1986 (10) TMI 237 - AT - Customs

Summary

Issues Involved:
1. Import at variance with the description in the advance licence.
2. Misdescription of the goods imported.
3. Failure to adhere to the requirements of the duty exemption scheme.
4. Violation of principles of natural justice.

Issue-wise Detailed Analysis:

1. Import at Variance with the Description in the Advance Licence:
The appellants obtained an advance licence for importing "Moulded sheets of ABS Resins together with handles and locks of different sizes" but subsequently amended it to "moulded sheets of ABS resins (with lower lids and covers) together with handles and locks of different sizes." The Customs authorities refused to release the goods, claiming they did not match the description in the amended licence. The goods imported were hinged parts with inner and aluminium linings, which was not specified in the licence. The Tribunal found that the appellants were aware from the beginning that they would import hinged parts but failed to disclose this in their application or amendment request. This constituted a variance from the licence description, confirming the violation under Section 111(d) of the Customs Act.

2. Misdescription of the Goods Imported:
The show cause notices alleged that the appellants intended to import fully manufactured attache cases, misdescribing them to obtain duty exemptions. The Tribunal confirmed that the imported goods were not described accurately in the licence or shipping documents. The appellants described the goods as separate parts, but they were imported as hinged and lined parts. This misdescription attracted the provisions of Section 111(d) of the Customs Act.

3. Failure to Adhere to the Requirements of the Duty Exemption Scheme:
The Collector of Customs held that the imported goods were fully manufactured attache cases, requiring only the fitting of handles and locks, which did not constitute a manufacturing process. The appellants argued that various processes were needed to convert the imported materials into attache cases. However, the Tribunal found that these processes were more about removing transit damage rather than manufacturing. The Tribunal agreed with the Collector that the requirement of a manufacturing process, as stated in the duty exemption scheme, was not met, thus denying the duty-free import entitlement.

4. Violation of Principles of Natural Justice:
The appellants claimed that the principles of natural justice were violated as they were not provided with the full examination report and their request for cross-examination was denied. The Tribunal noted that no such complaints were made during the adjudication process, and the necessary extracts of the report were provided. The Tribunal found no merit in this argument, stating that the appellants were not prejudiced by the lack of full reports or cross-examination.

Conclusion:
The Tribunal confirmed the findings of the Collector that the goods imported were not in accordance with the advance licence, were misdescribed, and did not meet the duty exemption scheme requirements. The appeals were dismissed, and the quantum of redemption fine and penalties were upheld as they were not merely technical violations but deliberate misdescriptions by the appellants.