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TMI Blog2006 (12) TMI 31X X X X Extracts X X X X X X X X Extracts X X X X ..... duty free clearances under DEEC Scheme, against advance licences. It is seen that as per the intelligence gathered by the Revenue, consignments in question imported under different bills of entries at different point of times were put under investigation. Samples were drawn and sent for testing. The statements of various persons were recorded and a view was found that the goods under import were wrongly declared by the appellant as "Cardboard" whereas the same was alleged to be "Art Paper". Consequently, it was alleged that the value of the goods is also on the lower side inasmuch as, the same was not Cardboard but Art Paper. 3.Based upon the above, proceedings were initiated against the respondents by issuance of show cause notice's proposing denial of benefit of notification in question on the allegation that the goods were not Cardboard, and as such, the benefit of advance licences was not available to the appellant. The notice also proposed to enhance the value of the goods from US$ 1150 PMT CIF as declared by the respondents to US $ 3000 PMT CIF. Accordingly, notice proposed confirmation of differential duties and imposition of penalties upon various persons. 4.The said s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e sample is a cut piece of white paper coated on one side with inorganic material. It is composed of chemical pulp. It is chrome board other than ivory board with Gsm 259.6 gm/m2. Sealed remnant returned". Revenue during the course of argument has drawn our attention to the other reports of the samples drawn from various consignments. For better appreciation we reproduce the same. Report Dated 1-7-98 "Each of the three samples is white sheet of paper coated on both the sides giving a glossy finish. It is mainly composed of chemical pulp. G.S.M. Thickness. 'A' 102.32 0.08 m.m. 'B' 168.10 0.15 m.m. 'C' 131.53 0.11 m.m. Report Dated 8-5-98 Report. - Each of the seven samples is white-sheet of Paper Coated on one side. Furnish is mainly of Chemical pulp. G.S.M. :- 1. 260.0 2. 153.5 3. 295.3 4. 198.5 5. 191.8 6. 253.8 7. 177.4 Report Dated 21-4-97 The sample is a cut piece of white sheet of paper/board. It is composite of chemical pulp and coated in both sides with inorganic material. It is Art Paper/Board, other than ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ina clay mixed with hydrolysed starch or casein, so that the mineral adheres firmly and will not pick or lift in printing. After the coating has been brushed on, the web is dried in festoons in a hot air chamber, re-reeled and sent to the supercalenders for glazing and then cut on single sheet cutters and guillotine trimmed on all four edge.." 6. I.S.I. GLOSSARY OF TERMS USED IN PAPER TRADE AND INDUSTRY (FIRST REVISION), IS:4661-1986 "Paper coated on both side, material containing adhesive, kaolin, etc. to give a surface suitable for fine screen half tone work." 7. DEFINITION OF DIFFERENT TYPES OF PAPERS AS PER TARRIF COMMISSION REPORT-1959 :- Art paper or board :- "Paper or board coated on one or both sides with a mineral coating based largely upon china clay and calendered to a high finish. These papers may be made suitable for printing by the letterpress and litho processes or colour processes. Can also be of matt surface." Definitions of Card Board :- 1. THE Chamber's Dictionary (New Edition) Page 256, 1997 Reprint: "A thin striff finely finished paste board; a rougher thicker material made from paper pulp..." 2. The Collins Dictionary ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e material and, in some cases, its use. Many materials of less than 180 g/m sq. such as certain grades of folding box board and corrugated raw materials are generally referred to as 'board' and many materials of grammage greater, than 180 g/m sq. generally referred to as 'paper' such as press pahn, kraft, cover paper, maplitho, etc. 8.After considering the above definitions, he has concluded that the essence of difference between Art Paper and Cardboard is neither same being coated nor the thickness or grammage per square but the stiffness of the same. The ISI Glossary of terms used in paperboard and industry clearly state that the definition between paper and board is primarily made on the basis of the characteristic of the material and in some cases, its use. Many materials of less than 180 gms sq. as well as certain grades of folding box board and corrugated raw materials are generally referred to as 'board' and many materials of grammage greater than 180 gms. sq. generally referred to 'paper', such as press pahn, kraft, cover paper, maplitho etc. He has also referred to a technical opinion T.No. 136/136/1-3-1993 issued from F.No.S/5-Test/772/93 NSCH (T.R. No. 1169 NSCH/ 25-5- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ces do not qualify the word "cardboard" neither is there any restriction with regards to the colour of the name. As such, we agree with the findings of the adjudicating authority that as long as licences covered the goods in question, benefit thereof cannot be denied to them on clarification subsequently issued by DGFT. 11.At the stage we may take note of the Tribunal's decision in the case of Santram Paper Mills v. Collector - 1989 (42) E.L.T. 642 (Tri.) referred to by the Revenue in support of their plea that any paper up to 180 gms would be treated as paper. Inasmuch as, the three samples in the present case were found to be of less than 180 gms., they have to be treated as paper and board. After going through the said order, we find that no such ratio was laid down by the Tribunal in the said case. In fact, we find that the Tribunal made a reference to Board's letter No.36/121/54-Cus-III dt. 14-4-1995 as regards distinction between paper and board. The said letter is to the effect that the grammage per sq. Mt. is an important criteria for distinguishing the paper from board and for this a substance of 180 grammage per sq. mt. may provide a convenient dividing point, the ultim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hing but cardboard, as declared by the respondents and for the importation of which proper advance licences were produced by them. It has to be kept in mind that the advance licences were transferred to the respondents importer and as such, the argument that the respondents-importer has not shown and established any nexus between the goods permitted to be imported against advance licences with the exoort product, cannot be accepted, in view of the law declared by the Tribunal in the case of M/s. Goodluck Industries v. Commissioner of Customs, Calcutta [1999 (108) E.L.T. 818 (Tribunal)] as confirmed by the Hon'ble Supreme Court in [2000 (120) E.L.T. A66]. 15.Having held that the goods were correctly deccribed and were covered by the advance licences produced by the respondents, and as such, were entitled to be imported free of duty, the issue on the undervaluation of the same becomes frivolous. Any how, dealing with the said issue, we find that the Revenue has sought to increase the price of the consignment in question on the ground that the earlier imports of card board by the respondents from the same supplier was at the rate of US $ 3000 PMT CIF. As rightly observed by the adju ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by Bill of Entry No. 1804 dated 25-2-1997. The Appellants CHA, on enquiry by the investigating officers informed that the goods in question, i.e. 85.862 MTs, were covered by Bill of Entry No. 1804 dated 25-2-1997. This claim was based on bona fide belief of the CHA because the said Bill of Entry No. 1804 of 25-2-1997 also covered 244 Pallets and the goods in question found lying in the docks were also aggregating to 244 Pallets. The CHA in good faith believed the goods in question to be the goods covered by Bill of Entry No. 1804 dated 25-2-1997 because that was the only consignment of which delivery was not given to the Appellants and the Bill of Entry was pending assessment and, therefore, the CHA honestly presumed that the goods in question were the same as those covered by Bill of Entry No. 1804 dated 25-2-1997 since by April, 1998, all other consignments of cardboard imported by the Appellants were duly assessed and delivered to them except the said goods covered by Bill of Entry No. 1804 dated 25-2-1997. It is submitted that, however, on detailed examination, it was found that the goods in question were not relatable to the goods covered by the said Bill of Entry No. 1804 d ..... 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