1989(12)LCX0053

BEFORE THE CEGAT, SPECIAL BENCH ‘C’, NEW DELHI

S/Shri K.S. Venkataramani, Member (T) and D.M. Vasa Vada, Member (J)

ROTO INKS (P) LTD.

Versus

COLLECTOR OF CUSTOMS

Order No. 779/89-C, dated 26-12-1989 in Appeal No. C/1661/89-C

Advocated By : Shri P.R. Dastidar, Consultant, for the Appellant.

Shri V. Chandrasekaran, SDR, for the Respondent.

[Order per: K.S. Venkataramani, Member (T)]. - This appeal is directed against the order of Collector of Customs (Appeals) Bombay issued on 28-2-1989 by which he had rejected the appellant’s appeal against the order dated 6-1-1989 passed by the Assistant Collector of Customs, Air Cargo, Bombay. The appellants herein filed a Bill of Entry on 3-12-1988 for the clearance of a consignment described in the Bill of Entry and the related invoice as technical documentation valued at Rs. 90, 755/- CIF for which assessment was claimed under Heading 4901.99 of Customs Tariff Act, 1975 which covers printed books, brochures, leaflets and similar printed matter, whether or not in single sheets, under which there is Nil rate of duty. The Custom House on examination of the goods found that the goods were in the nature of documents in loose pages without numbers but put up in loose leaf binders, and it was also found that they were described as technical documents. Therefore, the Custom House proposed to classify the goods under Heading 4911.99 which covers “Other printed matter, including printed pictures and photographs” for which the rate of duty is 100%. On consideration of the appellant’s representation dated 29-12-1988 thereon, the Assistant Collector passed the Assessment Order dated 6-1-1989 stating that the goods are technical documents in loose leaves without serial numbers but kept in loose leaf binders and that the binders did not have any index, a common title or any of the attributes which would classify it as a book, and on this basis confirmed the classification under Heading 4911.99. The appellants filed an appeal before the Collector (Appeals) who observed in the impugned order that the fact that the technical documentation is not a book by itself would not exclude it from being classified under Heading 4901.99. The Collector (Appeals) on a perusal of the sample, and on going through its contents, concluded that it was more in the nature of trade catalogue than scientific or literary document relating to exclusive know-how of the product, and, the Collector (Appeals) referred to the Explanatory Notes to Harmonised Commodity Description and Coding System (HCN) under Heading 49.11 indicating inclusion of trade catalogue of all kinds therein, and, on this basis, confirmed classification of the goods under that heading.

2. Shri P.R. Dastidar, the learned consultant appearing for the appellants submitted that the Collector (Appeals) while holding that the goods namely, technical documentation cannot be excluded from Heading 49.01 merely because they are not books, had yet erroneously come to the conclusion that the goods imported is trade catalogue. He pointed out that even the Assistant Collector’s finding was that these are technical documentation. The learned consultant referred to the licence agreement with the US collaborators M/s. Croda Inks Corporation to show that what has been imported is technical manuals about the product in terms of the agreement on technical know-how, and this, according to the appellants, cannot be called trade catalogue. The goods as technical documentation in loose leaf binders is fully covered by the ambit of Heading 49.01 of Customs Tariff Act.

3. Shri Chandrasekaran, the learned SDR contended that the Collector (Appeals)’s order was essentially one which confirms the classification adopted by the Assistant Collector showing how Heading 49.11-CTA is attracted for the imported goods and as such there was no infirmity.

4. We have carefully considered the submissions made by both the parties herein and have perused the records. Representative samples from the imported consignment was also produced before us which we have perused. We find that the Assistant Collector had found that Heading 49.01 was inapplicable only on the ground that the goods did not have the attributes of books. But he did say that goods are technical documents in loose leaf kept in binders and hence classifiable under Heading 49.11-CTA. However, Collector (Appeals) found that the goods are classifiable under Heading 4911 not because they cannot be considered as books, but because their contents showed that they are in the nature of trade catalogue for the product imported. Therefore, it is important to go through the sample of the imported goods which has been produced before us. On a perusal thereof, we find that the material consists of printed sheets divided into various sections indexed showing the heading of each section in the index slips kept in loose leaf binders. For example, the first section bears the heading “Quality control procedures. Oil Inks” and consists of an article entitled “Quality Control - Oil Inks” by one James G Smith. Another section is entitled “Colour matching procedures”. The section under heading “Fineness of grind determination” ends with a list of further reference books/publication on the subject. Another sample is entitled “Croda Inks Corporation. Red Code Book” and gives specifications of materials like various chips. Therefore, it is reasonable to conclude that what is supplied to the appellants is technical documents from their collaborators in terms of the licence agreement. In that agreement under para 4 “Transfer of know-how”, it is agreed in para 4.2.B and C that M/s. Croda shall make available copies of all brochures and publications related to the licensed products as also copies of all technical manuals published by M/s. Croda containing information related to the licensed products. In the circumstances, it is reasonable to conclude that the material imported is not in the nature of trade catalogue. We also observe that the Collector (Appeals) in coming to his conclusion that these are trade catalogues had not considered the contents of the material in the context of the terms of the licence agreement as we have seen above. We further find that in the Explanatory Notes to Harmonised Commodity Description and Coding System (HSN) to which the Customs Tariff is aligned, under Heading 49.01(c) textual matter in the form of sheets for binding in loose binders is covered and it further says that such publications as scientific thesis published by or for industrial firms may fall in this heading. From the discussion of the nature of the material above, we find that the goods imported are technical documents in loose leaf kept in binders consisting of technical manuals and brochures published by the foreign collaborators of the appellants being supplied as part of transfer of technical know-how relating to the product in terms of the collaboration agreement. In this view of the matter, it is held that having regard to the nature of the goods, and the contents thereof, and the form in which the goods imported in the context of a collaboration agreement, classification of the goods under Heading 4901.99 is in order. The appeal is, therefore, allowed.

Equivalent 1990 (47) ELT 398 (Tribunal)