STOCKO COMPANY Versus MEMBER (JUDICIAL), CENTRAL BOARD OF REVENUE
1. SAEEDUZZAMAN SIDDIQUI, J.‑‑ The Petitioner in the above case was issued an import licence on 4‑6‑1981 valid for import of `Unwrought Plastic Rods, Tubes and other Profiles, unwrought plastic sheets 0.245mm and above.' The above import licence was issued against Serial No.214 of the Free List of Import Policy Order, 1980. The Petitioner imported tracing films made of Polyster in rolls of 40" x 20 yds. and 36" x 20 yds. having a thickness of 002", 003" and 005". The consignment of tracing films arrived at Karachi, on or about 30th December, 1981 and on 6‑1‑1982 the Petitioner filed Bill of Entry for Clearance of the consignment declaring the goods as falling under ITC Heading No.39.01 IV, under section 79 of the Customs Act. The Customs authorities took objection that the goods imported by the Petitioner are not covered by the import licence as the thickness of tracing films was less than 0.254 mm whereas the import licence issued to Petitioner permitted import of such goods not below the thickness of 0.254 mm. Accordingly a show‑cause notice was issued to the Petitioner on 24‑4‑1982 by respondent No.3 calling upon the Petitioner to show cause why action should not be taken against them for alleged contravention of section 16 of the Customs Act, punishable under section 156(1)(9) read with section 3(3) of the Imports and Exports Control Act, 1950. The Petitioner contested the above show cause notice and contended before respondent No.3 that the thickness of 0.254mm mentioned in the import licence was applicable only in the cases of import of unwrought plastic sheets and this restriction was not applicable to other item importable, such as rolls, films etc. under the aforesaid licence. Respondent No.3, however, did not agree with the contention of the Petitioner and ordered confiscation of consignment but allowed its clearance on payment of redemption fine of Rs.65,000 in addition to personal penalty of Rs.15,000. On appeal respondent No.2 maintained the order of respondent No.3, but reduced the redemption fine to Rs.15,000 and personal penalty to Rs.5,000. On a further revision the CBR declined to interfere with the orders of respondents Nos.2 and 3.
2. Mr. Amanullah Khan, the learned counsel for the Petitioner contended before us that the licence issued to the Petitioner was against entry No.214 of the Free List of Import Policy Order of 1980 which did not impose any restriction as to the thickness of the films imported by the Petitioner. Learned Standing Counsel on the other hand contended that both in Entry No.214 of the Free List of the Import Policy Order of 1980 as well as in the import licence issued to the Petitioner it is specifically mentioned should be 0.245 mm and above and as such by importing tracing films of lesser thickness the Petitioner committed an offence under the Customs Act which was punishable under section 15(1)(9). The respondents, it is accordingly contended, rightly imposed the redemption fine and personal penalty on the Petitioner. In order to understand the controversy it is necessary to examine carefully Item 214 of the Free List of Import Policy Order of 1980, for which Petitioner was issued Import Licence. It reads as follows:‑
3. Serial No Description I.T.C.
4. 214 Unwrought plastic rods, 39‑01 III, IV Nil tubes and Other Profiles; 39‑01 III, IV,
5. Unwrought Plastic sheets 39‑01 II, III,
6. 0.25mm. (10/1000 in) and IV, 39.04 111, above, celluloid; and IV,39.05; III, nitrocellulose. IV,39.06,III,
7. IV.
8. From reading of the above entry of Free List of the Import Policy Order, 1980, it is quite clear, that amongst others items covered under ITC classification 30.01.III.IV were importable under free list of the Import Policy Order of 1980. It is common case of parties that the goods imported by the Petitioner fell under ITC classification 39.O1.IV which is as follows:‑‑
9. "39.01 Condensation, polycondensation and Polyaddition products, whether or not modified or polymerised and whether or not linear (for example, phenoplasts, aminoplasts, alkyds, polyallyl esters and other unsaturated polyesters, silicones);
10. I . ....................................................................
11. II. ....................................................................
12. III. ....................................................................
13. IV. Plasts, sheets, film, strip or foil.
14. V. ....................................................................
15. The import licence issued to petitioner under Item No.214 of the Free List had the following description of item:‑‑
16. Unwrought plastic rods, tubes and other profiles; Unwrought Plastic Sheets 0.25 mm 110/100 inch and above, celluloid; and nitrocellulose:"
17. After reading the description of item in the import licence issued to Petitioner alongwith Entry No. 214 of free list of Import Policy Order 1980 and IA I.T.C. Classification 30.01 IV, we are of the view that thickness of 0.245 mm mentioned both in entry 214 of the Free List of the Import Policy Order of 1980 as well as in the import licence issued to the Petitioner, was applicable only in case of import of unwrought plastic sheets. This restriction about thickness, however, did not apply to import of other items falling under ICT classification 39.01 (iv). Respondents Nos.1 to 3 therefore, clearly misread entry No.214 of Import Policy Order 1980 and the description of item given in the Import Licence issued to Petitioner, in holding that the import of tracing films of thickness of 0.002, 0.003 and 005" was not covered under the Import Licence and as such its import amounted to contravention of the terms of the licence issued to the Petitioner. There is nothing either in entry No.214 of the Free List of the Import Policy Order of 1980 or in the description of item given in the import licence issued to Petitioner or in the IGT Classification 39.01(IV) to support the conclusion of the respondents that the tracing films imported against the licence should have thickness of 0.254mm and above. We, accordingly, allow the petition and declare the orders passed by respondents Nos.1 to 3 as without lawful authority and of no legal effect. There will, however, be no order as to costs. The amount of redemption fine and penalty if recovered from the Petitioner be refunded to them.
18. MA.K./S‑472/K Petition accepted.