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TMI Blog1983 (9) TMI 289X X X X Extracts X X X X X X X X Extracts X X X X ..... otification, in order to properly appreciate the scope of the controversy. The Notification under reference being Notification No. 20/F. No. 60/192/76-DBK, dated 7th February, 1977, so far as it is relevant for the purposes of these appeals, reads as under :- New Delhi, the 7th February, 1977 18th Magha 1898 (SAKA) NOTIFICATION CUSTOMS G.S.R. No. 4. In exercise of the powers conferred by sub-section (1) of Section 25 of the Customs Act, 1962 (52 of 1962), read with sub-section (4) of Section 32 of the Finance Act, 1976 (66 of 1976), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts Nylon Filament Yarn and Polyester Filament Yarn, imported into India under/in accordance with the terms and conditions of an import replenishment licence issued under the Imports (Control) Order, 1955, against exports of :- (1) Nylon filament yarn fabrics, made-up articles, quilted fabrics and quilted blankets other than hosiery, knitwears and embroidered fabrics; XX XX XX from (a) the whole of the duty of Customs leviable thereon which is specified in the First Schedule to the Customs Tariff Act, 1975 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /s. Stretchlon (Private) Ltd., (Appellants of the first group) and two by the Stretch Fibres (India) Ltd. (appellants for the second group). 6. The Assistant Collector rejected all the refund claims on the view that the benefit of the Notification was available only for yarn imported against exports of nylon or polyester mixed fabrics, whereas the goods exported by the appellants were knitwear and hosiery fabrics, and consequently the benefit of that Notification could not extend in the case of imports effected by the appellants, which were the subject matter of the refund claims before him. 7. Both the appellants carried the matter to the Appellate Collector by way of appeals but the Appellate Collector also took the same view; namely, that exemption granted in the Notification was not applicable in the case of these imports inasmuch as what has been exported was in the nature of hosiery fabrics and since these were excluded from the contemplation of the said Notifications; the appellants were not entitled to the benefit of said Notification. He further added that even the endorsement on import licences as stipulated in the Notification; namely, a certification from the conc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing to a subsequent notification, being Notification No. 159/F. No. 609/49/77-DBK which was subsequently issued on 15-7-1977 (page 53 of the Paper Book) in which this distinction had been clearly brought out by putting embroidered fabrics as a separate category, and showing hosiery and knitwear in a separate sequence. He emphasised that this clearly showed that there was never any intention to link hosiery and knitwear with fabrics; that embroidered fabrics was a category apart and that the lower authorities have misconstrued the true meaning and import of the notification, under reference. 10. He also referred to dictionary meaning of the term `hosiery where this term is shown to have been derived from the term `hose : which, in turn, means a tight fitting outer garment worn by men covering the hips, legs and feet or extending only to knees or a ankles, and further pointed out that `hosiery has been defined to refer to `hose collectively or `knitted goods . During arguments, he had only one such dictionary; namely, Chambers Twentieth Century Dictionary, 1968 Edn. but he undertook to furnish extracts from said dictionary as well as other dictionaries of standing. He ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rted goods and to the extent that it covers export of stretched Nylon Socks/Hosiery of the value of ₹ 2,54,153/-, he conceded that this would be covered by the exclusion clause of the notification with the result that the said appellants would be entitled only to the refund of a sum of ₹ 2,12,545 in respect of the export of crimp nylon knitted fabrics and to that extent, the refund claim may be treated to stand modified. 14. Shri K. Chandramouli, SDR appearing for the respondent countered the arguments put forward by learned Counsel for the appellants, by contending that he fully shared the view held by the lower authorities, and that the relevant portion of the notification has to read to exclude three types of fabrics, namely, `hosiery fabrics , `knitwear fabrics and `embroidered fabrics . He further asserted that the goods exported, against which the benefit was being claimed, clearly carry the description as : `crimp nylon knitted fabrics and as such they would fall within the description of `hosiery fabrics and thus disentitle the appellants from claiming exemption with reference to Notification No. 20 of 7-2-1977. When asked by the Bench that in case the ter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he hosiery articles as such would go out of the exclusion clause. When confronted with this situation that in the same sentence, a word could not be read both as a noun and as an adjective, the learned Departmental Representative could not concede that the articles of hosiery would not be excluded from the benefit. If that is so, then the term `hosiery has to be read independently of the `fabrics . This inference becomes all the more logical when the last hanging words of this clause are read cumulatively because in between the term `hosiery and `embroidered fabrics appear another category; namely `knitwear . Now, this term knitwear, according to all common understanding and trade parlance invariably connotes ready goods or garments and there is no such term known as `knitwear fabrics . This expression, intervening between `hosiery and `embroidered fabrics , in the subject notification further highlights the fallacy of the view taken by the departmental authorities because `knitwear by itself can never be correlated with fabrics and so the expression `hosiery , appearing before `knitwear cannot be tagged on to `fabrics . Apart from this plain construction which arises out of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... led to exemption from customs, as well as auxiliary duty, for the consignments of imports which are subject matter of these appeals. 19. We also find that the appellants have to be treated to have satisfied all the conditions cited in the proviso of the aforesaid notification, inasmuch as there was a duly issued import licence, which the appellants have established to have been duly endorsed in their favour by the STC and the value of the goods exported is indicated at the back of the licences. Three of the clearances of disputed consignments are beyond the pale of controversy because the endorsements were before the date of clearances. Some doubt could arise in relation to two consignments, in respect of which the endorsements were obtained after the clearances. We, however, find force in the contention of the learned Counsel of the appellants that what is material is that the appellants should have satisfied all the conditions at the time, the refund claims were filed. We do not find any such apparent or hidden meaning in the wording of Section 27 of the Customs Act, whereunder the refund claims could be held to be restricted to or relate to only such orders, as were based on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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