1981 (9) TMI 278 - Board - Customs

Summary

Issues: Importation of Olive Oil under Open General Licensee (O.G.L.)

Analysis:
The judgment revolves around the importation of Olive Oil under Open General Licensee (O.G.L.) by the appellants. The case involved a dispute regarding the classification of the imported Olive Oil as consumer goods, which would require an I.T.C. License for importation, or as crude drugs required for making Ayurvedic and Unani medicines under specific conditions laid out in the Import Trade Memorandum. The Collector observed that the goods, packed in small consumer-sized packaging, did not appear to be trade goods but consumables, thus requiring an I.T.C. License. However, the Board disagreed with this assessment, emphasizing that the Policy must be interpreted as a whole and not in isolation. The Policy defined "consumables" as items participating in a manufacturing process but not forming part of the end product, providing a specific connotation to the term for the relevant period. The Board concluded that Olive Oil in small packaging did not fall within the scope of the term "consumables" as defined in the Policy.

The appellants claimed that the importation of Olive Oil was valid under item No. 28 of Appendix 10 of the ITC Policy for the relevant period, which allowed imports of certain items under O.G.L. without specifying restrictions on packaging size. The Board noted that the Policy did not impose any restrictions on the size of packaging for Olive Oil, unlike in the case of other items like dates, sugar, or milk, where specific packaging requirements were outlined. Therefore, based on the provisions of the Policy and the absence of any explicit restrictions on packaging size for Olive Oil, the Board held that the importation of Olive Oil under O.G.L. was permissible without any limitations on packaging size.

The judgment highlighted the importance of interpreting the import policy in its entirety and not in isolation to determine the permissibility of importation under specific categories. The Board's decision to allow the appeal and remit the fine imposed on the imported goods was based on the interpretation of the relevant provisions of the ITC Policy and the absence of explicit restrictions on packaging size for Olive Oil under O.G.L. This case underscores the significance of a comprehensive understanding of import policies and the need to consider specific definitions and conditions provided in such policies while assessing the legality of import transactions.