1991 (8) TMI 226 - AT - Customs

Summary

Issues:
- Importation without a valid ITC License
- Import of second-hand offset machine under Open General License (OGL)
- Interpretation of Import Policy regarding firm commitment for shipment

Importation without a valid ITC License:
The appeal was against an order confiscating goods for importation without a valid ITC License. The appellants were given the option to clear the goods by paying a fine. The main issue was whether a second-hand offset machine could be imported under the OGL without a valid license.

Import of second-hand offset machine under Open General License (OGL):
The dispute revolved around the import of a second-hand offset machine against a Letter of Credit opened in February 1983. The Letter of Credit included a condition for inspection by the appellant firm's proprietor before shipment. The machine was shipped in March 1984, causing a delay. The question was whether this delay was justified under the Import Policy's provisions.

Interpretation of Import Policy regarding firm commitment for shipment:
The key issue was interpreting paragraph 7 of Appendix 10 of the Import Policy, which allowed shipment extension if a firm contract for import was made before a certain date but goods could not be shipped due to a longer delivery period. The appellants argued that their case fell under this provision, citing relevant legal precedents. The Customs authorities contended that the inspection condition in the Letter of Credit invalidated it as a firm commitment.

The judgment analyzed the circumstances and found that the delay in shipment was due to unforeseen factors beyond the appellants' control. Despite the inspection condition in the Letter of Credit, it was deemed a firm commitment for shipment before the specified date. The suppliers had informed about the delay, and the contract was registered with the bank, meeting the Import Policy requirements. Considering these factors, the Tribunal ruled in favor of the appellants, setting aside the confiscation order and fine imposition.

In conclusion, the Tribunal held that the appellants' case fell within the provisions of paragraph 7 of Appendix 10 of the Import Policy. The delay in shipment was justified due to circumstances beyond their control, and the Letter of Credit constituted a firm commitment for importation. The legal precedents cited supported this interpretation, leading to the appeal being allowed and the confiscation order being overturned.