TMI Blog1993 (4) TMI 159X X X X Extracts X X X X X X X X Extracts X X X X ..... ), it was found that the cargo is mixture of both `wood roughly squared and `sawn wood like beams etc. According to the examination report, pieces with dimensions 10" x 10" and 10" x 12" can be considered as wood roughly squared. The rest of the cargo consisting of pieces of varying lengths with dimensions 6" x 10", 7" x 10", 8" x 10", 9" x 10" as sawn timber in the shape of beams and the sap wood is visible only on one side of the logs. Therefore, the importers were charged with mis-declaration of the description of the goods attracting action under Section 111(m) of the Customs Act, 1962. The Addl. Collector has also inspected the cargo and has recorded in the order, his examination, as follows - All the pieces were having rectangular/square sections. They were cut to various dimensions. The ends of the pieces were painted black with metal plates fixed at the centre. In some of the pieces, sap wood was visible on all sides. The Addl. Collector had requested Shri P. Somasekhara Reddy, IFS, District Forest Officer, Visakhapatnam to inspect the goods and give his report. In his report, he has stated that - The material seen by me is a completely processed sawn wood. All t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for classifying a product as sawn wood in the Customs Tariff. It is worth quoting the Encyclopedia Britannica, Volume 12, page 746, 1988 Edition. After a tree is felled, the wood is processed for round wood products (such as poles and posts) or as sawn wood (sawed lumber).. Sawn wood is treated and cut at a saw mill and then transported to other manufacturing facilities to be fashioned into particular wood products. From the above, it is very clear that sawn wood itself is again used in saw mills. I also hold that the presence of heart box is not very relevant for the classification of this item." Order In view of the above, I hold that the imported goods are correctly classifiable under Customs Tariff Item No. 4407/99. The goods are liable for confiscation under Section 111(m) of the Customs Act, 1962. Accordingly, I confiscate the goods but give the importers an option to redeem the goods on payment of a fine of Rs. 5,00,000/- (Rupees five lakhs only) within one month from the date of issue of this order. I also impose a penalty of Rs. 1,00,000/- (Rs. one lakh only) under Section 112(a) of the Customs Act, 1962." 4. The importers in the appeal had contended that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the cargo is sawn timber in the shape of beams etc. and sap wood is visible only on the one side of the log and not on all sides. He also pointed out to the report of Shri Verghese who has stated that the goods were required to be taken to saw mills for further sawing for commercial purpose. He contended that Notification No. 107/89-Cus., dated 1-3-1989 granted exemption to auxiliary duty for items falling under Chapter 44 which are in the nature of (i) wood in rough and (ii) wood roughly squared and half squared but not further manufactured. The description given in the notification refers to the description under sub-heading 4403 and if the item satisfies the description, then the exemption cannot be denied. It is his contention that the wood by merely sawing would not by itself go outside the category of 44.03, which the importers are claiming. The square or half square in the present case had been done only for the purpose of transportation and that the dimensional criteria is not relevant. Only if the wood is cut in the form of planks, beams etc. are not covered under sub-heading 4403 but fall under 4407 and for items to come under sub-heading 4407, dimensional accuracy is ne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has relied on the opinion given by Shri Reddy, who had given a clear opinion that the item is not wood in rough and his opinion is in favour of the department. He further submitted that the ISI specifications and glossary of terms is not conclusive on the facts of the present case. The item has been sawn to such an extent that it has to be taken out of the sub-heading 4403 which gives the heading - wood in rough whether or not stripped of bark or sap wood and roughly squared. He argued that only wood of rough condition could be brought under this sub-heading. The sawing could be done only to the extent of facilitating transportation and to prevent delay as could be gathered from the reading of chapter notes of HSN under the Heading 4403. The item in the present case has been sawn to such an extent that it goes out of the parameters laid down in the sub-heading 4403 as the sawing has been done to specific dimensions and that they are also not roughly squared. The parties plea that only course sawing has been done is not acceptable, as coarse sawing does not produce such results as seen in the present case. The Chapter note reading under Heading 4407 of HSN indicates that if the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of bark and sap wood. The bill of entry also clearly described the goods. The items of same size bundled together by itself does not mean that the item is wood sawn. He contended that ratio of Hunsur Plywood s case would squarely apply to the facts of the case. He contended that ISI specification and Glossary of Terms threw light on trade understanding and in this context, relied on the ruling rendered in the case of Union of India Others v. Delhi Cloth General Mills Co. Ltd. Others [1977 (1) E.L.T. (J 199)]; Akbar Badruddin v. Union of India [1990 (47) E.L.T. 161 (SC)]; Kutty Flush Doors v. Collector of Customs [1988 (35) E.L.T. 6 (SC)]. 12. We have carefully considered the submissions made by both the sides, perused the records, literature and citations relied by both the sides. The question that arises for our consideration is as to - (i) whether the goods described in the Bill of Entry as wood in rough half squared with bark, Badau group (Fox worthy)" is classifiable under sub-heading 4403.99 as - Other under the sub-heading 44.03 which reads wood in rough, whether or not stripped of bark or sap wood, or roughly squared" as prayed by the importer? or under s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d is sawn only for the purpose of transportation and while so sawing, the peal is clearly removed and also fresh sap wood and therefore, the heart wood is retained. There is no planing to extreme accuracy and dimensions. It is their contention that in the case of sawn wood, the sap wood is removed by accurate chipping and chipped to extremely accurate dimensions which renders subsequent planing unnecessary. 14. We have now to examine these contentions in the light of the technical literature and ISI Glossary of Terms so as to find out whether the imported goods would continue to fall within the definition wood in rough despite smooth surface and the saw dust sticking to the surface as observed by Sh. Reddy and whether the goods would fall under sawn and processed wood. 15. The learned Advocate has relied on a paragraph appearing at pages 12, 14 of A Manual of Forest Utilisation by H.C. Watts in respect of Classification of Timber and Square Timber, which is noted below - Section 1 - Classification of Timber A - Timber The details of classification vary greatly according to local custom and in almost every division there are special trade names for various classe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the sawed wood used for construction purposes. In construction work the word timber is often applied to large pieces of lumber used as beams. Wood is an organic chemical compound composed of approximately 49% carbon, 44 oxygen, 6 hydrogen and 1 ash. It is largely cellulose and lignin. The wood of white pine is about 50% cellulose, 25 lignin, and the remainder sugars, resin, acetic acid and other materials. Wood is produced in most trees by a progressive growth from the outside. In the spring, when sap flows rapidly, a rapid formation of large cells takes place, followed by a slower growth of hard and close cells in the summer. In some woods, such as oak, there is a considerable difference in quality and appearance between the spring and summer woods. In some long lived trees, such as Douglas fir, there is a decreasing in strength between the outside wood with narrow rings and the wide ringed wood of the interior. Heartwood is the dark center of the tree which has become set, and through which the sap has ceased to flow. Sapwood is the outer, live wood of the tree; unless treated, it has low decay resistance. The grain of sawed lumber results from sawing across the annual growth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here, when the above description, include : timber for sawing; poles for telephone, telegraph or electrical power, transmission lines; unpointed and unsplit piles, pickets, stakes, poles and props; round pit props; logs, whether or not quarter split, for pulping; round logs for the manufacture of veneer sheets, etc.; logs for the manufacture of match sticks, woodware etc. Telegraph, telephone or electrical power transmission poles are also to be classified in this heading when further trimmed with a draw knife or peeled with a mechanical peeler to a smooth surface ready for use. These poles are often painted, varnished or impregnated with creosote or other substances, for the purpose of preservation. Tree stumps and roots of special woods, and certain growths such as those used for making veneers or smoking pipes, also fall here. The heading also includes roughly squared wood which consists of trunks or sections of trunks of trees, the round surfaces of which have been reduced to flat surfaces by means of axe or adze, or by coarse saw; sawing, to form wood of roughly rectangular (including square) cross section; roughly squared wood is characterised by the presence of rough a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his heading covers panels of wood marquetry and inlaid wood, including those partly of material other than wood. It also covers a wide variety of articles of wood (including those of wood marquetry or inlaid wood) generally of careful manufacture and good finish, such as; small articles of cabinet work (for example, caskets and jewel cases); small furnishing goods; decorative articles. Such articles are classified in this heading, even if fitted with mirrors, provided they remain essentially articles of the kind described in the heading. Similarly the heading includes articles wholly or partly lined with natural or composition leather, paperboard, plastics, textile fabrics, etc. provided they are articles essentially of wood. The heading includes - (1) Boxes of lacquered wood (of the Chinese or Japanese type); cases and boxes of wood, for knives, cutlery, scientific apparatus etc.; snuff boxes and other small boxes to be carried in the pocket, in the handbag or on the person; stationery cases, etc.; needlework boxes; tobacco jars and sweetmeat boxes. However the heading excludes ordinary kitchen spice-boxes, etc. (Heading 44.19) (2) Articles of wooden furniture, other than ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clearance please. Cargo submitted for examination please. Inspect S/20 pcs. of each item verify the sizes with respect to packing list. Verify whether the maximum size of the log should be 10 C.M. x 10 M x 2 M for licence purpose. Verify whether the sawn timber is wood roughly squared or half squared but not further manufactured for CN 88/88. Verify plant quarantine certificate before release of the cargo. Also verify the size of the log ends with respect to packing list please. dated 27-5-1988. Open shed OPP - EQ-5-75 Inspected S/20 pcs of each item. Verified sizes w.r.t. price list. Sizes of sawn timber are as per price list for licence purpose. Sawn timber is wood sawn lengthwise falling under 44.07 (squared and rectangular) (Teak scantlings). Sizes of log-ends verified as per packing list. Verified quarantine department. Certificate No. 4-1/87 Tech. dated 26-5-1988. Please see file S8(a)/128/88. Teak posts are the wood roughly squared, but not further manufactured. Open for AO(a) Inspection Sd/- 31-5-1988 20. The above Inspection report has stated that the sawn timber is wood sawn length-wise (rectangular and square). Teak posts are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e on one side of the logs and not on all sides as in the case of Lot Nos. 9, 10 and 11". This inspection report which is noted on the back of the entry in respect of Sr. Nos. 1 to 8 clearly states the presence of sap wood on one side and as regards Sr. Nos. 9, 10 and 11, there is no dispute that the wood is roughly squared. Further, the learned Collector has not taken into consideration the inspection report fully. The Inspection report as well as the opinion of Shri Verghese clearly indicates the presence of sap wood and also the report of Shri Somasekhara Reddy discloses that the wood has been cut on a band saw. The cutting of the wood merely by band saw leaving a smooth surface and the saw dust sticking on the surface by itself will not make the timber as wood sawn for classification under sub-heading 4407.99. The mere sawing of the wood for the purpose of transportation will also not make the timber as wood sawn . As has been seen from the Explanatory notes, the process of sawing, chipping should be done in a machine to extremely accurate dimensions, a process which should result in a surface better than that obtained by sawing and which thereby render subsequent planing unnec ..... X X X X Extracts X X X X X X X X Extracts X X X X
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