Customs, Excise and Gold Tribunal - Delhi
Plastics And Metals (P) Ltd. vs Collector Of Customs on 6 December, 1989
Equivalent citations: 1990(26)ECC212, 1990ECR231(TRI.-DELHI), 1990(47)ELT424(TRI-DEL)
ORDER P.C. Jain, Member (T)
1. The appellants herein imported a consignment of moulds for dash board valued at Rs. 2,75,597/- clearance of which was sought against OGL Appendix 6 S.No. 6 of April-March (AM) 1985-88 Policy Book. The consignment was confiscated by the original adjudicating authority with an option to pay a fine of Rs. 1,35,6007- in lieu of confiscation on the ground that the appellants Small Scale Industries certificate (SSI) did not permit manufacture of dash boards. Therefore, the appellants could not be treated as actual users (industrial) who alone could import the moulds (within the terms of S.No. 6 Appendix 6 of OGL).
2. It is admitted to the appellants that at the time of import i.e. on 15.5.87 their SSI certificate did not specifically mention dash board as an item of manufacture. Later on, however, w.e.f. 3.6.88 this item has also been included in the items of manufacture to be undertaken by them.
3. Learned advocate for the appellants has urged that S.No. 6 of Appendix 6 reads as follows: -
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Items Categories of eligible importers 6. Jigs, fixtures, dies and patterns, Actual Users (Industrial) moulds (including moulds for diecasting), and press tools (other than those in Appendices. 1 Part- A, 2 and 3 Part-A) and parts thereof.
The aforesaid entry, he submits, should be contrasted with entries 16 to 18 which are also reproduced below: -
16. Medical gas cylinders 10.2 litres Actual Users (Industrial) having Industrial and below water capacity. Licence; Registration for manufacture of medical gas (oxygen) and/or Nitrous Oxide and having valid licence issued under the Drugs and Cosmetics Act, 1940.
17. CO2 Gas cylinders upto 15 litres Actual Users (Industrial) having Industrial water capacity for fire extin- Licence; Registration for manufacture of fire guishers. extinguishers.
18. Greases/lubricating oils. Actual Users (Industrial) provided of value of such goods imported in a financial year shall not exceed Rs. 10,000 subject to produc-
tion of 'No-Objection Certificate' from Indian Oil Corporation, Marketing Division, Bombay.
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3.1. He submits that a perusal of the entries at S. No. 16 to 18 immediately indicates that wherever the policy makers wanted the items under import to be restricted to manufacturers of specific commodities alone that has been specifically spelt out as mentioned against entries 16 to 18; whereas merely the words 'actual users industrial' have been mentioned against S. No. 6 as the eligible category of importer. It is not, therefore, necessary according to the learned advocate, to look into the SSI certificate as to the actual item of manufacture permitted to be manufactured. SSI certificate is not in the category of a licence which prohibits a person holding such a certificate from manufacturing any other item of that line. He also submitted that the appellants had already in hand as early as 1986 an order for manufacture of dash boards from Maruti Udyog Ltd. The appellants had the necessary plant and machinery and wherewithal to manufacture the necessary dash boards merely by Changing the injection moulds. In these circumstances, no doubt could be cast on their actual user category (industrial category). He submits that a narrow interpretation taken by the lower authorities of the Entry No. 6 Appendix 6 is uncalled for. OGL, according to him, is a beneficial provision and should not be given an undue restricted interpretation. He relies for this proposition on Supreme Court's judgment reported in 1985 (39) E.L.T. 503 (S.C.) [U.O.I. v. Suksha International & Nutan Gems and Anr.].
3.2 In any case he submits that non-mention of the specific item in the SSI certificate was merely a procedural lapse. This was also rectified by the specific amendment of the SSI certificate and the item was introduced w.e.f. 3-6-1988. The procedural lapse should, therefore, be ignored for the purpose of this import. He relies for this proposition on the following two judgments :-
(1) 1987 (32) ELT 579 [CCE v. MRF] (2) AIR 1986 SC 1479 3.3 In any case he submits that there being no doubt about the actual use of these items in view of the subsequent amendment in the SSI certificate and the relevant order from Maruti Udyog Ltd. a nominal fine would have met the ends of justice. A heavy fine in lieu of confiscation to the tune of Rs. 1,35,0007- is unwarranted.
4. Learned SDR, on the other hand, draws attention to the definition of 'actual user industrial' in the Import Policy and states that according to this definition 'actual user industrial' means "an industrial undertaking, be it in the large scale, small scale or cottage industries sector, engaged in the manufacture of any goods for which it holds a licence or Registration Certificate from the appropriate Government authority, wherever applicable". [Emphasis supplied by the Ld. SDR]. In view of this definition, the learned SDR has submitted that there is no doubt that at the time of importation the SSI certificate in the hands of the appellants was not valid to categorise them as actual user industrial for the purpose of item under import; they might be industrial undertaking otherwise. He, therefore, reiterates the findings of the lower authorities.
5. We have carefully considered the pleas advanced on both sides. Aforesaid definition of 'Actual User (industrial)' given in para 7(3) of the relevant ITC Policy and cited by the learned SDR has to be read in conjunction with the definition of 'Actual User' given in para 7(1) of the said Policy. It is reproduced below :-
"7(1) 'Actual User' means a person, who applies for/secures a licence for the import of any item or an allotment of an imported item required for his own use, and not for business or trade in it. Thus, in the case of an industrial undertaking, the item concerned shall be utilised for the manufacturing processes or operations conducted within its authorised premises (or made available to jobbing units or other units outside for intermediate processing only as part of such production effort). In the non-industrial category, such as hospitals, research and development units or any other institutions, commercial establishments and individuals, the concerned item shall be utilised for its/his own use, i.e., for the purpose for which the item was sought for import."
[Emphasis supplied].
The emphasis, therefore, is that the item under import should be used in an industrial undertaking for manufacturing process/operation. For that, there is no doubt in the instant case. A very narrow construction, as rightly pointed out by the learned advocate for the appellants is not called for in a beneficial provision like OGL unless the item under consideration is specifically prohibited elsewhere in the Policy. In the facts and circumstances of this case we do not find any doubt that the items imported by the appellants shall be used in the industrial undertaking of the appellants for the manufacture of further goods. Therefore, they satisfy the category of eligible importer for which the goods are permissible to be imported against S.No. 6, Entry No. 6 of the OGL.
6. In view of the foregoing, we do not find that there was any justification for treating the goods as requiring an import licence. Hence, we set aside the impugned order while allowing the appeal. Consequential relief to be granted to the appellants.