1987 (3) TMI 258 - AT - Customs

Issues Involved:
1. Whether the imported goods qualify as intra uterine contraceptive devices under the OGL.
2. Whether the approval of the Drugs Controller of India was necessary for the import of the goods.
3. Whether the Technical Officer's endorsement constitutes substantial compliance with the OGL requirements.
4. Whether there was a denial of natural justice in the adjudication proceedings.

Detailed Analysis:

1. Whether the imported goods qualify as intra uterine contraceptive devices under the OGL:
The appellants imported Laminaria Sea Tangle Tents and Golden Cardboard boxes non-sterile, claiming their clearance under the Open General License (OGL) as intra uterine contraceptive devices. The Customs authorities, however, determined that these goods were used for terminating pregnancy and not for preventing conception, thus not qualifying as contraceptive devices under the OGL. The Tribunal examined the submissions and concluded that the imported goods were not intra uterine contraceptive devices as envisaged in Appendix 6 Sl. No. 34(iii) of the Import Policy 1985-88. Consequently, the import was deemed to fall outside the OGL and required a specific license, which the appellants did not possess.

2. Whether the approval of the Drugs Controller of India was necessary for the import of the goods:
The appellants contended that the second condition of obtaining the approval of the Drugs Controller of India was not enforceable since the Assistant Drugs Controller had approved the import. The Tribunal, however, found that the requirement for approval by the Drugs Controller was explicit and binding under the OGL. The Assistant Drugs Controller's letter dated 23.6.1986 confirmed that the imported goods were not considered drugs under the Drugs and Cosmetics Act, 1940, and thus did not fall within the jurisdiction of the Drugs Controller. Therefore, the import without the necessary approval contravened the Import Trade Control Regulations.

3. Whether the Technical Officer's endorsement constitutes substantial compliance with the OGL requirements:
The appellants argued that the Technical Officer's endorsement of "no objection" on the Bill of Entry should be deemed as substantial compliance with the OGL requirements. The Tribunal rejected this argument, stating that the Technical Officer did not have the authority to permit the import under the OGL. Even if considered, the Assistant Drugs Controller's letter dated 23.6.1986 overruled any such permission. The Tribunal emphasized that a delegate cannot further delegate authority, and no evidence was provided to show that the Drugs Controller had delegated his approval powers to the Assistant Drugs Controller or the Technical Officer.

4. Whether there was a denial of natural justice in the adjudication proceedings:
The appellants claimed that the Collector relied on material not disclosed to them, thus denying natural justice. The Tribunal found this claim factually incorrect, noting that the relevant correspondence was shown to the appellants during the adjudication proceedings. The Tribunal also highlighted that the appellants did not raise this issue in their appeal memorandum, which instead suggested a pre-determined attitude by the Collector. The Tribunal concluded that there was no denial of natural justice as the appellants were given sufficient notice and opportunity to rebut the materials relied upon by the Collector.

Conclusion:
The Tribunal confirmed the order of absolute confiscation of the goods by the Collector of Customs, rejecting the appeal. The goods were not deemed intra uterine contraceptive devices, the approval of the Drugs Controller was necessary and not obtained, the Technical Officer's endorsement did not constitute substantial compliance, and there was no denial of natural justice in the proceedings.

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