TMI Blog1996 (1) TMI 371X X X X Extracts X X X X X X X X Extracts X X X X ..... same in terms of Section 111(d) of the Act. Since the goods were cleared as per the Hon ble High Court s Order and were not available for physical confiscation, he imposed a penalty of Rs. 10.00 lakhs on the appellants herein. 3. In Appeal No. C-91/94, in terms of the impugned Order-in-Original No. 6/94 (Collor), dated 18-3-1994, the Collector of Customs, Calcutta confiscated the similar goods valued at Rs. 11,68,411.40, on the same grounds in terms of Section 111(d) of the Act. Since the goods were not available for confiscation, he imposed a penalty of Rs. 10.00 lakhs on the appellants under Section 112(a) of the Act. 4. Since the goods imported in these cases and the points involved in both the cases, are exactly similar, we propose to dispose of these two appeals by a common order. 5. In Appeal Nos. C-90/94 as well as C-91/94 the goods imported are Polypropylene Packing Film. C.I.F. value of the goods concerned in Appeal No. C-90/94 is Rs. 11,25,307.40 and the value of the goods in Appeal No. C-91/94 is Rs. 11,68,411.40. 6. The case of the Department is that the appellants imported the goods i.e. Polypropylene Packing Film, and filed Warehousing Bills of Entry in both t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a all Advocates and D.K. Saha, Consultant appeared for the appellants herein. It was contended before us that these goods are new goods. Merely because the goods were of different sizes and specifications, it cannot be held that they are Disposal Goods . They further contended that as per Clause 5(3)(iii) of the Import (Control) Order, 1955 the goods for import of which a licence is granted shall be new goods other than Disposal Goods . Therefore, when the goods are new goods they cannot be termed as Disposal Goods , merely because they were of different sizes and specifications. In order to justify their arguments they have relied on the following decisions :- (i) 1981 (8) E.L.T. 936 (Bom.) in the case of Abdul Husein Mohammedally Master v. Union of India Others; (ii) Orders dated 6-5-1991 [2000 (123) E.L.T. 567 (T)] passed by this Tribunal in Appeal Nos. C-126 and 127/90 in the case of M/s. Marketing Enterprises v. Collector of Customs, Calcutta; (iii) 1995 (80) E.L.T. 403 (T) = 1995 (11) RLT 266 (CEGAT-A) in the case of Pride of India (P) Ltd. v. Collector of Customs, Delhi. 10. It was further contended that in the beginning when the goods were cleare ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d be prohibited for import if these are disposal goods. It has been admitted by the importers during the course of enquiries and in reply to the previous Show Cause Notice that the goods imported consists of (1) unsold surplus stocks of the manufacture, (2) stock lots, and (3) goods returned by the customers to the manufacturers, and (4) production surplus and job overruns of the factory, and (5) mixed sizes and mixed quality thickness. They have also clarified during personal hearing that there was pressure from the sellers to take the goods at a cheap price but they are not able to lift the goods because of the bottle-necks created by Customs. Therefore, it is obvious that what they are purchasing from the overseas suppliers is not prime quality goods, but goods which the sellers have not ready market to dispose off. These are goods which the manufacturers have failed to sell in the normal course against the customer s orders and which they are forced to dispose of to the importer because of the goods failing to satisfy the required specifications or with a view to avoid carrying a large inventory of unsold deteriorating goods. In such cases, the goods cannot be said to be of pri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have been given notice of the same in the show cause notice so as to enable them to explain whether the goods concerned in those cases as well as the goods concerned in these cases are different or not. Without relying on these documents in the show cause notice their cases could not be adjudicated by suddenly mentioning the same in the impugned orders. There is also nothing on record to show that the goods imported earlier and mentioned in their letter dated 2-3-1990 are similar goods which are the subject-matters in these two appeals. Therefore, that is not sufficient to hold that these goods are Disposal Goods . 16. The next reason given by the learned adjudicating authority is that at the time of hearing the appellants stated that the subject goods are production surplus and job overruns of the factory and were available at reduced rate. He also stated that the appellant-company had submitted before him that for these products, there were no buyers and there were pressures from the sellers to lift the goods at cheap prices. 17. The above observations made by the adjudicating authority in both the impugned orders are not correct. For this purpose, we have to look into the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve now refused to clear the goods on the alleged ground that the same were disposal goods, although there has been no change of either the facts and circumstances of the importation or law with regard to the same. (v) The importers in the instant case have challenged the issuance of the purported Show Cause Notices on the grounds mentioned in the reply to the Show Cause Notices. (vi) The identical point came up for consideration before the Hon ble Bombay High Court in the case of Abdul Hasim M. Master v. Union of India, reported in 1981 (8) E.L.T. 936, wherein the Hon ble Appeal Court was, inter alia, pleased to hold that the expression Disposal Goods occurring in Clause 3(3)(iii) of the Import (Control) Order must be read in the context of new goods used in the same clause. The expression Disposal Goods is used as contra distinction to new goods . Once it is found that the goods imported are new, then the mere fact that they are not of uniform type and size is not sufficient to warrant to come to the conclusion that they are disposal goods. Please also see the cases reported in 1985 (21) E.L.T. 207 (para 7), 1981 (8) E.L.T. 936 (para 6), 1986 (25) E.L.T. 535. In the ins ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods . Once it is found that the goods imported are new, then the mere fact that they are not of uniform type and size is not sufficient to warrant the conclusion that they are disposal goods. Shri Hidayatullah is right in his submission that the three authorities did not even challenge the fact that every item imported was new and unused. The authorities below proceeded on a wrong assumption that as the petitioners have purchased the goods in lot and goods are not of uniform type and size, they are to be treated as disposal goods. The assumption is unwarranted and contrary to the plain reading of sub-clause (3)(iii) of Clause 5 of the Import (Control) Order. The orders under challenge in these circumstances cannot be sustained and the order of confiscation requires to be set aside. 23. A perusal of this judgment clearly goes to show that Disposal Goods occurring in sub-clause (3)(iii) of Clause 5 of Import (Control) Order must be read in the context of expression, new goods used in the same clause. The expression, disposal goods is used as contradistinction to new goods . Their Lordships, therefore, held that once if it is found that the goods imported are new then the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... every licence that the goods for the import of which the licence is granted shall be new goods, other than disposal goods, unless otherwise stated in the licence. Disposal goods even if new will not be treated as new goods. (2) Requests for import of disposal of second-hand or reconditioned goods shall not be entertained except with the prior approval of the Chief Controller of Imports and Exports, New Delhi. For import of reconditioned second-hand capital goods, however, the procedure laid down in Chapter III of the Book will be available. 26. In terms of the Import (Control) Order, 1955, dated 17-12-1955 (as amended) it is one of the conditions of every licence that the goods for the import of which the licence is granted shall be new goods other than Disposal Goods unless otherwise stated in the licence. Disposal Goods even if new will not be treated as new goods. 27. It is, therefore, clear that even if the goods are new, but still if they are found to be Disposal Goods , then they will not be treated as new goods. In other words, the mere fact that the goods imported are new will not take it out from the purview of Disposal Goods . 28. In this case ld. Collector ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the Tribunal held as follows :- 8. We are fortified in our view by the judicial pronouncements of various High Courts in regard to this issue. The Division Bench ruling of the Delhi High Court in the case of Jain Shudh Vanaspati Limited Anr. v. Union of India Ors. reported in 1982 (10) E.L.T. 43 (Del.) and relied upon by the ld. Counsel for the appellants has clearly held that Section 47 of the Act, in the light of the legislative history attaches finality to the satisfaction of the officers that the goods in question are not prohibited. The finality cannot be disturbed except in a manner known to law. The Delhi High Court has further held that an order under Section 47 is one of the orders against which a revision can lie under Section 130 of the Act as it then stood . Under the present Act, as we have observed earlier, the order under Section 47 of the Act permitting clearance can only be reviewed or revised in terms of Section 129(d) of the Customs Act, 1962. The ld. Counsel for the appellants also placed reliance on the unreported judgment of the Madras High Court in Writ Petition Nos. 5296, 5297, 5653 and 5654 of 1979 wherein the question arose as to the let-export ..... X X X X Extracts X X X X X X X X Extracts X X X X
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