1992 (2) TMI 196 - AT - Customs

Summary

Issues Involved:
1. Whether ABS Moulding Powder and ABS Extrusion Granules are distinct commodities under the Import Policy 1985-1988.
2. Whether the Public Notice No. 113/ITC/P.N./85-88 dated 1st September 1986 has retrospective effect.
3. Whether the confiscation of goods and imposition of penalty by the Collector of Customs was justified.

Detailed Analysis:

1. Distinction Between ABS Moulding Powder and ABS Extrusion Granules

The appellants imported 680 bags of ABS sheet extrusion granules and claimed clearance under Open General Licence (OGL) as per Appendix-6 of the Import Policy 1985-1988. The Customs Authorities, based on a chemical test, classified the goods under Appendix-2, Part-B, Serial No. 1, which covers "ABS Moulding Powder," and thus deemed the import unauthorized.

The appellants contended that ABS Moulding Powder and ABS Extrusion Granules are distinct commodities both technically and commercially. They supported their claim with various authoritative sources, including opinions from the Indian Institute of Technology, Delhi, and M/s. R.V. Briggs & Co. Pvt. Ltd., which confirmed that the two materials have different properties, applications, and price structures.

The Customs Authorities, however, maintained that the two forms are essentially the same product, differing only in grade. They relied on technical literatures and opinions from Polychem Limited, Indian Plastics Federation, and ABS Plastics Limited, which suggested that both granules and powder could be used interchangeably for extrusion and injection moulding.

The Tribunal, after considering the submissions and evidence, concluded that ABS Moulding Powder and ABS Extrusion Granules are not the same commodity. The Tribunal noted that the subsequent amendment in the Import Policy (Public Notice No. 113/ITC/P.N./85-88) explicitly included "ABS Resin/Granules/Moulding Powder (all grades)," indicating that prior to this amendment, only ABS Moulding Powder was covered.

2. Retrospective Effect of Public Notice No. 113/ITC/P.N./85-88

The Tribunal examined whether the amendment introduced by Public Notice No. 113/ITC/P.N./85-88, which included ABS granules under the restricted category, could be applied retrospectively. The Tribunal referred to several Supreme Court decisions, including D. Mahendran v. State of Karnataka and Union of India v. Kanunga Industries, which established that amendments are generally prospective unless explicitly stated otherwise.

The Tribunal found no express provision or necessary implication in the Public Notice indicating retrospective application. Therefore, the amendment could not affect imports made before its issuance.

3. Justification of Confiscation and Penalty

Given the Tribunal's findings that ABS Moulding Powder and ABS Extrusion Granules are distinct commodities and that the amendment could not be applied retrospectively, the import of ABS Extrusion Granules by the appellants under OGL was deemed permissible. Consequently, the confiscation of goods and the imposition of a penalty by the Collector of Customs were found to be unjustified.

The Tribunal set aside the order of confiscation and the imposition of a redemption fine of Rs. 2,50,000.00. Additionally, the penalty of Rs. 50,000.00 imposed on the appellants was also annulled. The appeal was allowed, and the appellants were entitled to consequential reliefs.

Conclusion
The judgment clarified that ABS Moulding Powder and ABS Extrusion Granules are distinct commodities under the Import Policy 1985-1988. The Tribunal held that the amendment introduced by Public Notice No. 113/ITC/P.N./85-88 does not have retrospective effect. Consequently, the confiscation of goods and imposition of penalty by the Collector of Customs were set aside, and the appeal was allowed with consequential reliefs to the appellants.