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TMI Blog1991 (10) TMI 122X X X X Extracts X X X X X X X X Extracts X X X X ..... ining cloth material and being nylon fabrics they stood specifically excluded from Entry No. (vi) in Column No. 4 against Sl. No. 0.1 of Appendix 17 of the Import Policy and that the licences produced were not valid for the importation of the same as it felt under Sl. No. 25 of Appx. 4 of Import Policy for AM 83, (Serial No. 27 of Appendix 4 of Import Policy for AM 84) and was banned for import. Show cause notice was issued and the goods were confiscated under Section 111(d) of the Customs Act, 1962 read with Section 3(2) of the Imports and Exports (Control) Act, 1947 and the goods were allowed to be redeemed on payment of a fine of Rs. 1,30,000/- under Section 125 of the Customs Act, 1962. 2. The learned Consultant appearing for the appellants referred to the charge as framed in the show cause notice and pleaded that the ingredient of the charge on facts is set out in para 4 of the show cause notice which for convenience of reference is reproduced below: It is observed that normally the type of fabric that is used as lining material is soft with satin finish. The fabric imported is not soft or with satin finish. On market enquiry it is revealed that such types of fabrics are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bunal reported in 1988 (34) E.L.T. 98. He pleaded that going by the definition of lining cloth what has been upheld in that order, the appellants goods would be covered by the entry in Column No. 4 against Sl. No. 0.1 Appendix 17 of the Policy for April-March, 1983 to April-March, 1984. He has further pleaded that the appellants had filed the Bill of Entry (BE) and produced the licences and after scrutiny of the same endorsement of the rate of duty chargeable on the goods an order for bonding of the goods was passed by the proper officer. He has pleaded that once the BE had been completed and the licence accepted, the only course available with the authorities was, in case they found that improper order had been passed, to review the matter under the relevant provisions of the Customs Act, 1962 and that no adjudication proceedings could be drawn by issue of show cause notice as has been done. His plea is that once an order under Section 60 permitting the goods to be bonded in the warehouse without payment of duty had been passed all formalities regarding clearance of the goods except payment of duty could be taken to have been completed and that the order regarding acceptance of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gainst the appellants: (1) Trade enquiry showed that the cloth was not lining cloth; (2) Goods were man-made fabrics; (3) Being water reppellant these are umbrella cloths; (4) Umbrella cloths required separate licence. He has pleaded that in respect of these the learned lower authority s findings and his comments are as under : (1) Enquiry report - the learned lower authority has admitted that there was no record of the enquiry and these were personal in nature and no one could be made available for cross-examination. (2) That the fabrics were man-made fabrics. The learned Consultant has pleaded that there was no discussion in the lower authority s order in regard to applicability of para 5 of Appendix 17. (3) The goods on test were appeared to be water reppellant. The learned Consultant pleaded that these by itself could not mean that the goods were not lining cloths as in heavy woollen cloths water reppellant lining cloth was used. He has pleaded that the lower authority s order in view of the above grounds was not maintainable in law. In any case, he has pleaded that there was no warrant for levy of penalty since similar imports had been allowed earlier. He ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich for convenience of reference is reproduced below: SECTION 60. Permission for deposit of goods in a warehouse. - When the provisions of Section 59 have been complied with in respect of any goods, the proper officer may make an order permitting the deposit of the goods in a warehouse without payment of duty. It may be seen that all that Sec. 60 requires is compliance with the provisions of Sec. 59 of the Act. Sec. 59 requires execution of a bond in a sum equal to twice the amount of the duty assessed on such goods, under Sec. 17 or 18 of the Customs Act binding the person bonding the goods to observance of the provisions of the Act in respect of such goods, and the payment of the duties and penalties which may have been levied under the Act. Section 59 of the Act for the purpose of convenience is reproduced below: SECTION 59. Warehousing bond. - (1) The importer of any dutiable goods which have been entered for warehousing and assessed to duty under Section 17 or 18 shall execute a bond binding himself in a sum equal to twice the amount of the duty assessed on such goods:- (a) to observe all the provisions of this Act and the rules and regulations in respect of such g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and other charges payable in respect of such goods have been paid; (c) an order for clearance of such goods for home consumption has been made by the proper officer." It is seen that clearance is contingent upon such satisfaction of three conditions and one of the conditions being that an order for clearance for home consumption has to be there and this order for clearance as seen from Section 47 can be passed by proper officer if he is satisfied that the goods are not prohibited goods. The goods are prohibited or not will depend upon as to whether the goods that have been imported are covered by a valid import licence produced for the same. It may therefore be seen that it is only at the time when an order for clearance of the goods is to be passed, the proper officer passing the order has to satisfy himself that the goods are not prohibited goods and therefore the question of acceptance of the licence can pend till the order for clearance of the goods for home consumption is passed. Any scrutiny of the licence at this stage of passing the order for bonding of the goods for warehousing can at best be considered as preliminary scrutiny and the authorities can be taken to be wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any documentary evidence that what was ordered for by the appellants was lining material of particular specifications answering to any particular need, it is not possible to accept the same as such merely because the appellants have described the material as inter-lining material or had it described so in the licence. We observe that admittedly man-made fabrics as such are banned for import under Appendix 4 of the Import Policy April-March 83 as set out being listed at Sl. No. 25 of the said Appendix and at Sl. No. 27 of April-March 84 Import Policy. Appellants case is that lining even though of man-made fabrics are allowed for import under Column 4 against Sl. No. 0.1 Appendix 17 of import policy April-March 83 and April-March 84. We observe that the appellants seek to import the goods under an exception to the General Ban as in Appendix 4 as available under Appendix 17 mentioned above. It is therefore incumbent on them to show how they fall within this exception. Merely describing the goods as lining material is not enough to hold that the goods are covered by Appendix 17 as claimed unless it can be shown with evidence that what had been ordered for is lining material of a parti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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