copies of the
consignment notes and the bills of exchange, were duly sent by the Complainant through American Express
Bank Ltd. to Islami Bank Bangladesh Ltd. for acceptance for payment. The said documents, although
drawn under a letter of credit opened by the said Islami Bank Bangladesh Ltd., were sent on collection
basis as the said Letter of Credit had expired.
5 Para 8 of the Complaint: Thereafter, the said documents of the aforesaid five consignments were duly
returned unpaid by the said Islami Bank Bangladesh Ltd. to the Complainant’s bank under cover of their
letter dated 16.6.93.
5
Page 6
12. Upon the return of the original documents by the Islami
Bank, the respondent herein, by its letter dated 12th July,
1993, called upon the appellant to “rebook all the five consignments: for
transportation to New Delhi and deliver the same to the complainant at New Delhi”.
(Para 10 of the Complaint)) In response to the said letter, the
appellant herein, by its letter dated 22nd July, 1993, assured
the respondent that all the five consignments would be
rebooked for delivery at New Delhi. The appellant further
called upon the respondent “to surrender the original consignee copies
alongwith the invoice copies and pay one side freight and octroi at its Ahmedabad office
for rebooking”.
13. In reply to the letter dated 22nd July, 1993 of the
appellant, the respondent, by its letter dated 31st July, 1993,
called upon the appellant to confirm inter alia “that the goods covered
under the said consignment note were available with the respondent and the location of
the said goods”. The appellant replied by its letter dated 16th
August, 1993 without giving any information demanded by the
respondent but only gave assurance that the goods would be
delivered within fifteen to twenty days “after the receipt of the original
consignee copies”.
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Page 7
14. On 28th August, 1993, the respondent sent another letter
seeking unequivocal answers to the various enquiries made by
the respondent in its earlier letter dated 22nd July, 1993.
15. In reply, the appellant, by its letter dated 11th September,
1993, confirmed that all the aforesaid consignments were lying
at the godown in safe and sound condition and further
confirmed that upon receipt of the original consignee copies,
the said goods would be rebooked to New Delhi. The relevant
portion reads as follows:
“Sub.: Ch.No.A-08465 dated 28.10.1992
Ch.No.A-08565 dated 05.11.1992
Ch.No.A-08658 dated 16.11.1992
Ch.No.A-098738 dated 29.12.1992
A-11351 dated 15.02.1993
All Ex. Ahmedabad to Benapole
We have received your letter no.RKV/M-889 dated 28th August, 1993 for
rebooking of above consignments.
We have already given you two letters for advising your clients to deposit
the original consignee copy and one side freight and other dues then only
we will rebook the above consignements. But, you are asking for the
confirmation referred in your earlier letter in paras 1(a) and (b).
Please note that the above consignment is lying at our godown in safe &
sound condition. When your client will send the D/D for our dues with
original consignee copy to our Ahmedabad or Calcutta office then our
concerned office will advice to Benapole to rebook the material to Delhi
as per your advice. You are giving unnecessary correspondence and due
to this long delay the demurrage is going on higher side day by day @ 3
paise per kg. per day.
We hope, you understood all the points and take necessary action
immediately.”
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Page 8
16. The said letter was followed by another letter of the
appellant dated 29th September, 1993, the relevant portion
reads as follows:
“Sub.: Ch.No.A-08465 dated 28.10.1992
Ch.No.A-08565 dated 05.11.1992
Ch.No.A-08658 dated 16.11.1992
Ch.No.A-098738 dated 29.12.1992
A-11351 dated 15.02.1993
All Ex. Ahmedabad to Benapole
This has reference to our earlier letter no.SBD/OPN/INM/3569/93
dated 11th September, 1993 regarding above consignments.
As per the reply received from our Calcutta office, first four
consignments have already been exported and the documents were
sent to the party directly.
The last consignment i.e. Ch.No.A-11351 is lying at our Calcutta
Godown. If you want to rebook this consignment to Delhi, you
please send the original consignee copy and our dues by D/D to our
Ahmedabad or Calcutta Office directly for their necessary action.
On receipt of Consignee copy and D/D, our Calcutta office will
rebook this consignment to Delhi.”
17. In the background of the abovementioned facts, the
respondent herein filed a complaint under Section 21(a)(i) of
the Consumer Protection Act, 1986 before the National
Commission in Original Petition No.341 of 1993 claiming
various amounts totaling to Rs.40,98,164.04 along with
pendente-lite interest and future interest @ 21% per annum
on Rs.34,74,321.45 along with costs.
8
Page 9
18. In response to the said complaint, the appellant herein
filed its written statement wherein it admitted the fact that five
consignments of goods under five distinct consignment notes
(as specified in the complaint) were entrusted to the appellant
for being transported from Ahmedabad to Benapole
(Bangladesh). According to the appellant, of the
abovementioned five consignments, four consignments were
infact delivered. The relevant portion of the appellant’s written
statement reads as follows:
“The opposite party duly cleared the consignments at Indo-
Bangladesh border from Indian Customs and as per export
procedure duly handed over the same to the Bangladesh
Custom Officer which duly acknowledged the receipts of the
said 4 consignments.”
19. It is further the case of the appellant that the fifth
consignment was not exported to Bangladesh in view of the
fact that the respondent herein had instructed the appellant to
rebook the same to Delhi6.
20. It is the case of the appellant that as per the export
procedure, the goods (which are the subject matter of dispute)
were required to be unloaded and delivered at the Benapole
6 The goods covered by the consignment note No.A-11351 could not be exported to Bangladesh as in the
meantime the opposite party having received instructions to rebook the same. ….. The same consignment is
lying in the godown of the opposite party at Calcutta entirely at the risk and responsibility of the
complainant and incurring day to day demurrage charges. The opposite party was and still is ready and
willing to deliver the goods covered by the consignment note No.A-11351
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Page 10
Customs frontier of Bangladesh after crossing the Indian
border at Petrapole. The relevant portion of the written
statement, at para 4, reads as follows:
“The subject consignments were meant for carriage by lorry
transport from Ahmedabad/Odhav to Benapole (Bangladesh)
and as per export procedure and or as customary said goods
were to be unloaded and delivered after crossing India border
at Petrapole into the warehouse of Bangladesh customs at
Benapole. The importer consignee was to take delivery of the
said goods after paying the customs duties after complying
with the formalities as per rules of the Bangladesh Customs
Import and on submission of relevant documents to
Bangladesh Customs Authorities at Benapole. The opposite
party’s obligation was to transport the said goods by their
lorry and to deliver the same to the Benapole Bangladesh
Custom Warehouse as per prevalent procedure of exporting
the materials to beanpole (Bangladesh) from India. The
opposite party duly transported the said four consignments
and delivered the same at Benapole.”
21. Coming to the letter dated 11.9.1993 of the appellant
whereunder (according to the respondent) the appellant agreed
to rebook the five disputed consignments to Delhi, it is the
defence7 of the appellant that (a) the said letter only explained
the procedure for rebooking of the consignments, and (b) the
admission regarding the custody of the five consignments was
a mistake of fact in view of the communication gap between
the appellant’s headquarter and its various branch offices.
7 The opposite party states that by its letter dated 22.7.93 it never assured to rebook all the five
consignments for delivery at Delhi to the complainant as alleged. On the contrary, the opposite party by its
letter dated 22.7.93 explained the procedure for rebooking of the consignments by the consignor concerned.
Thereafter, on thorough enquiry from its concerned branch offices the opposite party by its letter dated
29.9.93 duly informed the complainant that the goods covered by the four consignment notes were exported
and delivered at the destination in terms of contract of carriage.
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Page 11
Within a short period after delivering the letter the appellant
realized its mistake and explained its position by subsequent
letter dated 29.9.1993 (the contents of which have already
been extracted earlier).
22. It is further the defence of the appellant that once the
goods crossed Indian customs frontier during the course of
export of such goods, only the exporter can bring back the
goods by following the procedure under the law8.
23. The appellant also took a defence that the respondent
availed the duty drawn back credit under the Customs Act on
the strength of the fact that the goods in dispute had been
exported. Therefore, it is not open to the respondent to
complain that the appellant has either misappropriated the
goods or made a wrong delivery.9
24. In support of its defence, the appellant relied upon three
sets of documents i.e. Annexures X, Y and Z, running into 8, 2
8 The complainant is also well aware of the fact that there is no ‘Trade treaty’ between India and
Bangladesh for rebooking of the consignment by the transporter against the consignment notes issued in
India. Only the Exporter can through his Clearing Agent at Bangladesh re-import the exported
consignments according to ‘back to India Bangladesh Customs procedure’. … After exporting the
consignments to Bangladesh it is the owner of goods who after completing all the formalities can clear the
consignments from Bangladesh Customs and it is only then the same can be brought back to India. The
opposite party as a carrier cannot of its own bring back the exported consignments in its country under the
Law.
9 The complainant being fully aware of the fact that the said 4 consignments were duly delivered at
beanpole (Bangladesh) in terms of contract of carriage duly applied for duty drawback as provided under
Section 74/75 of Customs Act, 1962 which is export-oriented benefit given by the Government of India.
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Page 12
and 6 pages respectively. Annexure ‘X’ consists of copies of
four invoices and copies of four consignment notes covering
four consignments of goods in dispute.
25. The National Commission recorded a finding that the
copies of the invoices produced under Annexure ‘X’ by the
appellant herein and the copies of the invoices filed by the
complainant do not tally with each other and, therefore, the
documents produced by the appellant herein are “bogus”.10
26. The National Commission also examined two letters
dated 08.04.2002 and 10.04.2002. These two letters were
sent by the Customs authorities of Petrapole, Kolkata and
Benapole (Bangladesh) respectively in response to the letters
dated 14.03.2002 and 12.03.2002 respectively of the
appellant. The National Commission recorded a finding,
“therefore, neither these two letters nor the endorsements and seals of
Cargo Officer alongwith signatures on said invoices or the statement of
Mahafuzur Rehman are of any help to the opposite party on the
controversy on hand”. The Commission, therefore, allowed the
complaint. The operative portion of the order is as follows:
10 Reading of two sets of invoices together would show that the number of cartons, measurement of fabrics
and dates as recorded in invoices at pages 61, 63, 65 and 67 are substantially different from the invoices at
pages 15, 18, 21 and 24 for which no satisfactory explanation has been offered by the opposite party. Also
considering the submission referred to above advanced by Shri Virmani, the invoices filed by the opposite
party must be held to be bogus and they cannot be exhibited and read in evidence.
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Page 13
“Complainant is thus entitled to the value of consignments
in question of Rs.29,73,321.45 alongwith interest thereon
which we quantify at 12% p.a. from the dates of booking
upto the date of filing complaint and pendentilite and future
interest at the said rate from the opposite party. Since
interest has been awarded to the complainant it is not
entitled to any damage separately.
Accordingly, the complaint is allowed and opposite
party is directed to pay Rs.29,74,321.45 with interest @ 12%
p.a. from the dates of book upto the date of filing complaint
and pendentilite and future interest at the said rate.
Opposite party will also pay Rs.25,000/- as costs.”
27. Hence, the appeal.
28. Elaborate submissions are made by the learned senior
counsel appearing for either side in support of their respective
cases virtually reiterating their respective pleadings.
29. Since the case arises out of a contract for transport of
goods by the appellant to a foreign country, an examination of
the relevant provisions of the Customs Act, which deal with
export of goods, is necessary. Import and export of goods into
or out of India is regulated by the Customs Act, 1962 and the
Rules and Regulations made thereunder. Section 5011 of the
said Act stipulates that the exporter of any goods by land is
11 Section 50. Entry of goods for exportation.—(1) The exporter of any goods shall make entry
thereof by presenting electronically to the proper officer in the case of goods to be exported in a
vessel or aircraft, a shipping bill, and in the case of goods to be exported by land, a bill of export
in the prescribed form.”
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required to make an entry12 thereof by presenting to the proper
officer BILL OF EXPORT.13 Under Section 5114, the proper
officer on receipt of a BILL OF EXPORT (contemplated under
Section 50) if satisfied that the exporter has paid the duty and
other charges under the Act, if any, and that such goods are
not prohibited goods, may make an order permitting clearance
and loading of the goods for exportation.
30. Under Section 40, a person-in-charge of a conveyance is
not permitted to load export goods at a customs station unless
a BILL OF EXPORT duly passed by the proper officer has been
handed over to the person-in-charge of the conveyance by the
exporter.
31. The relevant portion of Section 40 reads as follows:
“40. Export goods not to be loaded unless duly passed by
proper officer.—The person-in-charge of a conveyance15
shall not permit the loading at a customs station—
12 Section 2(16) “entry”, in relation to goods means an entry made in a bill of entry, shipping bill or bill of
export and includes in the case of goods imported or to be exported by post, the entry referred to in section
82 or the entry made under the regulations made under section 84.
13 Section 2(5) “bill of export” means a bill of export referred to in section 50.
14 Section 51. Clearance of goods for exportation.—Where the proper officer is satisfied that any goods
entered for export are not prohibited goods and the exporter has paid the duty, if any, assessed thereon and
any charges payable under this Act in respect of the same, the proper officer may make an order
permitting clearance and loading of the goods for exportation.
15 Section 2(9) “conveyance” includes a vessel, an aircraft and a vehicle.
Section 2(42) “vehicle” means conveyance of any kind used on land and includes a railway
vehicle.
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(a) of export goods, …. unless a … bill of export,
… duly passed by the proper officer, has been
handed over to him by the exporter;
(b) ….. …...”
32. Section 41 of the Act mandates that the person-in-charge
of a conveyance carrying export goods shall deliver to the
proper officer an EXPORT REPORT in the prescribed form in
the case of an export by vehicle.
“41. Delivery of export manifest or export report.—(1) The
person-in-charge of a conveyance carrying export goods
shall, before departure of the conveyance from a
customs station, deliver to the proper officer in the case
of a vessel or aircraft, an export manifest by presenting
electronically and in the case of a vehicle, an export
report in the prescribed form.”
33. In exercise of the power conferred under Section 157,
read with Sections 50 and 60, of the Customs Act, 1962, the
Central Board of Excise and Customs made regulations,
namely, Shipping Bill and Bill of Export (Form) Regulations,
1991 by a notification No.61/91 (N.T.)-Cus., dated 29.8.1991.
Regulation 3 thereof stipulates as follows:
“Regulation 3. Bill of Export.—A bill of export to be
presented by an exporter of goods be in the form
specified in Annexure V, Annexure VI, Annexure VII or
Annexure VIII (Se Forms 97, 98, 99 and 100 in Part 5), as
the case may be, appended to these regulations.”
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34. Regulation 4 prescribes the specifications of the BILL OF
EXPORT form.16
35. By a notification No.422/76 dated 23.10.1976 which was
subsequently amended by another notification, the Central
Board of Excise and Customs made regulations known as
Export Report (Form) Regulations, 1976. Regulation 3 thereof
stipulates that every EXPORT REPORT shall be delivered in
duplicate and cover all goods carried in a vehicle.
36. Regulation 4 prescribes the form:-
“Regulation 4. Form of Export Report.—(1) The export
report to be delivered under section 41 of the Customs
Act, 1962 (52 of 1962) by the person-in-charge of the
vehicle carrying export goods shall be in the appended
form (See Form 73 in Part 5) to these regulations.
(2) It shall be printed on white paper of size 21.5 cms x
34.5 cms of durable quality.”
37. Thus, the movement of goods in the course of export is
meticulously regulated and recorded.
16 Regulation 4. Specifications of Shipping Bill and Bill of Export (Form).— The Shipping Bill and Bill of
Export forms specified in Annexures 1 to VIII shall be in accordance with the following specifications,
namely:-
(a) the forms shall be printed on foolscap size of paper measuring 34.5 cms by 21.5 cms and
shall have the following margins namely:-
(i) top – 1.5 cms, (ii) bottom – 1.5 cms, (iii) left – 1.8 cms, (iv) right – 0.5 cms
The layout of the forms and the size of the boxes shall be as per the layout and boxes
shown in the Annexures;
(b) the forms shall be printed on paper of grammage 70 to 85 grams per square metre; the
paper should be stable in conditions of 50 to 60 per cent relative humidity;
(c) the captions inside the boxes of the forms should be printed in 6 pt. mono sans-serif and
should be located as near as possible to the top left of the boxes;
(d) the forms shall be filled in by using a typewriter only.
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38. The appellant, who claims to have exported 4 of the 5
consignments handed over to it by the respondent, could not
have loaded the goods at Petrapole Customs station without
having obtained a BILL OF EXPORT duly passed by the proper
officer and the person-in-charge of the conveyance owned by
the appellant could not have either loaded the goods in the
vehicle or departed from Petrapole Customs station without
delivering to the proper officer an EXPORT REPORT in the
prescribed form contemplated under Section 41.
39. The best proof of the case of the appellant that it had in
fact transported the goods in dispute beyond the Petrapole
Customs station and out of the customs frontier of India
would have been to produce the abovementioned two
documents i.e. copies of the BILL OF EXPORT and EXPORT
REPORT pertaining to the four consignments in dispute.
There is no pleading on behalf of the appellant before the
National Commission nor any discussion in the order under
appeal regarding the existence of the abovementioned two
documents vis-à-vis the four consignments in questions.
Except making a bald assertion in the written statement
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before the National Commission that the appellant had
delivered 4 consignments out of the 5 consignments entrusted
to it at Benapole (which is already taken note of at para 4 of
this judgment,) the appellant did not make any specific
pleading regarding the actual dates of the:
1. permission by the proper officer under Section 51 for
loading the goods for exportation; or the
2. delivery by the appellant of the EXPORT REPORT under
Section 41 with reference to each of the 4 consignments which
are allegedly transported and delivered at the Benapole
Customs Station Warehouse of Bangladesh.
40. We are conscious that the production and proof of the
abovementioned documents may not be the only possible
evidence to establish that the appellant stood discharged of its
legal obligation.
41. It is the pleaded case of the appellant that its legal
obligation as transporter ends on its delivering the goods
entrusted to it at Benapole Customs station. Unloading of
imported goods at any customs station in this country is also
regulated by the provisions of the Customs Act, 1962. We are

sure that it must be equally regulated by the law of
Bangladesh. What exactly the law of Bangladesh is in this
regard and how the factum of delivery of goods allegedly
carried and delivered by the appellant at Benapole is to be
proved are two distinct and different matters. It is a settled
principle of private international law that foreign law is always
a question of fact which is required to be pleaded and proved
by the party whose rights or obligations flow from such foreign
law. There is no pleading or proof in this regard in the instant
case.
42. The appellant did not plead as to what is the procedure
prescribed under the law of Bangladesh for the unloading of
the imported goods at its Customs Stations? Nor does the
appellant give the details of the dates of the actual delivery of
each of the 4 consignments at Bengapole.
43. However, the appellant placed heavy reliance on a letter
dated 11.04.2002 allegedly written by some officer of the
Customs Department of the Republic of Bangladesh at
Beanpole addressed to the Joint Commissioner, Customs
Department, Benapole – Jessore (Bangladesh). It refers to four
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bills of entry dated 9.1.1993, 13.12.1992, 20.12.1992 and
11.02.1993. The relevant portion of the document reads as
follows:
“1) Bill of entry No. – 14305 dated 9.1.1993 of shipping
bill No.4949/DB dated 28.12.1992 has been accepted by
M/s. Azim Garments Limited Dhaka – Bangladesh. Goods –
fabrics 21 bales and name of shipping agent M/S. Mun Mun
Shipping – Benapole.
2) Bill of entry No.2267 dated 13.12.1992 of shipping bill
No.3833/DB dated 2.11.1992 has been accepted by M/s.
Azim Garments Limited, Dhaka – Bangladesh. Goods –
fabric 30 bales and name of shipping agent Their Green
(Mun Mun) Benapole.
3) Bill of entry No.12516 dated 20.12.1992 of shipping
bill No. – 3834/DB dated 2.11.1992 has been accepted by
M/s. Azim Garments Ltd. Dhaka – Bangladesh. Goods
fabrics 30 bales and name of shipping agent M/s.
Madeezuddin (A-29).
4) The goods of shipping bill No.699/DB dated
11.02.1993 has not been accepted by the party. The goods
have been auctioned.”
44. It is rather difficult to understand the content of this
document, apart from the other problems with the document
which shall be discussed later. It speaks about three bills of
entry having had been “accepted” through three different
shipping agents of M/s. Azim Garments Ltd., Dhaka. Of the
4th bill of entry having not being accepted, the goods were
auctioned. It is difficult to understand what exactly is meant
by ‘accepting a bill of entry’. At least, insofar as the Indian law
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is concerned, a bill of entry is a document, under Section 4617
of the Customs Act, which is required to be presented by the
importer. Section 47 stipulates that on receipt of a bill of
entry, the proper officer, on being satisfied about the legality of
the import and the factum of payment of the appropriate duty
on the import of such goods, is required to clear the goods.
Assuming that the law of Bangladesh is similar to the law of
Customs in India, it is therefore difficult to understand the
content of the said letter. It speaks about acceptance of three
17 46. Entry of goods on importation. – (1) The importer of any goods, other than goods intended for
transit or transhipment, shall make entry thereof by presenting electronically to the proper officer a bill of
entry for home consumption or warehousing in the prescribed form :
Provided that the Commissioner of Customs may, in cases where it is not feasible to make entry
by presenting electronically , allow an entry to be presented in any other manner:
Provided further that if the importer makes and subscribes to a declaration before the proper
officer, to the effect that he is unable for want of full information to furnish all the particulars of the goods
required under this sub-section, the proper officer may, pending the production of such information, permit
him, previous to the entry thereof (a) to examine the goods in the presence of an officer of customs, or (b)
to deposit the goods in a public warehouse appointed under section 57 without warehousing the same.
(2) Save as otherwise permitted by the proper officer, a bill of entry shall include all the goods
mentioned in the bill of lading or other receipt given by the carrier to the consignor.
(3) A bill of entry under sub-section (1) may be presented at any time after the delivery of the
import manifest or import report as the case maybe :
Provided that the Commissioner of Customs may in any special circumstances permit a bill of
entry to be presented before the delivery of such report :
Provided further that a bill of entry may be presented even before the delivery of such manifest if
the vessel or the aircraft by which the goods have been shipped for importation into India is expected to
arrive within thirty days from the date of such presentation.
(4) The importer while presenting a bill of entry shall at the foot thereof make and subscribe to a
declaration as to the truth of the contents of such bill of entry and shall, in support of such declaration,
produce to the proper officer the invoice, if any, relating to the imported goods.
(5) If the proper officer is satisfied that the interests of revenue are not prejudicially affected and
that there was no fraudulent intention, he may permit substitution of a bill of entry for home consumption
for a bill of entry for warehousing or vice versa.
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bills of entry on different dates by three different shipping
agents of M/s. Azim Garments Ltd. No explanation in the
pleading as to what exactly is the implication of the statement
extracted above is available. Assuming for the sake of
argument, the letter seeks to convey that the bills of entry for
three different consignments had been presented by the
shipping agents of M/s. Azim Garments Ltd. and cleared the
goods covered by those bills of entry, there is nothing in the
letter to indicate that the goods covered by the said bills of
entry are the goods which are covered by the four consignment
notes which are in issue in this appeal.
45. The document purports to be the internal
correspondence between the two officers of the Customs
department of Bangladesh, no doubt purportedly with a copy
marked to the appellant herein. There is no pleading
explaining the occasion for such a correspondence. The proof
of public documents is required to be made in the manner
specified under Section 78 of the Evidence Act. Sub-section
(6) stipulates the mode of proof of public documents other
than those mentioned in sub-section (4) of a foreign country.
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“Section 78. Proof of other official documents.—The following
public documents may be proved as follows.—
(1) to (3) x x x
(4) The acts of the Executive or the proceedings of the
Legislature of a foreign country,—
by journals published by their authority, or commonly
received in that country as such, or by a copy of certified
under the seal of the country or sovereign, or by a
recognition thereof in some Central Act;
(5) x x x
(6) Public documents of any other class in a foreign
country,—
by the original, or by a copy certified by the legal keeper
thereof, with a certificate under the seal of a Notary Public,
or of an Indian Consul or diplomatic agent, that the copy is
duly certified by the officer having the legal custody of the
original, and upon proof of the character of the document
according to the law of the foreign country.”
46. There is nothing on record to establish that the
abovementioned letter has been duly proved in accordance
with Section 78 of the Evidence Act.
47. For all the above-mentioned reasons, the defence of the
appellant based on the letter dated 10.04.2002 (supra) that
the appellant had delivered four consignments entrusted to it
by the respondent at the Benapole Customs Station,
Bangladesh cannot be accepted.
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48. The other submission of the appellant that in view of the
fact that the respondent herein claimed a duty drawback on
the strength of the export of the goods which are the subject
matter of dispute in this appeal, the respondent cannot
dispute the fact that the goods were duly exported, i.e. duly
transported beyond India customs frontier and delivered at the
Benapole Customs station at Bangladesh.
49. The subject of drawback is dealt under Chapter X of the
Customs Act 1962. The expression ‘drawback’ is not defined
under the Act. Sections 74 and 75 create a right to claim a
‘drawback’. Section 7418 entitles an exporter to claim the
repayment/return (drawback) of 98% of any duty paid on
material imported into India when again exported out of India
18 74. Drawback allowable on re-export of duty-paid goods. – (1) When any goods capable of being
easily identified which have been imported into India and upon which any duty has been paid on
importation, -
(i) are entered for export and the proper officer makes an order permitting clearance and
loading of the goods for exportation under section 51; or
(ii) are to be exported as baggage and the owner of such baggage, for the purpose of clearing
it, makes a declaration of its contents to the proper officer under section 77 (which declaration shall
be deemed to be an entry for export for the purposes of this section) and such officer makes an order
permitting clearance of the goods for exportation; or
(iii) are entered for export by post under section 82 and the proper officer makes an order
permitting clearance of the goods for exportation,ninety-eight per cent of such duty shall, except as
otherwise hereinafter provided, be re-paid as drawback, if -
(a) the goods are identified to the satisfaction of the Assistant Commissioner of Customs or
Deputy Commissioner of Customs as the goods which were imported; and
(b) the goods are entered for export within two years from the date of payment of duty on
the importation thereof :
Provided that in any particular case the aforesaid period of two years may, on sufficient
cause being shown, be extended by the Board by such further period as it may deem fit.
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subject to the various conditions specified under the Section
and the Rules made thereunder.
50. Section 7519 provides for a drawback to be paid to the
exporter of any goods who used any imported material of a
class or description notified by the Government of India in the
manufacture or processing of the goods which are sought to be
exported, subject to other conditions stipulated under the said
Section and the Rules made thereunder.
51. Once again in the case on hand, it is not clear from the
pleadings of the appellant whether the respondent herein
claimed a drawback either under Section 74 or under Section
19 75. Drawback on imported materials used in the manufacture of goods which are exported. –
(1) Where it appears to the Central Government that in respect of goods of any class or description
manufactured, processed or on which any operation has been carried out in India , being goods which have
been entered for export and in respect of which an order permitting the clearance and loading thereof for
exportation has been made under section 51 by the proper officer, or being goods entered for export by post
under section 82 and in respect of which an order permitting clearance for exportation has been made by
the proper officer, a drawback should be allowed of duties of customs chargeable under this Act on any
imported materials of a class or description used in the manufacture or processing of such goods or carrying
out any operation on such goods, the Central Government may, by notification in the Official Gazette,
direct that drawback shall be allowed in respect of such goods in accordance with, and subject to, the
rules made under sub-section (2).
Provided that no drawback shall be allowed under this sub-section in respect of any of the
aforesaid goods which the Central Government may, by rules made under sub-section (2), specify, if the
export value of such goods or class of goods is less than the value of the imported materials used in the
manufacture or processing of such goods or carrying out any operation on such goods or class of goods, or
is not more than such percentage of the value of the imported materials used in the manufacture or
processing of such goods or carrying out any operation on such goods or class of goods as the Central
Government may, by notification in the Official Gazette, specify in this behalf :
Provided further that where any drawback has been allowed on any goods under this sub-section
and the sale proceeds in respect of such goods are not received by or on behalf of the exporter in India
within the time allowed under the Foreign Exchange Management Act, 1999 (42 of 1999), such drawback
shall except under such circumstances or such conditions as the Central Government may, by rule, specify
be deemed never to have been allowed and the Central Government may, by rules made under sub-section
(2), specify the procedure for the recovery or adjustment of the amount of such drawback.
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75. Be that as it may. In either case, the right to a drawback
accrues to the exporter once the exporter makes an entry for
export of the goods under Section 50 of the Act and on the
making of an order by the proper officer under Section 51
permitting clearance and loading of the goods. The scope of
both of these sections has already been examined earlier in
this judgment.
52. Rules are made by the Government of India from time to
time in this regard. The Rules currently in vogue are known
as the “Customs, Central Excise, Duty and Service Tax
Drawback Rules, 1995”, which are made in exercise of the rule
making authority conferred under the various enactments
including the Customs Act. However, these rules are
subsequent to the export transaction in question. Neither the
relevant rules governing the situation on the date when the
respondent claimed the drawback are placed before us nor is
there any clear pleading by either party as to the relevant date
on which such a claim for drawback could be made. We are
not sure whether under the rules applicable to the transaction
in question, whether it is the date of the actual delivery of the
goods in the foreign country which entitles the exporter to file
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an application claiming drawback or is it the date of the entry
of the goods for export from India. In the absence of any
material on record such as the one indicated above, the mere
fact that the respondent did claim (the respondent admitted
that they did claim a duty drawback as alleged by the
appellant) a duty drawback does not necessarily lead to the
inference that the appellant had duly delivered the goods in
question at Benapole Customs station.
53. Under the 1995 Drawback Rules, which are in force
today, Rule 13 stipulates that the claim for a drawback can be
filed on the date when the proper officer makes an order
permitting clearance and loading of the goods under Section
51 of the Act. We refer to Rule 13 not because it is applicable
to the facts of the case, but only to demonstrate that the law
clearly provides for the date and event, the happening of
which, entitles the exporter for seeking the drawback.
54. In view of the fact that the appellant admitted the
entrustment of goods by the respondent to the appellant for
transportation to Benapole (Bangladesh), the burden to prove
that the appellant satisfactorily discharged his legal obligation
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to deliver the goods at Benapole (Bangladesh) in accordance
with law is on the appellant which burden the appellant failed
to discharge. In our opinion, therefore, the National
Commission rightly allowed the claim of the respondent. We
do not see any reason to interfere with the same. Appeal is
dismissed. No order as to costs.
………………………….J.
(J. Chelameswar)
………………………….J.
(A.K. Sikri)
New Delhi;
November 05, 2014.
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