1. The petitioner, U.P. Co-operative Federation Ltd., obtained an import license dated 31st May, 1966 to import Yanmar Power Tillers from Japan. The goods were then imported from Japan. These arrived at Calcutta on 12th August, 1966. The respondent Collector of Customs, charged customs duty on these goods @ 15% as prescribed in item No. 72(8) of the First Schedule to the Indian Customs and Central Excise Tariff (Customs Tariff). The petitioner paid Rs. 87,680/- on the total value of the goods of Rs. 5,84,533.35 p.
2. Aggrieved by the order of the Collector the petitioner preferred an appeal to the Central Board of Excise and Customs. The Board by order dated 7th August, 1968 dismissed the appeal. From the appellate order a revision was filed before the Central Government. The revision was dismissed on 24th September, 1970. On 12th February, 1971 the present writ petition under Article 226 of the Constitution was filed challenging the decision of the authorities as regards the customs duty levied on the goods.
3. The contention of the petitioner is that the goods imported by them are Tractor-cum-Power Tillers. They rely on entry No. 72 of the First Schedule of the Customs Tariff and claim that if the imported goods be held to be tractors then they were exempted form the whole of the customs duty. The revenue, on the other hand, contends that these goods are power tillers and thereforee they are subject to duty of 15% as stated in the notes appended to item No. 72(8). There can be no dispute that if the imported goods are power tillers they are subject to 15% of the customs duty and the duty of Rs. 87,680/- has been correctly realised. In the notes appearing under item No. 72(8) in volume I of the Customs Tariff (6th issue as in operation on the 20th May, 1970) tillers have been mentioned amongst the goods falling under item No. 72(8) in respect of which the duty had been reduced from 40% to 15% ad valorem. It would thereforee appear that tillers are specifically mentioned as subject to 15% duty. As I have said, the dispute is whether the imported goods are tractors or tillers.
4. Counsel for the petitioner relies on three kinds of material in support of his contention that what were imported are tractors and not tillers. The first material on which he relies is the literature of the manufacturer. One has to be cautious about this material. This is the seller's talk in praise of the virtues of the goods for sale. Yanmar Power Tillers were manufactured by Messers Nichimen Company Ltd., Japan. They have sometimes described it as two-wheel tractor and sometimes as power tiller. It is described by the manufacturer as 'a multi-purpose machine doing all odd jobs of the farmer such as ploughing, puddling, tilling, haulage, pumping and spraying etc. etc.' From their literature it appears that primarily and mainly it is a tiller mounted on a tractor. The manufacturer claims many things for their product. It can do tilling and harrowing at a single stroke. It can do tilling and ridging at a single stroke. It can do tilling and heaping at a single stroke. It has a rotovator. The manufacturer says that it can also be used for various operations, namely, tilling, pudding, ploughing, transportation, ridging and pumping. But its main function and office is to serve as a tiller. The manufacturer has given 537 kg. as 'the weight of the tiller complete with rotary attachment, fuel, cooling water etc.'
5. The second material on which counsel for the petitioner relies is the test report of the Government of India. The Government of India before allowing the import of Yanmar Power Tillers tested them for 102 hours and found them quite good. The test report is merely a report on the performance of the product. It does not show anything more.
6. The third material is a letter dated 22nd August, 1966 of the Government of India to Nichimen Co. Ltd. saying that 'this Ministry has already moved the Department of Revenue in this connection on the ground that the Yanmar Power tillers are small two-wheeled tractors meant for agricultural purposes alone. The decision of that Department is awaited.' Nichimen had promotional interest in their product. At their instance the Government of India seems to have recommended to the Department of Revenue that this Yanmar Power Tiller be exempted from duty. This recommendation was accepted. As a result by notification dated 18-11-1967 the power tillers were exempted from the whole of the customs duty. There is no dispute that after 18-11-1967 the power tillers were exempted from duty. But the point of time with which we are concerned in this case is 12th August, 1966 when tillers were subject to duty of 15%.
7. On the whole case it appears to me that the decision of the authorities is correct. Chronologically speaking, tillers were subject to duty in 1966 of 15%. In November, 1967 power tillers were exempted from duty. This clearly indicates that tillers were subject to duty at the relevant time. Only later on the Government exempted power tillers from all duty. The basic question in the case is, as I have said, whether Yanmar Power Tiller can be said to be a tractor within the meaning of item No. 72. My answer is 'No'. The manufacturer himself calls it 'Yanmar Diesel Tiller'. This is how it is described in a coloured poster shown to me where a woman is riding on the tiller. This tiller has special rotary tines, cover fork, rotary tines with drum. It has an iron wheel. All these features are shown in the poster. The manufacturer himself calls it Yanmar Power Tiller. It is a power tiller mounted on a tractor. That is all. It is not a tractor in the sense of item No. 72 because men in the trade do not call it a tractor. They call it a power tiller. A hobbled horse is a horse. Call it by whatever name you like.
8. At the time of the importation under item No. 72(8) of the Customs Tariff there was a specific entry for 'tillers' levying a duty equal to 15% ad valorem of them. Customs Tariff makes a clear distinction between power tillers and tractors. That the power tiller and tractors have been exempted from duty brings out in high relief the point at issue. The Central Government in their order dated 24-9-1970 said the 'the arguments of the petitioners that power tillers are, in fact, tractors, since they serve the same purposes and act in the same way as tractor, are not correct, since mechanically they are two different entities and also in the trade are known as such. A Power Tiller is obviously a tiller and thus would be covered only by the specific exemption for a tiller.'
9. This appears to me to be a correct conclusion. In these matters we have to see the entry. We have to see the meaning given to the articles in a fiscal statue by persons in trade and commerce conversant with the subject. How do people understand the article in the trade Tractor and tillers are two separate things. They are known as different things in the trade. The two have been separately classified in the Customs Tariff. In Dunlop India Ltd. v. Union of India - A.I.R. 1977 SC 597 it is said :
'Once an article is classified and put under a distinct entry, the basis of the classification is not open to question.'
10. Now tractors are mentioned in entry No. 72. Tillers are mentioned in entry No. 72(8) note. Power tillers by a subsequent notification were exempted form duty. The statutory classification of tractors and tillers under separate entries is good evidence to show that a tiller is mainly and primarily a tiller, even though it can perform other functions as well. The manufacturer has called it tiller-cum-tractor. But that is puffery of the goods. And a court cannot go by flattering publicity alone. Essentially and fundamentally it is a power tiller and is known to the trade as such in common parlance. It must not be forgotten that the import license was for Yanmar Power Tillers. So they are tillers and not tractors. What is decisive is the description of the goods in the import license. That the goods imported possess other virtues also will not alter the fundamental fact that they are tillers. Their subsequent exemption from duty reinforces the conclusion that they were never treated as tractors. If they were in truth tractors the exemption was meaningless.
11. I have thereforee come to the conclusion that the decision of the authorities is right. That on the representation of Nichimen power tillers were exempted from duty is proof positive of the fact that Yanmar Power Tillers fell within the entry 'tillers' and were subject to 15% duty. It was felt that this would hinder rather than help a small farmer. The Government took the decision of exempting it from duty altogether.
12. I am not sitting in appeal over the decisions of authorities. All that I have to see is whether they have acted with jurisdiction. A court which has jurisdiction over a subject matter has jurisdiction to decide wrong as well as right. (see Hari Vishnu Kamath v. Ahmad Ishaque - : 1SCR1104 . The authorities in this case have acted with jurisdiction. Under Article 226 this court is not sitting in appeal over the decisions of the customs authorities. The correctness of the conclusion reached by these authorities on the appreciation of several items in the Customs Tariff is not a matter which falls within the writ jurisdiction of this court unless it is found that authorities have acted in complete disregard of the law. [see Girdharilal Bansidhar v. Union of India - : 1964CriLJ461 . I, thereforee, reject the contention that the imported goods were 'tractors' and not 'tillers' within the meaning of those terms as used in the Customs Tariff.
13. Counsel for the petitioner then said that the principles of natural justice have been violated and there has been no proper hearing of the case. He invited my attention to the order of the Collector where the scrutinising appraiser made the assessment 'with the concurrence of the Collector'. He said that the scrutinising appraiser had no authority to make the assessment. Then he said that he was not given a hearing. He referred to Section 17 of the Customs Act, 1962 and contended that there has been no examination or test of the imported goods as is incumbent on the authorities. I am not impressed by any of these arguments. The main reason is that none of these complaints find any place either in the grounds of appeal before the Board or in the revision before the Central Government. There is not the faintest suggestion of denial of a hearing. The orders of the authorities have merged into the order of the Central Government which is a reasoned order. If the petitioners were really aggrieved they ought to have taken these grounds specially before the authorities so that the matter could have been remanded for a test or examination or for the removal of any other defect in the proceedings. Very detailed arguments were submitted to the authorities in writing. They considered them. It is true that no oral hearing was given to the petitioner. But their representation was considered at each stage. Oral hearing is not essential in every case. There need be no oral hearing. [S. L. Kapoor v. Jagmohan and Ors. : 1SCR746 ]. All that the authorities have to do is to consider the representation made by the petitioner and to come to a conclusion of their own.
14. On the merits of the case I have to come to the conclusion, after hearing counsel for the petitioner at length, that there has been no injustice in this case. Nor has law been disregarded in any manner or form.
15. For these reasons the writ petition is dismissed. There will be no order as to costs. At the conclusion of the hearing on 16-9-1982 I announced the order. Now I have given my reasons for doing so.