1984 (6) TMI 231 - AT - Customs

Issues Involved:
1. Validity of the import license for HD-10 staplers as industrial stapling machines.
2. Classification of HD-10 staplers under the Import and Export Policy.
3. Interpretation of the term "industrial" in the context of the Import and Export Policy.
4. Previous clearance of similar stapling machines and their relevance.
5. Relevance of dictionary definitions and ISI specifications in determining the nature of the stapling machines.
6. Comparison with other models of stapling machines and their classification.
7. Application of rules of interpretation from the Customs Tariff Act.

Detailed Analysis:

1. Validity of the Import License for HD-10 Staplers as Industrial Stapling Machines:
The primary issue revolves around whether the HD-10 staplers imported by M/s. Continental Exporters qualify as "industrial stapling machines" under the import license. The Deputy Collector initially held that the HD-10 staplers do not qualify as industrial stapling machines, leading to their confiscation under Section 111(d) of the Customs Act, 1962, with a fine of Rs. 40,000 in lieu of confiscation. The Collector (Appeals) overturned this decision, stating that a stapling machine capable of use in the industry in which the importer is interested qualifies as an industrial stapling machine. The Tribunal, however, restored the Deputy Collector's order, concluding that HD-10 staplers are not industrial stapling machines as they are designed for light stapling work and are primarily intended for office and home use.

2. Classification of HD-10 Staplers under the Import and Export Policy:
The Import and Export Policy, April 1983-March 1984, under Appendix 17, allows the import of "industrial stapling machines" but not all types of stapling machines. The Deputy Collector and the Tribunal found that HD-10 staplers do not meet the criteria for industrial stapling machines. The Tribunal emphasized that the policy specifically distinguishes between industrial and non-industrial stapling machines, and HD-10 staplers, designed for light use, do not fit the industrial category.

3. Interpretation of the Term "Industrial" in the Context of the Import and Export Policy:
The term "industrial" was scrutinized using various dictionary definitions. The Concise Oxford Dictionary defines "industrial" as "designed or fit only for industrial use," while Webster's Third New International Dictionary provides a broader meaning. The Tribunal concluded that HD-10 staplers, described in the manufacturer's catalogue for office and home use, do not meet the stricter definition of being designed or fit only for industrial use.

4. Previous Clearance of Similar Stapling Machines and Their Relevance:
The Tribunal noted that previous clearances of similar stapling machines like MAX-30 and MAX-45 under the same type of license do not assist the respondent. The Tribunal emphasized the need to examine each machine's design and use individually. The earlier clearances, if any, were deemed to have been in error if they were cleared under identical circumstances.

5. Relevance of Dictionary Definitions and ISI Specifications:
The Tribunal found that the varied dictionary definitions of "industrial" do not provide a definitive conclusion. The ISI specification IS 5349-1969, which covers desk type and plier type staplers, does not distinguish between industrial and non-industrial staplers. The Tribunal concluded that HD-10 staplers, designed for light stapling work, do not qualify as industrial stapling machines based on their design and intended use.

6. Comparison with Other Models of Stapling Machines:
The Tribunal compared HD-10 staplers with other models like HD-12L and HD-3D, which are invoiced by the manufacturer as industrial stapling machines. These models are described for heavy-duty use, such as stitching thick documents and book-binding. In contrast, HD-10 staplers are designed for light stapling work and are primarily intended for office and home use, reinforcing the conclusion that they are not industrial stapling machines.

7. Application of Rules of Interpretation from the Customs Tariff Act:
The Tribunal noted that the rules of interpretation from the Customs Tariff Act, as mentioned in the Import Policy Book, are not helpful in this context. The relevant entry in the Customs Tariff Act deals with office machines, and the Import Policy distinguishes between industrial and non-industrial stapling machines. The Tribunal emphasized that the nature of the machine must be decided based on its design, intended use, and general uses.

Conclusion:
The Tribunal set aside the order of the Collector (Appeals) and restored the order of the Deputy Collector, concluding that HD-10 staplers are not industrial stapling machines. The decision was based on the design, intended use, and general uses of the HD-10 staplers, which are primarily for light stapling work in offices and homes, and not for industrial use.

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