1993 (2) TMI 196 - AT - Customs

Issues Involved:
1. Confiscation of imported goods under the DEEC Scheme.
2. Denial of exemption under the DEEC Scheme.
3. Alleged violation of principles of natural justice.
4. Classification of imported goods as Ivory Board or Card Board.
5. Interpretation of import licenses and the exclusion of Ivory Board.

Issue-Wise Detailed Analysis:

1. Confiscation of Imported Goods under the DEEC Scheme:
The appeal challenges the confiscation of 66 bales (14.73 MT) Ivory Board valued at Rs. 2,31,843.18P. by the Collector of Customs, Calcutta. The confiscation was based on the ground that the import of Ivory Board against import licenses issued for Card Board sheets under the Duty Exemption Entitlement Scheme (DEEC) was not permissible. The appellants were given the option to clear the goods on payment of a fine of Rs. 47,000 in lieu of confiscation.

2. Denial of Exemption under the DEEC Scheme:
The appellants were denied exemption under the DEEC Scheme on the basis that the "Ivory Board" imported was different from the permitted "Card Board sheets." The Collector relied on the opinions of the Chief Chemist and the Institute of Paper Technology, which were not furnished to the appellants for comments or rebuttal. The appellants argued that both Ivory Board and Card Board are used for packing and should be considered the same for the purposes of the DEEC Scheme.

3. Alleged Violation of Principles of Natural Justice:
The appellants contended that the Collector's reliance on external opinions without providing copies for rebuttal violated principles of natural justice. However, the tribunal found that the appellants were aware of the substance of the test reports and had waived the show cause notice, thereby nullifying the claim of violation of natural justice.

4. Classification of Imported Goods as Ivory Board or Card Board:
The core issue was whether the imported goods were Ivory Board or Card Board. The appellants argued that there is no significant difference between the two, both being used for packing. The tribunal examined definitions from various sources, including the Dictionary of Paper and the Glossary of Terms used in the Paper Trade Industry. The tribunal noted that "Ivory Board" is specifically defined as a coated board used for printing and writing, characterized by its smoothness, stiffness, and clean appearance. The reports from the Chief Chemist and the Institute of Paper Technology confirmed the goods as Ivory Board, possessing characteristics distinct from Card Board.

5. Interpretation of Import Licenses and the Exclusion of Ivory Board:
The appellants argued that the absence of a specific exclusion of Ivory Board in the import licenses allowed them to import all types of Card Board sheets, including Ivory Board. The tribunal found that the description in the licenses ("Card Board Sheet") did not cover Ivory Board unless explicitly mentioned. The tribunal noted that specific exclusion of Ivory Board in a subsequent license (Licence No. 3143794/86) indicated that Ivory Board was not intended to be included under the term "Card Board Sheet" in the earlier licenses. The tribunal concluded that the goods imported were not covered by the licenses submitted by the appellants and were rightly classified as Ivory Board.

Conclusion:
The tribunal upheld the Collector's order, rejecting the appeal. It was determined that the imported goods were correctly classified as Ivory Board, not covered by the import licenses under the DEEC Scheme, and the appellants were not entitled to exemption from duty. The tribunal found no merit in the appellants' arguments regarding the violation of principles of natural justice and the interpretation of import licenses.

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