1. Appeals under Section 129A of the Customs Act, 1962 praying that in the circumstances stated therein, the Tribunal will be pleased to set aside the orders of the Collector of Customs (Appeals) Madras, contained iu Nos. C3/149/81 dated 8-6-1982 and C3/87/1981 dated 8-6-1982 with consequential refund of duty paid.
2. These appeals coming up for order upon perusing the records and upon hearing the arguments of Shri V. Aravamudhan, Advocate for the appellants and upon hearing the arguments of Shri V. Ramachandran, Senior Departmental Representative for the respondent, the Tribunal makes the following order : 3. A consignment of synthetic camphor powder weighing 14350 kgs.
imported by the appellants was warehoused on 3-9-1979 in terms of Section 59 of the Act. On 12-8-1980 and 10-9-1980, two out of the three ex-bond Bills of Entry were presented for clearance of 400 cartons in all ex-bond for home consumption when the appellants noted thereon : "the goods are coming under volatile clause and suffering shortage in every carton. So please give us ORIGINAL OPEN ORDER to note down the shortages (test weigh). And also please allow us remission of duty." Perhaps they were given to understand that there was no provision for remission of duty on camphor. So a further note was recorded on the 15th stating, "if there is no provision in the Customs Act for remission of duty on camphor we are paying the duty under protest". A test weighment to some cartons was done and the following shortages were noticed as against the uniform declared weight of 27 kgs. per carton As the importers were given to understand that there was no provision in the Customs Act for remission of duty on camphor, they recorded a protest regarding payment of duty. Though the Assistant Collector, Group I, approved the note stating that no remission of duty was possible because of Notification No. 122/63, as amended, issued under Section 70 of the Act, protest was recorded. When the protest came to be considered by the Asstt. Collector of Customs (Appraising Department), Madras, he rejected the claim for shortage in terms of Section 70 of the Act pointing out that camphor was not one of the goods declared as volatile by Central Government under that Section. An appeal against this order was rejected by the Collector of Customs (Appeals), Madras on substantially the same grounds.
4. Before us the learned Advocate for the appellant refers to Section 23(1) of the Act. Section 23(1) provides :- "where it is shown to the satisfaction of the Assistant Collector of Customs that any imported goods have been lost or destroyed, at any time before clearance for home consumption, the Assistant Collector of Customs shall remit the duty on such goods." He urged that in the case of warehoused goods, clearance for home consumption means goods clearance ex-warehouse; and the shortage has been discovered prior to their clearance for home consumption.
Considering the volatile nature of the goods and the long period of dentention, it suffered both in the docks because of adjudication proceedings leading to confiscation and the order of confiscation of goods being set aside by the Board-and the warehouse, there has been loss due to sublimation. The Senior Departmental Representative, on the other hand, relied on Section 70 of the Act and indicated that allowance in cases of volatile goods is covered only by the provisions of Section 70 of the Act ; camphor is not one of the items notified under Sub-section (2) of that Section and hence the claim is not maintainable. He also pleaded that the provisions of Section 23 will not be applicable to warehoused goods.
5. We note that under Section 46(1), the importer of any goods shall make entry thereof for home consumption or warehousing in the prescribed form. Under Section 60, after completion of the formalities prescribed under Section 59, the proper officer may make an order permitting the deposit of the goods (intended to be warehoused) in a warehouse without payment of duty. Under Section 68 of the Act, the importer of any warehoused goods may clear them for home consumption if- (a) a bill of entry for home consumption in respect, of such goods has been presented in the prescribed form (c) an order for clearance of such goods for home consumption has been made by the proper officer.
From the above it is seen that the imported goods warehoused and cleared thereafter are cleared for home consumption only when they are laken out of the warehouse on the basis of an order for clearance made by the proper officer. Section 23 of the Act refers to remission of duty if goods have been lost any time before their clearance for home consumption. Thus it is clear that warehoused goods will also be covered by Section 23 of the Act.
6. We find further support for this new stand in the history of Section 23 of the Act. As we have already noted in the case of Bharat Electronics Ltd. v. Collector of Customs, Madras 1983 E.L.T. 653 (C.E.G.A.I.)-Order-in-Appeal No. CD (T) (MAS) 167/81 dated 15-2-1983 (para 7) Clause 23 of the Customs Bill was intended to replace Section 122 of the Sea Customs Act, 1878 which provided for remission of duty on warehoused goods lost or destroyed. The provision under the Sea Customs Act was enlarged to cover cases of losses or destruction whatever be the reason.
7. The plea of the Senior Departmental Representative that if Section 23 were to be interpreted this way, Section 70 will have no meaning, is not well-founded. Section 70 is confined only to those items which are notified as volatile by Government; in other cases obviously Section 23 could and would apply.
8. It now remains for us to determine to what extent relief can be given to the appellant. Unfortunately in view of the wrong understanding of the law at the initial stages, the consignment was not weighed in full though a request therefor had been made. However, we notice that the minimum loss noted at the time of weighment of the 20 packages is 0.6 kg. in the case of the first Bill of Entry and 1 kg. in the second Bill of Entry. We think it would be only fair if this minimum quantum is allowed in respect of each of the cartons covered by the respective Bill of Entry. Accordingly we order remission of duty be allowed at the rate of 0.6 kg. for each carton covered by the Bill of Entry No. C. 367 dated 17-8-1980 and 1 kg. per carton covered by Bill of Entry No. C. 561 dated 28-8-1980.
9. The issues involved in this case are identical to the ones dealt with in Appeal No. CD (MAS) 457/83, except that the number of cartons involved is 290; the date of examination was 13-10-1980 and the actual examination of the cartons was limited to six packages showing shortages as follows : - Following the decision in respect of Appeal No. 457/83, we order the remission of duty be granted at the rate of 1 kg. per carton in respect of the 290 cartons covered by Bill of Entry No. C. 403, dated 21-10-1980.