9911796707
TMI Blog1996 (3) TMI 534X X X X Extracts X X X X X X X X Extracts X X X X ..... examining officer has reported that fibre stuffed in the pieces comprising the set was found to be polyester soft waste as against the declaration in the S/B as polyester fibre (100% polyester). 2.2 Samples were drawn and sent for chemical test. In the test reports received from the Dy. Chief Chemist, it is reported - each of the five samples is made of woven and printed cotton fabric cover and polyester fibre stuffed inside. Thereafter, a query memo was sent to the Dy. Chief Chemist raising the following questions : (i) Whether the samples are containing polyester fibre or polyester waste or otherwise. (ii) If the samples are found to be polyester fibre, the fibre specifications viz. Denier, Staple length etc. may be indicated. In response to the query raised by the assessing officers, Dy. Chief Chemist replied as below with reference to the samples - The polyester fibres are in general found to be of varying length. There are fibre groups of different shades, white, dull white etc. some of them being coiled. Some samples also indicate the presence of entangled mass of filament yarn including texturised yarn ............. The above findings are indicative of mat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lants. 2.6 The present appeal is against the above order. 3. The main tenets of Shri Lodha s arguments on behalf of the appellants can be summed up as below : (i) Referring to Appendix 19, outlining the Duty exemption scheme, he points out that the scheme is available to export products, where there is a minimum of 25% value addition. (ii) Referring to the application for licence under DEEC scheme, he points out that value addition shown is indicated as 53.94% in terms of U.S. dollar. (iii) Referring to the purchase order placed by the foreign buyers, he points out that it is for 19000 baby bed sets to be made of 100% polyester with upholstery of cotton printed fabric, with a condition that the goods should conform to the sample submitted by them. (iv) The goods, in dispute, have been exported on bank guarantee and there is no dispute raised by the foreign buyer that the baby bed sets are not conforming to the samples or they are not polyester fibre stuffed. The buyers are satisfied with the goods. He refers to their letter in this regard. (v) Refering to the original test reports of Dy. C.C. he points out that all the three reports clearly indicate that the ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... application as well as the purchase order clearly state that the beds are to be stuffed with 100% polyester fibre and not with such fibre mixed with waste or with waste garnetted. (iii) By exporting beds stuffed with waste of polyester fibre, they are claiming as duty free replenishment material - an item, namely 100% polyester fibre, carrying higher price and also attracting higher rate of duty. (iv) DEEC scheme seeks to permit import of materials required for manufacture of export goods duty free. When they are using polyester waste in the beds, their declaration on the S/B should have been so and even in their application for licence, it should have been indicated. (v) Even in their letter dated 6-5-1985 to the licensing authority they have not made a whisper about stuffing the beds with polyester waste, whereas the General Manager, in his statement dated 28-1-1985, has stated that they would make necessary application to J.C.C.I.E. for necessary amendment to DEEC book to amend the description of exempt material as polyester fibre-mix waste. They in their letter dated 6-5-1995 have merely indicated that they are not getting the polyester fibre directly from manufacturer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .2 The arguments of Shri Lodha, on the face of it, appear very attractive and would have found acceptance, if the export is not under DEEC scheme. The main tenet of his arguments is that test report and even the technical opinion of Dy. C.C. state that it is polyester fibre. Hence there is no misdeclaration. If the shipment is sought to be done without a declaration concerning export obligation under DEEC scheme, such a plea would be quite effective. Here in this case, goods are sought to be exported under two declarations - one is description of the material stuffed as 100% polyester fibre and the other is that the goods are being exported towards the fulfilment of export obligation against the DEEC licence that will be issued to them, for which they have made the application. 6.3 Hence the matter has to be viewed in the context of that declaration concerning fulfilment of export obligation as also in the light of the application made for duty free import of replenishment material contained in the export goods. This is what we propose to do in the succeeding para. 6.4 They have declared on the S/Bs that the beds are made of 100% polyester with upholstery of cotton printed fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arly discernable. 6.6 It was pleaded by Shri Lodha that as against the minimum requirement of 25% value addition, their export product gets 53%. It may be so. For considering issue of DEEC licence 25% minimum value addition is prescribed under the scheme. But that scheme does not allow any material to be imported duty free other than the one used in the export product, if value addition is more than 25%. They cannot use polyester waste and claim duty free import of fibre. It is nowhere stated in Appendix 19 that if value addition is more, they can import any material of the species namely fibre. It does not authorise them to import fibre, where waste of fibre is used. 6.7 Now coming to the question whether waste of polyester fibre could be considered as polyester fibre, we looked into the question by referring to Fairchild s Dictionary of textiles. Fibre : - The fundamental unit used in fabrication of textile yarns and fabrics. A unit of matter characterised by having a length at least 100 times its diameter or width; fibres that can be spun into a yarn or made into a fabric by interlacing. Waste : Bye products created in the manufacture of fibres, yarn and fabric. W ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... export obligation that may be specified in the DEEC licence, which is pending issue. If, on adjudication of this case, it is found that these goods are not as per declaration meriting consideration as goods fulfilling the export obligation, such a direction is a corollary to the finding arrived at. This finding is to be given in the context of the specific declaration made on the S/Bs to that effect. Hence, Shri Lodha s claim that it is not specifically stated in the SCN does not appeal to us. We also look at this position from a different angle. In this case, the goods were allowed export as per the appellant s request on furnishing bank guarantee pending adjudication. On adjudication, if the goods are found to be liable to confiscation, the Collector would have ordered confiscation (had the goods not been allowed export) and simultaneously directed the goods to be taken back to town, in which case exports towards fulfilment of export obligation could not be claimed. Since the goods were provisionally allowed export pending adjudication, the Collector on finding the goods to be liable to confiscation on the ground of mis-declaration of the exempt material, can, in the circumstanc ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
