Customs, Excise and Gold Tribunal - Tamil Nadu
G.K. Enterprises vs Collector Of Customs on 23 December, 1993
Equivalent citations: 1994ECR13(TRI.-CHENNAI), 1996(83)ELT369(TRI-CHENNAI)
ORDER S. Kalyanam, Member (J)
1. This appeal is directed against the impugned order of the Collector of Customs (Appeals), Madras dated 28-5-1993 confirming the order of the Dy. Collector of Customs, Madras, dated 6-1-1993 absolutely confiscating 25 tonnes of dry whole betelnuts imported by the appellant hereinunder Bill of Entry No. 38239, dated 6-11-1992 valued at Rs. 1,76,750/- under Section III(d) of the Customs Act, 1962, the Act for short, besides a penalty of Rs. 15,000/-under Section 112 of the Act. The appellant herein imported whole betel nuts 25 tonnes under Bill of Entry dated 6-11-1992 and sought clearance of the same on the basis of Exim Scrip referred to in the order of the original authority. The authorities, on examination of the relevant provisions of the Policy, viz. AM 1990-93 and also going into the scope of Exim Scrip relied upon by the appellant for clearance of the goods imported, took a view that the goods imported are consumer items coming under the General category under Part-II of Chapter XV Policy April-May 1992-1997, requiring a specific licence and in that view proceedings were instituted against the appellant resulting in the impugned order appealed against.
2. Shri Raman, the learned Counsel for the appellant submitted that the authorities below have disputed the fact that the goods in question are "Dry Fruits" consumer items coming under Part-II dealing with the restricted items under Chapter XV of the relevant Policy. The learned Counsel assailed the correctness of the findings of the authorities holding that the goods will have to be categorised under the residual clause dealing with all consumer goods and submitted that the goods imported are only dry fruits, clearly permissible for import under the Exim Scrips. The learned Counsel submitted that under the Policy in question even items like dry fruits, viz., Almonds, dates are freely importable even though they are regarded as consumer items. In support of the plea that the goods imported are dry fruits, the learned Counsel placed reliance on the statement of the Hon'ble Minister of State for Commerce dated 15th Oct., 1991 in the [foreword] to the Import Licensing Policy - Aligned on Harmonised System of Commodity Classification. It was urged that under the Harmonised System of Commodity Classification under Chapter 8 dealing with Edible Fruit and Nuts, SI. No. 080290 00.20 Betel nuts, cola nuts, dry seeds for fruits are clearly mentioned with reference to limited permissible list with particular reference to Appendix 3A 202A of AM 1990-93 which was subsequently extended on the same line to AM 1992-97. The learned Counsel was at pains in expatiating on the plea that the very purpose for introducing the Harmonised System of Commodity Classification was only to-reduce the scope of discretionary decision-making at lower levels and introduced better transparancy in the Import Policy, including the tariff structure. It was contended that the classification was brought on to bring clarity to the Import Policy to help importers and exporters to understand better the contents of the Policy and the same was also compiled only in collaboration and in conjunction with the Department of Customs, DGTD, Department of Electronics, Ministry of Agriculture, Commerce, Steel apart from the office of the Chief Controller of Import and Export, now designated as the Director General of International Trade, in the Ministry of Commerce. The learned Counsel in developing these arguments placed reliance on Chapter 8 of the Customs Tariff: 1993-94 dealing with Edible Fruit and Nuts and referred to SI. No. 5 sub-heading 0802.90 dealing with Betel nuts. It was urged that Betel nuts are dealt with under the Chapter dealing with edible fruits and nuts, like Almonds, Cashew nuts dates etc. It was, therefore, urged that the nature of the goods imported as dry fruits will have to be construed only from the definition given in the Harmonised System of Commodity Classification read with relevant entries in the Customs Tariff Act, 1993-94. The learned Counsel also referred to the Dictionary meaning given in the Webster New World Dictionary where "Betel nut" is described as under :
"Betel nut the fruit of the betel palm, chewed together with lime and leaves of the betel (plant) by some Asian peoples."
Reference was also made to the definition of the word "Palm" which is as under :
"any of a family of tropical or subtropical trees with a tall branch less trunk and a bunch of large leaves at the top."
It was urged that Palm is the genus of the species like Areca palm date palm etc. The learned Counsel also referred to the New English Dictionary where 'Areca' is defined as the "name of the tree and fruit of genus of palm of which one species bears nuts of the size of nutmeg which the natives roll up with a little lime in the leaves of the betel and chew, thereby tingeing their teeth and saliva red."
In the same Dictionary betel nut is also defined as :
"Betel Nut: the nut or fruit of the Areca palm."
The learned Counsel further submitted that the adjudicating authority has mislead himself into an error by adopting common parlance meaning for the goods imported and contended that even from the stand point of common parlance, dry betel nuts are only catagorised in the mercantile world, in the commercial society as dry fruits and in support of this plea the learned Counsel placed reliance on the publication in the Economic Times, a recognised daily-newspaper with reference to the publication in the issues dated 5th May, 1993, 13th May, 1993 and 15th May, 1993. The learned Counsel also referred to the letter of the Commissioner of Horticulture and Plantation Crops, Madras, confirming that "Arecanut (betel nut) is the fruit of Areca (Arecacatechu) palm". Finally, it was urged that even in a situation where two views are possible the view in favour of the importer should be adopted and the learned Counsel in this regard placed reliance on the ratio of the ruling of the Supreme Court in the case of J.K. Steel Ltd. v. Union of India reported in 1978 (2) E.L.T. (J 355).
3. Shri Subramanian, the learned DR adopted the reasoning of the authorities below and contended that in common parlance betel nuts are not understood as dry fruits, even though they may be consumer goods and therefore, would require a specific licence under the relevant Policy.
4. I have considered the submissions made before me and indeed the arguments are heard by me at considerable length. The issue for determination is whether the goods imported, viz., dry whole betel nuts are permissible for import under the Exim Scrips relied upon by the appellant for clearance of the. same under the Policy AM 90-93, which was subsequently extended to March, 1997. Chapter 15 of the said Policy deals with negative list of import and Part-II Col. A deals with restricted items of consumer goods. In the said Policy dry fruits including almonds and dates are held items freely marketable, even though they are considered as consumer goods. The adjudicating authority has not disputed the fact that the goods imported are consumer goods. This has narrowed down the area of controversy and the only issue to be decided in this context is as to whether the goods imported would come within the mischief of "dry fruits" as contended by the appellant or would take it out of the ambit and connotation of the expression "dry fruits" within the meaning of the Policy in question and bring it within the mischief of the residual general clause of other consumer goods, industrial, agricultural etc. requiring a specific licence for import. On a specific query from me the learned Counsel submitted that there is no direct authority on this point of any court. In order to appreciate and understand the plea and also the nature of the goods imported, as to whether they could be considered to be "dry fruits" reference could be made to the Harmonised System of Commodity Classification. While introducing the Trade Policy in Parliament, the Hon'ble Minister of State for Commerce had clarified that the Harmonised System of Commodity classification was a step for rationalising and simplifying the Policy. This harmonised code has been prepared in consultation with the Customs authorities so as to ensure that no dispute should generally arise regarding the importability or classification of an item. The code was also prepared in consultation with DGTD, Department of Electronics, Ministries of Commerce, Steel, Agriculture etc. apart from the office of the Chief Controller of Imports and Exports, now designated as Director General of International Trade. In the said code under Chapter 8 dealing with edible fruits, nuts mention is made about betel nuts as under :
"080290 00.20 Others such as betel nuts, cola nuts, dry Ltd. Perm, list App.Sa 202a 144".
The above categorisation would make it clear that the goods in question were held permissible for import under the category of limited permissible list with reference to Appendix 3A, Item 202A of the relevant Policy. Reference can also be made in this context to Chapter 8 of the Tariff Act 93-94 dealing with edible fruits and nuts where also betel nuts are considered in the company of other dry fruits like cashew nuts, almonds, dates etc. The learned Counsel also made references to the Dictionary meaning of betel nuts which are already set out above and to avoid repetition only refer to what is extracted above in the various Dictonaries. In a situation where there is a doubt or ambiguity resort is had to the Dictionary meaning by Courts of law. The various Dictionaries have also regarded betel nuts as "dry Fruits". Apart from the Dictionary meaning reference can also be made to the opinion of the Commissioner of Horticulture and Plantation crops referred to above confirming that Areca nut is a fruit of Areca palm. Newspapers like Economic Times also refer betel nuts to dry fruits and this is how it is understood in the commercial and mercantile world. No doubt in a too technical, popular meaning it may be difficult to conceive the betel nuts as dry fruits, but be that as it may that would not take away the betel nuts from the category of dry fruits, because apart from this being a consumer item it is the dry nut of a areca palm fruit. Therefore, it would be seen that the harmonised system of commodity classification, Customs Tariff Act, Dictionary meaning, opinion of the Commissioner of Horticulture and Plantation Crops, Department of Horticulture, Govt. of Tamil Nadu, would all support the view that the goods imported are dry fruits. It is a settled law that wherever. two different interpretations are possible the view in favour of the importer should be adopted. In my view in the factual background of this case and in the light of the various evidences set out above, the view contra taken by the authorities below would appear to be hyper-technical and too finical, not permissible in the facts and circumstances of the case.
5. In the present case the goods imported have been found heavily infested/infected by the Plant Quarantine authority who have held that the goods are not fit for human consumption and the goods should be destroyed. To a specific query in this regard the learned Counsel submitted that the appellant has no objection to the goods being destroyed and is not questioning that part of the impugned order. It was submitted that the appellant is restricting the appeal only to the limited issue with reference to permissibility of goods which are otherwise fit for consumption like Areca nuts under the Exim Scrips. I therefore uphold that part of the impugned order absolutely confiscating the goods and directing its destruction as the same is not fit for human consumption. In regard to the permissibility of the import of goods such as dry betel nuts, for the reasons stated above I hold that goods fit for human consumption would be permissible for import under Exim Scrips under the relevant licensing policy. The impugned order would, therefore, stand modified to this extent.