Customs, Excise and Gold Tribunal - Mumbai
Resham Singh Brothers vs Collector Of Customs on 16 September, 1988
Equivalent citations: 1989(19)ECC260, 1989(21)ECR172(TRI.-MUMBAI), 1989(41)ELT171(TRI-MUMBAI)
ORDER K. Prakash Anand, Member (T)
1.The issue in this matter is whether, tyres, tubes and flaps imported by appellants and claimed to be covered under O.G.L. 10(4) of AM-83 Policy, can be properly considered as spares for actual users (Non-Industrial) or, as alleged by the department, they are consumer goods hit by S. No. 77 of Appendix 4 AM-83 Policy, vide definition under para 5(13) of the said policy.
2. We have heard Shri V.B.Akolkar, Advocate, for the appellants and Shri S.P. Prabhu, JDR, for the department.
3. In the order in appeal the Additional Collector held, that while admittedly, tyres, tubes and flaps (in equal numbers) are excluded from Appendix 3, they are hit by S.No.77 of Appendix 4 AM-83 Policy, read with the definition under para 5(13) of the Policy Book AM-83. The Additional Collector held that, the importers were required to produce a certificate under the Shops and Establishments Act, valid at least for last three years, which they failed to do. It was also held, that whether or not the items are consumer goods is determinable not on the basis of the purposes for which they are imported but on the consideration whether the items could be considered as consumer goods as such. The Additional Collector decided that general purpose bus/truck tyres were to be considered as consumer goods vide definition under para 5(13) of the AM- 83 Policy.
4. Accordingly, holding that the import was without cover of a valid I.T.C. licence, the goods in question were confiscated under Section 111(d) of the Customs Act, 1962 read with Section 3 of the Imports and Exports (Control) Act, giving appellants the option to redeem the goods on payment of fine in lieu of confiscation of Rs. 2,50,000/-.
5. We do not think that the view taken by the Additional Collector is maintainable. Appellants were registered as Motor Transport Undertaking under Motor Transport Act, 1961 and operated some 40 motor vehicles, including trailers. They claimed that the 300 packages tyres, tubes and flaps were required for maintenance for their vehicles. Appellants have rightly contended before us that the Additional Collector of Customs has taken an incorrect view in holding that the actual user (non-industrial) is required necessarily to produce a certificate under the Shops and Establishments Act. We find that as per para 5(4) (a) "Actual User (Non-industrial)" means - any commericial establishment which has been registered or holds a certificate for at least 3 years under the local law applicable to Shops and Establishments. The learned Additional Collector has admitted that appellants had produced before him photo copy of registration certificate permitting them to work as the Motor Transport Undertaking, claimed to be as per local statute. He has not accepted this certificate, but the reasons for this are not at all discussed.
6. It is also conceded by the Additional Collector in his order that the Customs had earlier allowed similar imports of the appellants. No reason at all is given why doubts had suddenly arisen about their being a commercial undertaking or owning a fleet of vehicles. There is no whisper as regards such doubts in the show cause notice.
7. The view taieen is that the items in question, being general purpose bus/truck tyres, are to be considered consumer goods as per para 5(13) of AM-83 Policy. As per this particular provision of the Policy "consumer goods", for the purposes of import policy, will mean consumption goods which can directly satisfy human needs without further processing; it would include consumer durables also.
8. In the case of Colour Chem Ltd. v. Collector of Customs, Bombay -1986 (25) E.L.T. 549, the question as to what are consumer goods for I.T.C. purposes came in for consideration by this Bench. The issue was, whether photocopier zerox machine was classifiable as consumer goods. Noting that consumer goods have not been defined in the Policy, it was observed that goods such as food and clothing directly satisfy human wants and therefore would pose no problem, but when dealing with gadgets like calculators etc., one entered a gray area where at one end of the spectrum were goods which could be used directly for satisfying human wants whereas at the other end, there were sophisticated goods that required technological skill or scientific knowledge for their operation or use and therefore they could not really be called goods that satisfied human wants directly. Photocopier not being an item of domestic use, was therefore considered to be classifiable as other than consumer goods.
9. We also find that in the case of Indian Airlines, Calcutta v. Collector of Customs, Calcutta - 1988 (38) ELT 679, it was held by this Tribunal that aeroplane tyres were spare parts for servicing. Indian Airlines, who were the importers in that case, being neither manufacturer nor seller of tyres, it was held that they used the tyres only to service their aircraft which periodically needed to have their tyres replaced.
10. We concur in the view taken in the decision of this Bench in the case of Colour Chem Ltd. v. Collector of Customs, Bombay as regards what can be considered of consumer goods for I.T.C. purposes. The tyres, tubes and flaps imported by appellants, who indisputably are commercial undertaking, were evidently for the servicing of their large fleet of motor vehicles including trailers and required for replacement purposes. In this view of the matter, they cannot be considered as common purpose consumer goods meant directly for satisfying human need.
11. We also concur in the view taken by this Tribunal in Indian Airlines, Calcutta v. Collector of Customs, Calcutta. Department's stand that being components, the goods in question are hit by S. No. 557 of Appendix 5 of AM-83 Policy, has therefore also to be rejected.
12. In the light of these discussions, orders appealed against are set aside.
13. Appeal allowed. The Appellant be granted consequential relief.