Customs, Excise and Gold Tribunal - Delhi
Globe Sales vs Collector Of Customs on 13 May, 1997
Equivalent citations: 1998(99)ELT290(TRI-DEL)
ORDER G.R. Sharma, Member (T)
1. The captioned two appeals arise out of the same order on the same issue, therefore, they are being disposed of by this common order.
2. The facts of the case in brief leading to the present appeals are that the appellants imported a product and described it as acrylic plastic scrap and claimed its import under OGL. Department alleged that the import of the product needed a specific licence and was not an item covered under OGL and hence/the proceedings started. The appellants submitted that import of waste, scrap, seconds, defective, etc. is covered by para 27 of the Hand Book of Procedures based on the Import Policy 1992 to 1997. The appellants argued that the product described in the invoice and the Bill of Entry is acrylic plastic scrap. That they had imported only this product and that this product was covered by pare 27(1) of the Hand Book of Procedures. It was submitted that para 27(2) speaks of waste of various fibres, etc. which require a specific licence and that this para does not speak and include acrylic plastic scrap. It was contended that since import of scrap was not prohibited or restricted but was permitted to be imported without a licence and, therefore, it was submitted that no licence was necessary. The Additional Collector adjudicated the case confiscating the imported goods but allowed to redeem on payment of a fine of Rs. 4 lakhs and Rs. 3 lakhs on the goods imported by the two importers and also imposed a penalty of Rs. 46,000/- and Rs. 34,000/-.
3. Appellants filed an appeal before the ld. Collector (Appeals) who reduced the redemption fine from Rs. 4 lakhs to Rs. 3 lakhs in one case and from Rs. 3 lakhs to Rs. 2 lakhs in the other case and upheld the imposition of penalty.
4. Shri H.A. Ahmedi, ld. Counsel appearing for the appellants submits the appellants had contested the confiscation of the goods on the ground the para 27 of the Hand Book of Procedures specifically exempted the licensing part of import of acrylic plastic scrap. He submits that scrap and waste are two different items recognised by the policy as such. He submits that waste and scrap are two different aspects has been so upheld by the Tribunal in the case of Hemani Industries v. Commissioner of Customs, Calcutta, 1996 (83) E.L.T. 617 (Tribunal). The ld. Counsel submits that the lower authorities instead of examining the issue in terms of Export Import Policy for the period examined it in altogether a different issue of letter of credit, grace period of 45 days entered into contract, etc. The ld. Counsel submits that even on examination by the Customs its findings recorded on the reverse of Bill of Entry concerned states that the product is crushed scrap. He submits that the Department has not placed any evidence on record to show that the product imported by them was not scrap but was waste so as to attract the stipulation in Sub-para (2) of para 27 of the Hand Book of Procedures. The ld. Counsel submits that the product imported by the appellants was scrap and since import of scrap has been allowed without a licence in terms of Sub-para (1) of para 27 of the Policy, the confiscation of the goods and imposition of penalty is not warranted and prays that the impugned order may be set aside and the appeal may be allowed.
5. Shri Satnam Singh, ld. SDR, appearing for the respondent Commissioner submits that reliance has been placed on the Hand Book of Procedure; the Procedures are administrative instructions and, therefore, the policy for the import of the goods is to be looked into. He submits that the policy for the relevant period (1st April, 1992 to 31st March, 1997) does not show that scrap was permitted to be imported without a licence especially so from 30-3-1994. He submits that the restriction came from 30-3-1994 and, therefore, the examination of the documents i.e. contract, letter of credit etc. become relevant and were so examined by the lower authorities. The ld. SDR submits that since the goods were imported after 30-3-1994, therefore, they were subject to the restriction brought in from that date. Justifying the action by the lower authorities the ld. SDR reiterated the findings.
6. Heard the submissions of both sides. We note that scrap of plastics was permitted to be imported without a licence before 30-3-1994. The restriction by way of sub-para (2) of para 27 of the Hand Book of Procedures came only with effect from 30-3-1994. The question, therefore, to be examined is whether the restriction covered imported goods meaning thereby whether a specific licence was required for import of acrylic plastic scrap or it was covered by the OGL provisions of the Policy. Looking at para 27 and its two paragraphs we find that first para stipulated that item in the form of waste, scrap, second and defective, waste paper and used rubber tyres/tubes cut into two pieces may be imported without a licence. Thus, both waste and scrap according to this para can be imported without a licence. However, sub-para (2) stipulated a restriction inter alia providing that the import of acrylic fibre waste, acrylic tow waste, acrylic top waste and all types of plastic wastes (except PET bottle waste) shall not however be permitted except against a licence. A dispute therefore, arose whether the items imported by the appellants was a waste, though, described as a scrap. We find that waste and scrap are two different terms so understood in common parlance. The law also recognizes these terms as two distinct terms and, therefore, they are not synonymous. We also find that the appellants cited and relied on the decision of this Tribunal in the case of Hemani Industries v. Commissioner of Customs, 1996 (83) E.L.T. 617 (Tribunal), cited in the preceding paragraphs. In para 8 the Tribunal held that :-
"I have carefully considered the submissions advanced from both sides. I find sufficient force in the two pleas of the learned Consultant. Firstly, Waste cannot be equated with Scrap even in terms of Para 27 of the Hand Book of Procedures inasmuch as the two expressions - waste and scrap - have been used in that para, therefore, they cannot, on the normal principle of construction of law, be treated as same."
7. On the other hand our attention was drawn to the examination report of the goods. From the examination report recorded on the reverse of the relevant Bill of Entry we find that on physical examination the goods have been found to be crushed scrap. The Department has not placed any evidence on record either to. prove that waste and scrap are synonymous or the scrap imported by the appellants was actually not a scrap but waste. In the absence of any positive evidence placed on record by the respondents we do not see any reason to hold that the scrap imported by the appellants was not scrap but waste.
8. Since import of scrap under sub-para (1) of para 27 of the Hand Book of Procedures is permitted without a licence, we hold that no licence was required for import of acrylic plastic scrap.
9. In view of the above findings, the impugned order is set aside and the appeal is allowed. Consequential relief, if any, shall be admissible to the appellants in accordance with law.