ORDER
K.S. Venkataramani, Member
1. This appeal is directed against the order dated 18.3.1988 passed by the Collector of Customs, Madras, by which he had ordered confiscation of consignments of velvet declared as artificial fur cloth under Section 111(d) of the Customs Act, 1962 read with Section 3(2) of the Imports and Exports (Control) Act, 1947, levying a
redemption fine of Rs. 4.8 lakhs on the consignments covered by two bills of entry.
2. The appellants imported what they declared as artificial fur cloth and filed two bills of entry on 11.11.1987 and 27.10.1987. Under the first bill of entry the c.i.f. value of the goods was Rs. 96,439; under the second bill of entry Rs. 87,911. They claimed clearance of the goods against two REP Licences which were issued under export product item D 2.2(i) for light categories of travel and other leather goods like attache cases, briefcases, ladies handbags, wallets, purses, leather hand gloves etc., and another under item D 2.2(ii) against export of leather garments. The materials permitted for import under appendix 17 of Import Policy 1985-88 under which licences were issued included artificial fur cloth! It was against this entry that the appellants claimed clearance of the consignments. The Custom House, however, was in receipt of information that velvet is being imported by traders by misdeclaring the goods as artificial fur cloth. Therefore, the consignments were subjected to investigation by the Special Investigation Branch of the Custom House to verify the correctness of the description declared in the bills of entry. Samples were drawn from the consignment and sent to the Custom House Laboratory for a test, but it was not possible for the Custom House Laboratory to distinguish between artificial fur fabric and velvet. Thereafter the samples of the consignment were shown to Dr. V. Subramaniam, Head of the Department of Textile Technology, Alagappa College of Technology, Anna University, Madras who, after examining the samples, gave his opinion that the samples are of velvet fabric and that they do not belong to the category of artificial fur cloth. The Custom House, therefore, took the view that velvet is an item which appears at S.No. 31 of Appx.2, Part B, which lists the restricted items for import, and the licences produced by the appellants which were issued under Appendix 17, were not valid because according to para 5 of Appendix 17, no import of an item appearing in Appendix 2 shall be allowed against REP Licences unless it is specifically described for import as material permitted for import under Col.4 or Col.5 of Appendix 17. Since velvet imported was not so specifically mentioned, the Custom House view was that the licences produced were not valid to cover the import. Proceedings were, therefore, initiated against the appellants and after considering the reply to the show cause notice, the Collector ordered confiscation of the goods, levying a redemption fine as in the impugned order against which the present appeal has been filed.
3. Shri Thiagarajan, the learned Counsel appearing for the appellants, submitted that the Custom House Laboratory itself was not in a position to ascertain that what was imported was not artificial fur cloth. The learned Counsel further assailed the Collector’s reliance upon the opinion of Dr. Subramaniam on the ground that Shri Subramaniam’s opinion does not seem to have been based on any analysis of the material and that in any case his opinion is not self-explanatory. The differential adopted by Dr. Subramaniam was that an artificial fur cloth does not have any weave structure unlike velvet, but it is well known that velvet and fur cloth are pile fabric for which there is always a basic fabric required. The learned Counsel further pointed out that they had also given technical opinions obtained by them from Bombay Textile Research Association and from Dr. M.K. Talukdar, Chartered Textile Technologist and Professor, Textile Manufacturers Department, Victoria Jubilee Technical Institute, Bombay. These opinions have clearly shown that there are specific technical parameters to distinguish between artificial fur fabric and velvet since both are woven and knitted pile fabric. The Collector has brought in the criteria of pile length in his order for making a distinction, and in this he has considered a data which was beyond his jurisdiction in seeing whether the goods imported are as per description in the import licence. The learned Counsel cited in this context the Supreme Court decision in the case of UOI v. Tarachand Gupta & Bros. which laid down that a decision or order passed by an officer of Customs under the Customs Act must mean a real and not a purported determination. A determination which takes into consideration factors which the officer has no right to take into account is no determination. The learned Counsel also drew our attention to the observation of the Collector in the order that artificial fur cloth should resemble natural fur and in this context, the learned
Counsel submitted that the material submitted to the Collector to show that the goods resemble natural fur as contained in the letter dated 28-3-1988 of K.K. Radhakrishnan, Assistant Professor, Victoria Jubilee Technical Institute, Bombay, has not been taken into consideration. This letter would show that about 60% of the material resemble natural fur. Therefore, the learned Counsel contended that there should be a reconsideration of the issue by the Collector and such direction should be given in this case.
4. Shri K.K. Bhatia, the learned S.D.R. appearing for the Department, contended that in this case, the Collector has taken up the matter with the licensing authorities in the joint weekly meeting of the two authorities, and it was the opinion of the licensing authorities, on an examination of the samples of the consignment, that the REP Licenses produced will not cover the goods imported. This opinion of the licensing authorities has also been furnished by the Collector to the appellants during the adjudication proceedings. He also argued that if the appellants were not in agreement with the expert opinion given by Dr. Subramaniam relied upon by the Collector, they ought to have justified their case by cross examining the expert with a view to determining the basis of his opinion. They have failed to do so. Therefore, the Collector’s order is correct in law as the goods produced, being velvet, are not covered by the licenses produced.
5. The submissions made by the learned Counsel and the learned S.D.R. have been carefully considered. The appellant’s contention is that the expert opinion given by Dr. Subramaniam should not be relied upon because there is nothing in the opinion given by the expert to show basis on which he has given this opinion and that there are no reasons given by Dr. Subramaniam for the finding that the samples given to him are velvet and cannot be considered as artificial fur cloth. Examining this contention it is seen that Dr. Subramaniam has given his opinion as follows:
I have examined the samples and found that they are velvet fabrics and do not belong to the category of artificial fur clothes. Artificial fur clothes do not have any weave structure unlike velvets. The samples clearly show the weave structure.
Therefore, it is seen that the opinion is given, after examining the samples from the import consignments sent to him. He has given the opinion based on the criteria of weave structure. If the appellants were not satisfied with the opinion given, or if they had any doubt about the basis, it was upto them to have asked for a cross examination of the expert to elicit from him the basis and the reasoning for giving the opinion as he has done. Having not done so, merely stating that the opinion should not be accepted as it is not a self-contained one, or that it does not give the reasons for the conclusions, will not be of much avail to the appellants. On the other hand, they had failed to avail of the opportunity of testing the expert evidence of Dr. Subramaniam, although the opinion as expressed by him was communicated to the appellants in the show causes notice. Apart from this it is also seen that the Collector has raised the matter before the licensing authority, who, after consulting the Textile Commissioner and as per the technical opinion given, have held that the samples of the consignment under import should only be considered as velvet, and that considering the usage of the goods in question, it has been communicated by the licensing authorities that the goods are not eligible for import against licences issued under D 2.2(i) and D 2.2(h) of Appendix 17. It is also on record that
the appellants had also referred to the licensing authority for clarification, and hence they were also aware of the issue and the technical opinion in this regard. The opinion of the licensing authorities had also been furnished to the appellants during personal hearing in the adjudicating proceedings, and the appellants had only responded by saying that even if it is considered as velvet, the materials belong to the same category as artificial fur cloth. In this context, it is relevant to refer to the provisions of para 25 (1) of the Policy 1985-88 under the heading Clarification and Interpretation of the Policy. It is stated therein that enquiries regarding interpretation of policy and procedure should be addressed to C.C.I.E., New Delhi and that any interpretation of the Import Policy given in any other manner or by any other person will not be binding on the C.C.I.E or in law.
In sub-para (2) thereby, it is further stated,
Notwithstanding what has been stated in sub-para (1) above any interpretation of Import-Export Policy or procedure given by C.C.I.E., New Delhi, will prevail over any other clarification in the sam matter given by any other authority or person.
Further in para 27(2) it has been laid down,
As in the matters relating to Import-Export Policy and procedures, the interpretation given by the C.C.I.E. is final, in case of doubt regarding these matters, the Customs authorities should consult the Import Trade Control Authorities for clearance of the goods.
Therefore, in this case it is seen that clarification has been sought by the Collector of Customs in the joint weekly meeting, and equally the appellant herein also appeared to have sought the clarification from the licensing authorities, and the view of the licensing authorities, given after examining the samples from the import consignment, was clear that the goods cannot be considered to be covered by REP Licences under Appendix 17 D 2.2. Therefore, in view of the policy provision regarding clarification as stated above, the C.C.I.E.’s opinion has to prevail over any other opinion. Quite apart from that, the Collector also had placed reliance on the expert opinion of Dr. Subramaniam who categorically gave his opinion, on examination of the samples from the import consignment, that the goods are velvet fabric and not artificial fur clothes. Therefore, the expert opinion supports the clarification given by the licensing authority and C.C.I.E’s opinion in that case is again a relevant piece of evidence.
6. The Supreme Court decision cited in the case of UOI v. Trarchand Gupta & Bros. is also not squarely applicable because that was a case where the respondents therein imported certain goods which arrived in two consignments and they were claimed to be motorcycle parts which their licence authorised them to import. The customs authorities held on examination of the goods that they constituted sets of complete motorcyles in knocked down condition and the case was adjudicated. The Supreme Court in this context made the observation that the decision or order passed under the Act should not take in to consideration the factors which the decision making officer has no right to take into account. The situation in the present appeal is that the Collector already had expert opinion. He refers to the technical literature also on the subject and mentions the pile length for a distinction. Further, in this case as we have seen the licensing authorities themselves had opined that the licences produced would not cover the imports, on examination of a sample from the consignment. The Import Policy 1985-88 also contains specific paragraphs indicating the mode and authority under the policy for issuing clarification of the Import Policy, already extracted supra, which has also been followed in this case by the Collector of Customs, and which distinguishes the present case from Tarachandcase . Further it is observed that the pile length is mentioned even in the opinion obtained from Dr. Talukdar by the appellants. The further submission made that they had shown evidence to indicate that the goods imported resemble natural fur is unacceptable because it is seen that the letter dated 28.3.1988 of Shri Radhakrishnan is one addressed to the appellants, and further, it is based on shipping samples, and not samples from the imported consignments. We also find that the letter is subsequent to the date of the Collector’s adjudication order. The Collector had adjudicated the case by his order dated 18.3.1988. Therefore, on a total consideration of evidence on record, it is seen that the Collector’s conclusion is supported by the expert opinion of Dr. Subramaniam, and by the official clarification given by the licensing authority in terms of the licensing policy, and in such a situation, there is no infirmity in the Collector’s order which is, therefore, upheld. The appeal is, therefore, rejected.