2003 PLP (Trib (PTD)

Date of hearing; 12th March, 2002. MIAN ABDUL QAYYUM, MEMBER (JUDICIAL).‑

This appeal is directed against Order‑in‑Original No. 335 of 2001, dated 9‑10‑2001 whereby the learned Deputy Collector (Adjudication), Faisalabad has ordered out right confiscation of five Catter Pillers brand diesel engines imported by Mr. Muhammad Ismail Khan (the appellant herein) under section 156(1)89 of the Customs Act, 1969.

2. Relevant facts of the case are that the appellant imported a consignment of used machinery containing diesel generators, air compressors, grass cutters and engines for generators etc., and sought clearance thereof vide Bill of Entry No.000364, dated 15‑9‑2001 filed at Faisalabad Dry Port. According to the report of the Deputy Collector Customs (Imports), Customs Dry Port, Faisalabad, examination of the consignment led to the recovery of five diesel engines for generators (fatter Piller brand) falling under PCT Heading No.8408.9000 the import of which was banned under the relevant Import Policy. The case was adjudicated by the Deputy Collector (Adjudication), Faisalabad, who after serving the appellant with a show‑cause notice and giving him opportunity of hearing ordered our‑right confiscation of goods under section 156(I) 89 of the Customs Act, 1969 read with S.R.O.1374(1)/98, dated 17‑12‑1998 holding that the diesel engines in question, being old and used machinery parts, were not importable under the Import Policy Order, 2001‑2002.

3. The appellant has challenged the aforesaid order of the Deputy Collector through the instant appeal. It has been argued on behalf of the appellant that the confiscated diesel engines according to the examination report recorded on the reverse of bill of entry, are not auto engines. These are meant for exclusive use with the generators, import of which is not banned under the Import Policy Order, 2001. It has further been argued that the engines in question are parts of the five generators imported in the same consignment. While the Customs Authorities have allowed clearance of generators, the diesel engines have been held on the ground that the same were separate and being old and used machinery parts banned under the Import Policy Order, 2001. As the generators without engines have no utility, the confiscation is illegal and unjustified.

4. The learned departmental representative has opposed the appeal pleading that the diesel engines in question have been rightly confiscated by the Adjudicating Officer as the same are old and used parts of machinery i.e. the generators, and their import is banned under the Import Policy Order.

5. We have examined the record and considered the submissions made by the appellant's counsel. The diesel engines for generators falling under PCT Heading No.8408.9000 are independent machines by themselves as clarified in Explanatory Notes to the Harmonized Commodity and Coding System at S. No.(2) in part (B) concerning general arrangement of Chapter

84. The aforesaid diesel engines though used to operate generators, cannot be treated as parts of machinery and therefore, not covered by S. No.8 of Appendix‑C to the Import Policy Order 2001‑2002. The machines of Heading 8408.9000 are also not listed in Appendix‑A or C of the Import Policy Order. As such there is no, restriction on the import of second hand diesel engines of PCT Heading No.8408.9000. The order for their confiscation is, therefore, illegal and the goods are entitled to be released on payment of leviable duty and taxes.

6. The appeal is accordingly, accepted and the impugned order is set aside C.M.A./722/Tax (Trib.) Appeal accepted