Customs, Excise and Gold Tribunal - Delhi
P.R. Parekh vs Collector Of Customs on 29 June, 1984
Equivalent citations: 1987(30)ELT493(TRI-DEL)
ORDER G. Sankaran, Member (T)
1. This appeal is against order No. SG.Misc.100/83 -/S/10.91/83A, dated 4-1-1984 passed by the Collector of Customs, Bombay, whereby he confiscated, under Section 111(d) and 11 l(m) of the Customs Act, 1962, read with Section 3(2) of the Import and Export (Control) Act, 1947, a consignment of goods described as "Foley Suction Cathetors", imported by the appellants at the port of Bombay. However, he allowed the goods to be redeemed on payment of a fine of Rs. 50,000/-. He also imposed a penalty of Rs. 10,000/- on the appellants under Section 112 of the Customs Act. He also denied duty-free clearance of the goods as claimed by the appellants.
2. List 2 of Appendix 10 of the 1983-84 Import & Export Policy specifies a number of life saving equipments allowed for import under Open General Licence (OGL). SI. No. 31 of the list specifies "Suction Catheters". The subject goods were described in the bill of entry as suction cathetors. However, on the basis of certain intelligence and subsequent investigations, the Collector concluded that the goods which were Foley Balloon Cathetors were not suction cathetors, but were surgical rubber goods covered by Appendix 5 of the Import Policy, requiring a licence for their import. On the basis of the finding that the goods were not suction cathetors, the Collector further held that the goods were assessable to duty under heading No. 90.17/18 of the Customs Tariff Schedule read with Customs Notification No. 217/77, dated 7-10-1977 at the rate of 40% (basic Customs duty) + 25% (auxiliary duty of Customs) +10% (additional or countervailing duty of Customs).
3. The evidence on the basis of which the Collector came to the above conclusions, as apparent from the record, is that the goods bore labels describing them as "Rusch-Gold balloon cathetors". The Collector has stated in his order that balloon cathetors are intended for removal of urine by increasing the internal pressure of the urine bladder. Suction Cathetors, on the other hand, are primarily intended for removal of unwanted fluids in the blood system. Furthermore, the Collector observes, Shri Pravin R. Parekh, partner of the appellant firm, had stated in his statement recorded under Section 108 of the Customs Act that the balloon cathetors imported by them were different from suction cathetors and that they had different functions to perform. Shri Parekh had offered to produce an import licence to cover the goods and also to pay import duty on the goods. The Collector, however, did not accept the licence produced for clearance of the goods since he did not see any reason for accepting the licence because the importers would have succeeded in their attempt to clear the goods without a licence and without payment of duty but for the investigations conducted by the Custom House.
4. Shri L.U. Balani, Counsel for the Appellants, at the hearing on 7-6-1984 submitted that balloon cathetors were only suction cathetors and were covered by the OGL as well as by the Customs duty exemption notification. In support of this statement he relied on a letter dated 1-5-1984 from Dr. G.H. Gidwani, for Director General of Health Services, New Delhi, testifying that "Foley Balloon Cathetors" could be used as Suction Cathetors and would, therefore, come under the term "Suction Cathetors". Shri Balani also relied upon certain catalogues and certain Orders-in-Appeal passed by the Collector of Customs (Appeals), Bombay holding Foley Balloon Cathetors to be Suction Cathetors. Since the letter of the Director-General of Health Services was not an authenticated copy, the hearing was adjourned to 22nd June, 1
5. On the resumed date of hearing Smt. Vijay Zutshi, S.D.R., produced a photostat copy of the letter dated 1-5-1984 addressed by Dr. G.H. Gidwani to the Deputy Collector of Customs, Special Investigation & Intelligence Branch, Bombay Custom House. However, she opposed the appeal because Shri Parekh, the Partner of the firm, had deposed in his statement that the imported goods were not Suction Cathetors.
6. We have carefully considered the submissions before us. The letter dated 1-5-1984 from the Director-General of Health Services signed by Dr. G.H. Gidwani for the Director-General of Health Services clearly states that the opinion that Foley Cathetors are Suction Cathetors is based on the opinion of the Urologist in Delhi and Asstt. Dean, K.E.M. Hospital, Bombay. The Directorate has since reconsidered the issue in consultation with Prof. Sarinder Man Singh, Head of the Department of Urology, All India Institute of Medical Sciences, New Delhi and the Profe ssor has confirmed that Foley Balloon Cathetors' could be based as Suction Cathetors and would, therefore, come under the term "Suction Cathetors". Copies of the letters of the Asstt. Dean, K.E.M. Hospital", Bombay and the Head of the Department of Urology, AIIMS have been perused. In his letter dated 23-3-1984 to the Director-General of Health Services, the Head of Dept. of Urology, AIIMS has stated that Foley Balloon Cathetors come under the term suction Cathetors and would qualify for exemption from Customs duty as life saving equipment. In his letter dated 21-5-1981 to the Collector of Customs, AIR Cargo, Bombay, the Asstt. Dean, KEM Hospital, Bombay has said that Foley Cathetors are Suction Cathetors and are used for urine suction. In the light of these categorical certificates, we have no difficulty in coming to the conclusion that the Collector's finding that the subject goods were not Suction Cathetors was clearly erroneous. His reliance on the statement of Shri P.R. Parekh cannot detract from the evidentiary value of the certificates issued by eminent men of medicine. At any rate, what Shri Parekh had said in his statement was that Foley Balloon Cathetors were different from Suction Cathetors but the former was an improved version of Suction CatKetors. The Collector in his order says that the function of Suction Cathetors is to remove unwanted fluids in the blood system. This finding also stands negatived by the certificates produced. The book "Medical Dictionary" 21st edition, published by E.&S. Livingstone Limited, at page 278 defines "Catheter" as "A hollow cylinder of silver, India rubber, or other material, designed to be passed through the urethra into the bladder to drain this viscus of urine in case of retention; a similar instrument used for passage through other canals".
7. Based on the above discussions, we have no hesitation in coming to the conclusion that the goods imported were Suction Cathetors and as such eligible for clearance without licence in terms of Open General Licence contained in Appendix 10, List 2, SI. No. 31. They are also eligible for duty exemption in terms of Customs Notifications 208/81, dated 22-9-1981 and 262/82, dated 30-11-1982 vide SI. No. 32 in the list of life saving equipments annexed to the notification. We, therefore, set aside the impugned order, allow the appeal and direct consequential relief to the appellants within 2 months from the date of communication of this order.
8. We do not think that the reason given by the Collector for not accepting the licence offered for clearance of the goods (presuming the licence was valid to cover the goods) is a sound one. Even if the party had attempted to clear the goods under OGL under a misdescription (we have found that there was no misdescription), that would not be a sufficient reason not to accept a licence offered for clearance of the goods if that licence was valid otherwise to cover the goods.