1986 (11) TMI 234 - AT - Customs

Summary

Issues:
1. Interpretation of import policy regarding canalised items.
2. Distinction between pharmaceutical and technical grades of imported goods.
3. Validity of licences for clearance against canalised items.
4. Consideration of past practice in customs clearance decisions.

Analysis:
1. The case involved a dispute regarding the import of Diethylene Diamine Tech. 62.6% by M/s. Allana Sons Pvt. Ltd. against licences transferred to an Export House. Customs objected to clearance, citing canalisation of the goods during the relevant Policy. The Collector of Customs ordered confiscation but allowed redemption on payment of a fine, which was later reduced by the Central Board of Excise and Customs. The appellants challenged this order before the Tribunal, arguing that the imported goods were not drugs but chemicals, and therefore, the licences were valid under the import policy.

2. The appellants contended that the Board erred in considering technical grade Piperazine under a canalised item, as the import policy did not specify the grade in the relevant entry. They also argued that past practices of the Customs House supported the clearance of similar goods. However, the Collector and the Departmental Representative maintained that the canalisation of Piperazine and its salts under the import policy covered all varieties of the substance, regardless of grade. They cited previous decisions and legal principles to support their interpretation.

3. The Tribunal analyzed the import policy provisions and past practices in customs clearance decisions. It noted that the import policy did not distinguish between pharmaceutical and technical grades of the imported goods, and the unqualified entry of "Piperazine and its salts" was considered canalised. The Tribunal held that the authorities' interpretation was plausible and consistent with legal precedents, including the principle of non-interference with lower authorities' decisions unless unreasonable. The consideration of past practice by the Board in reducing the fine was deemed appropriate, but it could not override statutory provisions or justify non-payment of fines in violation of the import policy.

4. Ultimately, the Tribunal rejected the appeal, upholding the orders of the Collector and the Board. It concluded that the goods imported fell under the canalised item as per the import policy, and the past practice could not invalidate the enforcement of statutory provisions. The Tribunal emphasized the importance of adhering to legal interpretations and statutory provisions in customs clearance decisions, even when past practices might suggest otherwise.