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Issues involved: Import of High Speed Automatic Wrapping Machine under Open General Licence for twist wrapping pharmaceutical products.
Summary: 1. The petitioners, engaged in pharmaceutical manufacturing, sought to import a High Speed Automatic Wrapping Machine for wrapping herbal throat drops classified as Ayurvedic medicine. 2. The machine fell under Item 18(18) of Appendix 1 Part B of the Import/Export Policy, allowing import by actual users under Open General Licence. 3. The Joint Chief Controller clarified that the machine could be imported under this provision, leading to the petitioners importing it. 4. However, Customs authorities issued a show cause notice claiming the machine was for twist wrapping sweetmeats, not allowed under the provision. 5. The dispute centered on whether twist wrappers for confectionery were excluded from the provision, with the petitioners arguing the machine was for pharmaceutical products, not confectionery. 6. The High Court held that the end use of the machine by the actual user determined its eligibility for import under the provision. 7. Emphasizing the importance of the actual user's intended use, the Court found the petitioners' use for medicinal preparations aligned with the provision's intent. 8. Citing precedent, the Court stressed that the nature of the item's use by the actual user was crucial in determining its import eligibility. 9. The Court upheld the Joint Chief Controller's clarification as final, emphasizing the authority's role in interpreting import policies. 10. Customs authorities were advised to consult import control authorities in case of doubt regarding policy interpretation to avoid conflicts and inconvenience to importers. 11. The Court highlighted that the licensing authority's interpretation of policy should prevail over Customs authorities' views to prevent confusion for importers. 12. The Court criticized the Customs authority's attempt to challenge the Controller's clarification, noting that any uncertainties should have been addressed before import. 13. Consequently, the petition was successful, and the Customs order confiscating the machine was overturned, with costs awarded to the petitioners.
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