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TMI Blog1986 (10) TMI 237X X X X Extracts X X X X X X X X Extracts X X X X ..... ferent sizes of black, burgundy or brown Colour-1,20,000 sheets . This amendment was granted under letter dated 1-2-1985. In accordance with the licence and the certificate, the appellants, who had obtained an order for supply of 60,000 attache cases to be manufactured out of the imported materials, opened a letter of credit on 18-12-1984. The first part of the consignment was imported under Bill of Entry No. 118-1F, dated 11-4-1985. These were allowed to be cleared without payment of duty. Attache cases were manufactured out of the same and also duly exported under the duty exemption scheme. The balance quantity was subsequently imported in two separate lots. At that stage the Customs authorities refused to release the goods on the ground that the goods were not according to the description contained in the amended licence and duty was therefore payable. To satisfy the Customs Authorities that their objection was not correct the appellants approached the Joint Chief Controller of Imports and Exports who issued a recommendatory letter dated 10-5-1985. In the said letter the JCCI E intimated the Collector of Customs, Calcutta that if the appellants had approached his office for am ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erewith the application in the prescribed form, for the Advance Licence for the import of Moulded Sheets of ABS Resins valued at Rs. 42,35,000/-. It may, however, be stated that these moulded sheets of ABS resins of the specific sizes will be fixed together with the help of special dyes (SIC) and tools in correct lineations. The locks and handles will be screwed to the bottom sheets to arrive at a complete attache case. The attache case will be tested for tensile strength and crushing strength in our works before dispatch. It is in accordance with this request that the advance licence had been granted, the description of the goods to be imported being mentioned in the licence as Moulded sheets of ABS resins together with handles and locks of different sizes-of black, burgundy or brown colour. The invoices of Feb., 1985 also contained this description only. But in the meanwhile under letter, dated 24-11-1984 the appellants had requested that the licence may be amended to read Moulded sheets of ABS resins (with upper and lower lids or covers) together with handles and locks of different sizes-of black, burgundy or brown colour. The actual amendment granted under letter, dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ins (of specific sizes) which were to be later fixed together by the importer with the help of special dies and tools and thereafter fitted with locks and handles. Even in applying for the amendment the appellants had described the need therefor by mentioning the slight modification is needed because the imported sheets would be upper and lower lids or covers of attache cases meant for export. Thus even in this application no indication had been given that the import was to be of the upper and lower parts hinged together. Since the amendment was in the light of this request, dated 24-11-1984, the amendment in the licence naturally made no reference to the two parts being hinged already at the time of Import. 6. But the available evidence indicates that right from the inception the appellants had known that they would be importing the two parts of individual attache cases already hinged. As pointed out in the show cause notices a telex communication of the appellants, dated 12-12-1984 had sought for acceptance of the lower price mentioned by them on the ground diplomat can easily accept this price as case will be supplied in nest packing thereby reducing the freight. The sign ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ize, thus reducing the volume of the freight and, evidently, charges for the freight which would be based on volume as well as weight. The other reason suggested is that the supplier would himself ensure that the corresponding upper and lower parts are hinged, thus avoiding the possibility of the upper part of any box being attached to the lower part of another box, resulting in misalignment. Since thus the normal course of supply in trade was, according to the appellants themselves, in the manner above-said, they should certainly have been aware even from the inception that the goods to be imported would be hinged parts and not loose parts. But in spite of such knowledge the appellants had chosen to make their application, dated-4-9-1984 as if the upper and lower parts were to be imported unattached to each other and as if it is they who will be attending to the hinging of the two lids as part of their process of manufacture of the attache cases. Again, even when applying for the amendment of the licence they had proceeded on the same basis and without disclosing the fact that the upper and lower parts would be imported in a hinged condition. 8. Shri Wattal contends that no sini ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esins (upper and lower parts) with handles and locks separately the actual import was of the parts not merely hinged together but fixed with the inner lining as well as aluminium lining. If, as mentioned by the appellants themselves in their appeal, the normal practice in international trade was for supply of the upper and lower parts hinged together, and also lined in the manner abovesaid, it was necessary that the appellants should have described the goods in that manner not merely when applying for the licence, but also in their shipping documents. Admittedly they had failed to do so, either in applying for the licence or in seeking for amendment of the same or in describing the goods in their shipping documents. Thus, as against the description on the licence that the lids were to be supplied as separate pieces, they were imported in a lined and hinged condition. In the circumstances the case that there has been a misdescription of the goods as will attract the provisions of Section 111(d) of the Customs Act is fully established. 11. Another reason on the basis of which the Collector had held against the appellants is that in order to become entitled to the duty free import t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ses mentioned in the letter, dated 4-9-1984 were in fact to be carried out, utilizing the dies and tools on the imported material. In any event, the processes described in the paper filed before us appear to be more in the nature of removal of blemishes as might have arisen due to the damage in transit except in the case of fixing of locks and handles. Therefore, the manufacturing processes mentioned in the letter, dated 4-9-1984 (on the basis of which the licence had been obtained as also the duty exemption certificate) do not appear to be necessary to be carried out on the imported material in the condition in which they were imported. The fixing of handles and locks would not appear to be a manufacturing process leading to the manufacture of an attache case. It, therefore, appears to me that with reference to the actual condition in which the goods were imported the requirement of a manufacturing process being carried out on them (as mentioned in the letter, dated 4-9-84) does not appear to be necessary in order to entitle the appellants to the duty free import under the scheme therefor. In arriving at this conclusion I have taken note of the condition in which the material had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant a decision on merits from us. In the circumstances reliance on the observations in the said decision are not of any assistance to the appellants. 14. Before us (as in the grounds of appeal) a request had been made for sending for the record in connection with an earlier import under the same licence when the goods were allowed to be cleared free of duty and then export completed. It is not denied for the department that such an earlier import had been allowed to be cleared free of duty. But that would not necessarily mean that if subsequently the Department is able to establish with reference to the further goods imported that they were not in accordance with the description in the licence or in the shipping document, the department could not take action on proof of such facts against the exemption claim put forward by the appellants. The requisite material with reference to the two consignments imported (which are the subject matter of the present appeals) have been fully considered in the discussion earlier to find that the conclusions of the Collector in this regard were correct. In the circumstances even a perusal of the documents connected with the earlier import is not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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