P L D 1979 Lahore 246 (PLP)

The rate of duty in case of this heading is 50 % ad valorem. The elastic straps are admittedly covered by heading 59.13 which is subject to 62J ad valorem duty. Chapter 58 expressly excludes such goods. However, these goods could be assessed under P. C. T. heading 83.09 in view of rule 3lhl noted above. ` '

9. It was argued by the learned counsel for the respondent on the basis of a letter dated 13th September, 1973, of the Chief Controller of Imports and Exports that his previous rulings would be deemed to have been superseded as the new Pakistan Customs Tariff Schedule, based on Brussels Nomenclature, had been enforced. It has not been shown to me under what provisions of law the Chief Controller of Imports and Exports could give a ruling that a particular Article should be assessed under a particular heading of P. C. T. schedule. However, Notes 3 and 6 at page V of the 'Pakistan Customs Tariff' issued by the Government of Pakistan, Ministry of Finance, Planning and Development (Central Board of Revenue), Islamabad, Eighth Edition, do render guidance in case of doubt or difficulty of classification. Note 3 reads as under: "

3. Arrangements on the basis of 'progressive classification, which is the basis of Brussels system of classification, is made so that raw material or substance and all articles derived from it are classified as far as possible in the same Chapter. In spite of all the care taken to make classification accurate and precise, there is and will always remain the possibility of genuine difference of opinion in the matter of interpretation particularly where an item is capable of being classified under more than one heading." Note 6 at the same page reads as under: "

6. In case of doubt, it is always useful to consult the Alphabetical Index to the Brussels Nomenclature or the Explanatory Notes."

10. The Explanatory Notes of the Brussels Nomenclature with regard to heading 83.09 are as under : "83.09?? (The description as in P. C. T.-already reproduced in para. 8 above). This heading covers a range of metal fittings of a kind commonly used for clothing, or for various textiles, leather, rubber, paper, paperboard, etc., goods for example; (1) ???????. (2) ???????. (3) Hooks, eyes and eyelets, for clothing, footwear, awnings, tents or sails. All these articles may contain parts of leather, textiles, plastics, wood, horn, bone, ebonite, mother of pearl, ivory, imitation precious stones, etc., provided that they retain the essential character of articles of base metal. They may also be ornamented by working of the metal. (The underlining? is by me). Thus the presence of a 1.1/8 elastic strap of textile would not bring this article to another classification if its essential character remains that of a~ hook, meant to fasten the main garment. Description of heading 58.05 part (B) clause (g) in the Brussels Nomenclature shows that if hooks fixed) at intervals on tape give the goods their essential character, they will be classified under heading 83.09.

11. The Note I of Chapter 61 of the Pakistan Customs Tariff Schedule makes that Chapter applicable to the articles mentioned therein only when they are made up of any textile fabric. It also applies to textile fabrics cut to shape for making those articles vide Note

5. Thus, to see if an article falls under Chapter 61, the test is that it should either be one of those 'made up' named articles or it should be cut to shape for making those articles. Here admittedly the 'made up ends' are only accessories or minor [Here i n italic.) parts of those articles. They cannot by themselves be used as one of those articles. They cannot be called corsets, corset-belts, suspenderbelts, brassiers, braces, suspenders, garters or the like. Their essertial character remains that of hooks or accessories. The 'made up ends', therefore, could not be brought under heading 61.09.

12. The Explanatory Notes of Brussels Nomenclature with regard to headings 61.09 and 61.11 further support the above conclusion and do clearly show that the 'made up ends' alone would not fall thereunder. It will be useful to reproduce them hereunder for ready reference : "61.09. Corsets, Corset-belts, suspender-belts, brassiers, braces, suspenders, garters and the like (including such articles of knitted or crocheted fabric), whether or not elastic. This heading covers articles of a kind designed for wear as body-supporting garments or as supporters for certain other articles of apparel. These articles may be made of any textile material including knitted or crocheted fabrics (whether or nor elastic). The heading includes, inter alia: All the above articles may be furnished with trimmings of various kinds (ribbons, lace, etc.) and may incorporate fittings and accessories in non-textile materials (e. g., metal, rubber, plastic or leather). The above heading thus covers articles of a kind designed for wear as body supporting-garments or as support for certain other articles of apparel and these articles may incorporate fittings and accessories in metal, etc. So the hook or hook with elastic strap cannot be called an article for wear .as it is only an accessory of metal. The relevant portion of the Explanatory Notes in respect of heading 61-11 is as under : "61-11. Made up accessories for articles of apparel (for example), dress shields, shoulder and other pads, belts, muggs, sleeve protectors; pockets). ? ?611This heading covers made up textile accessories for articles of apparel, not specified or included in other headings of this Chapter or elsewhere in the Nomenclature. These accessories include This heading does not include : (a)????? (b) Strips of press fasteners on hooks and eyes on tape (heading 58.05, 83.09 or 98.01). (c)?????????? Thus the strips of press fasteners or hooks and eyes on tape could be included in headings 58.05, 83.03 or 98.01 but not under Chapter 61.

13. In any case the elastic straps being covered by heading 59.13 are subject to 62J % ad valorem duty wherea3 the rate of duty on hooks covered by heading 83.09 is 50 % ad valorem. In the circumstances the D rate of duty of the composite article could be only 621 % under rule 3(c) of the Rules or the Interpretation of the First Schedule. In this view of the' matter 155 % duty under heading 61.09 could in no case be imposed. However, in view of the above, I have come to the conclusion that heading 83.09 applies and I uphold the ruling of the Chief Controller of Imports and Exports. .

14. The second question raised is, whether fine could be imposed in respect of elastic straps particularly when a clearance permit had been issued by the Chief Controller of Imports and Exports. The learned counsel for the petitioner mainly relied on the clearance permit. The learned standing counsel of the respondents also relied on the same but referred to the last portion of it which is as follows : " . which are not covered by exceptions (i) to (x vi) of Commerce Division Notification No. 317/260/24 dated 12th .Tune, 1951, are hereby permitted to be cleared from Lahore Airport/Dry Port (Port of Entry) without prejudice to any action (other than outright confiscation) under section 167 of the Sea Customs Act (VIII of 1878) by the customs authorities concerned."

15. The learned counsel for the respondents further submitted that the petitioner wilfully violated the import licence and imported such goods as fell under the P. C. T. heading 59.13 which being absent in the relevant import policy, were banned items. He also referred to sections 16 and _17 of the Customs Act, 1969, to say that the Federal Government may prohibit import of any goods and relied on section 156(9) (i) to say that a penalty could be imposed in such a situation. In view of the above, it was argued by him that though the goods in question could not be confiscated yet other alternate action like penalty could be taken. This contention of the learned counsel could not be effectively met by the learned counsel for the petitioner. The clearance permit is not unconditional. It waived only the confiscation but was issued without prejudice;, to any other action. 1, therefore, do not find any valid objection against the imposition of penalty. In view of the above, this petition partly succeeds. The impugned order, so far as, assessing the goods under P. C. T. item 61.09, is declared to be without lawful authority. The respondent No. 4 shall assess the goods under P. C. T. heading 83.09 and levy the tax accordingly, As question involved was not free from difficulty, there will be no order as to costs. S. A. H.??????????? Petition partly accepted.